JKD Fitness East Auckland Ltd director Able Chen sacked an instructor during a three-hour "torrent" of WeChat messages. Photo / Supplied
JKD Fitness East Auckland Ltd director Able Chen sacked an instructor during a three-hour "torrent" of WeChat messages. Photo / Supplied
A personal trainer who descended into depression and stopped washing and shaving after being fired from an Auckland gym during a frenzied WeChat message has been awarded nearly $30,000 for unjustified dismissal.
But just days after the penalty order was handed down, the company was liquidated, which the instructor claims was a calculated ploy to avoid paying him any money.
The timing of the liquidation has been labelled suspicious by the instructor’s advocate, and there are now suggestions of police involvement after a masked man allegedly entered the gym and began filming children less than a week after the liquidation.
JKD Fitness East Auckland Ltd runs a children’s martial arts “combat fitness” gym on the North Shore.
An Employment Relations Authority (ERA) ruling has found that instructor Peisen Fan was unfairly sacked during a three-hour “torrent” of WeChat messages from the company’s sole director, Shuai ‘Abel’ Chen in late 2020.
It followed rumours that Fan had been encouraging customers to bring their children to a rival gym, which Fan denied.
The decision says an angry Chen objected to the “immorality of stealing clients”, telling Fan he should stop coming to work and remove his personal belongings.
Chen later admitted he was too angry to meet Fan in person and that he had overreacted.
The ERA decision says Fan - a recent immigrant from China - was significantly affected by the termination.
He felt humiliated, hopeless and destroyed, and was unable to meet his financial commitments, the decision says.
“Mr Fan’s sleep and eating were impacted. He was observed by others to be in a bad mood, feeling helpless and refusing social invitations. One witness described Mr Fan as a mess, unwashed and unshaven.”
Fan took his case to the ERA, seeking $20,000 compensation for humiliation, loss of dignity and injury to feelings.
ERA adjudicator Nicola Craig said Chen did not approach the situation with an open mind.
Able Chen of JKD Combat Fitness gym on Auckland's North Shore. Photo / Supplied
“He was upset and angry and had predetermined the decision. Mr Fan’s denials that he had tried to persuade parents to transfer had no traction as Mr Chen was not open to investigating further or changing his mind.”
Craig found that JKD did not act as a fair and reasonable employer and that Fan was unjustifiably dismissed.
She ordered the company to pay $28,000 in compensation, lost wages, outstanding holiday pay and penalties to Fan, and $3000 to the Crown.
Craig noted there was “no suggestion” the company would have any financial difficulty paying the money.
However, just three weeks later, on March 8, JKD was placed into liquidation.
A liquidator’s report says the company was established in 2017 with the backing of local Chinese donors, who became shareholders.
The report says Fan’s dismissal led to a “protracted and expensive” ERA dispute.
“The fines were to be paid within 28 days ... and the company, we are advised, had no access to credit, and no funds to meet the payment by due date.”
The report claims the company’s shareholders were unhappy with the ERA decision and did not want association with a company unable to pay its debts. JKD’s accountant advised them to liquidate the business.
Chen - who is now listed as the sole shareholder and director - told the liquidator the company was insolvent due to the ERA determination.
The liquidator’s report says the company has no substantial assets other than a used boxing ring, punchbags and boxing gloves. The business is still running but now for sale.
It’s understood Chen has now launched a counter claim in the ERA against Fan and another former employee, alleging they tried to poach JKD’s customers.
Fan’s employment advocate Mins Chang told the Herald the timing of the liquidation was suspicious, coming just days after the ERA determination.
“We think it could be a way to avoid liability.”
Meanwhile the Herald understands the liquidator was preparing to contact North Shore police after a masked individual allegedly entered the gym without permission last month and began filming children, just days after the liquidation as the business continued to trade.
Chang told the Herald she was aware of the allegation but the masked man was not her client.
Fan said he’d spent $15,000 taking the ERA case but did not expect to receive any of the money.
