A community worker at a Christchurch drop-in centre was sacked following a personal fallout with her manager and after being accused of turning a blind eye to drug-taking at the centre.
But the Employment Relations Authority ordered the Inner City Interagency Trust to pay Melissa Howard more than$10,000 for unjustified dismissal, lost wages, hurt and humiliation.
In his determination, released yesterday, authority member Paul Montgomery said he found Ms Howard "a very credible witness and a person of considerable integrity".
He accepted her evidence that she did not see a visitor "inhaling a white powder" in the centre's lounge, as she would not have been afraid to intervene - given her willingness to act on an earlier incident in which she turned away a visitor searching for marijuana.
Two people lodged a complaint with centre manager Lisa Mora that Ms Howard had been in the lounge and done nothing to stop the incident, which breached the centre's policy.
She was suspended and later dismissed for "serious misconduct".
The authority said she had been employed by the trust last year because of her close links to Ms Mora, who was a neighbour of Ms Howard at the time. They were good friends.
However, Mr Montgomery said a "sea change" came over their relationship, as Ms Mora probably disapproved of a friendship developing between Ms Howard and a colleague, Bryan Holland.
Minutes of a meeting between Ms Howard and Ms Mora on March 7, 2006, recorded hostility between them. Ms Mora also refused to discuss anything other than work-related issues.
Ms Howard said she was given a verbal warning after the meeting without being given any reason for the warning.
On March 30, two days after the alleged drug-taking incident, Ms Howard was handed a letter telling her she had been suspended with immediate effect. After an investigation meeting, the trust wrote to Ms Howard on April 18 saying her employment had been terminated that day for "serious misconduct".
But Mr Montgomery found that the alleged conduct of Ms Howard did not amount to serious misconduct.
