Case studies provide key law lessons

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There is plenty HR can take away from reviewing Employment Relations Authority (ERA) cases as one group of HR advisors learnt this week. The 75 attendees of the HR Advisors Conference, run by Elephant Training and HR, were asked to discuss three cases, their thoughts on them and the key learnings of the case. HRM Online summarises the cases below presented by the Elephant team, Lisa Hunter, Nikki Peck and Karen Baird, and the findings the group came to.

Case 1. Taiapa v Turanga Ararau
Bruce Taiapa applied for leave from his employer, Turanga Ararau, for five days leave, however he was only granted three. He never responded to this but called in sick and produced a medical certificate on his return from his GP saying he was unfit for work that week, but no reason for the medical unfitness was provided. His manager saw a photo on Facebook taken of Taiapa at a waka ama event during the time he was on sick leave. An investigation was carried out and the company dismissed him concluding the sick leave wasn’t genuine. Taiapa argued to the ERA that an employer should not be permitted to dictate where a sick or injured person recuperates and this breached the right of free movement within New Zealand under the Bill of Rights. The case was also heard “de novo” in the Employment Court.

Both the ERA and Court found in favour of the employer. They found the Bill of Rights didn’t apply but accepted an employer cannot dictate where an employee recuperates. The judge said if an employee's actions were inconsistent with recuperation then an employer was entitled to question whether that person was genuinely ill. They also agreed Taiapa’s actions did constitute serious misconduct but the evidence of the Facebook photo was only a minor piece of evidence overall.

Key learnings from the case: Investigate issues appropriately; document all meetings and don’t rely solely on Facebook– a range of other factors must be considered.

Case 2. Hearn v Cable Bay Wine
Hearn was employed by Cable Bay Wines (CBW) as an Accounts Manager in the finance team. She had worked for its predecessor who had been placed into receivership. A term of the sales and purchase agreement stated all employees, including Hearn, of the predecessor company that continued were employed on a trail period. Hearn was given an employment agreement the third week into her trial. A month later, CBW directors became concerned that Hearn didn’t have an accounting qualification and the financial systems weren’t good. They recruited a qualified accountant who could cover Hearn’s work. She was told at a meeting a month later her employment was terminated on grounds of redundancy. Hearn went to the ERA claiming her position had not disappeared but was still being performed so her position was not truly disestablished.

The conference attendees all agreed there were significant flaws in this case. The ERA came to the same conclusion that it was not a genuine trail period since she did not receive the employment agreement until three weeks in and there was no consultation, she was only advised of the decision. The court did find the reasons for redundancy were genuine being a significant financial crisis but the process was flawed therefore it awarded compensation.

Key learnings from the case: Have a robust restructuring process in place; ensure the trial period is in writing and employment agreements given to staff before the trial period starts; always consult with the affected person about the redundancy and advise staff they can have a support person or representative at meetings.

Case 3. Rota-Tawha v Radius Residential Care
In this case the manager of the care lodge became aware of items going missing. She investigated but couldn’t identify a culprit. A staff member approached the manager with information that was agreed to be kept anonymous and confidential. The staff member alleged Rota-Tawha had some pots, pans and some chairs from the lodge kitchen in her home. The manager then emailed the police about the allegations. A constable visited the lodge and was shown the  chairs but because there was no evidence pots and pans were missing and  no written statements,no internal investigation was carried out. The officer visited Rota-Tawaha’s home and found the chairs were different to those missing and had no way of identifying the pots and pans so reported no stolen property. The day after, Rota-Tawaha met with her advocate and the manager. She said she was shocked and humiliated by the police visit and needed to take some sick leave to recover. Four days later another meeting was held and she resigned and took the case for constructive dismissal.

The group agreed the police shouldn’t have been involved when there was no tangible evidence and that it was a breach of duty to the employee and constructive dismissal, as it clearly conveyed the employer did not have trust and confidence in the employee. The ERA reached the same conclusion and awarded remuneration and compensation.

Key learnings:  Investigate properly; don’t call the police straight away; quietly investigate to ascertain as factually true and get legal advice.

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