Costly CDHB Decision – Reminder to Employers

A recent Employment Relations Authority (Authority) case has been released which is a good reminder to employers of the perils of disciplinary investigations and dismissals.

In the case of Conner v Canterbury District Health Board [2020] NZERA 444, Canterbury District Health Board (CDHB) was ordered to pay Ms Conner over $42,000 after terminating her employment following an investigation that “fell woefully short of procedural fairness”.  The facts of the case are as follows.

Ms Conner worked in the Burwood Hospital café. She was approached by another staff member asking for money to buy throat lozenges from the hospital pharmacy. The pharmacy pay facility was not working at the time, so Ms Conner removed some cash from a “charity jar” for donations to feed the hospital’s adopted cat, Harry (Harry’s Jar). She removed $20 from the jar, opened the till and swapped the $20 for two $10 notes, then placed $10 back into the jar. She then used the other $10 to pay for the lozenges for the other staff member.

There was some confusion between Ms Conner and the other staff member as to who would replace the $10 that was taken, however, it was eventually replaced by the other staff member.

CDHB commenced an investigation and then dismissed the employee for “misappropriating cash and acting in a deceptive manner with intent”.

The Authority identified the following issues with CDHB’s process:

1. The person who undertook the investigation and was also the decision-maker (Investigator) failed to make a record and disclose details of the first part of his investigation to Ms Conner;
2. The Investigator failed to disclose CCTV footage of the incident to Ms Conner prior to the first investigation meeting;
3. The summary of Ms Conner’s responses during the first investigation meeting was inaccurate;
4. The Investigator failed to interview relevant witnesses;
5. The Investigator pre-determined the decision to dismiss Ms Conner;
6. The Investigator did not follow internal Investigation and Disciplinary Process guidelines (nor did HR make him aware of the guidelines);
7. The Investigator did not consider the background and context to Harry’s Jar;
8. All meetings were inexplicably poorly documented and a ‘best practice’ of sharing agreed meeting notes was not adhered to; and
9. The Investigator failed to consider alternatives to dismissal.

The Authority found that CDHB did not have sufficient evidence to establish that Ms Conner intended to steal the money. The dismissal was held to be both substantively and procedurally unjustified.

Ms Conner was awarded compensation and lost wages, but her overall remedies were reduced by 10% for contributory conduct on the basis that the Authority thought it “unwise” of her to have taken the money in the first place. After the reduction for contributory conduct, Ms Conner was awarded $15,863.60 gross for lost wages and $27,000.00 in compensation.

This case is a good reminder to employers that, to dismiss an employee, you need to have both good reasons for the dismissal and to follow a fair process prior to dismissing the employee.

This involves:

1. Writing to the employee:
   • setting out the allegations against them in detail;
   • providing them will all relevant information;
   • advising them of their right to seek advice/representation; and
   • inviting them to attend a meeting to provide feedback on the allegations and information; and

    

2. Meeting with the employee to hear their response to the allegations;
3. Investigating further if required and giving the employee an opportunity to respond to any additional information; and
4. Communicating your decision to the employee.

It is very important to seek legal advice prior to undertaking such a process as not doing so can be very costly for a business.

For more information and specific legal advice on your employment relations obligations please contact us at the below details:

Andrew Riches (Partner)

Email: andrew.riches@saunders.co.nz

Mobile: 021 982 115

Claire McCool (Senior Associate)

Email: claire.mccool@saunders.co.nz

Mobile: 021 885 086

Deborah Hendry (Lawyer)

Email: deborah.hendry@saunders.co.nz

Mobile: 022 153 0220