Manager's unannounced ultimatum amounted to an unjustified dismissal, ERA finds
A company operating a retail store in Auckland has been ordered to pay a former employee $27,890 after the Employment Relations Authority (ERA) found she was unjustifiably dismissed during a meeting in which her manager told her to resign or be fired.
The employee had worked for the company as a part-time permanent client advisor since 22 March 2024 and reported to the company's area manager.
In its determination, the ERA found that the area manager's comments and actions at a meeting on 19 July 2025 amounted to a dismissal, and that the company followed no fair process before ending her employment.
'It will be done quite ugly'
The employee was working a late shift on 19 July 2025 when the area manager messaged her on WeChat asking her to attend a meeting at about 6pm. She did not know what the meeting was about.
The employee recorded the meeting. According to the transcript reviewed by the ERA, the area manager told her near the start: "I give you two choices, first amicable separation, you resign yourself, second two warnings are termination. Today you directly hand over the key. If you resign, you give me the key…if you want termination, it will be done quite ugly."
The employee replied: "Oh, so now you unilaterally want to persuade me to quit?"
After further heated exchanges, the area manager told her: "No, you were fired, you get no compensation."
He then called mall security, saying: "Hi this is [the area manager] from [the store], so I have a former staff that I have already terminated, and she refused to leave the store, can you come down and have a look."
The employee was subsequently removed from the roster.
No warning, no investigation
ERA member Simon Greening said the test was whether it was reasonable for someone in the employee's position to consider that her employment had been terminated.
"The combination of these comments and actions, objectively viewed, would reasonably be seen to be a dismissal," he wrote.
The ERA found the company had not met its obligations under s 103A(3) of the Employment Relations Act 2000.
"Prior to the meeting, [the company] did not make [the employee] aware of any allegations," the determination said. The company also did not provide relevant information, investigate its concerns or give the employee a reasonable opportunity to respond.
The ERA described the company's conduct at the meeting as "egregious," noting the company told the employee she could "contact the tribunal" if she "had a problem" with its actions.
It also found the company's breach of good faith was "deliberate, serious and sustained" and imposed a NZ$2,500 penalty.
The company argued that the employee owed it a duty of good faith to engage with its attempts to contact her after 19 July. The ERA rejected this, ruling that the duty "only applies to parties in an employment relationship," which had ended that day.
The area manager had concerns about the employee's compliance with the company's grooming and care policy. However, the ERA found "there was no evidential basis to establish [the area manager's] concern" and did not reduce her remedies for contribution.
The company also breached s 27(2) of the Holidays Act 2003 by failing to pay the employee's outstanding holiday pay when her employment ended, instead deducting 26 hours of accrued annual leave from her final pay. The ERA ordered NZ$650 in unpaid holiday pay and a NZ$500 penalty.
Phone counterclaim fails
The company counterclaimed that the employee had kept a company mobile phone and accessed the company's WeChat account in August 2025.
The ERA found the company had not provided sufficient evidence. The employee showed she lost the phone on 15 July 2025 and reported it to police the same day.
The employee's claim that the company breached the health and safety provision in her employment agreement also failed for lack of evidence.
Compensation ordered
The ERA said the employee "felt particularly humiliated by the manner in which [the company] terminated her employment," noting her evidence that staff from other stores watched security escort her out. It found the dismissal harmed her mental health and affected her ability to complete her master's degree at the University of Auckland.
The employee sought lost wages up to 22 March 2026, when she found new work. The ERA declined, finding it more likely than not that, given "significant issues" between the area manager and the employee, the employment would not have continued beyond three months.
The company was ordered to pay the employee, within 28 days: NZ$18,000 in compensation for hurt and humiliation, NZ$6,240 (gross) in lost wages, NZ$650 (gross) in outstanding holiday pay, NZ$2,500 as a penalty for breaching good faith, ad NZ$500 as a penalty for breaching the Holidays Act. Costs were reserved.
