Selwyn McDonald v Traffica Roading Services Limited [2026] NZERA 360

This Employment Relations Authority (ERA) determination concerns Selwyn McDonald, an experienced concrete worker and foreman employed by Traffica Roading Services Limited. Mr McDonald was summarily dismissed during a heated worksite exchange with Traffica director Bashir Ahmed. The ERA preferred Mr Ahmed's account of the exchange and accepted that Mr McDonald made serious disrespectful comments with racial connotations. Even so, the dismissal was unjustified because Traffica dismissed him on the spot without giving him a fair opportunity to respond before the decision was made. The unjustified disadvantage / bullying claim failed. Remedies were reduced by 40 percent for contribution, leaving final orders of $9,000 compensation and $3,800 gross lost wages. The full determination is embedded at the end of this page.

The short point

This determination is a useful example of the difference between substantive concerns and procedural fairness. Traffica had real concerns about Mr McDonald's conduct, resistance to instructions, and the way he interacted with others on site. The ERA accepted that there was a heated exchange and preferred the employer's account that Mr McDonald made explicit disrespectful comments with racial connotations.

However, Traffica did not run a disciplinary process before dismissing him. Mr Ahmed dismissed Mr McDonald immediately on site, telling him to pack his tools and go home. That meant Mr McDonald was not given a fair opportunity to respond to the allegation before the decision was made. The ERA found those defects were not minor and resulted in unfairness.

The result was a split outcome. The dismissal was unjustified, but Mr McDonald's conduct was serious enough to attract a 40 percent reduction to all remedies.

Background

Traffica is a civil construction company founded by Mr Ahmed. It employed about 120 people. Mr McDonald was an experienced concrete worker and worked for Traffica as a foreman from May 2022 until April / May 2024. As foreman, he was responsible for a team of workers deployed to different sites.

Mr McDonald said there had been problems in 2023 during meetings about tools and equipment. He claimed Mr Ahmed had been aggressive toward him and that this caused stress. Mr Ahmed denied being aggressive and said Mr McDonald had not raised that as an issue. Mr Ahmed also said Traffica had provided Mr McDonald with support during personal difficulties, including additional paid time off and help after the Auckland floods.

In early 2024 Traffica began work on a large subdivision project. Mr McDonald was part of the concreting work on that project. The project continued for some months after his employment ended.

The dairy incident and final written warning

On 18 April 2024, Mr McDonald was involved in an incident at a dairy near the worksite. Mr McDonald's position was that a security guard had racially profiled him and followed him around the dairy, causing a confrontation with dairy staff. He accepted that he had used strong language. The dairy owner complained to Traffica.

Mr Ahmed then met Mr McDonald about the dairy incident. Mr Ahmed was concerned that Mr McDonald had used strong language in a confrontation with dairy staff while wearing Traffica uniform. Mr Ahmed considered the conduct part of a pattern of poor behaviour. He also asked Mr McDonald to undertake a drug and alcohol test.

On 19 April 2024, Mr Ahmed issued a final written warning. The warning referred to serious misconduct, abusive behaviour, and a number of road rage incidents, including one said to have occurred more than a year earlier. It warned that Mr McDonald's employment could be terminated if his conduct did not improve, if there was a repeat incident, or if there was a failed drug test.

Mr McDonald did not challenge the final warning at the time. He told the ERA that he understood the kind of behaviour shown in the dairy was not acceptable, although he said it had occurred in the context of personal and work pressure.

The positive THC result

On 22 April 2024, the drug and alcohol test returned a positive result for THC. Mr McDonald said that reflected legitimate medicinal use. The later dismissal letter referred to the failed drug test, but the dismissal itself occurred during the worksite exchange on 14 May 2024.

The ERA's reasoning focused on the fact Mr Ahmed dismissed Mr McDonald on the spot after the heated exchange, rather than after a disciplinary process dealing with the THC result, work performance, or other concerns.

Worksite tensions before dismissal

Traffica's evidence was that Mr McDonald's work was not necessarily poor because he lacked concreting skill. The problem, from Traffica's perspective, was that he was obstinate and resisted instructions based on the requirements of council inspectors who regularly visited the site.

Under questioning, Mr McDonald expressed reservations about inspectors telling him how to do his job when they may not have laid concrete themselves. The ERA considered it likely that Mr McDonald expressed similar views at work and did not readily undertake work as directed.

Traffica witnesses described Mr McDonald as having a tendency to overreact when challenged about work issues. Although construction sites may involve colourful language, he was described as unnecessarily aggressive and reactive toward other employees and his own team.

The dismissal on 14 May 2024

On 14 May 2024, senior supervisor Adam Taylor spoke to Mr Ahmed about concerns that Mr McDonald was not listening, was uncooperative, and was difficult to handle on site. Mr Ahmed said he would talk to Mr McDonald.

As Mr Ahmed drove through the subdivision, he saw Mr McDonald walking up the road, turned his car toward him, and called him over. There was a heated exchange about concerns Traffica had with Mr McDonald's work and his resistance to doing the work in the way required.

Mr McDonald said he tried to walk away to de-escalate the situation. Mr Ahmed said Mr McDonald used explicit language with racial connotations referring to where Mr Ahmed had come from. Mr Ahmed said he told Mr McDonald that if he could not hold a decent conversation about his work, he could no longer work for Traffica.

The ERA preferred Mr Ahmed's account on the balance of probabilities. It found that Mr Ahmed's version was more consistent with the parties' pattern of behaviour and explained why Mr Ahmed dismissed Mr McDonald on the spot. Mr Ahmed told Mr McDonald to pack his tools and go home.

The dismissal occurred on site and was observed by others. Mr McDonald had to walk back through the site, remove his tools, and ask another co-worker for a ride home because he no longer had use of the company vehicle. He said the dismissal spread around the industry and caused humiliation, including because his son was also on site.

Why the dismissal was unjustified

Section 103A of the Employment Relations Act required the Authority to decide whether Traffica's actions, and how it acted, were what a fair and reasonable employer could have done in all the circumstances at the time. A fair process required Traffica to raise its concerns, give Mr McDonald an opportunity to respond, and consider that response before dismissing him.

The ERA found Traffica did not do that. Mr Ahmed accepted he dismissed Mr McDonald on the spot because of Mr McDonald's response when Mr Ahmed tried to speak with him about work issues. Mr McDonald did not have a fair opportunity to respond to the concerns about his language before the dismissal decision was made.

The Authority considered it likely Mr McDonald would have given a response if he had been given the opportunity. Traffica would then have been required to genuinely consider that response before deciding whether dismissal was warranted. The procedural defects were not minor and resulted in unfairness.

Mr McDonald therefore established a personal grievance for unjustified dismissal.

Why the bullying / unjustified disadvantage claim failed

Mr McDonald also alleged that he had been unjustifiably disadvantaged by Mr Ahmed's aggressive behaviour during meetings in 2023. The ERA did not accept that claim.

The Authority found Mr McDonald had not established that he was bullied by Mr Ahmed or otherwise disadvantaged in 2023. It considered it more likely that other matters in Mr McDonald's personal life had contributed to his stress at that time. The unjustified disadvantage claim was therefore dismissed.

Lost wages

Mr McDonald sought lost wages arising from the unjustified dismissal. The Authority accepted that he had provided proof of attempts to mitigate his loss. However, it did not award the full three months' remuneration.

The ERA considered the counterfactual position. There was increasing tension on site flowing from Mr McDonald's resistance to instructions from council inspectors and management. Mr McDonald also considered his team was under-resourced and was becoming increasingly stressed at work. The Authority considered it more likely than not that further confrontation would have occurred and that Mr McDonald would not have remained employed by Traffica for more than another month.

Mr McDonald was paid $40 per hour and was contractually entitled to 40 hours per week. The Authority assessed one month of lost wages at $6,400 gross before contribution.

Compensation

Mr McDonald sought compensation for humiliation, loss of dignity and injury to feelings under section 123(1)(c)(i) of the Employment Relations Act. The ERA accepted that the dismissal was abrupt, loud and in front of colleagues, including his son. It also accepted that he was humiliated by having to go back through the worksite to retrieve his tools, and that others on site were aware he had just been dismissed.

The Authority found Mr McDonald was humiliated, suffered injury to feelings and suffered loss of dignity. Compensation was assessed at $15,000 before contribution.

Contribution reduction

The contribution issue was significant. The ERA found that Mr McDonald's comments to Mr Ahmed were blameworthy and significantly contributed to the circumstances giving rise to the grievance. It also found that the conduct was serious because it would have materially undermined trust in the employment relationship.

The Authority referred to the Employment Court's guidance that 50 percent reductions should be reserved for exceptional cases, that care should be taken before imposing a 25 percent reduction, and that proportionality is important. Despite that, it considered a 40 percent reduction appropriate in all the circumstances. The reduction was applied to all remedies.

Why this case matters

The determination is important because it shows that procedural fairness still matters even when the Authority accepts the employer's version of the incident. The ERA did not find that Mr McDonald behaved well. It found the opposite: his comments were serious and blameworthy. But the dismissal remained unjustified because Traffica moved directly to termination without putting the allegation to him and considering his response.

The case also illustrates the practical effect of contribution. Contribution did not defeat the personal grievance, but it materially reduced the remedy. A 40 percent reduction is substantial, especially given the Court's warning that large reductions should be approached carefully. The Authority clearly treated the conduct as serious enough to sharply reduce the financial outcome.

For employers, the lesson is simple: if dismissal is being considered, slow the process down. Even where a director has personally witnessed the conduct, the employee should be told exactly what is alleged, given a chance to respond, and the employer should consider that response before deciding. For employees, the case shows that even if a dismissal process is unfair, serious misconduct or aggressive comments can significantly reduce any award.

Practical takeaways

• Do not dismiss on the spot unless truly exceptional: immediate dismissal is highly vulnerable if the employee is not given a proper opportunity to respond.
• Witnessing the conduct is not the same as running a process: the employer still needs to put the allegation to the employee and consider their explanation.
• Prior warnings matter, but are not enough: a final written warning may support seriousness, but it does not remove the need for fairness over the later incident.
• Contribution can be substantial: serious employee misconduct can sharply reduce remedies even where the dismissal is unjustified.
• Bullying claims require proof: stress at work is not enough if the alleged bullying or disadvantage is not established on the evidence.
• Lost wages are counterfactual: the ERA may award less than three months if it concludes the employment relationship would likely have ended soon anyway.
• Dismissal in public increases hurt: being dismissed in front of colleagues or others on site may increase compensation for humiliation and loss of dignity.

Read the full ERA determination (embedded)

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