Employer penalised $12,000 for unjustified dismissal for terminating fixed-term employment...

An employee brought a claim against their employer to the Employment Relations Authority for unjustified dismissal after a dispute with her manager as to when her fixed-term employment ended.

They were employed on a fixed-term Employment Agreement with the fixed-term due to end four weeks after the intern sat her exams.

The intern did not pass her exams. She met with her manager who verbally offered to extend her employment so that she could re-sit the exams again in a few months’ time. The intern claimed that at this meeting, she was offered a role when she passed the exams, but the manager stated he only offered her casual work until her resubmission. The intern and manager did not record in writing what they discussed and the intern continued to work on a regular basis.

Later, the intern passed her exams and told her manager she would be practising as a pharmacist on the day she received her results. The manager responded that her contract expired four weeks after her first exams and there is no contract between the pharmacy and the intern.

The intern brought a claim for unjustified dismissal to the Employment Relations Authority.

The Authority first had to establish the nature of the intern’s employment and whether it was a fixed term arrangement or only casual employment.

The Authority found that, because the intern needed to be employed as an intern pharmacist to take the exams, there must have been an obligation on the pharmacy to provide work and an obligation on the intern to accept work so that the intern could meet the requirement of being employed at the time she re-sat her exams. The Authority concluded that this was a fixed term arrangement.

The fixed term arrangement was not recorded in writing. If a fixed term employment does not record in writing the way in which the employment will end, an employer cannot rely on the fixed term.

In this case, because the intern’s fixed term employment was not recorded, the manager could not rely on what he said about the end of the fixed term.

As the manager dismissed the intern on the spot and did not follow the correct process for termination, the intern was successful in her claim for unjustified dismissal. The Authority ordered the pharmacy to pay the intern $12,000 in compensation for the hurt and distress caused by the dismissal.

This case demonstrates the importance of always recording terms of employment in writing to avoid lengthy disputes and large penalties.  All employment agreements must be in writing. It is an offence to not provide an employee with a written agreement. In addition some provisions such as a fixed term or a 90 day trial period cannot be enforced if they are not in writing and use the required wording.

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