Permanent, fixed term or casual employment

The Employment Relations Authority has upheld a personal grievance for unjustified dismissal of a worker following confusion over the status of his employment agreement.  The employee alleged that he was a permanent employee while the employer alleged that the employee was on a casual employment agreement.

The employee’s claim of a permanent position failed as he accepted that he knew the employment would end when a full time employee was found for the job.  He also knew that he was able to apply for the full time position but decided not to.

The employer’s position that the employment was casual also failed despite being called a casual employment agreement in the written document.  The fact that it was called a casual employment agreement was the only factor pointing to it being casual as the employee was obliged to work and had no right to turn down work on a particular day.

The Employment Relations Authority found that in fact the employee was on a fixed term employment agreement but that the requirements of the Employment Relations Act as to fixed term positions were not complied with.  Therefore the employer could not rely on the fixed term nature of the agreement to bring the position to an end.  The employee was therefore unjustifiably dismissed and was awarded $7,700 for lost wages.  In an interesting twist the ERA refused to award any compensation for the dismissal as it held that the employee knew the position was going to come to an end and he gave no evidence as to any hurt and humiliation suffered despite claiming $15,000 on that matter.

It is important for employers to get the status of employees correct and to comply with the legal requirements for each possible status whether it’s casual, fixed term or permanent as a failure to do so will result in substantial awards for any lost wages and usually for hurt and humiliation.

Alan Knowsley
Employment Lawyer
Wellington