Jacob Maarschalk v West Auckland Trust Services Limited [2024] NZERA 333

This page summarises and embeds an Employment Relations Authority (ERA) determination. It is not legal advice.

What the case was about

The applicant challenged two employer actions as unjustified disadvantage:

• how the Trusts implemented changes to rostering and total hours at the store (August 2023); and
• a first and final written warning issued on 3 April 2023 following misconduct allegations.

Story in plain English

Mr Maarschalk worked for West Auckland Trust Services Limited (the Trusts) and was a retail duty manager. Although he was consistently rostered well above his written 25-hour-per-week part-time term, the Authority found there was no express or implied agreement that his contracted hours had become full-time.

In August 2023 the Trusts advised retail staff it would reduce total labour hours because of budget pressures (including cost increases and lower sales) and circulated a new roster to take effect in mid-September 2023. The change was presented as a decision rather than a proposal.

The Authority accepted the Trusts was focused on 'contracted hours' and said those would not be reduced. However, it also found the Trusts knew Mr Maarschalk had been routinely offered (and was routinely working) materially more than 25 hours and had asked to move to full-time hours. In that context, the Authority said he had a legitimate interest in how the new roster would affect his hours beyond the guaranteed minimum and should have been given a reasonable opportunity to comment before the decision was made.

Separately, in March 2023 co-workers raised concerns about workplace behaviour (including horseplay in-store and taking non-alcoholic drinks without paying immediately). The Trusts moved from an 'informal' meeting to a formal disciplinary meeting and then issued a first and final written warning on 3 April 2023.

The Authority found the disciplinary investigation was deficient. Key problems included: not clearly applying (or even identifying) the disciplinary process promised by the employment agreement; running the first meeting as effectively disciplinary without proper notice or representation; and a lack of specificity about the allegations (especially around alleged inappropriate language in front of customers and alleged duty manager failings). Because of those flaws, the Trusts could not establish that upholding all allegations as serious misconduct - and issuing a final warning - was fair and reasonable in the circumstances.

Two unjustified disadvantage grievances were therefore established: one relating to the roster change process, and one relating to the final written warning process.

Why the Authority found unjustified disadvantage

1) Rostering and hours process

The Authority did not accept that the employee's contract had become full-time, but it found the employer knew he was routinely working well above his guaranteed hours and wanted more hours. In those circumstances, the employer was required (as a matter of good faith and fair process) to give him a reasonable opportunity to comment before finalising a rostering/hours decision that could affect his hours beyond the guaranteed minimum.

2) Final written warning process

The Authority found the investigation and disciplinary steps were procedurally deficient. In particular, the Authority said the allegations were not put with enough specificity and the employer did not clearly follow (or identify) the disciplinary process promised by the employment agreement. Because of that, the employer could not justify upholding all allegations as serious misconduct and issuing a final warning.

Orders and payments

• Compensation (s 123(1)(c)(i)): $8,500 total (comprised of $5,000 for roster-change harm and $3,500 for warning-related harm after a 30% contribution reduction).
• Payment deadline: within 21 days of 7 June 2024.
• Costs: reserved (costs timetable set if not agreed).

For harm (humiliation, loss of dignity, and injury to feelings) arising from the rostering process, the Authority awarded $5,000.

For harm arising from the deficient disciplinary process and final written warning, the Authority would have awarded $5,000 but reduced that component by 30% for contributory conduct. The contributory conduct was Mr Maarschalk consuming a non-alcoholic drink and paying for it the next day, which contributed to the situation that gave rise to the grievance.

The total compensation ordered was $8,500 under s 123(1)(c)(i), payable within 21 days of the determination date. Costs were reserved, with a timetable set if costs could not be agreed.

Practical takeaways

• Contracted hours: Authority treated the written 25 hours/week term as the guaranteed minimum; regular additional hours did not convert the contract to full-time without agreement.
• Good faith and process: where an employer knows an employee is routinely working well above guaranteed hours and wants more hours, they should be given a reasonable chance to comment before a roster/hours decision that may affect that interest is finalised.
• Disciplinary fairness: allegations must be put with sufficient detail; promised procedures should be followed; and an early 'informal' meeting can still need basic procedural fairness if it is in substance disciplinary.
• Remedies: modest compensation was awarded for process failures, with a contribution reduction applied to the warning-related component.

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Source: Employment Relations Authority determination hosted on determinations.era.govt.nz.