Napier artesian water manufacturer pay $62k in unjust dismissal

Published 31 October 2023 | 2 min read

How to protect your business from costly legal claims

To build a successful business you know that your employees are essential to your success. But what if you're faced with an allegation of misconduct against one of your employees? How do you know if you're handling the situation fairly and legally?

Unfortunately, many New Zealand businesses get into trouble when they dismiss employees without proper justification. In fact, in 2022, the Employment Relations Authority (ERA) ordered One Pure Limited to pay their former procurement and logistics manager, Peter Hynes, over $62,000 after ruling that he was unjustifiably dismissed.

The One Pure case is a cautionary tale for all New Zealand businesses. It shows that even a small mistake in the dismissal process can have costly consequences.

What went wrong in the One Pure case?

The ERA found that One Pure's general manager, Gerry Bolmatis, did not have a proper basis for the allegations against Hynes. Bolmatis alleged that Hynes had made racist comments, failed to follow directions, and acted in the company's best interests. However, the ERA found that there was not enough evidence to support these allegations.

In addition, the ERA found that Bolmatis did not conduct a fair and impartial investigation into the allegations. Bolmatis did not interview all of the potential witnesses, and he failed to produce any documentation to support his findings.

How can New Zealand businesses avoid making the same mistake as One Pure?

There are a few things that New Zealand businesses can do to avoid making the same mistake as One Pure:

Have a fair and transparent disciplinary process in place

This process should be documented and communicated to all employees. The process should outline the steps that will be taken if an allegation of misconduct is made, and it should ensure that all employees are treated fairly and consistently.

Conduct a thorough and impartial investigation when allegations of misconduct are made. 

This includes gathering all relevant evidence and interviewing all potential witnesses. The investigation should be conducted in a fair and objective manner, and the employee accused of misconduct should be given a fair opportunity to respond to the allegations.

Make a decision about whether or not to dismiss the employee based on the evidence gathered during the investigation. 

If the evidence does not support the allegations of misconduct, the employee should not be dismissed. If the evidence does support the allegations of misconduct, the employer should consider the severity of the misconduct and the employee's disciplinary history before making a decision about whether or not to dismiss the employee.

Seek legal advice if you are unsure about whether or not a dismissal is justified. 

Our team at EQ Consultants can help you to understand the law and your options in a given situation.

Email us at info@eqconsultants.co.nz, or call us on 03 366 4034 for professional, one-on-one guidance.