| Restrictions | OK |
|---|---|
| Jurisdiction | Employment Relations Authority - Auckland |
| Reference No | [2015] NZERA Auckland 196 |
| Hearing date | 19 - 20 May 2015 (2 days) |
| Determination date | 30 June 2015 |
| Member | E Robinson |
| Representation | B Smith ; R Amaranathan |
| Location | Auckland |
| Parties | Tibbitts v EWP Sales Ltd and Anor |
| Other Parties | UP2IT Access Hire Ltd |
| Summary | BREACH OF CONTRACT – Applicant sought damages for respondent’s breaches of employment agreement (“EA”) by failing to pay bonus and settlement agreement (“SA”) by failing to pay amount owed – Whether respondent allowed to withhold money owed under SA for applicant’s breaches of EA and SA - PENALTY – Applicant sought penalty for respondent’s failure to pay amount owed under SA - COUNTERCLAIM – PENALTY - Respondent sought penalty for applicant’s breach restraint of trade provisions in SA – Operations/sales Manager |
| Abstract | AUTHORITY FOUND –BREACH OF CONTRACT: EA contained one express provision covering bonuses. No evidence of any other additional terms added covering bonuses. Respondent incorrectly calculated bonus payment but overpaid applicant instead. No breach of EA. SA entered into in accordance with s149 Employment Relations Act 2000 (“ERA”), so cannot be set aside except in cases of duress, but no evidence of duress. Factors indicating joint employment between respondent and third party, but still does not set SA aside. Respondent to pay applicant $24,500 damages. Interest payable.PENALTY: Respondent’s breach of SA deliberate and sustained, although done under mistake belief. $250 penalty appropriate.COUNTERCLAIM – PENALTY: Restraint of trade clause in SA enforceable under s149 ERA. Applicant had interest in business competing with respondent in breach of clause and applicant took respondent’s confidential information for use in business. Respondent had not given express written consent to applicant setting up competing business. Breach of clause deliberate and flagrant. Breach caused respondent’s director great stress. Applicant ordered to comply with clause. $10,000 penalty appropriate. |
| Result | Applications granted ; Orders made ; Interest (5%) ; Penalty ($250)(payable to Crown)($10,000)(payable to respondent) ; Costs reserved |
| Main Category | Breach of Contract |
| Statutes | ERA s149;ERA s149(2);ERA s149(3);ERA s149(3)(ab);ERA s149(4);ERA Second Schedule cl11;Holidays Act 2003;Judicature Act 1908;Judicature (Prescribed Rate of Interest) Order 2011 |
| Cases Cited | EWP Sales Ltd v Tibbitts [2015] NZHC 619;Hutton v Provencocadmus Ltd (in rec) [2012] NZEmpC 207, [2012] ERNZ 566;Xu v McIntosh [2004] 2 ERNZ 448 (EmpC);Young v Board of Trustees of Aorere College [2013] NZEmpC 140 |
| Number of Pages | 26 |
| PDF File Link: | 2015_NZERA_Auckland_196.pdf [pdf 325 KB] |