Cases of interest: December 2023

A summary of interesting or topical employment cases.

Cronin-Lampe v Board of Trustees of Melville High School [2023] NZEmpC 221

Employment Court – Breaches of duties – Personal grievance – Unjustified disadvantage – Damages

The main issue was whether the employees would be awarded damages and remedies for their personal grievances and for claims the employer had breached their employment agreements, common law and the Health and Safety in Employment Act 1992.

The employees were guidance counsellors at a high school for 15 years. They were a married couple. During their time as counsellors at the school, there were around 32 deaths in the school community, many by suicide. They assisted students, families and teachers with the resultant trauma. They also provided a wide range of counselling services and led project work such as restorative practices. The employees were expected to be available 24/7 to provide support to the community. Over the course of their employment, their workload increased and the level of supervision and support they received decreased.

The Court found the employer breached express and implied duties to the employees, including failures to (see paragraphs 23, 111):

  • monitor the caseloads and stress levels of the employees
  • provide training, resources, professional development and adequate supervision
  • identify and manage hazards or harm in the workplace.

The Court found the employees suffered post-traumatic stress disorder as a result of the breaches, and that the harm was foreseeable.

The Court further found actions of the employer had disadvantaged the employees, for example (see paragraphs 122–126):

  • failure to provide debriefing after traumatic events
  • failure to provide regular time off and cover
  • failure to support the employees when they had difficulties with other staff
  • failure to resolve the uncertainty of 1 employee about his job status and duties.

The Court found the actions of the employer were not those of a fair and reasonable employer. The personal grievances were therefore successful (see paragraph 135).

The Court quantified the appropriate level of damages and compensation and awarded the higher of the 2, being damages, because there could not be “double recovery” (see paragraph 225). The Court ordered the employers to pay the wife $123,500 in damages for non-economic loss and $705,855 in special damages. The husband was awarded $95,625 in damages for non-economic loss and $870,337 in special damages. The special damages included lost income, superannuation loss, capital loss on the sale of a rental investment they were forced to sell due to a lack of income, rental income loss, interest and medical expenses (see paragraphs 456–457).

Cronin-Lampe v Board of Trustees of Melville High School [2023] NZEmpC 221(external link)

Labour Inspector of the Ministry of Business, Innovation and Employment v Prisha’s Hospitality (2017) Ltd [2023] NZEmpC 225

Employment Court – Migrant exploitation – Minimum employment standards breaches – Compensation – Pecuniary penalties

In an earlier decision, the Court made declarations of breach against the employers and ordered them to pay 7 employees over $30,000 in arrears and repay $6,522 charged as premiums. At issue was the quantity of compensation orders, penalties and costs the Court would order the employers to pay.

6 of the employees worked for 1 restaurant and the seventh employee worked for a second restaurant owned by the same married couple. The restaurants have since ceased to operate. The employees were all immigrants from India. The Labour Inspector investigated complaints the employees had not been paid correctly and had paid premiums, or a fee to their employer, to secure their employment. It found multiple breaches of minimum standards. The employees gave evidence that they had felt “caged” or “like slaves” in their employment (see paragraph 9). The Court found the employers had threatened the employees’ visas which led to the employees believing they had “no choice but to accept the treatment they were receiving” (see paragraph 11).

The Court ordered the employers to pay:

  • $19,000 to 1 employee, $17,000 to 5 employees and $500 to 1 employee as compensation for distress (see paragraphs 12–15)
  • pecuniary penalties of $197,500 to the Crown ($100,000 to be paid by the first restaurant, $30,000 by the second restaurant, $45,000 by the husband personally and $22,500 by the wife personally) (see paragraph 47)
  • costs and disbursements of $78,429.65 (see paragraph 58).

Labour Inspector of the Ministry of Business, Innovation and Employment v Prisha’s Hospitality (2017) Ltd [2023] NZEmpC 225(external link)

Pilgrim v Attorney-General [2023] NZEmpC 227

Employment Court – Identity of employer

At issue was the identity of the employer of 6 female ex-Gloriavale residents who were earlier found to have been employees at Gloriavale.

The employees submitted that all of the Shepherds were their employers, whereas Gloriavale submitted that, if they were employees, only the Overseeing Shepherd was the employer (see paragraph 12). The Court found that the Overseeing Shepherd was their employer. Prior to his death on 15 May 2018, the Overseeing Shepherd was Hopeful Christian. Since his death, it had been Howard Temple (see paragraph 57).

The Court took the following into account:

  • Although the other Shepherds played important roles, they were “not the ones who ultimately pull[ed] the strings” (see paragraph 15).
  • The document central to the Gloriavale community entitled “What We Believe” stipulates (at paragraph 20):

… there will always be one principal leader who must accept full responsibility for all that happens in the Church, and to whom all the other leaders and brethren must give account.

  • Although the Overseeing Shepherd delegated supervision of work, he retained “ultimate control” (see paragraph 22).
  • An employer did not have to be an entity recognised at law for the purposes of section 6(external link) of the Employment Relations Act 2000 (Act) (see paragraph 31). The Court held:

[36] It is accordingly clear that an employer need not be a separate legal entity for the purposes of s 6, acknowledging the array of “employer” manifestations that exist within our employment relationship environment.

The Court declared the employees were employed by the relevant Overseeing Shepherd during the time they worked on the teams at Gloriavale (see paragraph 57).

Pilgrim v Attorney-General [2023] NZEmpC 227(external link)

Ministry of Business, Innovation and Employment v Duan [2023] NZEmpC 232

At issue was whether an employee was entitled to parental leave payments under the Parental Leave and Employment Protection Act 1987 (PLEPA).

The employee took annual leave for a couple of weeks after her baby was born. The employee then returned to work for 5 months, during which she had assistance from a family friend in caring for her baby. The employee then applied for parental leave. Her application was declined. 2 weeks later, the employee resigned her employment. She cared for her baby full-time for a few months, before starting a new part-time position. The Ministry of Business, Innovation and Employment (MBIE) asked the Court to decide whether the employee should have been granted parental leave payments.

A full Court outlined a “roadmap” with 5 steps to be used when deciding if a parent is entitled to paid parental leave (see paragraphs 23–41):

  1. Determine the employee’s eligibility to receive parental leave payments (section 71CA(external link) of the PLEPA).
  2. Determine the employee’s entitlement to parental leave payments (section 71D(external link) of the PLEPA).
  3. Determine whether the employee made a valid application in the appropriate timeframe (section 71I(external link) of the PLEPA).
  4. Determine the start of the parental leave payment period (section 71K(external link) of the PLEPA).
  5. Determine the end of the parental leave payment period (section 71L(external link) of the PLEPA).

The Court found under step 2 that the employee was not entitled to parental leave payments because she had not taken parental leave in the period she was eligible for payments (see paragraph 44). Under step 4, the employee was required by section 71K(external link) to commence parental leave on the earlier of the date she gave birth (or went into confinement) or the date she chose to take parental leave (see paragraph 54). By taking annual leave when her baby was born and immediately returning to work, she did not take advantage of parental leave (see paragraph 46).

The Court decided the employee was eligible but not entitled to parental leave payments (see paragraph 42).

Ministry of Business, Innovation and Employment v Duan [2023] NZEmpC 232(external link)

Perry v The Warehouse Group Ltd [2023] NZERA 773

Employment Relations Authority – Personal grievance – Leave to raise personal grievances out of time – Unjustified disadvantage – Constructive dismissal – Burnout

At issue was whether the employee raised personal grievances within 90 days and, if so, whether the employer unjustifiably disadvantaged and/or constructively dismissed the employee.

The employee worked in the Education Sales team of a nationwide retailer. The employee complained to his employer during his employment that:

  • His sales targets were inconsistent (see paragraphs 14–17).
  • The loss of support staff following a restructure impacted his ability to perform his role (see paragraphs 18–20).
  • He should have been consulted before changes to his business card, uniform and email address after the employer aligned itself more closely with another brand within the parent company’s suite of retail brands (see paragraphs 21–22).
  • He felt pressure to cross-sell products of the related brand, though he refused to do so (see paragraphs 23–24).

The employee told his managers he was burnt out. The company took some steps to assist him, recommending he utilise EAP and giving him sick leave “off the books”. Months later, the employee resigned and raised personal grievances.

The Authority found that the employee’s personal grievances on the grounds that unjustified actions of his employer had caused him disadvantage were raised outside of the 90 days stipulated in section 114(external link) of the Act. The Authority found that the employer could not have been reasonably expected to treat the employee’s complaints as personal grievances (see paragraph 59). The Authority further declined to give the employee leave to raise the personal grievances out of time, as it did not find that exceptional circumstances had existed (see paragraph 63). The constructive dismissal claim was raised within 90 days.

The Authority found the employer had constructively dismissed the employee. Although the employee had resigned, he had done so in response to a breach of duty by the employer. The Authority found “a fair and reasonable employer with [the employer’s] resources would have taken more formal and proactive steps to understand [the employee’s] mental health situation at the time” (see paragraph 70). The Authority ordered the employer to pay the employee $25,000 in compensation, 3 months’ lost wages and 5 days’ lifestyle leave (see paragraph 85).

Perry v The Warehouse Group Ltd [2023] NZERA 773(external link)

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