Cases of interest: September 2022

A summary of interesting or topical employment cases.

Zink v Board of Trustees of Southland Boys High School [2022] NZEmpC 164

Employment Court – Public holiday entitlements – Otherwise working day 

At issue was whether the employee was entitled to be paid for public holidays that fell during the employer’s Christmas closedown period. 

The employee was a chef at the boarding hostel of a high school. The school did not accommodate students during holidays but did sometimes host outside groups. The employee primarily worked during the school term and the Term 1 and Term 3 holidays. For many years, he was paid public holiday entitlements for Christmas Day, Boxing Day, New Year’s Day and the day after New Year’s Day. A dispute arose between the employee and the employer when the employer ceased paying public holiday entitlements for those days. The employer argued they were not “otherwise working days” under s 12 (external link) of the Holidays Act 2003 (Holidays Act). 

The Employment Court (Court) found the four days were otherwise working days; and the employer was required to pay the employee public holiday entitlements for them (see para 103). The Court gave the following reasons: 

  • The school required the employee to take his annual leave over the Term 4 holiday, which was consistent with it being a closedown period as defined in s 29 (external link) of the Holidays Act (see para 83).
  • Under s 12(3A) of the Holidays Act, if the public holiday falls during a closedown period, whether it was an otherwise working day must be ascertained as if the closedown period were not in effect (see para 55).
  • The Court held that the effect of s 12(3A) was that “the Christmas break must be put to one side” (see para 92).
  • The employee usually worked on the days of the week on which the public holidays fell, and therefore they were otherwise working days (see para 97). 

The Court made a declaration accordingly (see para 103). Conversely, the Court held that the employee was not entitled to public holiday payments for Easter because there was no closedown period over the Easter break (see paras 100–101). 

Zink v Board of Trustees of Southland Boys High School [2022] NZEmpC 164 [PDF, 80 KB] (external link)  

Halse v Employment Relations Authority [2022] NZEmpC 167

Employment Court – Judicial review – Confidentiality of records of settlement – Application to strike out proceeding 

At issue was whether the application for judicial review of a series of determinations made by the Employment Relations Authority (Authority) should be struck out. 

The applicant was an employment advocate who was not a lawyer. The advocate signed a record of settlement under s 149 (external link) of the Employment Relations Act 2000 (Act) along with his client, an employee, and his client’s previous employer. The settlement agreement stipulated that neither party, nor their representatives, would make “disparaging or negative remarks” about one another (see para 8). The advocate then made numerous disparaging comments about the employer on social media. 

The employer commenced proceedings in the Authority. In a series of seven determinations issued over 11 months, the Authority issued non-publication orders, compliance orders and penalties in response to the advocate’s behaviour (see para 13). The Authority found the advocate and his company, CultureSafe NZ Ltd, had breached the record of settlement 26 times and non-publication orders 24 times. The Authority ordered the advocate and his company pay $52,800 in penalties and $30,000 towards the employer’s legal costs. 

The advocate applied to the Court for judicial review of those seven determinations and three other decisions. The advocate claimed the Authority did not have jurisdiction to make determinations against “third parties” who were neither the employee nor the employer in an employment relationship. The advocate also claimed Parliament did not intend to give the Authority jurisdiction to “override the fundamental right to justice” or “suppress the fundamental right of freedom of expression” (see para 17). 

The Court did not accept the advocate’s submissions (see para 62). The Court noted that s 137 (external link) of the Act gave the Authority jurisdiction to order compliance when “any person” had not complied with a record of settlement. The Court considered previous cases that had discussed the confidentiality of mediation and settlement agreements. It held that if the Authority had no jurisdiction over participants other than the employees and employers, those participants would be able to breach confidentiality without sanction. Such breaches of confidentiality would undermine the intention of Parliament (see paras 64–67). The advocate had signed the record of settlement and had obtained a financial benefit from it. 

The Act also confers jurisdiction to the Authority to make non-publication orders (see para 76). The Court struck out the application for judicial review because the claims were not amenable to review, disputed the clear jurisdiction of the Authority or were an abuse of process (see paras 90, 97). 

Halse v Employment Relations Authority [2022] NZEmpC 167 [PDF, 220 KB] (external link)  

Ashby v NIWA Vessel Management Ltd [2022] NZEmpC 174

Employment Court – Quantum of lost remuneration – Quantum of distress compensation 

At issue was the appropriate amount of lost remuneration and distress compensation that should be awarded to the employee, after she was unjustifiably dismissed. 

The employee worked as a cook on the employer’s research vessel for nearly 20 years. In 2009, the employee made a sexual harassment complaint against the (then) First Mate. The employer upheld the complaint. Two years later, the employer promoted the First Mate to the position of Master. The employee then had to report to him. 

In 2014, the employee raised concerns that the Master was bullying her. She requested a shift change, but the employer did not agree. The employee later became upset when she learned there had been a privacy breach about her historic sexual harassment complaint. She raised a formal complaint and again requested a shift change. When the employer did not transfer her, the employee took sick leave. 

The parties tried facilitation, mediation and an investigation. These steps did not resolve the issue. The employer terminated the employee’s employment on the grounds of incompatibility. The employee raised a personal grievance claim. In Ashby v NIWA Vessel Management Ltd [2019] NZERA 571 (external link) the Authority found the dismissal was unjustified. The Authority awarded the employee the $20,000 she sought in compensation and three months’ lost wages. 

The employee challenged the quantum of remedies. In the Court she sought $100,000 in compensation and further lost wages. The employer noted the employee had only claimed $20,000 in compensation in the Authority. It argued she should not later be able to claim the Authority should have awarded her more (see para 41). The Court held that although the Court could not award more than the amount claimed, the Authority could. The Court held that “provided it complied with the rules of natural justice, it was open to the Authority to award more than the amount claimed in the statement of problem” (see para 48). 

In considering the award for distress compensation, the Court found that the impact of the dismissal was significant for the employee because: 

  • The employee had long service with the employer. She enjoyed her role and it was well remunerated (see para 70). 
  • Until the privacy breach, the employee had self-managed her discomfort with working under the Master. Her “distress was exacerbated by being denied the opportunity to continue to perform in her role due to the repeated dismissal of her requests to change to another shift” (see paras 75, 77). 
  • The employee was impacted by the sexual harassment and alleged bullying. This left her in a vulnerable state when the employer dismissed her (see para 76). 
  • After the dismissal, the employee was quite unwell. The employee’s long-term personal relationship also broke down (see para 80). 

The Court awarded 12 months’ lost wages and $35,000 in compensation to the employee (see paras 74, 83). 

Ashby v NIWA Vessel Management Ltd [2022] NZEmpC 174 [PDF, 310 KB] (external link)  

Shah Enterprise NZ Ltd v Labour Inspector of Ministry of Business, Innovation and Employment [2022] NZEmpC 177

Employment Court – Minimum standards breaches – Person involved – Penalties 

At issue was whether the employer had breached minimum standards breaches and should be ordered to pay arrears and penalties. 

The employee worked in the employer’s convenience store. The employee was originally on a student visa that allowed him to work up to 20 hours a week. The employer said the employee agreed to pay $250 a week for board but was not required to pay that until he had finished studying. The employee was later permitted to work up to 40 hours a week. He then began working full time. The employee claimed he worked 95 hours a week. The employer claimed it was 40–48 hours a week. However, the employer continued to only pay him wages for 20 hours a week. The employer claimed that the remaining wages were to cover his board and repay his previous board. 

The Court found the employee worked 75.5 hours a week (see para 37). The Court calculated the employee’s wages at the minimum wage rate at the time, deducting 15 per cent for board according to s 7 (external link) of the Minimum Wage Act 1983 (see para 38). The Court ordered the employer pay the employee wage arrears of $18,147.13 and holiday pay of $1,853.24 as well as interest on the sums (see paras 39–40). 

The Court held that the director of the company was a “person involved” in the minimum standards breaches under Part 9A (external link) of the Act (see para 44). The Court ordered the employer to pay $19,200 and the director to pay $9,600 in penalties for the breaches (see para 86). In doing so, the Court considered the vulnerability of the migrant employee (see para 69) and that the employer knew the employee was working well over the number of hours he was being paid for (see para 64). 

Shah Enterprise NZ Ltd v Labour Inspector of Ministry of Business, Innovation and Employment [2022] NZEmpC 177 [PDF, 160 KB] (external link)

Rail and Maritime Transport Union Inc v KiwiRail Ltd [2022] NZERA 470

Employment Relations Authority – Changing location of employment – Interpretation of collective agreement – Terms implied by custom and practice 

At issue was whether the employer could change the location of the employees’ employment without the agreement of the employees or the union. 

The employer was a railway operator. The employees were remote control operators (RCOs), responsible for rail shunting yard operations. The employees were union members. The employer and union were parties to a collective agreement. The employer employed two yard-operations employees in Balclutha. One of the two Balclutha based employees transferred to Picton, creating a vacancy. The employer proposed to employ the replacement as an RCO in Dunedin and roster the Dunedin RCOs to regularly travel to Balclutha. The union sought a determination from the Authority that the proposed roster breached the collective agreement and a term implied by custom and practice. 

The Authority determined the Dunedin based RCOs could not be required to work in Balclutha without their express agreement (see para 47). In making that determination, the Authority found:

  • Documentation such as position descriptions and letters of offer were inconclusive. Some indicated the employees may be required to work in other locations and others did not (see paras 10–12). Likewise, the provisions of the collective agreement were not definitive (see paras 13–21).
  • In order to imply terms by custom and practice, the Authority would have to find that the custom was certain, reasonable and not inconsistent with the express contract. The custom “must have acquired such notoriety that the parties must be taken as knowing of it and intended it should form part of the contract” (see para 25).
  • There was an implied term that the Dunedin based RCOs worked in Dunedin and Port Chalmers, including the mainline between those yards (see para 46). That geographical boundary was certain and reasonable (see paras 26–27). It was not inconsistent with any express terms in the documentation or collective agreement (see para 45).
  • The implied term could only be varied by agreement (see para 47). 

Rail and Maritime Transport Union Inc v KiwiRail Ltd [2022] NZERA 470 [PDF, 130 KB] (external link)

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