EMPLOYMENT LAW NEWS

June 2007 Issue No: 12

JUSTIFICATION FOR DISMISSAL
The long awaited judgment between Dr X and the Auckland District Health Board (ADHB) is out along with other s103 judgments. This judgment provides more information relating to the new justification test s103A Employment Relations Act 2000 and reinforces the importance for employers to have an independent employment law specialist guiding and advising them through any disciplinary process. Employment Relations Act s103 justification test …. the question of whether a dismissal or an action was justifiable must be determined, on an objective basis, by considering whether the employer’s actions, and how the employer acted, were what a fair and reasonable employer would have done in all the
circumstances at the time the dismissal occurred. Dr X raised a personal grievance of the nature of unjustified disadvantage and unjustified
dismissal relating to the process and procedure the ADHB took while investigating what was found by the ADHB to be serious misconduct and the subsequent dismissal. At the time of Dr X’s dismissal he held the dual positions of Director of (hospitals relevant specialist unit) and Director of
Research (in specialty) at Auckland’s city hospital. Dr X was dismissed from the ADHB essentially because he took photos of his genitals using the camera function on his cell phone and attempted to send the photo using the ADHB’s electronic mail system. Dr X also sent another work colleague a pornographic calendar largely consisting of middle aged, elderly and/or obese women in provocative sexual positions. As part of the decision to
dismiss, the ADHB took into consideration Dr X’s conduct after they had commenced the investigation relating to the photographs/pictures which attracted significant attention by the trial Judge. The ADHB in its letter of dismissal brought in other considerations aside from the
photographs and by doing this, essentially muddied the waters which seemed to be largely responsible for rendering the dismissal unjustified. From a process point of view Dr X was reinstated to his former position with the ADHB but was awarded no remedies due to contributory fault. The fact that a Doctor of such high position and who people put their highest level of trust in, was reinstated following his unexplained behavior described by the Judge as “stupid”, highlights how difficult it is for Employers to dismiss an Employee and for the Authority or Employment Court to consider it justifiable. The Dr X judgment also discusses in depth the objective test for the s103 justification test. An Employer investigating and deciding to dismiss an Employee must look at the whole situation through the eyes of a neutral observer. This is a hard test for Employers to pass as it requires them to act as a “dispassionate or disinterested observer”. The first challenge for the Employer is to act in an objective manner throughout the whole dismissal process. The second challenge for the Employer is to convince the Authority member or Employment Court Judge that they did act in an objective way and that all decisions were free from irrelevant considerations. The Dr X judgment says “Although an employer may continue to have recourse to a range of legitimate options in determining whether the employer will dismiss an Employee or disadvantage an employee in employment, it is for the Employment Relations Authority or the Court to evaluate that action against the objective standard of what a fair and reasonable employer would have done in the circumstances.” and “The Authority or Court may, on an objective analysis, reach a different conclusion from that of the employer”. The Dr X Judgment also says that when the Authority or the Court is determining if the employer acted as a fair and reasonable employer “the Court must apply the standards of a notional employer to the conduct of the actual employer. In doing this the Authority or Court must draw on their knowledge and experience of, and expertise in, employment relations to determine whether they are satisfied the employer met those notional standards”. Our interpretation of this is that the “notional employer” the Court measures the actual employer against, will have the years of employment relations and employment law experience, skills and knowledge of the particular Judge or Authority member who is hearing the case. Thus, the Court must be substituting its view for that of the Employer. The law has significantly moved. In 1992 BP
Oil NZ Ltd v Northern Distribution Union the Court of Appeal judgment stated “But for the Court to enter upon that territory was to usurp the responsibility and prerogative of the employer. The remarkable outcome of this case resulted from the Court substituting its judgment for that of the employer in a manner of which the employer was in reality the best and in law the only judge”. W & H Newspapers v Oram 2001 stated “If, in the
case of summary dismissal, the employer showed that the conduct was such that a fair and reasonable employer could see it as deeply impairing of basic trust and confidence, it would hardly be necessary to consider, as a separate step, whether in all the circumstances, the employee ought to have been dismissed. That was dependent on whether the fair and reasonable employer took into account all the relevant circumstances of the conduct and the particular relationship in determining that the necessary confidence and trust had been deeply impaired.” All of this places significant hardship on Employers who are called to justify a dismissal. Although the Employment Court has said the Employment Court Judge cannot substitute it’s view from that of the Employers, they draw on their extensive knowledge and experience when measuring the Employer’s action against what a notional fair and reasonable Employer would have done in all the circumstances. It is a rare Employer who will have the years of employment relations experience and employment law knowledge of the Judge or Authority member. We strongly urge all our clients to contact us
at the outset of any disciplinary process. All too often we are contacted either at the end of a disciplinary process when an employee has raised a personal grievance or throughout the disciplinary process when damage has already been done. In these situations we can perform
damage control however, it is likely the Employer will have to pay compensation or lost wages to the disciplined Employee. If we are present at the outset of the disciplinary process we can greatly assist the Employer to ensure the disciplinary process is handled in accordance with the law and that is viewed objectively and therefore less likely to be challenged. Our website is up and running. Check it out - www.garytayler.co.nz