Medical Incapacity – Four Common Mistakes

Employment matters with thanks to Chapman Employment Relations

Are you looking to possibility of exiting an employee who is not attending work often enough (or at all), due to injury or ill health? Read here to learn about four common mistakes that are made in the process of medical incapacity. 

Not meeting with the employee before reaching a decision

In considering any dismissal you need to be communicative with the employee. 

The primary reason for providing an employee an opportunity to have input is to allow them to provide relevant information that may avert a decision by an employer that dismissal is necessary.

Making a decision to dismiss an employee for medical incapacity without reasonably attempting to meet and discuss the matters may well fundamentally flaw procedural fairness and lead to a decision of unjustified dismissal if a personal grievance is raised.

Not seeking medical information

Employers must make reasonable attempts to ascertain the medical facts before dismissing an employee for incapacity.  You should also ensure the information current – as the medical incapacity process can take some time you may need to seek further medical assessments.

An employee is not required to consent to a medical assessment or release personal medical information, however should the employee not consent, the employer can still make a decision as to the ongoing employment based on facts it can reasonably ascertain.

Following a disciplinary process for genuine illness absences

Genuine illness is not a disciplinary matter, it is an issue of incapacity. In other words the employee is incapable of meeting their obligation to do the work you agreed to pay them for.

Coping too well for too long without the employee

A key component of medical incapacity is to “balance the fairness to the employee and the reasonable dictates of its practical business requirements”.  If an employer has managed the absence/incapacity for a long period of time

without unreasonable hindrance or unreasonable cost to the business then it will be hard to argue an urgent or impending need to dismiss the employee due to the absence/incapacity. It is important to remember the employee continues to accrue annual holiday and sick leave entitlements while they are absent.

…and as always check the employment agreement and any policies you may have to confirm any required process

Workplace Health & Safety Reform 2014

Health & Safety in the workplace rules and regulations are changing.

The Health & Safety at Work Act is currently open for submissions and the proposed changes are significant. WorkSafe NZ is the new regulator and this organization has already been established, the proposed new Act provides wide ranging powers to WorkSafe NZ and includes new definitions for who is responsible for workplace accidents, and the definition is very wide.

The new primary duty holder or person responsible is the PCBU – Person Conducting Business or Undertaking and they must take all steps ‘reasonably practicable’ with regards to workplace safety.

The new primary duty holder definition (PCBU) covers all relationships between those in control and those affected, including upstream participants and these could include designers, engineers, architects, manufacturers of equipment that caused an accident, suppliers of the equipment and importers. And let’s not forget business owners, directors, trustees, board members and managers.

Depending on the circumstances and ownership structure there may be multiple PCBU’s involved in work at one location and WorkSafe NZ can prosecute each and every one of those people.

The Act givers workers the right to greater participation in work place health and safety with worker Health and Safety reps able to direct unsafe work to cease.

While many of these changes are designed to improve safety in areas like mining and forestry the rules apply to EVERY workplace and the penalties or potential fines are highly significant – starting at up to $50,000 at the very low end to up to $3m for corporations and up to five years in jail for Individual PCBU’s or workers.

As a business owner you need to know about this, it affects every business!

Employment matters Q&A

Employment matters with thanks to Chapman Employment Relations

Q. What can void 90 Day Trial Period?

Answer:

o    If the employee has previously worked for you (or a subsidiary).

o    If the employee was not given a written employment agreement before commencing employment. Once they have started work they are considered an employee and so point #1 would kick in.

o    If you give the employee an Employment Agreement but do not get the employee to sign the agreement prior to commencing work.

o    If you have never given the employee an Employment Agreement.

o    A recent local case also highlighted the necessity to give the Employment Agreement to the employee personally and not rely on a third party to do so as the delivery can be disputed.

o    Having incorrect Trial Period wording in the Individual Employment Agreement that does not meet the requirements of Section 67A of the Employment Relations Act 2000.

 

Q. What is the maximum fine for not providing your employee with an Employment Agreement? Where does the money go?

Answer:

o    Under section 63A of the Employment Relations Act 2000 an employer must provide an employee with a written employment agreement (Individual or Collective), and penalties may be awarded under section 64 if no written employment agreement is provided, up to $10,000 for individuals and $20,000 for companies.

o    The fines go to the Ministry of Business Innovation and Employment (Old Dept of Labour)

 

Q. Do you have to provide a payslip for your employees?

Answer:

o    Legally you do not have to provide a payslip for your employees but it is good practice to do so. You do however, have to keep accurate records of what you have paid your employees and your employees are entitled to ask to see these records and take copies whenever they want. Records must be kept for 6 years.

 

Q. Can you read an employee’s personal emails sent on their work computer and using your email address?

Answer:

o    Employment Courts have tended to take the employer’s side when this situation has occurred. You should have a valid business reason for reading any personal emails on work computers. You shouldn’t look through an employee’s emails just to be nosey. But if you are concerned that business’ secrets are being leaked or an extraordinary amount of work time appears to be spent on personal communication then you have just cause to investigate.

 

Hot tips for increasing productivity

 With Barbican Training Centre 

Increasing productivity is what keeps you

ahead of the pack. It’s what keeps you afloat when the others are sinking. But staying productive can be a real challenge. At the end of the day, there’s a good chance that you are not satisfied with what’s been accomplished. If that’s the case, then here are some pointers that could help you and your business:

  • Take stock—identify obstacles

This is the first thing you need to do—if you don’t know what’s wrong, how can you fix it? Look around your business and see what’s stopping the work being quick and efficient. Is your equipment outdated? Or is it simply not being used properly? Assess where your team is at the moment—do they have the right equipment, the right authority, the right training? Look at all parts of your business; figure out what works, find out what doesn’t need to be done, what can be done more cheaply and what can be done better.

  • Seek help and delegate tasks accordingly

Nobody is an expert at everything; make sure that the right members of your team are in the right positions, doing the right jobs—you wouldn’t have a rugby first five-eighth (fly half) as the main line out receiver if you wanted to win. If you haven’t got the right talent, then hire it when it’s needed.

  • Avoid unnecessary meetings

Most meetings are quite simply unnecessary for many of the participants—only people who are directly involved need attend. Parties interested in what happened receive notes of the most important details, leaving them to get on with their work, instead of abandoning this for a meeting.

  • Keep administration to a minimum

Administration, whilst absolutely necessary, is a cost centre, not a profit centre—it doesn’t bring in the money, it spends. Examine what your administration department does and

figure out how to do it better. Be prepared for howls of protest from your administration department, as they won’t appreciate your “help”, and will see you as the enemy.

  • Use technology

Automate tasks wherever possible to get the job done more quickly and more accurately—taking the human element out of a task usually results in greater accuracy. Accuracy means that jobs only need to be done once; it’s that old chestnut—do it once, do it right.

  • Ask the team

Team members often know better than management how things can be done more quickly, more cheaply, or improving quality—so ask. You can also offer monetary rewards— a

percentage of money saved to encourage participation.

  • Train the team

Conduct training sessions to upgrade employee performance. Training helps employees to handle new equipment and perform jobs more efficiently. Make sure new employees have a proper induction process, so that they know what needs to be done and how.

  • Weed out distractions

Staff may have Facebook, Twitter, LinkedIn, YouTube, Instagram, Hootsuite, Tumblr, Pinterest, Google Chat, accounts plus many others you’ve never heard of. If they are not using these, they may be checking their email on their smartphones or reading random facts on Wikipedia every 5 minutes. Disconnect! In the U.S., this is estimated to cost companies roughly $6,000 per year per worker. Ouch!!!

 

 

 

Recruitment & Misrepresentation – Buyer Beware

Employment matters with thanks to Chapman Employment Relations

Misrepresentation by a job applicant is a serious matter, but you still need to get the procedure right when managing the situation.

Mr Richardson was employed by Fonterra as a Tanker Driver.  Prior to employment Mr Richardson was asked if he had any previous criminal convictions, he advised he did not. Further Mr Richardson was advised a criminal record check would be carried out, he agreed to this prior to employment, the vetting was completed after his employment began.

On being offered employment Mr Richardson was provided, in effect, a new set of conditions, including the requirement of a Criminal Record Check.  The employer did not advise what would happen if he failed that test even though this is stated in the previous recruitment process.  The letter of offer pointed to a Collective Agreement that had a completeness clause which had the effect of wiping all previous conditions and undertakings, including those within the recruitment process.

There is a great deal of trust and confidence required by the employer in their drivers, in being able to undertake their duties largely autonomously with sound judgement and professionalism.

On receipt of the criminal record check it was discovered Mr Richardson had driving offences including, drink driving, and theft and dishonesty convictions which resulted in fines disqualifications and imprisonment.

Fonterra determined to undertake an Employment investigation for a failure to disclose his convictions and advised Mr Richardson that the matter was considered serious, and that termination may follow.

Through the employer’s investigation Mr Richardson stated he understood his previous convictions were covered by the Clean Slate Act so wasn’t required to submit the convictions.  In his case this was not correct.

Whilst Mr Richardson’s last conviction was in 2004 he did not meet the criteria for coverage under the Clean Slate Act, at the very least convictions including imprisonment are excluded.  He formed his view that he did not need to disclose his convictions, it seems, from discussions with his wife who had apparently checked the Ministry of Justice website.

After an initial investigation Fonterra advised Mr Richardson, in a letter of dismissal:

You have misrepresented yourself to the Company by failing to disclose all of your previous traffic and criminal convictions and as such we are terminating your contract with immediate effect.

When Mr Richardson appealed the decision internally, Fonterra went further and advised:

Given the conclusion that Mr Richardson had deliberately withheld information material to Fonterra’s decision to employ him, Mr Rogers decided that dismissal without notice was the appropriate outcome and advised Mr Richardson of this.

Firstly let’s be clear about the Criminal Records (Clean Slate) Act 2004, if an employee or prospective employee has convictions covered by the Clean Slate Act then that person is not required to advise of the convictions, it is as if an invisibility blanket has been cast across the convictions and no one need know, speak, or hear of them in the future, well at least not in an employment setting.

When Mr Richardson appealed the decision internally, Fonterra went further and drew a conclusion that Mr Richardson had “deliberately” misled the employer.

Late in the piece Fonterra did attempt to use Contract law and misrepresentation forming a breach to justify dismissal, however it does not appear it advised Mr Richardson it intended to use this aspect of the law prior to the matter going to the Authority. In any case the Authority ruled the employer could not rely on this legislation in any regard even before testing the breach of good faith in not advising Mr Richardson earlier in the process it intended to rely on this legislation.

The Authority found the previous stipulations in the recruitment process did not have any weight, that the unconditional offer of employment, and the Employment Agreement, did not cover this situation.  Further the Authority found that the reliance Fonterra placed on wilful or deliberate misrepresentation was not correct. The Authority concluded Mr Richardson did not intend to mislead, and reference was made to Mr Richardson’s wife’s evidence and that he had agreed to a criminal record check being undertaken.  The Authority determined Fonterra had not been clear on this allegation of deliberate misrepresentation through its investigation process, so again Fonterra was found wanting on its conclusions.

The Authority found the dismissal unjustified and provided remedies in the employee’s favour, including lost wages and hurt and humiliation of around $20,000, plus costs.

The Authority did not reinstate Mr Richardson’s employment through a mixture of considerations including Mr Richardson’s desire to not return given his negative experience and apparently more importantly that had the employer been aware of the criminal convictions the employer would not have employed Mr Richardson, to which the Authority member agreed.

It would seem to be another case of get your initial allegation right, run a thorough process, and ensure your decisions reflect the allegations and findings made through the investigation. Further it is important to create a connection between an offer of employment and employment agreement that covers misrepresentation, or facts discovered after employment, otherwise buyer beware.

 

Lessons,

  • When requiring Criminal Record Checks for employment purposes wherever possible undertake these prior to employment.
  • Review process and supporting documentation to cover the transition from recruitment to employment process.
  • If you are in a position whereby you still would want a criminal record check done but time has not allowed:
  • have a clause in the offer letter stipulating the offer of employment, and employment itself, is subject to a Criminal Record Check satisfactory to the employer, and
  • that any issues discovered that had not been raised or represented prior may lead to an employment investigation, and that this may lead to termination of employment.

We recommend reviewing your employment agreement and consider including such a clause.