Cases of Interest: May 2025

Youtap Ltd v Johnston [2025] NZEmpC 90

Employment Court – Identity of employer – Jurisdiction

At issue was whether the employer was a New Zealand company or a Singaporean company, and consequently which law governed the dispute. 

The employee had worked with a director in various companies over many years. He was employed by Company A in New Zealand as the Chief Technical Officer in 2007. Ten years later, Company A wanted to expand into Asia and Africa. It decided to set up a hub in Singapore. The employee agreed to relocate to Singapore to spearhead its operation there. He wrote a list of requirements for his move, partially to meet Singaporean work visa conditions. In accordance with that list, he became the resident director of the company registered in Singapore for the expansion (Company B), which was wholly owned by Company A. He also became an employee of Company B. The director was a director of both Company A and Company B.

The employee and Company B did not have a written employment agreement until Company B was audited. When the auditors asked for a copy, the parties signed and backdated an employment agreement. The employee’s employment was terminated with one month’s notice by letter in 2022 in accordance with Company B’s understanding of Singaporean employment law.

The employee’s lawyer wrote to Company A and Company B and claimed that he was unjustifiably dismissed by Company A. In the alternative, he claimed that Company A was the controlling third party of his employment with Company B.

The Employment Court (Court) found that Company B was the employee’s employer at the time of his dismissal. In doing so, it considered:

• The employee held himself out as being the Chief Technical Officer of Company B (see paragraph 17).
• The employee was an “active participant” in the change of employment arrangements (see paragraph 38).
• The changes were mutually beneficial to both parties. Company A needed a senior employee resident in Singapore to oversee the expansion. The employee gained significant tax advantages. He needed the employment with Company B to gain a work visa (see paragraph 39).
• When the employee moved to Singapore and commenced work for Company B there was a ‘novation’, where both parties intended for there to be a change of contracting parties (see paragraphs 37 and 40).
• At the relevant time, the employee was no longer employed by Company A (see paragraph 61).

The employment was therefore outside of the jurisdiction of New Zealand employment law.

The Court noted that section 103B(external link) of the Employment Relations Act 2000 is only applicable where there is an unresolved personal grievance between the employee and their employer before the Employment Relations Authority (Authority) or Court. In this matter, there was no claim against Company B. Therefore, it was premature and outside of the Court’s jurisdiction to consider whether Company A was a controlling third party.

Youtap Ltd v Johnston [2025] NZEmpC 90(external link)

Happy Belly Production Ltd v Dawson [2025] NZEmpC 92

Employment Court – Interpretation of employment agreement – Hours of work clause – Arrears

At issue was the number of hours per week the employment agreement guaranteed the employee.

The written employment agreement between the parties included the following clause:

Hours of work – As a full-time employee, you agree to work a minimum of 40 hours per week to discharge your duties. However, due to the nature of our business, your hours of work will be in accordance with our roster schedule which is decided from time to time …

The employer did not always provide the employee with 40 hours of work per week. The employee claimed the employer should have provided a minimum of 40 hours per week and claimed the shortfall in arrears. The employer argued the parties agreed the employee would have the opportunity to work “up to” 40 hours a week (see paragraph 10).  

The Court undertook contractual interpretation and found:

• Employment agreements are created in the context of legislation. Section 67C(external link) of the Employment Relations Act 2000 requires the number of guaranteed hours of work to be specified (see paragraph 9).
• The reference to “a minimum” of 40 hours per week would have been redundant if it did not mean the natural meaning of minimum (see paragraphs 12 and 14).
• The word “however” indicated the times and days would be in accordance with a roster rather than specified in the agreement. It did not “connote a distinction with what has gone before” in this clause (see paragraph 15).
• There was nothing in the rest of the agreement which assisted the Court with interpretation (see paragraph 17).

The Court found the employee had not been paid for 64.5 hours guaranteed in his employment agreement (see paragraph 20). It ordered the employer to pay him $1,719 in arrears plus interest (see paragraph 22).

Happy Belly Production Ltd v Dawson [2025] NZEmpC 92(external link)

Chief Executive of Oranga Tamariki – Ministry for Children v Hill [2025] NZEmpC 98

Employment Court – Personal grievance – Unjustified dismissal – Use of force

At issue was whether the employee was unjustifiably dismissed.

The employee was a residential youth worker at a youth justice residence that cared for rangatahi who had been remanded or sentenced to Oranga Tamariki’s care by a court order. A rangatahi in her care took an item but did not admit to it. When she learned of this, she instructed him to sit in the corner of the room. The rangatahi then insulted her using derogatory language. The employee said she used a defensive technique called a ‘train stop’ to push the rangatahi away. The employer watched video footage and considered the employee had held her hands around the rangatahi’s neck. After a disciplinary process, the employee was dismissed on the basis of serious misconduct.

The Court applied the test in section 48 of the Crimes Act 1961 to decide whether the employee’s force was justified because it was referred to in the relevant training programme of the employer:

48 Self-defence and defence of another

Every one is justified in using, in the defence of himself or herself or another, such force as, in the circumstances as he or she believes them to be, it is reasonable to use.

The Court found that although the employee believed she was acting in self-defence, her actions were not reasonable in the circumstances, and therefore unlawful (see paragraphs 85 and 87). Although the rangatahi used offensive language, he did not pose any threat to the employee’s safety (see paragraph 70).

The Court concluded that as unlawful use of force constituted serious misconduct in the employer’s disciplinary policy, it was reasonable for the employer to dismiss the employee as a fair and reasonable employer (see paragraph 99).

Chief Executive of Oranga Tamaraki – Ministry for Children v Hill [2025] NZEmpC 98(external link)

Stevenson v Mountain Chalets (2005) Ltd [2025] NZERA 248

Employment Relations Authority – Casual or permanent – Personal grievance – Unjustified dismissal – Holiday pay

At issue was whether:

• The employment was casual or permanent in nature.
• The employer unjustifiably dismissed the employee.
• The employer paid holiday pay correctly.

The employer owned and operated a motel, a lodge and a smaller accommodation site. The employee was a cleaner at the properties for five years. The employment ended in disputed circumstances. The employee claimed her hours of work had been unilaterally reduced; she had been unjustifiably dismissed; and her holiday pay had been paid incorrectly throughout her employment.  The employer asserted the employee was employed on a casual basis and therefore could not raise the claims.

The employment agreement between the parties was signed two years into the employee’s employment. It referred to the employment relationship as casual with no expectation of ongoing employment. Throughout the five years, the employee worked Monday to Thursday with some variation between Friday and Sunday. Her work day began at 9am and finished when the cleaning was completed. She usually worked between 20 and 25 hours a week. If she needed time off, she would ask her employer for permission in advance. The employer would often text to check she was available for work. For a period of time there was a roster. Her holiday pay was paid as 8% of her wages as she went, purportedly in accordance with section 28(external link) of the Holidays Act 2003. The employer hired extra cleaners in the busy months but considered the employee to be a ‘main stay’ employee, albeit on a casual basis due to the nature of the hospitality industry (see paragraph 26).

After another staff member left, the employee was tasked with checking all rooms after they had been cleaned which provided her with approximately 8 extra hours of work a week. A couple of months later the task was unilaterally removed by the employer because it was concerned standards were slipping. The employee raised concerns about the reduction in her hours of work. The parties argued. The employee believed she had been fired. The employer believed it had advised her that if she needed more hours she should look elsewhere for extra hours. When the parties realised the misunderstanding, neither attempted to reconcile.

The Authority found over time the employee became permanent part-time rather than casual because there was a reasonable expectation of ongoing regular employment. The employer’s attempt to label the employment as casual was “an opportunistic attempt to impose what amounted to a ‘zero hours’ agreement” (see paragraphs 38 and 40). The Authority found the employee had not been dismissed because once she realised the employer had not intended to dismiss her, she did not attempt to reconcile (see paragraph 70). However, the Authority found the employee was unjustifiably disadvantaged by the actions and omissions of the employer when it failed to make her role permanent part-time (see paragraph 76). The employee was awarded $8,000 compensation (see paragraph 82).

The Authority found the employee should not have been paid holiday pay as 8% on top of her wages. (Section 28(external link) of the Holidays Act 2003 requires an employee to either be on a fixed term agreement or for their work to be “so intermittent or irregular that it is impracticable for the employer to provide the employee with 4 weeks’ annual holidays” before their holiday pay is paid as 8% on top of their wages.) The Authority ordered the employer to pay holiday pay for the entire period of her employment in accordance with section 24(external link) (see paragraph 84).

Stevenson v Mountain Chalets (2005) Ltd [2025] NZERA 248(external link)