Yifu Jiang v Smartrade Limited [2026] NZERA 56

A detailed, plain-English summary of an Employment Relations Authority (ERA) determination about an employer trying to rely on a fixed-term clause to end employment, and why the Authority found the dismissal was unjustified. The full determination is embedded at the end of this page.

What happened

Mr Jiang worked for Smartrade Limited as an office clerk from 2 October 2023 until his employment ended on 11 December 2024.

The written employment agreement was not signed until 7 December 2023 (about two months after he started). It recorded a full-time Monday to Friday role at $1,100 gross per week, and said the agreement may be terminated on 11 December 2024 by either party giving two weeks' written notice.

On 11 November 2024 the owner/manager emailed Mr Jiang advising the business would not renew his employment contract when it expired on 11 December 2024, referring to unexpectedly low market conditions and insufficient sales to cover expenses including wages.

Mr Jiang raised a personal grievance for unjustified dismissal. The employer defended the claim by saying the employment was always a fixed term and that it was simply not renewed at expiry. The employer also raised a counterclaim alleging various breaches and seeking orders against Mr Jiang.

What the Authority had to decide

• Was Mr Jiang unjustifiably dismissed?
• If so, what remedies should be awarded (lost wages and compensation)?
• Was the employer's counterclaim established?

Key findings in plain English

• The Authority held the employer could not lawfully rely on the fixed-term clause because the statutory requirements for a fixed term were not met.
• There was insufficient evidence that the employer had genuine reasons (based on reasonable grounds) for a fixed term that were communicated to and agreed with Mr Jiang before the agreement was entered.
• The written agreement recorded an end date but did not record the reasons for a fixed term, which is a mandatory requirement.
• Because the fixed term was not lawful, ending the employment by notice was a dismissal, and the employer was required to run a fair process.
• Mr Jiang was not given an opportunity to comment on the proposal to end his employment, and the Authority held the dismissal was not what a fair and reasonable employer could have done in all the circumstances (s 103A).
• The employer's counterclaim was rejected. Performance-type allegations could have been dealt with during employment using ordinary processes, and the alleged property/confidentiality/other issues were not proved to the required standard.

Orders and payments

• Within 21 days of the determination date, the employer was ordered to pay $12,000 compensation for humiliation, loss of dignity, and injury to feelings (s 123(1)(c)(i)).
• Within 21 days of the determination date, the employer was ordered to pay $15,600 gross lost wages (13 weeks at $1,200 per week) as reimbursement (s 123(1)(b)).
• Contribution was not applied (no blameworthy contribution by the employee).
• Costs were reserved, with a timetable for any costs memorandum (applicant within 21 days; respondent reply within 14 days of service).

Why this case matters

• Fixed-term agreements are technical. It is not enough to write an end date - the employer must have genuine reasons based on reasonable grounds, those reasons must be communicated and agreed before the term is entered, and the reasons must be recorded in the agreement.
• If a fixed term is not lawful, ending the employment at the nominated end date can still be treated as a dismissal at the initiative of the employer - and a fair process is required.
• Counterclaims are not a substitute for ordinary employment processes. If an employer says there were performance or misconduct issues, the Authority will look at whether those were raised and dealt with properly at the time.

Read the full ERA determination (embedded)

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