One missing warning transformed extensive employee support into an unjustified dismissal finding
A hospital's extensive training plan turned into a $30,000 mistake after never warning the employee her job was at risk.
Lei Yang, a laboratory scientist with 16 years of unblemished service, was dismissed in March 2023 after she couldn't meet competency standards during a six-month training period at Whangārei Hospital. But nobody had told her that failing the plan could cost her job.
In a judgment delivered December 19, 2025, Chief Judge Christina Inglis of the Employment Court of New Zealand ruled the dismissal was unjustifiable, ordering Te Whatu Ora to pay three months' lost wages plus $23,750 in compensation.
The case emerged from a 2020 restructure at Whangārei Hospital's laboratory, which faced potential loss of accreditation. Yang moved into the Microbiology department, where new management soon identified concerns about technical aspects of her work.
What followed was remarkable in scope. Witnesses for Health NZ testified that the training plan starting in June 2022 was "the most comprehensive training plan that had ever been offered within the laboratory." It involved supervision, feedback, and targeted skill development across multiple workstations.
Initially, the plan showed promise. But by October and November 2022, concerns mounted. By December, Yang was deemed competent on only two of seven benches and couldn't return to shift work without supervision.
That's when things shifted. Health NZ moved from support mode to disciplinary proceedings, advising Yang in late December that dismissal was under consideration. The problem? The Authority found Yang had been "effectively blind-sided" by this pivot.
The Court emphasized this point, noting that while Yang had agreed to undertake the training plan after significant consultation, she "was unaware that if she failed to satisfactorily complete the training plan her employment was at risk."
The decision addressed another critical HR issue: when does poor performance justify reducing an employee's remedies? The Authority had cut Yang's compensation by 20 percent for contribution, reasoning that her failure to follow procedures was blameworthy.
The Employment Court disagreed, reducing the penalty to just 5 percent. The judge found that Yang's "puzzling" and "inexplicable" difficulties in consistently meeting standards couldn't be described as "blameworthy" and "culpable" in the way the law requires.
This distinction matters. The Court clarified that an employee who cannot meet role requirements through no fault of their own shouldn't automatically face reduced remedies. As the judgment stated, the reviewer concluded that it was "both concerning and puzzling that, despite the comprehensive training that had taken place, Ms Yang had not achieved competency to work as an independent scientist in Microbiology."
Yang had sought reinstatement to her role, but the Court upheld the Authority's decision against it. A key factor was evidence from Yang's current employer, who confirmed an endorsement on her practicing certificate requiring supervised work. The Court accepted this would create "significant practical difficulties" in a safety-sensitive laboratory environment.
The case also explored whether Health NZ had breached good faith obligations warranting a penalty. While the Authority found a breach in failing to communicate the shift from training to disciplinary process, it declined to impose a penalty. The Court agreed this was appropriate given the breach wasn't sustained or repeated.
HR leaders should take note that when any performance management process could lead to dismissal, that possibility must be explicitly communicated from the start. Even the most comprehensive support program cannot justify termination if the employee doesn't know their job is at risk.
The math tells the story: what might have been a lawful dismissal became a $30,000-plus mistake because of one critical communication failure.
