16 August 2022

Dismiss In Haste, Repent At Leisure

The recent Employment Relations Authority (Authority) decision in Curnow v Advanced Security Group (Sth Is) Limited [2022] NZER 359, is a lesson to all employers that, even when your employee has admitted to serious wrongdoing, you must still follow a fair process before deciding to dismiss.

Advanced Security Group (Sth Is) Limited (ASG), a security and surveillance firm, summarily dismissed its employee, Garry Curnow, for making covert recordings of conversations between his co-workers that he was not a party to. Mr Curnow acknowledged he had secretly recorded his colleagues’ conversations and provided his employer with the recordings. Despite this activity being a crime, for which Mr Curnow was subsequently prosecuted and pleaded guilty to, the Authority found that Mr Curnow’s dismissal from employment was unjustified due to serious flaws in the way ASG investigated the allegations and carried out its disciplinary process.

The Authority emphasised that Mr Curnow’s conduct was behaviour that “irrevocably destroyed the trust his employer was entitled to place in him” and concluded that summary dismissal of Mr Curnow was a decision that was open to a fair and reasonable employer in all the circumstances. The problem for ASG was wholly down to some serious procedural flaws, including:

  • ASG’s investigation into an initial complaint, that Mr Curnow was threatening and aggressive towards co-workers was biased from the outset. ASG did not act upon Mr Curnow’s complaint regarding issues with his team leader but focused on the team leader’s complaint.

  • ASG interviewed co-workers but did not record statements or provide details of the complaints to Mr Curnow for his response. The Authority found this to be a significant breach of ASG’s good faith obligations.

  • When the second serious allegation of making covert recordings came to light, ASG failed to put Mr Curnow on notice of the fresh allegation or the possibility that a criminal complaint would ensue. ASG did not give him a reasonable opportunity to seek legal advice before questioning him on the allegations.

  • ASG made the decision to dismiss Mr Curnow during the same meeting that he gave his response to the second allegation. Prior to the meeting, ASG failed to inform Mr Curnow that a potential outcome of the meeting was dismissal. ASG did not investigate the context of the recordings or consider mitigating circumstances before quickly moving to the decision to dismiss.

The Authority also criticised ASG for appointing the General Manager as the investigator and decision maker. Consideration was given to ASG’s resources, and the Authority observed that appointing an external investigator would have been wise.

Although Mr Curnow ultimately succeeded in his personal grievance, the judgment was clear that Mr Curnow engaged in blameworthy misconduct and did not act in good faith. He should have made a formal complaint about his co-workers’ conduct instead of making the covert recordings. As a result, the Authority reduced the compensatory remedy it would otherwise have awarded him. That was cold comfort for ASG, which was ordered to make payments to Mr Curnow of nearly $30,000.

Whether a decision to dismiss an employee is justified is inherently fact specific. Therefore, we recommend seeking legal advice at an early stage before taking action against an employee, even when the issues seem reasonably clear cut, as they must have done for ASG.

The above information is of a general nature only. The information in this article does in no way constitute legal advice and all readers should contact a law firm for advice relating to their specific circumstances.

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