Latest Trial Period Case

Posted by on 7 November 2017

While the use of trial periods are now well established in the workplace there is still some uncertainty around certain aspects of the use of the trail period, and in particular whether the employer is required to provide reasons for dismissal.

The recent case of Mann v Maxam Corporation Limited [2017 NZERA Wellington 104; 11/10/17; T MacKinnon] deals with the issue of the employer providing a reason for dismissal.

The Authority found that the employee could not raise a personal grievance for unjustified dismissal as she was dismissed on day 87, which was within the 90 day requirement.

The Authority held that the trial period clause in the employment agreement was valid. The notice of termination was held to be effective and lawful under the terms of the trial period provision of her employment agreement.

The Authority found however that the employee did have a personal grievance for unjustifiable disadvantage. This arose from Maxam’s refusal to provide reasons for the termination on the day it gave the employee notice under the trial period provision.

The Authority held that an employer is not required to provide a statement in writing of the reasons for the termination under a trial period. However, the employer has an obligation of good faith including that of being responsive and communicative and not doing anything, whether directly or indirectly, to mislead or deceive.

The employee had recently returned from a short period of sick leave and suspected that her employer had decided to terminate her employment on health grounds. She was greatly upset by this and by not being made aware of the reasons for her termination. The Authority accepted that her distress was in no small part due to not having her questions answered about the reasons for termination. This led to the employee accepting the employer’s offer to leave the workplace immediately rather than having the opportunity to work out her period of notice and depart in a less agitated state of mind.

The employee was awarded $1,500 as compensation for hurt and humiliation.