Employee fined for breaching confidential settlement agreement…

The Employment Relations Authority has fined an employee $3,000 and ordered him to pay $1,800 costs after the employee breached the terms of a confidential settlement.

The settlement agreement between the employee and his employer contained a confidentiality clause and a non-disparagement clause.  Immediately after the settlement the employee told others he had won and been paid a substantial sum of money by his employer.  The employer heard about this and through its lawyer notified the employee’s lawyer that the employee should cease breaching the agreement.  A short time later in a public place the employee was disparaging the employer and other employees.

The employer therefore sought a compliance order from the Employment Relations Authority and a penalty.  The ERA found that the breaches were deliberate and imposed the $3,000 fine on the employee and also put in place a compliance order.  A breach of the compliance order could result in further penalties on the employee.




Alan Knowsley
Employment Lawyer
Wellington