| Restrictions | OK |
|---|---|
| Jurisdiction | Employment Relations Authority - Christchurch |
| Reference No | [2013] NZERA Christchurch 47 |
| Hearing date | 17 Jan 2013 |
| Determination date | 04 March 2013 |
| Member | M B Loftus |
| Representation | P Dalziel ; H White |
| Location | Timaru |
| Parties | Frahm v New Zealand Dairy Workers Union Te Runanga Wai U Inc |
| Summary | GOOD FAITH – Applicant claimed respondent breached duty of good faith by making statements misleading, or likely to mislead, respondent’s members voting on terms of prospective collective employment agreement – Authority found respondent accepted wage increase could not be annualised when term less than one year and resulting portrayal of wage increase over first year inflated – Found value of medical insurance upgrade not portrayed inaccurately – Found fact wage increase portrayed inaccurately meant total portrayal inaccurate – Found no breach of duty of good faith as even annualised wage increase less than increase respondent promised members initially, actual wage increase reported and not hidden and respondent understood portrayal to be accurate when representation made – No breach of duty of good faith |
| Abstract | Applicant claimed respondent breached duty of good faith by making statements misleading, or likely to mislead, respondent’s members voting on terms of prospective collective employment agreement (“CEA”). Respondent negotiated new CEA with employer and respondent’s members provided with summaries of terms of settlement (“summary”). Summary stated wage increase over eleven months of first year of new CEA 4.15 percent meaning annualised increase of 4.53 percent over whole year. Summary stated upgrade of medical insurance plan by employer worth 0.48 percent meant total annualised increase over first year of new CEA of 5.01 percent. Applicant claimed respondent’s members misled into accepting proposed CEA and value of settlement inflated deliberately to influence vote’s outcome resulting in improperly obtained ratification. Applicant claimed annualised wage increase of 4.53 percent over first year mathematically false and overstated amount received by respondent’s members. Applicant claimed dollar amount of medical insurance upgrade could not represent 0.48 percent increase for even lowest paid of respondent’s members.;AUTHORITY FOUND –;GOOD FAITH: Respondent accepted wage increase could not be annualised when term was less than one year and resulting portrayal of wage increase over first year inflated. Real benefit to employees of medical insurance upgrade greater than applicant’s calculations based on net benefit received by employees. Evidence clear respondent’s members advised during ratification meetings 0.48 percent increase not worth 0.48 percent of every member’s salary and members told accurately what figure represented. Nothing misleading in way medical insurance upgrade portrayed. Fact wage increase portrayed inaccurately meant total portrayal inaccurate. No breach of good faith as even annualised wage increase less than increase respondent promised members initially, actual wage increase of 4.15 percent reported and not hidden, respondent’s practice used commonly by number of unions over number of years, respondent understood portrayal to be accurate when representation made and nature of evidence complex. No breach of duty of good faith. |
| Result | Application dismissed ; Costs reserved |
| Main Category | Good Faith |
| Statutes | ERA s4(3) |
| Cases Cited | AMI Insurance Ltd v Finsec Inc (No 2) [2003] 1 ERNZ 518;Waikato District Health Board v New Zealand Public Service Assoc Inc [2008] ERNZ 80 |
| Number of Pages | 6 |
| PDF File Link: | 2013_NZERA_Christchurch_47.pdf [pdf 221 KB] |