Prior warnings are being looked at, says Katherine Burson
KEY POINTS:
The Employment Court's 2007 decision to require the Auckland District Health Board to reinstate Dr Harvey White, a cardiologist who had been dismissed for accessing and sending inappropriate images using the Health Board's email system, was one which was greeted with concern and dismay by many employers.
The decision was one of the first from the Employment Court (and the first of the Chief Judge) following the passing into law of section 103A of the Employment Relations Act 2000, which sets out the test which employers must meet to justify decisions to dismiss or discipline employees.
The Dr White decision led many employers to question when they would be able to justify dismissing an employee.
However, some more recent cases from the Employment Court suggest that there is more flexibility under section 103A than employers first thought.
Section 103A, which came into force at the end of 2004, requires the Employment Court (or Employment Relations Authority) to ask whether the employer's decision to dismiss or discipline the employee in question was what a "fair and reasonable employer would have done in all the circumstances ..."
At first, the concept of the fair and reasonable employer attracted attention and it seemed from Dr White's case and others that the Court's enquiry would focus on the employer.
More recently there has been growing emphasis on the circumstances of the case, which might involve considering the employee's actions and the whole work environment.
Based on these recent decisions employers will now be able to draw out and emphasise factors including:
* The employee's past behaviour and the existence of prior warnings, particularly for similar conduct;
* The nature of the workplace and the standards which apply there; and
* Relevant policies and house rules.
Past behaviour
Two cases from the Employment Court this year have hinged on prior warnings issued to the employee and the extent to which these informed of the employer's decision to dismiss the employees. These cases confirm that previous warnings are to be taken into consideration.
In Coffey v Christchurch Press the employee had been dismissed for using offensive language to his supervisor.
In Court, the employee relied heavily on his 44 years of service and claimed that dismissal, in light of his years of service, was too harsh.
The Court upheld the dismissal and referred to previous warnings received by Mr Coffey, the second of which was a final warning. The warnings, were, in the Court's words, "very explicit" in making clear that offensive language would not be tolerated.
In Butcher v OCS, Mr Butcher was dismissed for smoking in a non-smoking area. He argued that the employer's policies defined this as simple misconduct, warranting a warning, and that dismissal was not an option.
But Mr Butcher had already been disciplined for the same offence and had been told, in the warning letter he got at that time, that if this happened again, he would be liable for dismissal. Again, the Court placed emphasis on this clear, prior warning, and found the dismissal to be justified.
The work environment's nature
Tied to a consideration of previous warnings is the question of the work environment and standards applied there. In Arthur D. Riley v Wood, the Employment Court heard evidence that the work environment was a conservative one and that Ms Wood's conduct in sending explicit images via email was unacceptable in this environment, particularly when Ms Wood knew the standards which prevailed.
The Court observed that section 103A did not mean that the dismissal was judged according to the standards of an impartial observer, but that the "circumstances of an employment environment are a factor to be considered". The Court also recognised the need to weigh the impact of the employee's behaviour on other employees and on the work environment in general.
Policies and house rules
Mr Butcher's and Ms Wood's cases highlight the relevance of house rules or other policies put in place by the employer and confirm that even where they have not been strictly applied in the past, the employer is still entitled to refer to those rules when conducting a disciplinary investigation (Arthur D. Riley v Wood).
The cases show that the Court will consider policies or house rules. It will also place importance on whether employers have expressed the culture and standards which apply in their workplaces in those policies or house rules (Arthur D Riley v Wood); and that the issue is not whether an employer has followed every detailed requirement of a policy document, but whether, in all the circumstances, the employer acted fairly and reasonably - this being a more comprehensive and flexible approach (Butcher v OCS).
Employers should watch for developments as the Full Employment Court is expected to consider the meaning of section 103A next year.
There may also be some changes as the National Party indicated during the election campaign that it was concerned that procedural fairness requirements have begun to "trump" the question of whether the employer had a good reason for the decision to dismiss or discipline the employee.
Katherine Burson is a senior associate with Simpson Grierson Employment Law Group.
