Air New Zealand's legal workload

Photo / Sarah Ivey.

Air New Zealand has been in the news  (again) with another employment decision going against them - this time a claim based on workplace stress.

This is the third major case involving Air New Zealand in a few months - the second involving an age discrimination claim, and the third being a case the company won, involving an employee in a safety sensitive role who was dismissed after testing positive for cannabis.

The latest case, based on workplace stress, concerned an employee called Shelley Rosenberg, who started in 1995. In 1997 Ms Rosenberg was promoted and became responsible for a large team, with many responsibilities. She began to experience stress from workload pressure and excessive hours.

Despite having her role split and the number of employees reporting to her reduced (from 27 to 18!), she continued to suffer stress. Her supervisors submitted four business cases for extra staff but these were not adopted by Air NZ. Her condition deteriorated. She became tearful, anxious, and tired, and exhibited stress symptoms of reflux and rash.

In September 2001 Ms Rosenberg suffered a breakdown. She took time off and was slowly integrated back into full-time work. Air NZ allowed additional leave and provided other forms of support. However, her stress-related illness continued. In January 2004 she was assigned to a temporary secondment with less demanding duties.

During a subsequent restructure her permanent role was filled and she was told that failure to accept her temporary role on a permanent basis would disentitle her to redundancy pay (as Air NZ regarded the roles as similar). Ms Rosenberg resigned.

Ms Rosenberg claimed breach of contract and constructive dismissal, on the basis that Air NZ failed to provide her with a safe and healthy workplace, and to keep her permanent position open.

The Employment Relations Authority found that up until her breakdown in September 2001, Air NZ failed to provide her with a safe work environment. Air NZ did not know she was actually unwell, but her breakdown was foreseeable - given that Air NZ was aware she was under stress from under-staffing and several business cases for further staff had been submitted.

After September 2001, Air NZ did take all reasonably practicable steps to assist and provide Ms Rosenberg with a safe workplace. Nevertheless, the Authority found she was constructively dismissed. Air NZ failed to consult meaningfully about the potential redundancy of her permanent position.

It failed to investigate alternative roles and wrongly treated her permanent role as reasonably similar to her temporary position. This converted her resignation into a constructive dismissal.

No remedies have yet been awarded. It seems likely however, that the compensation will be substantial, given the nature of the findings.

Air New Zealand is not exactly shy of litigation, as suggested by the number of cases brought against that have got to the stage of a determination being made of the merits (both recently and over the last few years).

It might say that some of this is due to its workforce having strong and active union representation, compared to some other industries. But a unionised environment does not necessarily mean more litigation - having a good union relationship can help resolve problems.

Some of this must be down to the approach of Air NZ itself to employment relations issues. It remains to be seen whether this case will prompt a change in that approach.

 

Greg Cain

 

Photo: Sarah Ivey