The Employment Relations Authority has ordered an employer to pay $5,600 after the unjustified dismissal of an employee.

The employee signed a 3-month fixed-term employment agreement. Under this agreement, the employee was to work 4 days a week in return for a weekly wage of $250 and free accommodation.

Three weeks into the employment relationship, the working relationship between the employee and the employer broke down.

The employer informed the employee that due to the impending Covid lockdown her services were no longer required, and provided her with notice that her employment was coming to an end.

A week later the employee ceased working and left the accommodation provided to her by the employer.

The employee sent an email to the employer asking why she had been dismissed and asking to be paid for a notice period of three weeks, as prescribed by her employment agreement.

The employee raised a personal grievance claim with the Authority after mediation was unsuccessful.

The Authority had to first identify whether the worker was an employee or an independent contractor. To assess this, the Authority had to assess the true nature of the relationship between the parties.

The Authority found that the employee had signed an employment agreement, there was reference to a 90-day trial period by both parties, there was a degree of control over the worker that is indicative of an employment relationship, and there was no evidence that the worker was conducting a business of her own.

These factors led the Authority to the decision that the worker was an employee.

The Authority then had to assess whether the dismissal was justified or not. It was found that the employer was not dismissed for disciplinary or performance reasons, and that a fair and just process was not used.

This was not what a fair and reasonable employer could have done in the situation and was therefore an unjustified dismissal.

The employer was ordered to pay $4,000 as compensation for humiliation and loss of dignity, $1,500 as compensation for lost wages, and holiday pay of $100.

If there is confusion around the correct dismissal process, it pays to seek advice from a professional with experience in the area.

Leading law firms committed to helping clients cost-effectively will have a range of fixed-price Initial Consultations to suit most people’s needs in quickly learning what their options are.  At Rainey Collins, we have an experienced team who can answer your questions and put you on the right track.

Alan Knowsley & Matthew Binnie