De Wys & Jenney v Solly's Freight (1987) Limited

29 July 2020

Stu AdamsonRecent media has pronounced the Solly’s decision to be the first covid-19 redundancy case of note to emerge from the Employment Relations Authority.  Two drivers were found to have been unjustifiably dismissed as part of a redundancy process that occurred between 23 March and 2 April 2020.

The case raises no new principals of law.  It has very little to do with Covid 19.  The lockdown was part of the background factual matrix, but was not really determinative.  As such it can be seen only as reinforcement of the established law (which is in the Act anyway).

Member Cheyne held:

a) It was not fair and reasonable for the employer to say on the one hand that they had applied for the subsidy and would use best endeavours to keep staff, and then on the other hand to withdraw those staff members names from the subsidy application (Section 103A).

b) The employer did not meet it’s obligations under the Act to consult with affected staff, seek a response to the redundancy proposal, and genuinely consider the response (Section 4).

c) Both of these were a breach of the employers good faith obligation.

There is some discussion in the case about the effect of loss of revenue and business activity as a result of lockdown, and an acknowledgement that staff reductions could have been a reasonable business decision, but that did not excuse the fundamental failings of failing to consult and acting unreasonably.

 

Stu Adamson | Solicitor

 

Legal Team

 

David Browne | Senior Solicitor/Legal Team Manager | 03 456 1812 | 021 225 6938 | david@osea.org.nz

Adam Siwerski | Solicitor | 03 456 1809 | 021 756 809 | adam@osea.org.nz

Stu Adamson | Solicitor | 021 197 4603 | stu@osea.org.nz 

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