Can our private lives impact on an employer’s reputation? – Feb 2017



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Wednesday 22 February 2017

Can our private lives impact on an employer’s reputation?

I commonly get asked for advice on situations where an employee’s conduct outside of work is considered to impact on the reputation of the company or entity that they work for. This can be a vexed issue because, on the face of it, employee’s private lives are just that.  But, where the out of work conduct involves unlawful behaviour, there is a common assumption that proof of that will automatically provide grounds for dismissal.  A recent case of the Employment Court demonstrates that this is a flawed assumption.
In the case of Wikaira v The Chief Executive of the Department of Corrections [2016] NZEmpC175 the Employment Court considers this difficult issue for an organisation where the fact of criminal convictions may have a real connection to the work of their employees in roles such as Corrections Officers.

In this case, the Court has been critical of not necessarily the investigation carried out by the Department, but the erroneous findings or decisions made by the senior managers at the end of that process.  The Court commented that:

“An employer who does it right is in a better position to get it right.   … As this case illustrates however, that is not a universal truth or necessary sequitur.”

In short, the Department got it wrong.

Key Facts
Ms Wikaira was employed in the role of Corrections Officer for the Department at the Northland Prison. She had been a long serving employee with an unblemished employment record.

In her personal time, she was engaged in an altercation involving her stepfather. Ms Wikaira was the Executor of her late mother’s estate and her stepfather had a life interest in living in a house, however, he was expected to meet the outgoings.  Acting on the advice of a lawyer, Ms Wikaira attempted to serve a trespass notice on her stepfather, as he was not meeting his financial obligations. To avoid the service of the trespass notice he started to reverse out of the property, and brushed Ms Wikaira’s leg with his vehicle. According to Ms Wikaira, out of fear, she struck his vehicle’s windscreen causing it to crack. This led to the stepfather bringing a charge of wilful damage against Ms Wikaira.

Ms Wikaira did not immediately tell her employer of the events that led to her being charged or that she would have several Court appearances. On the day of her first Court appearance, she was scheduled to work and instead of advising her employer of the Court date, she reported sick.

She only disclosed to her employer the fact of the charges when, on legal advice she decided to admit the charge and sought a letter from her employer in support of her application for discharge without conviction.  Once it learned of the charges, the Department asked Ms Wikaira to keep it informed of the steps in the Court proceedings.

She was ultimately granted a discharge without conviction which at law amounts to an acquittal.

The employer then appointed an external investigator and initiated a disciplinary process which lead to her dismissal, principally on the basis that she had:
1.    Admitted to unlawful conduct.
2.    Brought the employer into disrepute.
3.    Breached the Code of Conduct by not immediately reporting the fact of the criminal charges.
This was found to be an unjustifiable decision by the Employment Court for a number of reasons.   The Court was concerned that the decision was based on flawed assumptions about the real impact on reputation and a misinterpretation of the code of conduct.

Remedies
The Employment Court awarded substantial remedies in this case including:
1.    Reinstatement to the Employee’s former position.
2.    Lost earnings from the date of the dismissal through to the reinstatement.
3.    Compensation for hurt and humiliation of $20,000.

The remedies of a monetary nature were reduced by 15% for Ms Wikaira’s contribution to the situation.  It was noted that she had been misled her manager about needing sick leave when she had her first court appearance and that she had not properly complied with the request to keep the Department updated as to the progress of her court proceedings.

The Court had some sympathy with Ms Wikaira because of her remote location where work was difficult to find. The Court readily accepted her evidence that she had applied for and been rejected in respect of a significant number of jobs since her dismissal.

Comment
In this case the Court was critical of the black and white approach taken by the Department about the fact that Ms Wikaira had admitted to the charge of wilful damage (despite the fact of an acquittal at law).  The employer took a strict approach without properly considering the background extenuating circumstances.

When conducting any kind of enquiry an employer needs to consider the purpose of the disciplinary process. If an employee is remorseful or unlikely to re-offend, serious consideration needs to be given to whether an alternative to dismissal should be allowed such as a warning.

A zero tolerance approach will not generally find favour with the Employment Court or Employment Relations Authority because of the fundamental principle that the employer is always required to consider with an open mind the employee’s response and all of the relevant circumstances before they make their decision.

This case became complicated over what was a very simple set of facts.  Yet key information such as the sentencing notes from the District Court Judge were not sought or considered by the employer.  We consider it important that investigations are not made bigger than the issue at hand, but instead employers really turn their minds to seeking out information which will help them make an informed decision.

Contact
If you have any comments or questions about this article, or for more information on the key learnings from this case, please feel free to contact me at jo@douglaserickson.co.nz or Ph  (09) 320 1699 or (0275) 777 018.

This article is intended for general information purposes only and should not be used as a substitute for professional legal advice.

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