Court rules Carter Holt Harvey wrong to force workers to take leave

Carter Holt Harvey (LVL) plant at Marsden Point was wrong to harvest workers' leave during the initial Covid lockdown, the Employment Court has ruled. Photo / Michael Cunningham

A major timber processing company in Northland was wrong to ask workers to take leave without consent during the original Covid lockdown, the Employment Court has ruled.

E tū Union initially took Carter Holt Harvey (LVL) plant at Marsden Point to the Employment Relations Authority (ERA) after the timber processor advised its employees they needed to take eight days leave in April 2020 after New Zealand went into Level Four lockdown the previous month.

The union represented its members and company employees Jenny Mooney, Nicholas Godfrey and Vincent Kask.

In an email sent on behalf of company chief executive Prafull Kesha, the employees were advised they could take their leave in the following order: annual leave, accrued annual leave, entitled long-service leave, alternate days and unpaid leave.

After that advisory, E tū's organiser in Northland Annie Tothill twice emailed a senior human resources adviser at CHH and said workers who were unable to work from home and who were forced into isolation should be fully paid without the need to access their existing leave entitlements.

She did not receive any response from CHH.

Kask and Godfrey had their annual leave entitlements of eight days and 5.42 days respectively. Mooney had no annual leave entitlement at the time, but four days leave was debited as annual leave taken in advance.

The ERA was of the view that since important questions of law were likely to arise in the dispute, it would refer the case to the Employment Court for determination.

The New Zealand Council of Trade Unions and Business New Zealand were granted leave to intervene.

E tū argued CHH breached the Holidays Act 2003 by requiring its workers to take leave and without giving adequate notice.

CHH said it was unable to reach an agreement on leave given the time available between the Government's announcement and the start of Alert Level 4 lockdown, among other factors, before the business closed on March 25, 2020.

The court ruled that while the CHH Group had priorities and aims when considering what to do about employee leave and pay arrangements during the lockdown, it had to follow the legislation.

CHH Group made no attempt to use electronic mediums available to engage with its employees and E tū before deciding on annual holidays, the court said.

"In short, we do not accept that Carter Holt LVL can say it was unable to reach an agreement when it made no attempt to do so.

"Given this conclusion, we do not accept the submission made for Carter Holt Harvey (LVL) that it was, in the circumstances, entitled to exercise management prerogative to require employees to take annual holidays," Judges Bruce Corkill, Kathryn Beck and Joanna Holden said.

CHH didn't wish to comment on the court ruling.

E tū sought a declaration only from the court that CHH's action was in breach of the Act.

New Zealand Council of Trade Unions president Richard Wagstaff said the result was a win for all working people.

"This has been an important case for defining entitlement to annual holidays. Businesses can't force their employees to take holidays without talking to them first - especially during a nationwide lockdown."

Wagstaff said this outcome could have widespread implications for leave-harvesting as an issue in workplaces.

E tū assistant national secretary Rachel Mackintosh said the court ruling clearly showed employment law could not just be ignored because of a public health emergency.

"Decent work and dignity remain vital, and we're delighted to see workers' entitlements are upheld by this decision."