NEW ZEALAND CARDS Ltd v RAMSAY NZEmpC CHCH
| Jurisdiction | New Zealand |
| Judge | A A Couch |
| Judgment Date | 27 March 2012 |
| Court | Employment Court |
| Docket Number | CRC 6/10 |
| Date | 27 March 2012 |
IN THE MATTER OF a Challenge to a Determination of the Employment Relations Authority
[2012] NZEmpC 51
CRC 6/10
IN THE EMPLOYMENT COURT CHRISTCHURCH
Challenge to an Employment Relations Authority determination which held the defendant had been unjustifiably dismissed — defendant was a fulltime sales representative — plaintiff wanted defendant to resign and become a casual employee — defendant told to “make this the last day” but not explicitly dismissed — different beliefs over state of employment — whether plaintiff under a duty to communicate with defendant to clarify employment position under s4(1A)(b) Employment Relations Act 2000 (good faith — parties required to be responsive and communicative) — whether defendant entitled to three months lost remuneration under s128 (lost remuneration as a result of the personal grievance) when he elected to become care giver for his mother.
Robert Beresford, agent for the plaintiff
Jonny Sanders, advocate for the defendant
JUDGMENT OF JUDGE A A Couch
New Zealand Cards Limited (the Company) makes and sells scenic postcards and similar products. The sole shareholder and director of the Company is Bob Beresford. Colin Ramsay was employed by the Company for ten years or more until late November 2008. The principal issue in this case is how the parties' employment relationship came to an end. Mr Ramsay says he was dismissed. The Company, through Mr Beresford, says that Mr Ramsay either resigned or abandoned his employment.
Mr Ramsay pursued a personal grievance alleging that he had been unjustifiably dismissed. The Employment Relations Authority sustained his claim and ordered the Company to pay Mr Ramsay about $12,000 in remedies 1.
Subsequently, the Authority ordered the Company to pay a further $3,000 for costs 2. The Company challenged both determinations and the matter came before the Court by way of a hearing de novoIn the course of the hearing, which occupied four days, a great deal of evidence was given. This included several lengthy documents and three audio recordings. Much of this evidence was irrelevant or, at best, peripheral to the essential issues and need not be referred to. I confirm, however, that I have reviewed the whole of the evidence in the course of preparing this decision.
The Company operates a small business. Mr Beresford is a talented photographer, particularly of landscapes. He takes photographs which are used to make postcards, sold principally to tourists. The Company also makes some other products but scenic postcards provide most of its business. These postcards are sold to retailers throughout New Zealand.
Mr Ramsay was originally employed by the Company on a part time basis to make and repair stands used to display the postcards. He was introduced to Mr Beresford by his sister, Elaine Ramsay, who worked for the Company as an accounts clerk and bookkeeper. It was unclear from the evidence when the employment relationship was established but it appears to have been between 1996 and 1998. As well as working for the Company, Mr Ramsay earned money doing gardening.
In about 2000, Mr Ramsay became a full time employee of the Company. In addition to carrying on with the work he had done before, he became a sales representative for the Company. His territory included the whole of the South Island and the lower part of the North Island. This part of the work required Mr Ramsay to undertake lengthy trips, during which he frequently worked long hours. Working full time for the Company meant that Mr Ramsay did less gardening than before but he continued to do some.
In 2002, Mr Beresford was dissatisfied with some aspects of Mr Ramsay's performance. In particular, he felt that Mr Ramsay worked too slowly. Mr Beresford recorded these matters in a letter in which he suggested that Mr Ramsay give up the sales work and return to working only part time. That never happened and Mr Ramsay continued working full time as before.
In about 2005, Elaine Ramsay began cultivating and selling four leaf clovers as a novelty item. Mr Ramsay assisted her to place a few of these in retail stores. When he learned that Mr Ramsay was doing this, Mr Beresford became concerned. There was some discussion between the two men about it but this was never a disciplinary issue and Elaine Ramsay stopped producing the items after only a year or so.
Also around 2005, one of the retailers of his cards commented to Mr Beresford that Mr Ramsay had been promoting what were known as 3D cards for another supplier. This prompted another discussion between the two men but, again, there were no disciplinary connotations.
In mid-2008, another issue arose. During his sales trips, Mr Ramsay worked many more than 40 hours each week. While he was in Christchurch, his other work sometimes did not occupy him all of each day. To even out his income, and possibly to reduce the amount of tax he had to pay, Mr Ramsay recorded some of the hours he had worked while away on sales trips as hours he had worked in Christchurch. It appears he started this practice some time in 2006 but it only came to Mr Beresford's notice in July 2008. He then had a lengthy discussion about this with Mr Ramsay. It concluded with Mr Ramsay saying he would stop the practice and Mr Beresford saying he could continue if he wished. Subsequently, Mr Ramsay did not transfer any more hours.
After resolving this issue with Mr Ramsay, Mr Beresford took up the same issue with his sister. As a result of accusations of dishonesty made by Mr Beresford which Elaine Ramsay found unacceptable, she resigned. She finished work for the Company around the end of October 2008.
An important consideration for Mr Ramsay was the care and well being of his elderly mother. During the second half of 2008, her health was deteriorating. She lived alone in her own home and, while she was able to care for herself during the day, she increasingly needed assistance at night. While he was in Christchurch, Mr Ramsay was able to provide that assistance but he was obviously unable to do so while away on sales trips.
The market for postcards of the type produced by the Company was seasonal. During the winter, the demand was less and few, if any, sales trips needed to be made. There was, however, a real need for such trips to be made from September onwards. Mr Ramsay made a trip to coastal Otago in late August 2008, a trip to Central Otago in mid-September and a further trip to Picton in late September but more trips were required.
Mr Ramsay was conscious of the competing demands of his job and his mother. He spoke regularly with her doctors and made enquiries about getting paid care for her. In early October 2008, he approached Mr Beresford. They discussed the situation. Mr Ramsay expressed his concern about being able to make lengthy sales trips unless arrangements were made to care for his mother. Mr Beresford did not suggest any changes to Mr Ramsay's job at that stage.
Another issue which became apparent about this time was that Mr Ramsay had accrued eight weeks of annual holidays. Mr Beresford was concerned about the contingent liability this represented and encouraged Mr Ramsay to take some of those holidays. Mr Ramsay responded by taking most of the first three weeks of October 2008 as holidays. When he returned to work, Mr Ramsay was able to arrange for someone else to be with his mother for a week and he used that time to make a sales trip to the west coast of the South Island. After Mr Ramsay had been away for four days, however, his mother unexpectedly deteriorated and he had to return to Christchurch
On 11 November 2008, Mr Ramsay approached Mr Beresford again. Mr Ramsay said that he felt unable to take extended trips out of town until arrangementshad been made to care for his mother. Mr Ramsay told Mr Beresford of the efforts he was making to do that. No conclusions were reached in that discussion.
On Friday 21 November 2008, Mr Ramsay's mother had a sudden turn and was admitted to hospital. The nature of her condition was unknown and a major source of worry for Mr Ramsay over the weekend. He made an appointment to see the hospital doctor who was attending her on the afternoon of Monday 24 November 2008. In order to keep that appointment, he had to leave work at 3.30pm.
Mr Ramsay went to work as usual on Monday 24 November 2008. During the morning, Mr Beresford telephoned him and Mr Ramsay told Mr Beresford about the appointment. Some time after 3pm, Mr Beresford went to Mr Ramsay's work area and engaged him in conversation.
This conversation was the last effective communication between Mr Beresford and Mr Ramsay and is central to the issues in this case. Unbeknown to Mr Ramsay, Mr Beresford recorded the conversation and he did not reveal the fact that he had done so until shortly before the Authority's investigation meeting. The tape recording and various transcripts of it were produced during the hearing before the Court.
Although it is clear from the tape recording what was said in this conversation and how it was said, there were critical differences in the parties' views about the inferences to be drawn from it. I deal with those in later in this decision. Some aspects of the matter are, however, undisputed. Mr Beresford initiated the conversation with a view to resolving the uncertainty about Mr Ramsay's availability to do sales trips in the immediate future. Mr Beresford wanted Mr Ramsay to cease being a full time employee and, instead, to become a casual employee available on call. During the conversation, Mr Beresford repeatedly urged Mr Ramsay to resign and proposed several times that Mr Ramsay make that day his last day. Mr Beresford did not, however, explicitly say that Mr...
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