Cases of interest: January 2022

A summary of interesting or topical employment cases.

Chief of New Zealand Defence Force v Darnley [2022] NZEmpC 4

Employment Court – Personal grievance – Constructive dismissal – Unjustified disadvantage 

At issue was whether the employee was constructively dismissed. 

The employee was a human resources site lead. The employer issued a directive about compensation settlement payments. The employee settled an employment mediation on behalf of the employer for an amount that was significantly more than was authorised by the directive. When questioned, the employee said she did not believe the directive applied to that situation. The employer undertook an investigation. During a subsequent disciplinary process, the employer issued its decision that it intended to dismiss the employee on notice for serious misconduct.  The employee took leave during which she gained alternative employment. The employee ultimately never resigned; nor was she dismissed.  

The employee raised a personal grievance for constructive dismissal on the basis that a breach of duty by the employer led her to resign. The Employment Court (Court) found that the employer breached its duty when it wrote to the employee stating that it had concluded the allegations were proven and serious misconduct had occurred (see para 60). The employer should have given the employee the opportunity to comment before the decision was made that serious misconduct had occurred. It failed to do so (see para 57). 

The Court found this breach did not amount to constructive dismissal (see para 86). The employee’s new position was what caused her to end her employment (see para 79). It broke the causation between the breach and the termination of the employment (see para 78). The Court was not satisfied the breach was serious enough to make her resignation reasonably foreseeable in any case (see para 85). The Court found the employee had been unjustifiably disadvantaged under s 122 (external link) of the Employment Relations Act 2000 and awarded her $5,400 in compensation (see para 111). 

The employer claimed the employee breached her employment agreement and good faith when she failed to give notice or respond to communication from the employer asking if she had found another position. The Court agreed (see paras 114 and 121). The Court ordered the employee to pay a $1,500 penalty to the Crown (see para 133). 

Chief of New Zealand Defence Force v Darnley [2022] NZEmpC 4 [PDF, 400KB] (external link)  

VMR v Civil Aviation Authority [2022] NZEmpC 5

Employment Court – COVID-19 – Vaccinations Order – Interim reinstatement 

At issue was whether the Court would reinstate four unvaccinated aviation workers to their positions on an interim basis. 

The employees were Aviation Security Officers at an airport. Their roles were covered by the COVID-19 Public Health Response (Vaccinations) Order 2021 (external link) (Vaccinations Order). The Vaccinations Order mandated that certain roles be performed by vaccinated individuals. The four employees chose not to be vaccinated. When alternative roles for the employees were not found, the employer terminated their employment. The employees raised personal grievances for unjustified dismissal. They asked the Court to reinstate them to their positions on an interim basis pending a substantive hearing. 

The Court recognised and respected the rights of the employees to come to their own conclusions about whether to be vaccinated (see para 265). However, the Court dismissed their application (see para 290). The Court found:

  • The employees’ contention that their role was not covered by the Vaccinations Order was only weakly arguable (see para 201).
  • The employer could not be expected to give the employees a special limited role which excluded activities that might require them to work airside (see paras 224–228).
  • It was arguable the employer could have taken a more proactive approach to finding alternative roles for the employees (see para 235).
  • Reinstating the employees to their roles would place them and the employer in breach of the Vaccinations Order, which could lead to penalties (see para 255). 

The Court noted that its findings were provisional (see para 139). 

VMR v Civil Aviation Authority [2022] NZEmpC 5 [PDF, 520KB] (external link)  

O’Brien v Discovery NZ Ltd [2022] NZERA 15

Employment Relations Authority – Restraint of Trade 

At issue was whether a restraint of trade was enforceable. 

The employee was a political editor for a news programme on television. The employment agreement between the parties included restraint of trade provisions requiring non-competition for a period of three months and non-solicitation and non-dealing for six months (see para 8). The restraint stated the employee could not be involved in any business in competition with the employer. The geographical area for non-competition was nationwide. The employee resigned when she was offered a position as a host for a morning talk back show with another broadcaster. As per the employment agreement, the employee gave the employer three months’ notice of her resignation.  

The employee believed the restraints of trade would not be enforced by the employer because it did not have a radio station and was therefore not in direct competition with the future employer. The employee participated in a photo shoot and provided a quote to be used in promotion of the talk back show while she was still an employee of the television station. The employer advised the employee it intended to enforce the restraints of trade to protect its confidential information, business relationships and goodwill. 

The Employment Relations Authority (Authority) found the restraints of trade were reasonable and enforceable because the employee had agreed to the terms and held a key role (see para 56). It found there was a degree of competition between the broadcasters for viewers or listeners in the breakfast time slot (see para 66). However, the Authority reduced the period of the restraints. It backdated the three months of non-competition to begin at the start of the Christmas break, thereby modifying the duration to seven weeks (see paras 54–55).  The Authority also reduced the duration of the non-solicitation and non-dealing restraints from six to three months (see para 61). 

The employer sought a penalty for breach of the employment agreement in respect of the promotional photo shoot and quote. The Authority ordered the employee to pay a penalty of $2,000 and issued a compliance order (see paras 92–93). 

O’Brien v Discovery NZ Ltd [2022] NZERA 15 [PDF, 430KB] (external link)

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Page last revised: 10 February 2022

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