| Restrictions | OK |
|---|---|
| Jurisdiction | Employment Relations Authority - Auckland |
| Reference No | [2012] NZERA Auckland 342 |
| Hearing date | 23 Apr 2012 : 24 Apr 2012 (2 days) |
| Determination date | 01 October 2012 |
| Member | A Dumbleton |
| Representation | A Drake ; P Swarbrick |
| Location | Auckland |
| Parties | Edwards v Two Degrees Mobile Ltd |
| Summary | ARREARS OF WAGES – DISPUTE – PENALTY - Parties disputed interpretation and application of parties’ employment agreements - Applicant sought arrears of wages, interest, compensation for loss of entitlement as unable to participate in employee share option scheme and penalties for breaches of agreement – Authority found 2007 agreement superseded parties’ previous agreements – Found applicant did not assent to subsequent agreement - Found applicant entitled to $350,000 salary per annum, parties to determine quantum of arrears of wages - Interest payable – Found applicant entitled to two month notice period if employment terminated – Found respondent could not prevent applicant from participating in share option scheme itself but could determine extent of applicant’s participation – Compensation appropriate as applicant denied opportunity to participate in share option scheme, parties to determine quantum |
| Abstract | Applicant employed by respondent. Parties disputed interpretation and application of parties’ employment agreements (“EA”). Applicant sought arrears of wages, interest, compensation for loss of entitlement as unable to participate in employee share option scheme and penalties for breaches of EA. Applicant’s unjustified dismissal claim removed to Employment Court. Applicant claimed entitled to three years’ notice period in accordance with initial EA (“2002 agreement”). Respondent denied applicant entitled to three years’ notice or alternatively claimed any previous agreements superseded by subsequent arrangement parties entered into (“2007 agreement”). 2007 agreement stated applicant to receive substantial salary increase to $350,000 per annum. Respondent claimed 2007 agreement superseded by applicant’s conduct when applicant acquiesced to further changes year later (“2008 agreement”) including 43 per cent salary reduction and one month notice period. Respondent denied applicant entitled to participate in any employee share option scheme after 2008 agreement in place. Applicant refused to sign 2008 agreement but respondent began paying salary at reduced rate. Applicant advised respondent would not accept 2008 agreement two months later.;AUTHORITY FOUND –;ARREARS OF WAGES: Authority ordered non-publication of information relating to share option schemes. Applicant did not assent to 2008 agreement and applicant’s alleged acceptance of reduced salary did not amount to agreement. Under 2007 agreement applicant’s salary increase part of consideration for reduction of notice period. Applicant entitled to previous $350,000 salary per annum, parties to determine quantum of arrears of wages. Interest payable.;DISPUTE: Applicant entitled to three year notice period under 2002 agreement but 2007 agreement superseded parties’ previous agreements. Applicant entitled to two month notice period if employment terminated. Under 2007 agreement applicant entitled to participate in any employee share option scheme. Respondent could not prevent applicant from participating in share option scheme itself but could determine extent of applicant’s participation. Compensation appropriate as applicant denied opportunity to participate in share option scheme, parties to determine quantum.;PENALTY: Applicant aware salary being paid at reduced rate over three years prior to applicant commencing penalty claim. Penalty could not be awarded for respondent’s actions or omissions occurring over year ago. $4,000 penalty appropriate. Penalty for other alleged breaches by employer could not be awarded as claims outside time limit. |
| Result | Applications partially granted ; Orders made ; Arrears of wages (quantum to be determined) ; Interest (5%) ; Compensation as applicant denied opportunity to participate in share option scheme (quantum to be determined) ; Penalty ($4,000)(payable to Crown) ; Costs reserved |
| Main Category | Arrears |
| Statutes | ERA s4(1);ERA s134;ERA s135;ERA s135(5);ERA Second Schedule cl10;ERA Second Schedule cl11;Judicature Act 1908 s87(3) |
| Cases Cited | Brogden v Metropolitan Railway Co (1877) 2 App Cas;Investors Compensation Scheme Ltd v West Bromwich Building Society [1998] 1 WLR 896;Silver Fern Farms Ltd v New Zealand Meatworkers and Related Trades Unions Inc [2010] ERNZ 317;Smith v Stokes Valley Pharmacy (2009) Ltd [2010] ERNZ 253;Vector Gas Ltd v Bay of Plenty Energy Ltd [2010] NZSC 5 |
| Number of Pages | 13 |
| PDF File Link: | 2012_NZERA_Auckland_342.pdf [pdf 276 KB] |