Sasha Lee v JNJ Management Limited and National Holdings Limited [2026] NZERA 309

This Employment Relations Authority (ERA) determination is a useful case on redundancy, removal of duties, wage arrears for a salaried employee, holiday pay, and the limits of joint employer arguments within a group of companies. Sasha Lee was employed by JNJ Management Limited as personal assistant to James Kwak, the sole director of the JNJ Group. Her role was much broader in practice, extending across various businesses in the group, including National Holdings Limited and hospitality operations such as Metro Lanes Bowling. The ERA found that Ms Lee was not also employed by National Holdings Limited. However, JNJ unjustifiably disadvantaged her by removing key duties without consultation and unjustifiably dismissed her by redundancy. JNJ was also ordered to pay substantial wage arrears and annual holiday pay. The full determination is embedded at the end of this page.

Background

JNJ Management Limited was the parent company of the JNJ Group. National Holdings Limited was one company within that group. National Holdings operated Metro Lanes Bowling and associated retail hospitality businesses, including Aotea House, Pastamago, Sushi Wave, Okonomi Yaki, Bake My Day, and Mini Golf.

Ms Lee began working for JNJ on 12 November 2018. On paper, she was personal assistant to Mr Kwak. In practice, she said her work went well beyond ordinary personal assistant duties. She performed management, human resources, project coordination, facility management, business development and operational work across different group businesses.

Towards the end of the employment relationship, JNJ removed some of her duties, she raised concerns about how she had been treated, and then JNJ advised that her position had been made redundant. Her employment ended on 19 January 2024 after she was paid four weeks in lieu of notice.

The joint employer argument did not succeed

Ms Lee argued that she was jointly employed by JNJ and National Holdings Limited. The point mattered because she sought wage arrears and holiday pay from both entities. The ERA approached the issue by considering the real nature of the relationship, including the parties' intentions, the written documents, how Ms Lee was paid, and how the work was actually arranged.

The ERA accepted that Ms Lee undertook work for National Holdings and was integrated into National Holdings operations in a practical sense. Organisational charts and internal role descriptions used titles such as general manager for National Holdings and business development manager. There was also an addendum document referring to National Holdings.

However, those facts were not enough to make National Holdings an employer. Ms Lee had a written employment agreement with JNJ, was paid by JNJ, did not receive separate salary payments from National Holdings, and did not have a separate written employment agreement with National Holdings. The Authority also noted that JNJ was the parent company and Mr Kwak controlled the group. Work for National Holdings was work Ms Lee did as part of her employment with JNJ.

The ERA distinguished joint employment cases where multiple entities each take on parts of the employer obligations. Here, JNJ was found to be solely responsible for the employment obligations. National Holdings was not Ms Lee's employer.

JNJ removed key duties without consultation

Ms Lee's unjustified disadvantage claim about removal of duties succeeded. On 22 November 2023, a meeting took place involving Ms Lee, Mr Kwak and Kerry Jeon, who was employed by JNJ as a human resources administrator. The arrangements for covering the human resources aspect of Ms Lee's role during upcoming annual leave were discussed.

On 24 November 2023, Ms Jeon sent a notice to all employees across the group announcing new appointments. Mr Kwak was announced as general manager of Metro Lanes and Ms Jeon was announced as HR manager, effective from 24 November 2023. Ms Lee then emailed explaining that she felt upset and humiliated by the announcement and by the lack of consultation before it was made.

The ERA found that management duties for National Holdings and human resources management for JNJ were key parts of Ms Lee's role. They were not small or insignificant duties. JNJ had announced permanent changes by distributing these duties to Mr Kwak and Ms Jeon. Because Ms Lee was not consulted about those permanent changes, she was unjustifiably disadvantaged.

The healthy and safe workplace claim did not succeed

Ms Lee also claimed unjustified disadvantage on the basis that JNJ had not provided a healthy and safe work environment. The central incident was an allegation that Ms Jeon shouted loudly at Ms Lee in front of colleagues and Mr Kwak on 30 November 2023.

The ERA focused on what JNJ did after the incident. It found, on the balance of probabilities, that Mr Kwak was not present when the incident happened, although Ms Lee reported the matter to him later. JNJ did not specifically address the incident. However, the ERA found JNJ was limited in what it could do because Ms Lee took sick leave on 30 November 2023 and did not return to work. This separate safe workplace disadvantage claim was therefore not established.

The redundancy dismissal was unjustified

JNJ advised Ms Lee on 21 December 2023 that her position had been made redundant. The ERA applied the redundancy principles from Grace Team Accounting Limited v Brake and found the dismissal unjustified. The problems were both substantive and procedural.

The first problem was timing. JNJ tried to consult with Ms Lee between 7 December and 21 December 2023, but Ms Lee was on sick leave during that period. JNJ did not pause the process. That put real pressure on the fairness of the consultation.

The second problem was predetermination. Two weeks before the restructure consultation began, JNJ had already removed key aspects of Ms Lee's role without consultation. That suggested the decision to disestablish her role was predetermined from the outset. The consultation documents then proposed disestablishing aspects of her role that had already been removed from her job description.

The third problem was lack of information. The consultation pack did not explain why JNJ proposed to make Ms Lee's position redundant. It did not explain what savings were required or why removing her position would assist the company. The proposal referred to a notable 500 percent profit decrease compared with the previous year, but no financial information was provided to explain that decrease, what it meant, or why it made Ms Lee's redundancy necessary.

The fourth problem was lack of alternatives. The consultation material did not discuss alternatives to redundancy, other possible cost savings, or why other positions were not also being considered for redundancy if the profit decrease was as significant as JNJ claimed. The ERA found Ms Lee was unjustifiably dismissed.

The wage arrears claim

The wage arrears claim was one of the most important parts of the determination. Ms Lee claimed $145,043.28 in wage arrears for additional hours worked between August 2020 and January 2024. JNJ argued that she was a salaried employee and that her salary covered all hours worked.

The employment agreement contained clauses that pulled in different directions. One clause suggested the salary covered all hours needed to complete the responsibilities of the position. Another clause said extra payment would be made for reasonable and mutually agreed additional hours. The ERA reconciled those clauses by finding that normal additional hours needed to complete the role were covered by salary, but additional hours requested or mutually agreed would be paid separately.

JNJ also argued that Ms Lee had not obtained express approval from Mr Kwak before working the additional hours. The ERA rejected the need for express approval in the circumstances. Ms Lee worked closely with Mr Kwak, and for a period they lived together. Mr Kwak controlled a wide group of businesses. The ERA found that mutual agreement could be implied because Mr Kwak must have known about the additional hours and did not take steps to stop her working them.

The ERA also found that JNJ had not complied with its obligation to maintain proper wage and time records for the additional hours. That did not mean every hour claimed by Ms Lee was automatically accepted. The Authority still assessed the evidence objectively, including work diaries, spreadsheets, check-in/out records, the nature of her role, personal work sometimes undertaken during office hours, and the Covid-19 lockdown period.

JNJ was ordered to pay Ms Lee $105,342.25 gross in wage arrears. That order was to be paid within 60 days of the determination.

Annual holiday pay

JNJ did not dispute that Ms Lee was owed 378 hours of accrued annual leave. The dispute was about value, because the additional hours affected average weekly earnings. On the basis of the additional hours proven, the ERA calculated Ms Lee's average weekly earnings for the relevant period at $2,733.71.

The ERA found that Ms Lee was owed $25,844.55 gross for 9.45 weeks of accrued annual leave. It also found she was owed $8,529.20 as 8 percent of gross earnings for the final year of employment. JNJ was ordered to pay $34,373.75 gross for annual holiday pay.

JNJ sought to offset sums it had already paid to Ms Lee against the annual holiday entitlement. The ERA declined that application, referring to the purpose of the Holidays Act 2003 and noting that JNJ could bring a separate application if it considered mistaken payments had been made.

Public holidays were not established

Ms Lee initially maintained that she had worked some hours on some public holidays. However, she accepted in submissions that she was not able to establish the hours worked on various public holidays and did not pursue that claim. The ERA found the public holiday claim was not established.

Compensation and after-acquired misconduct

The ERA considered compensation for both the unjustified disadvantage and unjustified dismissal. Ms Lee felt humiliated and shocked when key aspects of her role were removed without consultation. The announcement made her feel as if she had been dismissed. She also described the significant emotional and mental toll caused by the dismissal, including social withdrawal, depression, sleep problems, anxiety and poor physical health.

The ERA assessed compensation at $8,500 for the disadvantage claim and $17,000 for the dismissal claim, a combined $25,500. However, the ERA then considered a later allegation raised by JNJ after the employment ended. JNJ alleged that Ms Lee had continued dealing with a tenant of an apartment and that tenant payments had been made to an account connected with Ms Lee. The matter had been reported to police, but no criminal charges had been laid at the date of the determination.

The ERA treated the allegation as serious and found that, if known while the employment relationship was still on foot, it could potentially have resulted in dismissal. It reduced the compensation awards by $8,000 on that basis. JNJ was therefore ordered to pay $17,500 compensation under s 123(1)(c)(i) of the Employment Relations Act 2000.

Lost wages after dismissal

Ms Lee also sought reimbursement of lost wages after dismissal. The ERA was not satisfied she took steps to find alternative employment during the first 13 weeks after dismissal. However, it accepted that the relationship between Ms Lee and Mr Kwak was complicated and that police and Family Court issues arose after termination. Ms Lee sought third party government assistance and was referred to a psychiatrist.

In that context, the ERA found it was reasonable for Ms Lee not to seek alternative employment immediately after dismissal. She was awarded 13 weeks' wages under s 128(2) of the Employment Relations Act 2000. The order did not state a fixed dollar amount for that item, but required JNJ to pay the sum equivalent to 13 weeks' wages within 28 days.

No contribution reduction under s 124

The ERA found that Ms Lee did not contribute to the circumstances that gave rise to her unjustified disadvantage grievance or her unjustified dismissal grievance. Remedies were therefore not reduced under s 124.

This needs to be distinguished from the $8,000 reduction to compensation for the later allegation of misconduct. The reduction was not a contribution reduction under s 124. It was an after-acquired misconduct type adjustment to the s 123 compensation assessment.

Why this case matters

This decision is useful because it deals with several common employment law traps in one case. The first is the corporate group problem. Employees often work across related companies, use different titles, and report to the same controlling director. That does not automatically make every group company an employer. The ERA will still look closely at who paid the employee, who made the employment agreement, and who actually assumed employment obligations.

The second lesson is about removal of duties. If duties are key parts of the role, removing them and announcing replacements can itself be an unjustified disadvantage. Employers cannot treat major role changes as an internal management preference that needs no consultation. Good faith requires consultation where an employer proposes to make a decision likely to adversely affect continuation of employment or conditions of employment.

The third lesson is about redundancy evidence. A redundancy consultation pack should explain the business reason, the financial basis, the proposed savings, and alternatives considered. A vague reference to a large profit decrease will not be enough if the employer does not provide supporting financial information or explain how the employee's redundancy addresses the problem.

The fourth lesson is about salaried employees and additional hours. A salary does not always defeat an additional hours claim. If the employment agreement provides that reasonable and mutually agreed additional hours will be paid, the employer may be exposed where it knows the employee is working those hours and does nothing to prevent or clarify the position. Poor wage and time records increase that exposure.

The fifth lesson is about remedies. Ms Lee succeeded on the main disadvantage and dismissal claims and received substantial monetary orders. But the later misconduct allegation still reduced compensation, even though it was not treated as contribution under s 124 and even though no criminal charge had been laid.

Practical takeaways

• Group companies: working across several related businesses does not automatically create joint employment.
• Role changes: removing important duties without consultation can be an unjustified disadvantage.
• Redundancy process: consultation should be paused or managed carefully where the employee is on sick leave and cannot properly participate.
• Predetermination risk: removing duties before consultation begins can make a later redundancy look predetermined.
• Business case: employers should disclose enough financial and operational information to explain why redundancy is proposed.
• Alternatives: consultation material should address alternatives to redundancy and other possible cost savings.
• Salaried employees: salary wording should be clear, especially where additional hours may be paid separately.
• Time records: failure to keep proper wage and time records can be costly when additional hours are later disputed.
• Holiday pay: additional hours can affect average weekly earnings and therefore final holiday pay.
• After-acquired conduct: serious later-discovered allegations may reduce remedies even where the dismissal itself was unjustified.

Read the full ERA determination (embedded)

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