ERA award for humiliation, loss of dignity and injury to feelings opens the way for compensatory awards for unjustified action by employers.
BuckettLaw was happy to assist its client Usha in the groundbreaking case the ERA Usha Bhana v Jarden Partners limited the ERA awarded Usha Bhana nearly $70K.
In making its determination the ERA determined Jarden’s had thrice unjustifiably disadvantaged Usha in her employment and unjustifiably dismissed her for incompatibility.
In departing from the usual practice of the ERA of globalizing the award for compensation for disadvantages and dismissal the ERA awarded $25K for the dismissal and $10K for each of the three grievances for the humiliation, loss of dignity and injury to feelings.
This approach now opens the way for compensatory awards for each unjustified action causing a disadvantage that is not interconnected with the dismissal.
In Usha's case, the ERA found the dismissal for incompatibility was unjustified and that Usha was disadvantaged by Jarden’s actions in three ways.
Moving her into a new team to avoid investigating her complaint.
Failing to address her concerns about her manager.
Proposing two performance improvement plans
There wasn’t much that Jarden got right in its dealings with Usha.
The ERA found in assessing the level of compensation that the disadvantages were separate from the dismissal for the incompatibility because they formed part of Jarden’s effort to deal with performance at an earlier time.
Usha's troubles started when she raised a complaint about her manager, gaslighting and ostracizing her and making inappropriate remarks.
Her complainant was never investigated but Usha was from that time on subjected to a litany of unjustified actions arising from two unjustified attempts at a performance improvement plan (PIP), 12 days into her role, an unsubstantiated allegation of serious misconduct (later withdrawn) and finally an unjustified dismissal for incompatibility.
The ERA found that implementing a PIP just 12 days into a role could never have been justified.
Further supporting the unjustifiability of the PIP there was no attempt the ERA said by Jarden to provide objective measures for the performance assessment but rather Jarden relied on a subjective assessment by its management who had been in the job for a long time.
Then ERA found that none of the competency expectations on which she was being performance managed had been directly put to Usha. Consequently, the ERA found she was unaware of any serious performance concerns if there were any.
The PIP the ERA found was problematic and unjustified and the dismissal for incompatibility unsustainable.
There was no evidence of any performance deficiencies and what was produced lacked detail.
Jarden’s focus on the unjustified PIP and the unfair treatment of her had an adverse effect on Usha's health. Usha provided expert evidence of the substantial detriment and harm to her health and well-being.
If you would like to read the ERA's full determination please find it here.
View PDF via employment.govt.nz- NZERA-65.pdf
Take aways from this decision
For employers:
Each unjustified action will be justifiable and no longer seen as one claim. In this case, the employer needed to engage constructively with its employee to address the concerns from the outset. In not doing so it got itself into serious hot water and compounded what ought to have been a very simple process of good faith engagement.
Performance management plans need to be objective robust and constructively targeting identifiable poor performance; not used as a tool to manage an unwanted employee out.
All complaints or concerns raised by an employee need to be taken seriously and addressed not swept under the carpet or as in this case moved to another side.
We suggest you get advice early on to get it right and avoid unnecessary escalation and costly litigation outcomes. BuckettLaw can assist with all employment processes.
For employees:
Make sure every disadvantage grievance is claimed within the 90 days. It may well form a separate grievance entitling you to a separate compensatory award.
If you think you may have a personal grievance, talk to us for expert advice and guidance. We pride ourselves on positive outcomes as achieved in this case.
If you have any employment situation whether as an employee or employer that you need assistance with, BuckettLaw can be contacted here or on 0800 624 055
