Hill v Workforce Development Limited
[2015] NZCA 190
•22 May 2015 at 11 am
| IN THE COURT OF APPEAL OF NEW ZEALAND |
| CA591/2014 [2015] NZCA 190 |
| BETWEEN | LYNDA JEAN HILL |
| AND | WORKFORCE DEVELOPMENT LIMITED |
| Hearing: | 11 May 2015 |
Court: | Ellen France P, Harrison and Stevens JJ |
Counsel: | H Gilbert for Applicant |
Judgment: | 22 May 2015 at 11 am |
JUDGMENT OF THE COURT
A The application for leave to appeal is dismissed.
BThe applicant must pay the respondent costs for a standard application for leave on a band A basis and usual disbursements.
____________________________________________________________________
REASONS OF THE COURT
(Given by Ellen France P)
Introduction
This is an application for leave to appeal against a judgment of Judge Inglis in the Employment Court in which the Judge upheld a challenge by Workforce Development Ltd (Workforce), the respondent, to the determination of the Employment Relations Authority.[1] The Authority upheld a personal grievance brought by Mrs Hill, the applicant.[2] Mrs Hill’s claim was based on s 103A of the Employment Relations Act 2000 (the Act) which deals with what constitutes unjustifiable dismissal.
Background
[1]Workforce Development Ltd v Hill [2014] NZEmpC 174.
[2]Hill v Workforce Development Ltd [2013] NZERA Wellington 65.
We first need to describe the factual narrative and the history of the proceedings before setting out the relevant statutory provisions.
The factual narrative
Mrs Hill was employed from 6 December 2010 by Workforce as an adult literacy and numeracy tutor. Workforce had a contract with the Department of Corrections (Corrections) under which it provided Corrections with tutoring services in various prisons. This included Mrs Hill’s services as a tutor. Problems arose in August 2011 when prison officers intercepted a postcard sent from Mrs Hill to a serving prisoner whilst overseas. It emerged there had been further communication from outside the prison by Mrs Hill with that inmate. By 15 September 2011 Mr Dack from Corrections had met with Mrs Hill. In an email sent that day Mr Dack summarised the meeting to another Corrections officer in fairly positive terms. He referred to the fact Mrs Hill was apologetic and realised she had crossed an ethical boundary. Mr Dack suggested a course of action that did not involve cutting off Mrs Hill’s access to the prison.
A week later, however, on 21 September 2011 Mrs Hill was suspended from the prison facility by a prison manager whilst Corrections investigated the matter more closely. On 29 September 2011 a Mr Kaiwai from Corrections wrote to Workforce summarising the nature of his concerns about the safety of continued access for Mrs Hill. These included fears for Mrs Hill and others’ safety and concerns about the true extent and possible dubious nature of her contact with the inmate. Mrs Hill was not given a copy of this letter. The same day Workforce wrote to Mrs Hill reminding her that her employment contract stated that if she was to lose access to the prison and if the company could not find any other suitable work for her, she may be dismissed.
In late October 2011 there was a meeting involving Mrs Hill, her husband, Workforce and a representative from Corrections. It appears that the focus of the meeting was on the need for Corrections to more adequately induct new tutors. Mrs Hill and Workforce’s representative, Ms Greenhalgh, left the meeting optimistic that Mrs Hill’s access to the prison would not be cut. In the event, however, on 16 November 2011 Corrections decided to cease access and Mrs Hill was notified of that on 18 November.
We interpolate here that Mrs Hill’s employment agreement with Workforce provided that should Corrections find Mrs Hill to be in breach of any of their rules or policies and that the breach is serious, they may withdraw access to their sites. The agreement stated that in this situation, and absent any redeployment opportunities, Workforce could terminate the agreement. On 21 November 2011, Workforce gave Mrs Hill four weeks’ notice terminating her employment on 16 December 2011 on the basis of Corrections’ final decision and the fact that no other work opportunities were available.
The history of the proceedings
In the Authority Mrs Hill succeeded in establishing that Workforce did not do enough to support her at various stages of the process. For example, it did not provide her with opportunities to receive professional advice.[3] Apart from that, the Authority found that dismissal was “in the range of responses available” to Workforce where “redeployment was not a possibility”.[4] The identified failures in process entitled her to three month’s wages ($11,128) and $8,000 compensation for injury to her feelings.
[3]Hill v Workforce Development Ltd, above n 2, at [30].
[4]At [34].
The Employment Court took a different view. Judge Inglis said that while Workforce could have done more “at various points of the process” it did not breach any of its obligations as an employer in the way in which it responded to Corrections’ investigation and the subsequent events.[5] The Judge stated:[6]
[Workforce’s] decision to terminate was one that was open to it in the circumstances and was justifiable. Nor do I consider that Mrs Hill suffered an unjustifiable disadvantage in her employment. Any deficiencies in the process were minor and did not affect the outcome.
The relevant statutory provisions
[5]Workforce Development Ltd v Hill, above n 1, at [55].
[6]At [55].
Section 103A of the Act sets out the test for unjustifiable dismissal. Section 103A(2) states:
The test is whether the employer’s actions, and how the employer acted, were what a fair and reasonable employer could have done in all the circumstances at the time the dismissal or action occurred.
Section 103A(3) then goes on to set out factors the Court must consider in applying that test, as follows:
In applying the test in subsection (2), … the court must consider—
(a)whether, having regard to the resources available to the employer, the employer sufficiently investigated the allegations against the employee before dismissing or taking action against the employee; and
(b)whether the employer raised the concerns that the employer had with the employee before dismissing or taking action against the employee; and
(c)whether the employer gave the employee a reasonable opportunity to respond to the employer’s concerns before dismissing or taking action against the employee; and
(d)whether the employer genuinely considered the employee’s explanation (if any) in relation to the allegations against the employee before dismissing or taking action against the employee.
In addition, reference should be made to s 4 of the Act which deals with the obligations of parties to an employment relationship to act in good faith.[7]
Proposed basis of appeal
[7]See also s 3(a).
The applicant proposes two questions of law, namely:
ADid the Employment Court err in holding that s 103A(3) of the Act was either inapplicable or appl[ied] with diluted force to the respondent in the context of this case? And;
BDid the Employment Court misapply the law of good faith by finding that once Corrections had made a decision to deny the applicant access to its premises, the respondent was not obliged to take any further steps to challenge or question that decision?
The application for leave is opposed.
In relation to the first proposed question, the applicant relies particularly on the emphasised words in the following statement from the judgment of the Employment Court:[8]
The full Court identified a number of difficulties with the application of the s 103A(3) factors in situations involving no-fault dismissals in Angus v Ports of Auckland Ltd. Such difficulties are compounded having regard to the tripartite relationship at issue here. As Mr Webster observed, the factors set out in s 103A(3) sit uncomfortably with the context of the present case and are either inapplicable or apply with diluted force. It was Corrections’, not [Workforce’s], investigation into concerns about Mrs Hill’s actions. The outcome of the investigation was that the Prison Manager withdrew Mrs Hill’s access to the prison. It was this step that triggered the termination clause in Mrs Hill’s employment agreement with her employer.
[8]At [32] (footnote omitted).
The applicant wishes to argue on appeal that the Court has erred in stating that the factors in s 103A(3) were either “inapplicable or appl[ied] with diluted force”. The argument is that the Judge has ignored mandatory relevant factors and applied a lower standard because the Judge has taken the view the relevant investigation was that of Corrections and that Workforce had no part to play in that investigation. It is also submitted there is a question of more general importance about the effect of s 103A in cases such as this involving a tripartite employment relationship.
On the second proposed question, the submission is that the Judge did not consider the obligation of good faith when assessing Workforce’s actions.
In opposing leave, the submission is that some adjustment is needed in the application of the factors in s 103A(3) to a case such as the present. However, it is submitted that the only issues arising in terms of the application of those factors in this case are matters of fact. No question of law arises.
Criteria for grant of leave
Leave to appeal from the Employment Court may be granted only if, in this Court’s opinion, a question of law involved in the proposed appeal, by reason of its general or public importance or for any other reason, ought to be submitted to this Court.[9] The Act also provides that the Court has no power to consider decisions on the construction of an employment agreement.[10]
Is the test for leave met?
[9]Employment Relations Act 2000, s 214(3).
[10]Section 214(1).
Dealing with the first proposed question, it is not entirely clear what the Employment Court meant by the reference to the s 103A(3) factors being “either inapplicable or appl[ying] with diluted force”. The observation is therefore not particularly helpful. That said, we do not consider the proposed question gives rise to a question of law and, even if it does give rise to a question of law, the proposed question does not meet the standard in s 214(3) of the Act. We can explain our reasons in this way.
First, it is clear that the Judge did not apply some lesser standard but had the test in s 103A(2) firmly in mind and applied it. Her reasons for concluding that test was not met primarily turned on her findings as to the facts. Secondly, the matters the applicant would have had the Judge consider under s 103A(3) have been considered. Again, on analysis, the complaint is about the assessment of the facts in a situation where it is not suggested the factual findings were insupportable.[11]
[11]Bryson v Three Foot Six Ltd [2005] NZSC 34, [2005] 3 NZLR 721 at [25].
As to the first point we note that, immediately after the observation criticised by the applicant, the Judge went on to make it clear the issue was whether Workforce’s actions were those of a fair and reasonable employer. Judge Inglis said:[12]
[33] Ultimately, consideration must be given to what a fair and reasonable employer could have done in all the relevant circumstances at the time at which the dismissal or disadvantage occurred. As was observed in Angus:
These relevant circumstances will include those of the employer, of the employee, of the nature of the employer’s enterprise or the work, and any other circumstances that may be relevant to the determination of what a fair and reasonable employer could have done and how a fair and reasonable employer could have done it. Subsections (3), (4) and (5) must be applied to this exercise.
[12]Footnote omitted, emphasis added.
The Judge was therefore cognisant of the observation in Angus v Ports of Auckland Ltd (No 2) that it was necessary to apply the remaining subsections of s 103A.[13]
[13]Angus v Ports of Auckland Ltd (No 2) [2011] NZEmpC 160, [2011] ERNZ 466 at [58].
Judge Inglis then addressed what she described as a “key focus” of the argument advanced on Mrs Hill’s behalf.[14] That was the submission that Workforce had breached its obligations as employer by failing to tell Mrs Hill of the matters raised in the letter from Mr Kaiwai of 29 September 2011. The Judge rejected this argument on the basis that the Prison Manager who ultimately made the decision to end Mrs Hill’s access to the prison had not been aware of Mr Kaiwai’s concerns. Those concerns did not therefore have any place in the decision-making process.
[14]At [34].
The Judge also said it was “far from clear” from the evidence as to whether the Corrections officer attending the meeting with Mrs Hill was aware of those concerns.[15] The Judge continued:[16]
In any event, Mrs Hill was squarely on notice that her actions in sending the postcard, including against the backdrop of a previous incident of a similar nature involving the same prisoner, were at issue. She candidly accepted during the course of the meeting with Mr Mason [from Corrections] that the postcard incident was not an isolated event, that she had communicated with the same prisoner at a different prison location on a previous occasion, that she appreciated that it reflected an error of judgment and that it gave rise to legitimate safety concerns for Corrections.
[15]At [35].
[16]At [35].
Subsequently, Judge Inglis observed there could be no contracting out of the statutory obligations, which must include s 103A.[17]
[17]At [57] with reference to s 238 of the Act.
As to the second point, the primary argument for the applicant is that failure to consider the factors in s 103A(3) has led the Judge to accept as fair and reasonable what Ms Gilbert describes as Workforce’s “purely contractual approach” and ignore the requirement on Workforce to “strongly advocate” for Mrs Hill’s continued access to the prison. However, the Judge expressly considered this aspect and her reasons for rejecting the proposition are essentially factual. Judge Inglis noted Ms Greenhalgh from Workforce was herself concerned about what had occurred and Mrs Hill’s actions. The Judge said:[18]
In these circumstances strongly advocating for Mrs Hill, while possible, would likely have placed Mrs Greenhalgh in a difficult position.
[18]At [38].
Judge Inglis also considered that Mrs Hill was able to make the points she says Workforce should have advocated on her behalf. For example, the Judge said:
[42] Mrs Hill said that she had been expecting Mrs Greenhalgh to advise Mr Mason of her work record and her good character, … . Mrs Hill was perfectly able to make these points herself … . She did not take this step and nor did she raise any concerns at the time as to what Mrs Greenhalgh was saying, or not saying, or seek an adjournment or break in the meeting to discuss matters with her.
The Judge addressed G & H Trade Training Ltd v Crewther,[19] relied on by the advocate for Mrs Hill as supporting the proposition that there was a duty on the employer to persuade a third party. The Judge distinguished Crewther because Corrections in the present case had sole control over the workplace.[20] This might be seen to support the applicant’s concerns over the Judge’s approach. However, Judge Inglis’ view was only that Workforce’s role as a result was “necessarily constrained”.[21] Further, the Judge was correct that the situation in Crewther was different. The third party in that case was found to be using its economic power to “dictate” that the employee be dismissed.[22]
[19]G & H Trade Training Ltd v Crewther [2002] 1 ERNZ 513 (EmpC).
[20]At [39].
[21]At [39].
[22]G & H Trade Training Ltd v Crewther, above n 19, at [39].
The other way in which the error in approach is said to manifest itself is in the Judge’s rejection of the proposition that once Corrections had decided to withdraw access, Workforce erred when it took no steps on Mrs Hill’s behalf. The applicant says that Workforce should have advocated for a different outcome. The Judge’s reasons for rejecting this proposition relate in part to the absence of any contractual mechanism for doing so and also the fact that the prison manager’s decision was a final one. Further, Judge Inglis said there was “nothing new that had come to light” which might have “prompted further steps”. Mrs Hill made a “vague” request to Workforce to ask Corrections to reconsider.[23]
[23]At [51].
Accordingly, in our view, the proposed first question does not give rise to a question of law but rather reflects a different, but available, view of the facts. However, even if the proposed appeal in this respect raises a question of law it is not one of the requisite importance that ought to be submitted to this Court.
There are two reasons for this view. First, there has been some recent consideration of the application of s 103A to situations other than misconduct by this Court. In Grace Team Accounting Ltd v Brake dealing with the application of the section to a redundancy, [24] the Court said that the list in s 103A(3) “uses language that is appropriate for cases of dismissal for misconduct, but not appropriate for a redundancy situation”.[25] With reference to Angus, O’Regan P delivering the judgment in Grace Team Accounting said:[26]
But it is notable that the Full Court went on to say, “we can really only conclude that the … Court should try to give a sensible interpretation to subs (3)”.
[24]Grace Team Accounting Ltd v Brake [2014] NZCA 541, [2015] 2 NZLR 494.
[25]At [74].
[26]At [75].
The Court continued:[27]
The Full Court certainly did not suggest that s 103A did not apply to redundancies or that it should be given a different meaning in redundancy situations than in misconduct situations. …
We agree with the Full Court that it will be necessary to interpret s 103A(3) in a way that adapts it to a situation not involving misconduct and to invoke s 103A(4) (allowing it to consider “any other factors it thinks appropriate”) in redundancy cases.
[27]At [76]–[77].
It is not apparent to us that the present case would lend itself to any more detailed guidance on the application of the section than this. That militates against the submission the case is one that ought to be submitted to this Court.
Secondly, it is apparent that the case as argued before the Employment Court has now been given a different focus in some key respects. That factor alone would not necessarily be determinative in the decision to grant leave, but it means that this is certainly not an ideal case for submission to this Court.
As to the second proposed question of law, it is true that the Judge does not refer expressly to good faith. However, nothing different is said to flow from that failure than the matters already discussed. Any issues arising from this proposed question are entirely factual. The conclusion we have reached in relation to the first question applies equally. Accordingly, the test for leave is not met in relation to this question.
Result
For those reasons the application for leave is dismissed. Costs should follow the event. The applicant must pay the respondent costs for a standard application for leave on a band A basis and usual disbursements.
Solicitors:
Rennie Cox, Auckland for Appellant
Sainsbury Logan & Williams, Napier for Respondent
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