Unjustified dismissal - Why you should follow a fair and reasonable process for terminations…
The Employment Relations Authority has upheld a claim for unjustified dismissal and ordered an employer to pay $98,000.
The employee began working for the employer in a highly technical and supervising role. The employer did not provide the employee with any training or familiarisation with its systems, and directed him to manage the team as he saw fit.
A year later, the employer called the employee into the office and dismissed him on the spot. When a request was made for the reasons behind the dismissal, the employer replied that there were performance issues.
The employee’s employment agreement included a process that was to be followed in the event of poor performance, but the employer ignored this.
The employer also attempted to convince the employee to sign a settlement agreement, to prevent him from bringing a claim against the employer. The employee declined to sign the agreement and raised a personal grievance.
During the Authority’s investigation, the employer also attempted to claim that the employee was negligent, did not follow company processes or instructions, and kept poor records, and that this meant the employee’s dismissal was justified.
The Authority held that the employee was unjustifiably dismissed. It explained that the employer failed to follow any kind of fair process, and did not raise any of the issues with the employee before dismissing him. It additionally raised serious concerns that the employer’s approach was to dismiss the employee on the spot and then try to convince him to sign a binding settlement.
The Authority ordered the employer to pay the employee $65,000 in lost wages, $30,000 compensation, and imposed a $3,000 penalty for breaching its good faith obligations, $2,000 of which was to be paid to the employee.
It is important that where there are performance or disciplinary issues with an employee, that employers follow the correct legal process and any process in the employee’s employment agreement. Failure to do so may result in an expensive personal grievance.
If there are uncertainties around how to approach issues with an employee or how to follow the appropriate process, it pays to speak with a professional experienced in the area.
Leading law firms committed to helping clients cost-effectively will have a range of fixed-price Initial Consultations to suit most people’s needs in quickly learning what their options are. At Rainey Collins we have an experienced team who can answer your questions and put you on the right track.