Keith Wills v Goodman Fielder New Zealand Ltd
| Jurisdiction | New Zealand |
| Judge | B A Corkill |
| Judgment Date | 22 December 2014 |
| Court | Employment Court |
| Docket Number | CRC 3/14 |
| Date | 22 December 2014 |
IN THE MATTER OF a challenge to a determination of the Employment Relations Authority
[2014] NZEmpC 233
CRC 3/14
IN THE COURT OF APPEAL OF NEW ZEALAND
Challenge to a determination of the Employment Relations Authority (“the Authority”) which found the plaintiff had not been unjustifiably disadvantaged in his employment, that the defendant not been bound to make his position redundant and he was not entitled to redundancy compensation — the plaintiff had been employed as a baker by the defendant from 1978 — by 2011, he was the Bread Plant Manager — building was damaged in the Christchurch earthquake in February 2011 and ceased operating — following the earthquake other bakery staff were made redundant — the plaintiff held some temporary roles but resigned in December 2011 due to frustration and uncertainty over his role — policy stated an employee could become redundant when work disappeared — the plaintiff claimed constructive dismissal — breaches of duty alleged were: failure to provide him with meaningful work; failing to treat him in good faith and failing to properly consider his request to be made redundant in November 2011 — the plaintiff sought reimbursement of lost wages and other money, including loss of benefits in the form of redundancy compensation as well as compensation for hurt, humiliation and injury to feelings — whether the plaintiff's position had become redundant — whether the defendant had breached it duties.
L Ryder and J Goldstein, counsel for the plaintiff
T Clarke, counsel for the defendant
JUDGMENT OF JUDGE B A Corkill
Mr Keith Wills was employed as a baker by Goodman Fielder New Zealand Limited (Goodman Fielder) or its predecessor company, from 1978. By 2011, he was the Bread Plant Manager at the bakery operated by Goodman Fielder at Essex Street in Christchurch (Essex Street site). The bakery building and plant was seriously damaged in a significant earthquake which occurred on 22 February 2011.
This case concerns what happened to Mr Wills' role following the earthquake. Although his staff were eventually made redundant, he was not because Goodman Fielder hoped to retain his skills and experience. He held some temporary roles, but by late 2011 he was very uncertain as to whether the bakery would be rebuilt, and as to what would be required of him in the meantime. In December 2011, he resigned in frustration. He then brought proceedings in the Employment Relations Authority (the Authority), asserting that he had been constructively dismissed because Goodman Fielder had breached duties owed to him. In particular, he contended that his position should have been disestablished, and that he should have been offered redundancy compensation. He sought various remedies including an amount equal to his redundancy compensation. He also brought a breach of contract claim in similar terms.
The Authority determined Mr Wills was not unjustifiably disadvantaged in his employment, and that Goodman Fielder was not bound to make Mr Wills' position redundant; it was also held that he was not entitled to redundancy compensation. 1 Mr Wills challenges the Authority's determination, essentially putting his case on the same basis as previously. Goodman Fielder contends that he resigned voluntarily, that there is no proper basis for asserting a constructive dismissal grievance and that it was not in breach of contract. It also says that he is not entitled to the remedies sought.
On 15 July 1978, Mr Wills commenced work as an apprentice baker for a business enterprise which was subsequently transferred to Goodman Fielder. In December 1998, he became Bread Plant Manager at the Essex Street site.
In 2004, Goodman Fielder was incorporated, and Mr Wills became an employee of that company with his previous service being treated as continuous.
Goodman Fielder had two main divisions: the Baking Division, which produced bread products under the trade-name of Quality Bakers; and the Dairy Division which produced products under the trade-name Meadow Fresh. Each division had its own management structure. It thereby operated two separate trading arms.
In his role as Bread Plant Manager, Mr Wills managed the day-to-day operations of the plant, including overall plant efficiencies, waste, quality and the administration of staff holidays' and rosters. Twenty-seven staff reported to him.
The bakery operated three shifts of nine staff, seven days a week except for Christmas day. An important part of Mr Wills' role was the training of apprentice bakers. To become qualified, three to five years' training and work experience was required. Goodman Fielder employed up to nine qualified bakers. Mr Wills was also responsible for ensuring the quality of the bread product was maintained, and that it was available for distribution in a timely wayMr Wills said he was passionate about bread-making and took pride in producing consistently top quality bread, on a continuous basis. It was common ground that he possessed excellent technical skills; he was regarded by management and colleagues as being very competent in his role.
On 4 September 2010, a major earthquake occurred in Christchurch. Although some damage was sustained by the plant at the Essex Street site, it continued to operate.
Between September 2010 and May 2011, Mr Wills took over responsibility for the Food Coatings division on a temporary basis which was also located at the Essex Street site. It was intended that the temporary role would continue until a replacement manager could be appointed, because the previous manager had transferred to Napier. Ultimately the Regional Operations Manager, Mr Tony Andrew, determined that Food Coatings did not require a full-time manager. The role was neither technical nor full-time. He offered Mr Wills the role, who then took over responsibility for Food Coatings.
The management of the Food Coatings occupied approximately 25 per cent of Mr Wills' full-time role; the Bread Plant Manager role, when the plant operated, occupied 75 per cent of his full-time role; and it constituted 90 per cent of his overall financial responsibilities.
At this point Mr Wills reported to the Manufacturing Manager, Mr Brett Pfahlert (based in Christchurch); Mr Pfahlert reported to Mr Andrew as the Regional Operations Manager (based in Christchurch); Mr Andrew reported to Mr Colin Avis, Manufacturing Director of Baking (based in Auckland); and Mr Avis reported to the General Manager of Goodman Fielder New Zealand, Roger Gray, (based in Auckland).
On 22 February 2011, a second earthquake occurred in Christchurch. The bakery building and plant was seriously damaged; this meant that both the bread and crumb plants had to cease operations.
In the aftermath, it was initially decided that the company would continue to pay as many staff as possible despite production having ceased. This was achieved by providing staff with alternative duties. Arrangements were made to bring in bread from plants beyond Christchurch; those at the Essex Street site arranged distribution. Mr Wills assigned some of his staff to these tasks, at the request of the Distribution Manager. The receipt of bread products to the Essex Street site meant that the production of breadcrumbs was able to recommence in April 2011; ten of Mr Wills' staff were thus able to return to normal duties.
In May 2011, Mr Pfahlert offered Mr Wills an appointment to the permanent role of Plant Manager – Bread and Food Coatings. The purpose of this role was to manage both the Bread Plant and the Food Coatings operations efficiently. Mr Wills had direct responsibility for the operation of those plants in all respects; key accountabilities included operational effectiveness, maintaining quality, ensuring the plants kept to their budgets, providing leadership of staff in both plants, ensuring health and safety standards were maintained, and effecting improvements. An employment agreement for the purposes of the new role was provided to Mr Wills, and both parties had signed this by 25 May 2011.
In April 2012, Mr Pfahlert was seconded to the Continuous Improvement Team in Auckland for 12 months. By June 2012 Mr Andrew was concerned that Mr Wills was finding the ongoing uncertain circumstances stressful. It had become clear that it could take two years to rebuild the baking manufacturing building and plant. After discussion with senior managers, Mr Andrew decided to announce at a meeting of staff that Mr Wills would cover some aspects of Mr Pfahlert's role while he was working in Auckland. It was his view that formalising this role with Mr Wills in advance was likely to be unacceptable to him. Before the two had discussed the additional duties he announced that Mr Wills would be assisting him. Then they informally agreed the details. Mr Wills' job description was not amended.
It was agreed that Mr Wills would be responsible for manufacturing at the Essex Street site; but he was not to be responsible for the distribution or logistics functions which operated at that site. Nor would he undertake some financial responsibilities which would otherwise fall on the Manufacturing Manager; those would be conducted by Mr Andrew.
For his part, Mr Wills did not consider that the role involved significant extra work. There were other managers at the site, and he saw the role as being a point of contact for staff or others if needed. He had on previous occasions been asked to undertake a Manufacturing Manager role, and had declined such an offer. A Manufacturing Manager had administrative and financial accountabilities which he said the company was well aware were tasks with which he did not feel comfortable; he made his concerns about taking on the full role clear to Mr Andrew, and the...
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