In 2018 Marlborough's Yealands Wines pleaded guilty to charges under brought by MPI after admitting staff disguised the fact that they were adding sugar to wine destined for Europe. Photo / supplied.
In 2018 Marlborough's Yealands Wines pleaded guilty to charges under brought by MPI after admitting staff disguised the fact that they were adding sugar to wine destined for Europe. Photo / supplied.
Yealands Wines has failed to keep its name secret after a former staffer turned whistle-blower asked the Employment Relations Authority (ERA) to rule that an investigation showed the company had lied to him when he was made redundant.
The case originated from a complaint made by an employee who had raised concerns about activity within the company, including with its rich-lister eponymous founder, Peter Yealands, but no action was taken.
When Marlborough Lines learned of the investigation, after it had taken a controlling stake in the winery, it was told by management that the complaints were being made by a disaffected former employee and had no merit.
The offences, which led to the first convictions under the Wine Act, related to records of more than 6.5 million litres of wine, with about 3.7 million litres exported to Europe between May 2013 and December 2015.
Peter Yealands ($30,000), Yealands Wines ($400,000) and two former senior staff ($35,000 each) pleaded guilty to charges brought by MPI and were given heavy fines for what MPI said was "deliberate, deceptive and sustained" offending.
Peter Yealands, who founded Yealands Wines, was also convicted by MPI as he knew about the activity. Photo / Jason Oxenham
The applicant in the ERA application, known only as FDS, was employed at Yealands in January 2012.
In August 2015, he was invited to a meeting with the company where he was told he was being made redundant due to a restructure.
He challenged the dismissal but later signed a binding settlement.
But in August 2019, he applied to the ERA saying "he now considers the agreement invalid on the grounds company representatives lied at the mediation thereby wrongly inducing him to enter into the agreement".
According to the decision, released today, FDS believed his dismissal was due to his decision to raise issues with MPI, something that was "vehemently denied" in mediation.
"FDS says his concerns of improper activity were subsequently found to be valid which led to Yealands and some of its managers being fined a total of $500,000."
He took the view that documents released by MPI confirmed his suspicions that Yealands representatives had lied during mediation, as he asked the ERA to set aside or overturn his settlement.
His application was rejected however.
The ERA ruled that settlements signed under section 149 of the Employment Relations Act were limited to issues of mental capacity or duress, but even if they were not the authority was not convinced the alleged misrepresentation occurred from the documents FDS presented.
"While there are comments which suggest an ulterior motive it is not the complaint to MPI but general dissatisfaction with FDS's performance, " ERA member Michael Loftus wrote.
"The first email that suggests Yealands was aware FDS had raised the issues which ultimately led to the prosecution does not arise till after the redundancy and even then there is no mention of MPI," with suggestions that Yealands staff believed the issue, which would eventually see the company prosecuted, remained internal.
The ERA ordered that FDS should not be named because the complaint he made to MPI amounted to a protected disclosure.
However Loftus rejected Yealands' bid for a non-publication order.
"The issues have been the subject of widespread publicity and those with a genuine interest such as participants in the wine export market to which the submission refers will already be well aware of them and not need reminding."
Yealands Wines had argued that there was "a very real concern that reputational damage and commercial harm will eventuate following publicity [and the resurfacing] of these issues".
