Cases of interest: August 2026

Health New Zealand v Healey [2026] NZCA 351

Court of Appeal – Leave to represent employee – Lay advocate

At issue was whether the Court of Appeal should grant an employment advocate leave to appear and represent an employee.

The employer applied for leave to appeal a judgment of the Employment Court. An employment advocate who represented the employee in the Employment Relations Authority and the Employment Court filed a memorandum on behalf of the employee to oppose leave being granted.

Generally, only lawyers with current practising certificates and natural persons representing themselves have standing to appear in the Court of Appeal. The employer raised a concern about the advocate purporting to represent the employee. The advocate applied for leave to appear and represent the employee as a lay advocate.

The advocate submitted that they were aware of the Court of Appeal’s obligations to make sure that the employee had competent and professional representation and that its time was not used by someone unqualified. They submitted that they could provide such assurance by setting out their relevant background, which included that:

• They are a fully qualified lawyer with a conjoint BA/LLB degree.
• They held a practising certificate between 2002 and 2005 (they have not held one since as their work has been confined to the employment jurisdiction, where lay advocates are permitted to appear).
• They are the leading advocate for a workers’ union.

The Court of Appeal noted, among other things, that:

• Only lawyers who hold current practising certificates:
  • have obligations to undertake ongoing professional development and continuing education (see paragraph 6)
  • are subject to ongoing ethical and professional obligations which are backed by regulation and a disciplinary regime (see paragraph 7). 
• It assumed the advocate was being remunerated for their services; it was normally entitled to expect that advocates who were being paid for their services were properly trained and subject to such obligations (see paragraph 20).
• While the advocate was trained in the law, they were not subject to these comprehensive professional and ethical obligations (see paragraph 20).
• The advocate filed documents in the Court of Appeal in two other proceedings on behalf of employees without seeking leave to appear; in both cases it found that the advocate’s proposed questions of law on appeal were not questions of law or were not seriously arguable (see paragraphs 15, 17). This disregard for the requirement to seek leave in three successive years raised concerns as to whether it was appropriate to grant leave (see paragraph 19).
• Its jurisdiction regarding employment law is strictly limited to questions of law of general or public importance; accordingly, it is likely to receive the most assistance from lawyers who are familiar with this jurisdiction (see paragraph 19).
• There was no evidence that insisting on qualified counsel would be unduly technical, burdensome, or costly (see paragraph 21).

The Court of Appeal declined to grant the advocate leave to represent the employee (see paragraph 22).

Health New Zealand v Healey [2026] NZCA 351(external link)

Courage v Attorney-General [2026] NZEmpC 178

Employment Court – Judicial Review – Labour Inspector

At issue was an application for judicial review by former members of the Gloriavale Community (the Community) against actions of the Labour Inspectorate.

In 2017 Charities Services raised a number of concerns to the Labour Inspectorate regarding work being done in the Community. The Labour Inspector undertook an initial inquiry which was focused on whether it had jurisdiction to look into the employment status of members of the Community. The Labour Inspectorate produced a report (the 2017 report) which noted that if the workers within the Community could be considered employees, there would be serious breaches of employment law. However, the report concluded on balance that the work undertaken was either a partnership or voluntary work.

In 2020, claims of poor working conditions and long working hours within the Community were raised in the media. The Labour Inspectorate reviewed its 2017 inquiry and undertook a site visit alongside WorkSafe inspectors. The Labour Inspector undertook a second site visit in 2021. The Labour Inspectorate decided before the second site visit to exclude children from the scope of its investigation. Before the Court, two Labour Inspectors cited concerns with obtaining parental consent and concerns with resourcing as the basis for excluding children. The Labour Inspector prepared a second report (the 2021 report) which recorded its conclusion that the intention of the parties was to create a sharing community rather than an employment relationship. No references to children were made in the 2021 report. The 2021 report concluded that the workers within the Community could not be considered employees and that the Labour Inspectorate did not have jurisdiction to investigate further.

The former members of the Community, who had worked in the Community as children, submitted that they were seriously failed by the Labour Inspectorate. The Employment Court (the Court) understood the focus of their submissions to be on the decisions of the Labour Inspector:

• not to undertake an investigation following the 2017 report
• to exclude children from its 2021 investigation
• not to take any more action following the 2021 report.

The Crown submitted that:

• The Court did not have jurisdiction to determine the claims as:
  • The Labour Inspector’s investigatory powers are inherently discretionary and involve allocation of scarce resources.
  • The application for review was premature as the 2017 and 2021 reports were not final determinations of the employees’ rights.
  • The 2017 and 2021 reports reflected conclusions of a general nature that did not affect the rights of any of the individual employees.
• If the Court did have jurisdiction, judicial review was not available as the claim would amount to an impermissible challenge to the decision and actions taken by the Labour Inspector.

The Court concluded that the Labour Inspector’s decisions were subject to judicial review (see paragraph 124). In doing so, it addressed the Crown’s arguments and noted, among other things, that:

• Resource implications cannot be used as a shield to judicial review (see paragraph 101).
• The 2021 report did not mention resourcing issues and the 2017 report only had a fleeting mention of resourcing. In the absence of any contemporaneous mention of resourcing issues, this cannot be later elevated as an underlying reason for the way in which the Labour Inspector exercised its statutory powers (see paragraph 108).
• The Labour Inspector’s decision not to proceed to an investigation, and the reports issued in 2017 and 2021, were in reality final decisions (see paragraph 118).
• A standard of anxious scrutiny, rather than any judicial restraint, was warranted where this case engaged fundamental human rights, international obligations and allegations of child labour (see paragraphs 120, 124).

The application for judicial review succeeded (see paragraph 180). The Court found that:

• The Labour Inspectorate was wrong to conclude that it could not investigate further without being satisfied that the workers were employees; it misunderstood its own jurisdiction regarding the exercise of its powers which amounted to an error of law (see paragraph 137).
• When the Labour Inspector took into account the risk that an investigation could cause considerable disruption to the Community, this was an irrelevant consideration (see paragraph 141).
• By omitting children and the position of child workers from the scope of its investigation, the Labour Inspector failed to have regard to a mandatory consideration (see paragraph 158).
• The failure of the Labour Inspector to have regard to the position of children was irrational and manifestly unreasonable based on its knowledge of the Community and the position of vulnerable children within the community (see paragraph 162).
• The Labour Inspector’s failure to make further inquiries relevant to the employment status of workers in the Community was irrational and unreasonable (see paragraph 169).
• The Labour Inspector’s decision to close the inquiry without seeking further comment from those who left the Community was unfair and unreasonable (see paragraph 174).

Courage v Attorney-General [2026] NZEmpC 178(external link)

Jenkins v Allied Investments Ltd (t/a Allied Security) [2026] NZEmpC 170

Employment Court – Challenge to direction – Jurisdiction

At issue was whether the Employment Court (the Court) had jurisdiction to consider a challenge to a direction of the Employment Relations Authority (the Authority).

The employee and employer are parties to proceedings before the Authority. The employee applied to audio record the investigation meeting before the Authority. The Authority issued a direction which declined the employee’s application. It directed that the parties were able to make handwritten notes of the investigation in the usual way.

The employee challenged this direction. The Court noted that it may not have jurisdiction to consider the challenge under section 179(5)(external link) of the Employment Relations Act 2000 (the Act), which prevents parties from challenging determinations relating to the procedure that the Authority followed or intended to follow. The Court also noted that under section 188(external link) of the Act it is not a function of the Court to advise or direct the Authority in relation to the procedure that it followed or intended to follow.

The employee submitted that the direction was not merely procedural and would have many consequences extending beyond ordinary case management. They submitted that:

• The direction would affect:
  • the accuracy of the factual record
  • the parties’ ability to verify what happened during the investigation meeting
  • the ability of either party to prepare for any subsequent challenge
  • the overall fairness and transparency of the Authority’s process.
• The present challenge can be distinguished from other proceedings where the matter was found to be procedural due to the irreversible consequences of the direction.
• The Authority did not provide any reasoning for its decision; the decision cannot be characterised as an unchallengeable procedural decision where the Authority decided a procedural application but did not provide a reason for how it exercised its discretion.
• There are good policy reasons for the Court to act in a supervisory manner over procedural decisions that affect the integrity of an investigation.

The employer submitted that:

• The direction fell squarely within section 179(5) of the Act; accordingly, the challenge was outside of the Court’s jurisdiction and should be dismissed.
• The employee’s arguments did not move the direction outside of procedure.

The Court concluded that the direction was procedural and that it did not have jurisdiction to consider the challenge (see paragraph 34). In doing so, it considered that:

• Section 179(5) must be read in the context of the Act; the role of the Authority is to make determinations on merits without regard to technicalities (see paragraph 26).
• The aim of the Authority’s investigations is to resolve employment relationship problems as efficiently and cheaply as possible (see paragraph 27).
• Generally, proceedings in the Authority should not be interrupted by challenges before a final determination is issued (see paragraph 28).
• It can consider challenges to preliminary decisions where the outcome could not otherwise be remedied, however it will not be enough that a party can demonstrate some impact from an Authority’s decision (see paragraph 29).
• The employee’s primary concern related to their ability to assess the accuracy of the Authority’s factual findings; any inaccuracies could be rectified as part of the process of challenging the determination in the Court (see paragraph 32).
• The other concerns raised by the employee did not change the Authority’s direction from being procedural (see paragraph 33).

Jenkins v Allied Investments Ltd (t/a Allied Security) [2026] NZEmpC 170(external link)

Labour Inspector v Indo Kiwi Horticulture Ltd [2026] NZERA 557

Employment Relations Authority – Minimum Employment Standards Breaches - Penalties

At issue was whether the employer:

• owed arrears to four complainants for unpaid wages and unpaid holiday entitlements
• requested unlawful premiums
• should pay penalties for any breaches of minimum employment standards.

At issue was also whether the previous director of the employer was a person involved in any breaches and should pay penalties.

The employer supplied labour to kiwifruit orchards. The Labour Inspector received complaints from four migrant employees who travelled to New Zealand to work for the employer. The complainants alleged the employer breached a number of minimum employment standards.

The Labour Inspector investigated these complaints. It concluded that the employer owed the complainants arrears for unpaid wages and holiday pay, that the employer had received unlawful premiums and that there were multiple breaches of minimum employment standards.

The Employment Relations Authority (the Authority) found that the employer owed arrears:

• to four complainants totalling $65,176.03 for unpaid wages (see paragraph 34)
• to three complainants totalling $10,904.80 for unpaid holiday pay (see paragraph 38)
• to one complainant of $9,239.49 for unpaid holiday pay (see paragraph 40)
• to three complainants totalling $658.93 for unpaid public holiday payments (see paragraph 42)
• to three complainants totalling $878.66 for unpaid alternative holiday payments (see paragraph 44).

The Authority found that the employer and/or its director received a total of $65,437 in unlawful premiums from three of the complainants (see paragraph 69).

The Authority ordered the employer to pay penalties of $176,000 (see paragraph 124) and its former director to pay penalties of $88,000 (see paragraph 126). In doing so, the Authority considered, among other factors, that:

• The breaches were clearly intentional and not inadvertent (see paragraph 86).
• The inherent imbalance of power in the employment relationship was amplified by the fact that the complainants were vulnerable migrants who were dependent on the employer (see paragraph 100).
• Seeking unlawful premiums, failing to pay the minimum wage and withholding pay from employees are very serious breaches (see paragraph 109).
• There were no mitigating factors (see paragraph 111).
• There needed to be a deterrent factor reflecting the egregious nature of the conduct (see paragraphs 123, 125).

Labour Inspector v Indo Kiwi Horticulture Ltd [2026] NZERA 557(external link)

Brown v Alliance Group Ltd [2026] NZERA 569

Employment Relations Authority – Unjustified dismissal – Medicinal cannabis

At issue was whether the employee was unjustifiably dismissed.

The employee suffered a workplace injury in 2016. In 2022, the employee was prescribed medicinal cannabis as an alternative to their previous pain management medication. The employee informed the employer of their prescription. In 2025 the employee undertook a drug test which returned a non-negative result. A final written warning was placed on the employee’s file.

Around six months later the employer noted that despite the employee being on a final warning and subject to extra scrutiny, the employee had not been drug tested for a while. At the employer’s request the employee undertook a drug test which returned a non-negative result.

The employer suspended the employee until the employee could return a negative test result. The employer commenced an investigation into the results of the drug test. The employer alleged that the employee’s non-negative result and reporting to work under the influence of illegal drugs were breaches of the employee handbook. The employer stated these breaches potentially constituted serious misconduct. The employer dismissed the employee.

The employee submitted:

• No concerns were raised about their continuing use of medicinal cannabis.
• They were willing to stop taking the prescription and to be frequently drug tested.
• Their situation should be distinguished from other habitual users of drugs.
• They believed they had taken the medication with sufficient time to pass a drug test and that they were not impaired in the workplace. 

The employer stated:

• It could not tell whether the employee was self-medicating or misusing their prescription.
• It had to apply the drug and alcohol policy consistently; it previously dismissed employees who failed a second drug test.
• It had an obligation to make sure the employee worked in a safe manner as they worked with heavy machinery in a safety sensitive area.

The Authority found that the employee was unjustifiably dismissed (see paragraph 72). In coming to this conclusion, the Authority considered, among other things, that:

• The employer’s investigation was rushed; a more thorough investigation could have included steps such as (see paragraph 52):
  • interviewing witnesses to determine whether the employee showed signs of impairment
  • reviewing the employee’s file and looking at how the disclosure of their prescription had been previously handled
  • seeking more medical advice about the effect of the prescription on the employee and whether there were any available alternatives.
• Too much emphasis was placed on a simplistic and rigid application of the drug and alcohol policy (see paragraph 54).
• In circumstances where the employee disclosed their prescription to the employer and were not tested because of any concerns arising from their behaviour, it could not be said that they had engaged in serious misconduct (see paragraph 61).
• A “zero tolerance” approach has limitations; the duty of good faith requires an employer to fairly assess an employee’s individual circumstances, including the reason they are using medication (see paragraph 70).

In considering remedies, the Authority:

• concluded that there were no insurmountable practical difficulties with reinstating the employee (see paragraph 86)
• ordered the employer to pay:
  • lost remuneration for the period between the dismissal and the date of the investigation meeting (see paragraph 90)
  • compensation of $25,000 (see paragraph 93)
• found that the employee’s use of a prescription medication for legitimate purposes could not be considered contribution to their personal grievance (see paragraph 95). 

Brown v Alliance Group Ltd [2026] NZERA 569(external link)