Employee put into casual employment, then terminated without notice
A former employee of Smartlife Whangarei Limited has won over $20,000 after the Employment Relations Authority (ERA) ruled that he was unjustifiably dismissed.
Mark Foden was hired as a former technician and salesperson in September 2021, but his employment was put in jeopardy after his employer said there wasn't enough work for him.
Foden claimed that within a matter of weeks, there were cases where his employer failed to pay him on time and failed to give him the correct amount of wages.
Gavin Allan, Smartlife's director at the time, said the issues on the workflow were "teething problems" that were common with new businesses, and that he was expecting that a significant volume of new work would be made available by 2022.
Foden then proposed to be put on leave without pay in late November 2021 so he could do some renovations in his home - an arrangement made orally and accepted by both parties.
Not enough work available
By January 2022, both parties met again, where Foden understood that he was to resume work on a full-time basis.
Smartlife, however, said the company still didn't have enough work for Foden and concluded that the leave without pay arrangement would continue.
Foden only worked, and got paid, for two non-consecutive periods in September 2022 and one period in October 2022.
By 2023, Foden began raising his concerns about when he would be able to return to full-time work, telling Smartlife that he was owed wage arrears from January 2022.
The HR advisor of Smartlife, however, disputed the wage arrears, stating that Foden's position was changed to a "casual nature" following the period of leave without pay.
Foden claims, however, that he never agreed to be under casual employment.
By May 2023, Allan told Foden's advocate that he was no longer employed and has not been since the two months of leave without pay in January 2022 except for a few casual engagements.
Foden said he was surprised by the outcome but accepted it as notice of termination before raising the matter to the ERA.
Unjustifiably dismissed
The ERA ruled in favour of Foden in the case, declaring that he was unjustifiably dismissed.
According to the ERA, Foden was summarily dismissed in the May 2023 email after not receiving any notice nor wages in lieu of notice.
Smartlife also did not follow any process in terminating Foden's employment, the ERA said, pointing out that there were no proposals or consultation prior to his dismissal.
"In all the circumstances at the relevant time, the decision to dismiss Mr. Foden was not a decision a fair and reasonable employer could have taken," the ERA stated in its ruling.
"A finding is made that Mr. Foden was unjustifiably dismissed by Smartlife by its email to Mr Foden of 22 May 2023."
Casual employment
On the nature of employment, the authority also ruled that Foden did not become a casual employee after a period of leave without pay, pointing out that it was "unusual" for a casual employee to be provided with a company laptop, cell phone and vehicle.
"The provision of these things is more consistent with that of a permanent employment relationship, rather than casual employment, as it suggests that the parties had a mutual expectation of continuity," the ERA said.
It also accepted the Foden never agreed to be a casual employee and noted how Allan distanced himself from Smartlife HR advisor's statement.
Allan also said that the HR advisor was wrong in the issue, adding that he did not consider Foden was casually employed.
Foden initially sought $105,337.91 from his employer as wage arrears as he was under the belief that he returned on a full-time basis after January 2022.
The ERA, however, accepted that Foden did not return to full-time hours after January 2022, and it was more likely that his leave without pay arrangement was extended indefinitely.
As a result, Smartlife is ordered to pay Foden $16,000 for compensation, $6,153.92 in wage arrears in respect of unpaid contractual notice, $492.31 for holiday pay, and another $1,145.38 on holiday pay arrears.
