ERA examines rushed dismissal, delays to holiday pay in recent dispute
The Employment Relations Authority (ERA) recently dealt with a case where a salesperson claimed unjustified dismissal after questioning work hours and refusing to drive a company vehicle without proper licensing. The employment lasted only eleven days, from 1 February 2024 to 12 February 2024.
The worker brought several claims before the ERA, including failure to provide a written employment agreement, delayed holiday pay, and unjustified dismissal. He sought reimbursement of lost wages, compensation, and penalties for alleged breaches of employment law.
The case raised questions about proper dismissal procedures and whether the employer, a container supply business serving restaurants and takeaway businesses, had fulfilled their statutory obligations under New Zealand employment law.
The employment started with an agreed rate of $24 per hour, with a planned increase to $26 upon obtaining a full driver's licence. Text messages between the parties at the start of employment confirmed the role was to be full-time at 40 hours per week.
A critical conversation occurred on 12 February 2024 while the employer was in China. The worker said he was told not to come to work after questioning his hours and refusing to drive a company van without proper licensing. The employer maintained she only meant for him to stay away for that particular Monday.
The ERA received evidence of a text message from the employer stating: "I didn't tell you don't come forever. I only said don't come on Monday. You told me to pay off the salary. Even came to the shop, took all the keys and tried to steal or rob my products."
A letter dated 19 March 2024 from the employer stated: "I am writing to address the charges brought forth by [the worker] through his legal team and to provide a comprehensive account supported by concrete evidence of his employment conduct and the resulting termination from our company."
The same letter later concluded: "[The worker's] inability to meet job requirements, his repeated policy violations, and his threatening behaviour, our decision to terminate his employment was both justified and necessary."
However, when questioned during the ERA hearing about these policy violations, the employer acknowledged not knowing what a policy was.
The ERA noted: "It was clear to [the employer] within four days of 12 February 2024 that [the worker] understood he had been dismissed. If, as [the employer] says, this was not in fact what occurred, there was no proper attempt in good faith to disabuse [the worker] of this and invite him to return to work or to a meeting."
The ERA determined significant procedural failures occurred, stating: "The procedural defects were not minor and they did result in [the worker] being treated unfairly. The procedural defects overlap with any conclusions a fair and reasonable employer could have reached that [the worker's] actions amounted to serious misconduct in all the circumstances."
The Authority found no evidence of proper performance management, noting: "If there are performance concerns with an employee then a process is required to raise these and advise what is required to achieve performance and allow time for this. [The worker] had only been employed for two weeks. There was no process."
The ERA confirmed the employer breached Section 65 of the Employment Relations Act 2000 by failing to provide a written employment agreement, and Section 27(2) of the Holidays Act 2003 by not paying holiday pay until 4 July 2024, despite the employment ending in February.
The ERA ordered reimbursement of lost wages calculated at 40 hours per week at $24 per hour for nine weeks, totalling $8,640 gross. This covered the period from 13 February 2024 until 17 April 2024, when the worker secured new employment.
The worker received compensation of $12,000 for emotional harm after evidence showed he "could not sleep or face people" following the dismissal. The ERA noted his attendance at the warehouse after believing he was dismissed indicated "a highly emotional reaction and a level of distress."
The Authority imposed penalties totalling $800: $300 for failing to provide a written employment agreement and $500 for the late payment of holiday pay. Of the holiday pay penalty, $250 was awarded to the worker and $250 to the Crown. The employer was also ordered to pay costs of $2,250 plus the $71.55 filing fee.
