Worker wins dismissal case after company fails to get signed agreement first
The Employment Relations Authority (ERA) recently dealt with an unjustified dismissal claim involving a worker who was terminated during a training course under a trial period provision that had not been properly executed prior to the commencement of employment.
The worker argued she was unjustifiably dismissed because she had not signed the employment agreement before starting work, making the trial period invalid under employment law.
She claimed the company treated the training course as the start of employment, but dismissed her before she had properly commenced in the agreed role.
Job application and training arrangements
The worker applied for a sales representative position advertised on a job website in April 2024. During a phone call on 19 April 2024, a company director suggested she interview for a store manager position instead, considering her skills more applicable.
Following a successful interview on 22 April 2024, she received an email that evening advising her that she would be offered a key account manager position.
On 30 April 2024, the director invited her to attend a three-day training course for new employees, stating it was not mandatory but would be an opportunity to familiarise herself with the product.
He also said that if she attended, she would be paid for the training.
On 2 May 2024, the director emailed the worker an employment agreement for a key account manager position with a start date of 4 June 2024, offering a $100,000 salary for 42.5 hours per week.
The contract contained a trial period clause stating "The first 90 days of employment will be a trial period, starting from the first day of work."
The worker responded that evening, saying she would return it signed on Monday morning.
Training course conduct and conflicts
The three-day training course commenced on 6 May 2024. The worker was late arriving on the first day due to building issues at her home, though she messaged to explain the delay.
The directors said they understood such issues had happened, but were dissatisfied when they believed she was late on another morning, which the worker denied.
When the worker arrived, the director asked for the signed employment agreement. She told him it was signed, but she had forgotten to bring it, though she later denied saying she had signed it.
The worker said that if she had realised the training course was the start of her employment, she would have brought the signed agreement.
During the training, the worker made telephone calls to previous contacts and carpenters to tell them about the company.
The director said he was unaware of this contact and had not asked her to do so, as the company already had contractor arrangements in place.
He observed her leaving training sessions frequently to make calls and vape, and said she constantly spoke over other attendees and guest speakers, pulled faces, and called attendees names.
Dismissal decision and worker's response
Following the training course, the directors discussed the worker's behaviour during the three days.
The former director complained about her behaviour toward him, and several team members also complained. On 14 May 2024, the worker received an email terminating her employment under the trial period provision.
The termination letter stated that while her agreed start date was 4 June 2024, she had attended training which the company had decided to pay for, so "the trial period is deemed to have commenced on 6 May 2024."
The company provided seven days' notice and payment for the training days.
The worker responded by text message stating, "I handed you the contract signed for June. I am going to talk to a lawyer, as this is a total lack of good faith. I did the training as a favour to you."
The director replied, citing numerous instances of behaviour that did not align with company values and complaints received, expressing concern about how such behaviour would reflect on their brand with customers and partners.
ERA findings on trial period validity
The ERA applied the strict requirements for trial period provisions under sections 67A and 67B of the Employment Relations Act.
The Authority noted that trial period provisions remove long-standing employee protections and therefore require strict adherence, including that the provision must be contained in a written employment agreement signed by both parties before employment commences.
The worker's evidence was that she had not signed the employment agreement provided on 2 May 2024 prior to attending the training course on 6 May 2024.
While she had not realised the training course was the start of her employment, the company did regard her employment as commencing on that date.
The ERA found that since the employment agreement had not been signed prior to employment commencing, the company could not rely on the trial period provisions.
The Authority determined that the worker had been unjustifiably dismissed, citing established case law that an agreement is only a draft until executed by both parties.
Compensation and contributory conduct
The ERA awarded the worker $25,000 in lost remuneration for 13 weeks until she found alternative employment, and $8,000 compensation for humiliation, loss of dignity and injury to feelings.
The Authority accepted that the dismissal caused additional distress when she was already dealing with anxiety from her divorce and home repairs following flooding.
However, the ERA found significant contributory conduct, noting the worker had confirmed she left sessions to make phone calls and vape, and constantly interrupted and behaved disrespectfully toward other team members during training.
The Authority observed that she corroborated claims that she acted disrespectfully and openly toward at least one team member.
The ERA concluded that while the company was initially keen to employ the worker, it was her own conduct during training that altered their decision.
Finding she was "to a large extent the author of her own misfortune," the Authority reduced all remedies by 70 percent, resulting in final awards of $7,500 for lost wages and $2,400 for compensation.
