A recent case before the Employment Relations Authority highlights the need to follow a fair process – even if you are justified in taking the action.

Liuju Wang, a builder, was dismissed by Y&L Building via WeChat shortly after his visa was transferred to the company. The Director of Y&L Building let Wang know that the company was in difficulty and that he needed to find another job. Wang raised concerns, but the employer reiterated there was no further need for his services.

Wang lodged a personal grievance for disadvantage and unfair dismissal. The employer argued that the warning about reduced hours and impending closure was fair as the business was in financial trouble and he was planning to close it.

The ERA ruled in favour of Wang, stating that the employer’s actions constituted unjustified dismissal. While acknowledging that the employer had warned Ye about limited work, the ERA found fault in not thoroughly investigating before ending Wang’s employment. There was also no discussion or exploration of alternative solutions before dismissal. It also turned out that the employer was able to secure additional work and did not close down, but the employee turned down offers of further work with the Employer.

As compensation, Wang was awarded $5,120 for lost wages and $20,000 for emotional impact, reduced by 10% due to his refusal of work requests while out of a job.

This case underscores the importance of fair dismissal processes and thorough consideration before terminating an employee, even in challenging business situations.

Source: https://determinations.era.govt.nz/assets/elawpdf/2023/2023-NZERA-763.pdf

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