Employment Law Update 2024
Below we summarise some recent key cases in the employment jurisdiction, along with our takeaways.
A recent case of note
Non-publication orders
Open justice dictates that all details of Employment Court and Employment Relations Authority decisions are made public, unless there are compelling reasons for confidentiality. In such cases, a non-publication order can be sought and awarded. If a non-publication order is made, the Court, Authority or the media cannot release identifying information about the party or an individual. Personal sensitivity or potential embarrassment are unlikely to meet the established high threshold for a non-publication order to be made. However, serious negative impacts on a person’s safety, health, reputation or future employment prospects can meet the threshold.
In the decision of MW v Spiga[1] a full court of the Employment Court reevaluated and established guidelines for non-publication orders in both the Employment Relations Authority (the Authority) and the Court. MW was employed by Spiga Limited (Spiga) for roughly three months before an employment relationship problem led to mediation and ultimately the employee’s departure under a confidential record of settlement. Although Spiga fulfilled the settlement payment, MW claimed in the Authority that Spiga failed to comply with the agreement’s confidentiality and non-disparagement clauses. MW sought a non-publication order to prevent his name being published in decisions about his employment matter. The Authority declined this request, resulting in MW challenging this determination in the Employment Court.
This case highlights the issue that publication of an employee’s name in an Authority determination has the potential to lead to blacklisting from future employment. This can discourage employees from lodging claims out of fear of public exposure. Employers and recruiters have been known to conduct internet searches for Authority and Employment Court decisions. This can play a role in their hiring decisions. This increases the pressure on claimants to settle matters outside of litigation.
The majority of the Employment Court ruled that the principle of open justice is fundamentally important in the employment jurisdiction. There must be sound reasons to justify a departure from this. The Court set out a two-part test to determine this:
- There must be ‘reason to believe that the specific adverse consequences could be reasonably expected to occur’.
- The Authority or Court must determine whether the adverse consequences that could reasonably be expected to occur justify a departure from open justice in the circumstances of the case. The Court set out relevant factors in considering this, such as:
- The circumstances of the case
- Interests of the person/entity applying for a non-publication order.
- The interests of the other party or parties to the litigation.
- The interests of any third party.
- The public interest, including the rights of media.
- Issues of equity and good conscience.
- Tikanga and its principles, values, or concepts.
The Employment Court unanimously set aside the Authority’s determination as to non-publication and made a permanent non-publication order in respect of MW’s name and identifying details. In their decision, the Court considered the fact the parties were part of a small community in New Zealand, tikanga considerations such as the consequences to MW of the hara (breach), including the risk of MW experiencing whakamā (shame), should not be exacerbated by further publication. The Court emphasised that denying non-publication could undermine the significance of mediation.
The Court also discussed an alternative option of anonymising of the names of the participants, which it suggested should perhaps be used more often. This does not require a formal order and offers protection in respect of internet searches as well as meaning participants can speak freely about the litigation.
Some key takeaways from this case:
- The impact of publicising an employee’s name on their future job prospects in the social media age is something the Courts are beginning to acknowledge.
- Anonymising participant names may serve as a viable alternative to formal non-publication orders.
- Following the lead of the Supreme Court, more and more the Employment Court is willing to consider tikanga. Te Hunga Rōia Māori were interveners in this case.
Uber case – Court of Appeal judgement
The series of cases involving Uber has been one of the most prominent in New Zealand employment law in recent times with the employee/contractor distinction sitting at its centre. Uber claims its drivers are independent contractors, operating their own businesses. In 2022 the Employment Court rejected the claim that Uber was merely a facilitator between drivers and riders, holding that four Uber drivers were employees. Uber appealed this decision to the Court of Appeal, which dismissed the appeal and upheld the drivers’ status as employees.[2]
Despite this decision only applying to the four drivers who made the claim, it has the potential to set a new precedent for workers in the gig economy. An employment relationship could exist when individuals choose to undertake short-term app-based work.
An employee has more rights than contractor, these include:
- Holiday pay entitlements.
- Sick leave entitlements.
- The right to join a union and bargain collectively.
- Minimum wage entitlements.
- Access to personal grievance procedures.
Whilst agreeing with the Employment Court’s conclusion, the Court of Appeal accepted the Employment Court’s application of s 6 of the Employment Relations Act 2000 was misdirected. The test requires looking at the ‘real nature of the relationship’ between a person and the company/organisation which has engaged them. The drivers were employees of Uber at times when they were logged into the Uber app. The critical point for the Court of Appeal is that when a driver is logged into the Uber app, there is no opportunity for them to establish a business goodwill of their own. They had very limited influence over the quality or the quantity of the work, could not negotiate their terms or revenue and were subject to a high level of control. Despite the driver agreement appearing to not create an employment relationship, the provisions which confirm independent contractor status were deemed ‘window dressing’ which do not reflect the realities of the relationship. For example, drivers could choose to charge less than Uber’s standard rate, however it is unclear why they would do this. Especially in circumstances where they cannot build a relationship with riders or establish goodwill of their own. Uber has issued a statement confirming its intention to appeal to the Supreme Court.
Shortly after the decision was released, the Government announced a proposed amendment to the Employment Relations Act including several changes regarding contractors. Their stated intention is to ‘maintain the status quo that contractors who have explicitly signed up for a contracting arrangement cannot challenge their employment status in the Employment Court.’ The Government intends to amend the Employment Relations Act to include a gateway test for determining a claim whether a person is a contractor or employee. It will have four key criteria:[3]
- A written agreement with the worker which specifies they are an independent contractor.
- The business does not restrict the worker’s ability to work for another business (including competitors).
- The business does not require the worker to be available to work on specific times of day or days, or for a minimum number of hours OR the worker can sub-contract the work.
- The business does not terminate the contract if the worker does not accept an additional task or engagement.
If all the criteria are met, the worker is a contractor. If one or more factors are not met, the existing s 6 test applies. The aim of this is to clarifying contractor status and give employers certainty, sparing the expense of testing it through the courts. However, given the Authority will still need to determine whether the gateway test is met there will be some expense.
Jordyn Antonio-Rooney v Air New Zealand [2024] NZERA 570
The applicant had worked for Air New Zealand (Air NZ) since 5 May 2017, initially as a flight attendant and from 1 May 2023 as Crew Enablement Support. While on leave, she used her security card to access unauthorised areas of Auckland airport and allowed an unauthorised person (her aunt whom she was travelling with) to do the same. She bypassed customs with her aunt to catch a flight to Australia, claiming it was a one-time mistake, and she believed the door led back to customs. She claimed she was unjustifiably dismissed for serious misconduct. Air NZ argued the dismissal was justified due to her breach of airport security.
A senior manager at Air NZ highlighted that she would have known she was bypassing customs as the door had a glass window. She had access to Air NZ policies including the Code of Conduct, which clearly stated the need for proper security checks before allowing unauthorised individuals into secure areas. She was suspended with pay while an investigation was undertaken. The investigation revealed nine security breaches on her part, including taking a member of the public into restricted areas.
Her senior manager concluded she had exploited her position with Air NZ to bypass the normal customs process, raising serious concerns about her judgment and trustworthiness as an employee.
Air NZ claimed her actions demonstrated a disregard for security rules, poor judgement and a degree of recklessness which deeply impaired its trust and confidence in her to such a degree that continuity of the employment relationship was not tenable. The Authority determined Air NZ acted within its rights as a fair and reasonable employer in the circumstances in dismissing her for serious misconduct. It stated the actions of the employee were ‘not an isolated act of negligence, but the breaches were repeated and sustained. Moreover, they were committed in full knowledge of the importance of the security requirements.’ It was ultimately determined that despite her long tenure, her decision to ignore the rules warranted dismissal.
If you are an employer considering dismissing an employee for serious misconduct, bear in mind:
- If serious enough, a ‘one-off mistake’ can justify summary dismissal.
- Being unable to establish a wilfulness to breach an employment agreement or a company code of conduct does not mean that behaviour isn’t serious misconduct.
Assistance
If you have encountered any of the circumstances we have covered in this article, or need advice on a specific situation, our lawyers are here and happy to assist you. Talk to a member of the Dyhrberg Drayton Employment Law team today!
Jordan Boyle, Partner and Lachlan Spence, Lawyer and Ruby Prescott, Law Clerk
[1] MW v Spiga Ltd [2024] NZEmpC 147.
[2] Rasier Operations BV v E Tū Inc [2024] NZCA 403.
[3] Hon Brooke van Velden “Increased certainty for contractors coming” (press release, 15 September 2024).
