Lack of work no barrier to reinstatement

8 January 2020

The Employment Court has granted interim reinstatement to an employee who was dismissed on the grounds of redundancy despite his employer arguing that there was no role for the employee to be reinstated to

Genesys Telecommunications Laboratories Limited (Genesys) operates from two offices, one in Auckland and one in Wellington. Mr Scott was employed in April 2014 as a Senior Principal Solutions Consultant, spending 10% of his time working with Auckland and Australia based Account Executives, and 90% of his time with Wellington based Account Executives.

In October 2018 another employee (RG) was employed as a Solutions Consultant in the Wellington office. Two months later, Genesys proposed to make Mr Scott’s position redundant as the Auckland office had a staff surplus. The proposal was confirmed in June 2019, and Mr Scott’s employment was terminated. Mr Scott raised a personal grievance and sought urgent interim reinstatement in the Employment Relations Authority.

Employment Relations Authority Determination

In August 2019 the ERA determined that Mr Scott should be reinstated on an interim basis until an investigation meeting was held, but could be placed on garden leave. The determination was challenged by Genesys to the Employment Court.

Employment Court Decision

Reinstatement is now that primary remedy once again. The ERA or Court must provide a successful claimant reinstatement when sought and if practicable and reasonable. The Court considered two questions when considering whether there was a serious question to be tried in relation to the claim of unjustified dismissal; and if so, if there was a serious question to be tried in relation to the claim of permanent reinstatement.

The Employment Court found that aspects of Mr Scott’s claim for unjustified dismissal were strong.

Mr Scott alleged that Genesys had predetermined the disestablishment of his role in September 2018, when it told Mr Scott that RG was to be appointed in Wellington and then transferred Mr Scott’s Wellington based work (90% of his role) to RG. As a result, the consultation in December 2018 was about a decision which had already been made.

Genesys argued the restructure was not predetermined; there was no link between RG’s appointment and the Auckland office restructure based on a review of resourcing in November/December 2018. However, Genesys failed to disclose any review documentation or any accounts of the review. The Court found that Genesys had not shown that the steps it took could have been taken by a fair and reasonable employer in all of the circumstances. The Court found the lack of information supported Mr Scott’s claim for interim reinstatement.

Mr Scott argued that as RG was based in Wellington and Mr Scott was willing to relocate to Wellington, Genesys should have carried out a selection process to determine who would be made redundant. Genesys said this misunderstood the proposal, which was based on overstaffing in Auckland, not Wellington. The Court said it was arguable that a fair and reasonable employer could have recognised that it had two New Zealand SC’s and carried out a selection process based on those roles.

Mr Scott argued that Genesys failed to consult with him about redeployment opportunities. Mr Scott advised Genesys he was willing to relocate to a position in Canberra which had been vacant since January 2019. Genesys gave evidence that the role had been offered to a candidate the following day. The Court found that it was arguable that despite the job offer being imminent, a fair and reasonable employer could have consulted in good faith about possible redeployment to Canberra.

The Court also found Mr Scott’s permanent reinstatement claim was strong. Genesys argued there was no work available for Mr Scott, and that it would have to ‘make work’ for him. The Court said that if Mr Scott’s dismissal grievance was made out, Genesys would have taken steps that a fair and reasonable employer could not have made, and would therefore have been the author of its own misfortunes. Genesys argued that the parties’ relationship of trust and confidence had been damaged relying on issues relating to the return of a work laptop and a covert recording made by Mr Scott. The Court found these issues could not reasonably be relied on to support such an argument to say reinstatement was not practicable or reasonable.

The Court found that the balance of convenience favoured Mr Scott. There were few suitable vacancies available to Mr Scott and a limited market for his skills. The Court found that damages would not be an adequate remedy as Mr Scott’s inability to obtain income for the three to six months before a substantive determination of the matter would likely give rise to financial difficulties for him.

The Court then considered the overall justice of the case and given the merits of the situation, it concluded an order of interim reinstatement was appropriate. The conditions of that order of interim reinstatement were the same as those made by the ERA, including that Mr Scott could be placed on garden leave.

Lessons

Employers should note that dismissing an employee on the grounds of redundancy (i.e. being surplus to requirements) is not a barrier to reinstatement. If there is truly no work for the employee the employer may need to create work. In this case, the ERA and Court ordered that Mr Scott could be placed on garden leave sidestepping this issue.

(SOURCE: Quigg Partners, www.quiggpartners.com)

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