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Chapman ER News – Employer Successful in Constructive Dismissal Case

We have seen an increased occurrence of employees resigning and then raising a PG, stating that their resignation was constructive dismissal and unjustified.  In many instances they haven’t previously raised their concerns with their employer or the issues raised appeared minor with the employer believing each was addressed at the time as no further concern was raised by the employee.  However, post-resignation, the employee might list all of the minor issues trying to prove that a trend existed. They may even claim an illness that they believe resulted from issues in their employment.

It is reassuring to see the Employment Relations Authority reject a recent claim of constructive and unjustified dismissal by Kathryn Gifkins that she was forced to resign from her position at Marinoto Rest Home in Taranaki.

The claim followed two incidents; one regarding a false accusation of Gifkins dragging a resident and the other about her being stalked by a dementia patient.  Gifkins​ claimed her manager did nothing about either incident and so felt she had no option but to resign i.e. her resignation was constructive dismissal and was unjustified.

Gifkins was employed as a healthcare assistant at Marinoto Rest Home in July 2016. Two issues arose, shortly after she started which she said were of “significant concern for her”.

She soon realised that she was expected to dispense medication to patients which was something she felt uncomfortable doing in case she made a mistake and also felt it was a a registered nurse duty.

Her manager, Barbara Kay, said Gifkins did not convey her concerns about making a mistake and commented that Gifkins was “very competent” at providing medication and had no concerns about her confidence.

The Authority was satisfied the dispensing of blister pack medications was a reasonable activity for Gifkin’s position.

The second issue Gifkins had was with a dementia patient who became “infatuated” with her.

The patient told her he wanted to marry her and proposed to her. He continuously sought her out, giving gifts, making phone calls to her home and following her to the car park.

Despite complaining to Kay about feeling harassed, she said her concerns were never addressed.

However, Kay argued she told Gifkins she did not have to go to the area of the rest home where the patient was living, she did not have to care for him or communicate with him.

Gifkins said it was difficult to distance herself from him due to the size of the rest home.

The Authority member said it was clear Gifkins received unwanted attention from the resident, but she could not apportion blame to the rest home as options were given to her by management to reduce the interaction.

In May 2017, Gifkins resigned. This followed an incident which Gifkins described as “the final straw”.

Gifkins claimed that earlier that day Kay falsely accused her of dragging a patient when she and another carer were trying to lift a patient off the floor into a chair.

Gifkins claimed Kay yelled “Are you dragging him or lifting him?”. Kay admitted she said those words, but denied she yelled them, or directed them solely at Gifkins.

Gifkins said she was unhappy with the way she had been treated and felt distressed that Kay had not listened to her or been responsive.

The Authority member noted that Kay’s manner, along with the words used at the time of the incident, may have been “insensitive and unhelpful in the moment” and added “I accept, however, that Ms Gifkins was unhappy and resentful as a consequence, but I am not at all persuaded that the interaction could be regarded as a breach of Ms Gifkins’ employment, let alone one that could be fairly characterised as dismissive or repudiatory conduct that would make it reasonably forseeable Ms Gifkins would resign, an employer is under no contractual obligation to behave sensitively towards its employees.”

A constructive dismissal occurs where an employee resigns from employment but really the resignation was forced or initiated by the action(s) of the employer.

The Authority assessed whether a substantial risk of resignation was reasonably foreseeable and found that it was not in this case.

The Minimum Wage Increases from 1 April 2018.

While the Government must review the Minimum Wage annually the new Government has already pledged to get it up to $20 per hour by 2020. The first step to this target is the increase that comes into effect from 1st April 2018

The new minimum wage rates are:

Adult – $16.50 an hour
Starting-out – $13.20 an hour (up from $12.60)
Training – $13.20 an hour (up from $12.60)

If you already pay above the minimum wage there is no obligation to increase it proportionally.

If you have any employees earning less that $16.50 an hour then you MUST increase their pay rate to the appropriate new minimum wage

Employees who are paid wages need to be paid for the actual hours they work. This includes any extra hours completed.

For Salaried staff you need to consider if they are being paid below minimum wage for total hours of work.

Employment Relations Amendment Bill

The first wave of changes to legislation in the employment arena were announced last week. There was nothing unexpected, except for possibly the usefulness of NZ First to act as a hand brake for more widespread changes.

One of Labour’s flagship policies was the abolition of the 90 day trial period. The great news for SME’s is that if you have 19 or less employees, the trial period will still be available to you. An unexpected turn of events and a moved that has disappointed unions. Unions however did get a number of changes they were seeking.

The purpose of this Bill is to implement the Government’s post-election commitments to restore key minimum standards and protections for employees, and a suite of changes to promote and strengthen collective bargaining and union rights in the workplace. Read here a summary of the changes, and over the next few weeks we will detail how the changes may affect how you operate your business.

Proposed Amendments

Restoring Key Minimum Standards and Protections for Employees
  • Removing the exemption for employers with fewer than 20 employees from the current rules about business transfers, which will allow vulnerable workers of these employers to elect to transfer to an incoming employer
  • Extending the time frame for vulnerable workers to elect to transfer to an incoming employer and placing information and notification requirements on employers in respect of their employees’ personal information
  • Reinstating the right to prescribed rest and meal breaks, as applied previously regarding number and length of breaks within specified work time, with limited exceptions for essential services where certain conditions exist
  • Restoring reinstatement as the primary remedy in unjustified dismissal cases, where the employee requests it and where reinstatement is practicable and reasonable
  • Limiting trial periods to employers with fewer than 20 employees
Collective Bargaining and Unions

The proposed amendments include:

  • Removing the requirement for a union representative to gain consent from an employer before entering a workplace
  • Requiring employers to allow union delegates reasonable time during working hours to perform their duties in respect of the employees of that employer.
  • Reinstating that the parties are required to conclude a collective agreement, and repealing the provisions that enable the ERA can determine that bargaining has concluded
  • Reinstating the ability of unions to initiate collective bargaining 20 days before an employer
  • Repealing sections 44A to 44C that allow employers to opt out of multi-employer collective bargaining once bargaining has been initiated
  • Requiring that collective agreements must contain rates of pay and that rates of pay must be agreed during collective bargaining
  • Repealing the ability of employers to deduct pay as a response to partial strikes
  • Requiring that new employees are afforded the same terms and conditions as the applicable collective agreement relating to their work for the first 30 days of employment
  • Restoring key minimum standards and protections for employees
  • Requiring employers to provide the applicable collective agreement and union contact details and the option to join the union at the same time as they provide an intended individual employment agreement to an employee
  • Requiring that employers provide information about the role and functions of the applicable union when the intended employment agreement is given to prospective employees
  • Encouraging an active choice by a new employee on whether to join the union, and whether to object to the employee’s employer providing the employee’s name and notice of the employee’s choice to the relevant union
  • Extending the grounds for discrimination to include an employee’s union membership
  • Extending the time frame under section 107 for which an employee’s union activities may be considered to contribute to an employer’s discriminatory behaviour from 12 months to 18 months

Cafe Deducted Pay for Breaks Worker Was Never Allowed to Take

Natalie Cornelius was employed as a crew member in a café in Napier. She became concerned by her employer’s practice of deducting 30 minutes wages from her pay each day. This was allegedly to cover breaks which she is adamant she was never allowed to take.

Ms Cornelius tried to raise her concerns in writing and verbally however she says her employer inevitably reacted in a rude and belligerent manner and failed to address her concerns. Things got to a point where Ms Cornelius felt she had no choice but to resign.

Ms Cornelius subsequently raised a claim of unjustified dismissal, albeit constructively, by her employer, HPG Private Ltd (HPG). The claim was heard in the Employment Relations Authority in May 2016 where Authority Member Loftus agreed with Ms Cornelius that she had been constructively dismissed and awarded her the sum of $4,000 as compensation for hurt and humiliation.

In regards to the 30 minute deductions from Ms Cornelius’s pay each day for her breaks that she said were not taken, Member Loftus accepted Ms Cornelius’s calculations and awarded her $2,080. In all Ms Cornelius was awarded a total of nearly $12,000 for lost wages, inappropriate pay deductions, hurt and humiliation, plus costs.

Under recent changes to the Employment Relations Act, the duration and time of breaks is no longer strictly regulated. In the past, stringent rules governed how long rest and meal breaks had to be, and when they had to be given. For example, one 10-minute paid rest break during a work period of between 2 hours and 4 hours; one 10-minute paid rest break and one 30-minute meal break (unpaid unless agreed otherwise) during a work period of between 4 hours and 6 hours and so on. Now there are no specific rules for how long, or when, rest and meal breaks should be.

Employers and employees should bargain in good faith over the timing and length of breaks. All employers are required to provide employees with rest and meal breaks which give employees a reasonable chance during their work period to rest, refresh and take care of personal matters.

Under this legislation, some employers may be exempt from giving breaks. For example when employees agree to reasonable compensation in exchange for breaks, or where the employer cannot reasonably give the employee rest and meal breaks because the workplace environment or position make it impractical (for example, emergency medical staff, a sole charge customer service position, etc). However, the employer will always be required to compensate the employee if this situation arises. Compensation could be alternative time off equivalent to the missed break (i.e. finishing 15 minutes earlier but being paid until the end of the shift), or extra remuneration.