When he returned he found complaints had been made about his conduct with both clients and staff.
It was alleged that Mr Milne had been rude to customers and failed to take seriously a number of complaints made about the safety in the gym.
He was also accused by another trainer of taking four hour lunch breaks, an accusation the ERA found no basis for, noting the trainer who made the complaint "clearly did not get on" with Mr Milne.
"It is significant that no other complaint was received about Mr Milne's alleged regular absences," the authority said.
As a result of the complaints Korey Gibson, Mr Milne's boss, accused him of eight counts of serious misconduct and said these were grounds for dismissal.
"As a manager there is a high level of trust and confidence that is required: my trust and confidence in you to remain in the role has been seriously eroded," Mr Gibson wrote in a letter to Mr Milne.
"My interim decision is to dismiss for serious misconduct."
However the ERA found that, with one possible exception, the accusations were "matters of performance, not matters of serious misconduct."
The ERA said warnings or further training would have been the appropriate course of action, rather than dismissal.
"It was therefore not open to Snap Fitness to dismiss Mr Milne over the vast majority of the complaints raised against him."
The ERA found compensation appropriate because of the effect being fired had on Mr Milne.
"Mr Milne was deeply affected by his dismissal. It affected his self-confidence in particular, as well as his standing in the Palmerston North fitness community and his career opportunities."
However the ERA chose not to award Mr Milne compensation for lost wages as he had not taken any opportunity to look for work after being fired, instead returning to the United States to stay with his partner's family.
