Court found employer applied for wage subsidy despite terminating the driver
A former driver for a moving company will receive more than $60,000 after winning an unjustified dismissal case against his employer. The said employee was a permanent fulltime worker for the company in January 2020, but was terminated in late March the same year after New Zealand was placed under Alert Level 4 due to COVID-19.
In April 2021, the employee filed a claim to the Employment Relations Authority for compensation believing that he was unjustifiably dismissed by his employer. The director of the company, however, argued that the case was already out of time.
Court decision
Prior to filing the case to the ERA, the former employee sought the assistance from Community Law in Nelson back in April 2020.
The Community Law wrote to the company that same month, urging them to revoke the employee's redundancy, citing that such measures were not necessary due to the wage subsidy scheme launched by the government.
Read more: Former CEO awarded compensation for unjustified dismissal
The ERA in its decision acknowledged this and ruled that the employee "raised his personal grievance within time by effect" of the April letter. It also agreed with the Community Law in saying that the company did not act as a fair and reasonable employer at the time of dismissal.
According to the ERA, the termination without notice also breached the employment agreement, which provided a necessary two-week written notice.
The authority also pointed out that another organisation, which shared the same director as the company, applied for and received wage subsidy for the employee despite dismissing him.
The ERA said the subsidy should have been used under the expectation that it would retain the employee, but the company "did nothing to meet that expectation."
"This is an additional factor that is relevant. No fair and reasonable employer could have conducted itself that way," said the ERA in its decision.
"I find that the dismissal was unjustified," the ERA said, adding that the employee has a "personal grievance."
The ERA then awarded the employee $20,000 as compensation for the harm induced by his former employer's actions. An additional $40,480.00 would also need to be compensated for the lost wages between March 30, 2020, and January 29, 2021.
