This page summarises and displays the Employment Relations Authority (ERA) determination Mere Broughton v The Whanau Ora Community Clinic Ltd [2023] NZERA 52. The determination is a useful reminder that probation clauses and 90 day trial periods are different legal tools, and employers cannot "backdate" a probation decision after the period has already ended.
The Authority records at paragraph [5] that George Ngatai, described in the determination as the respondent's director, attended the investigation meeting with manager Raewyn Bhana. The Authority did not take evidence from either of them, although Mr Ngatai spoke by invitation.
Quick facts
- Citation: Mere Broughton v The Whanau Ora Community Clinic Ltd [2023] NZERA 52
- ERA registry: Auckland
- Member: Alastair Dumbleton
- Investigation meeting: 19 January 2023
- Determination date: 2 February 2023
- Applicant representative: Lawrence Anderson (advocate)
- Respondent director recorded by the ERA: George Ngatai
- Respondent manager recorded by the ERA: Raewyn Bhana
- Respondent counsel: William Tumai
What happened (overview)
Ms Broughton began working for the respondent in March 2022. She initially performed vaccinations assistant work and was paid as if she was an independent contractor. On 15 March 2022 she signed an individual employment agreement for an Administrator role which included a probation clause.
A short meeting was called on 30 June 2022 with only same-day notice. At the end of the meeting Ms Broughton was unexpectedly dismissed. She was told she had been underperforming and (incorrectly) that no notice was required because she had been employed for less than 90 days.
The probation and "90 day" issue
The employment agreement contained a probation provision (per Employment Relations Act 2000, section 67), but it did not contain a compliant statutory trial period clause (section 67A). The Authority found the probation period was not extended and expired on 14 June 2022.
Dismissing on 30 June 2022 by treating the probation arrangements as if they were still "live" was held to be unfair, unreasonable, and unlawful. The Authority also noted that even during a probation period an employer must still act fairly and give feedback and warning (see Nelson Air Ltd v NZ Airline Pilots Association).
Practical takeaways
- Probation is not a free pass: you still need fair process, feedback, and warning.
- Trial period clauses must comply with section 67A: they must be in writing and must state the employee cannot bring a personal grievance for dismissal.
- Check dates: do not assume an employee is within "90 days" or within probation. Your payroll records usually prove it either way.
- Give notice if required: if you dismiss after probation ends, your contractual notice terms normally apply (unless serious misconduct is proven).
Key findings
- Unjustified dismissal: the employer offered no justification and wrongly attempted to invoke probation after it had expired. The dismissal was held to be unjustified under the section 103A test of justification.
- No notice paid: Ms Broughton was dismissed without notice or payment in lieu of notice.
- Holiday pay unpaid: annual holiday pay due on termination was not paid.
- Procedural issues: the respondent's response to the ERA process was significantly late, and key witnesses were not called to provide evidence.
Orders and remedies
The employer was ordered to pay (within 28 days)
- $20,000.00 compensation for humiliation, loss of dignity and injury to feelings
- $12,725.86 reimbursement of lost wages
- $3,907.20 wages in lieu of notice (including applicable entitlements as calculated in the determination)
- $1,007.92 annual holiday pay on termination (including applicable entitlements as calculated in the determination)
- Interest: interest was ordered on the lost wages, the wages in lieu of notice, and the annual holiday pay.
- Costs: costs were reserved.
Read the full determination
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