| Restrictions | OK |
|---|---|
| Jurisdiction | Employment Relations Authority - Auckland |
| Reference No | AA 97/07 |
| Hearing date | 27 Feb 2007 |
| Determination date | 29 March 2007 |
| Member | R Arthur |
| Representation | C Rowe ; C Patterson |
| Location | Auckland |
| Parties | Belich v Rusty Pelican Ltd |
| Summary | JURISDICTION - Whether employee or independent contractor - All shares in respondent company (RPL") owned by R&R through joint share and trust - Applicant and husband discussed buying RPL - Applicant and husband unable to raise required funds to buy business outright - Applicant, husband and two others ("G") formed 3PL Ltd in order to buy 45% of shares in RPL - Applicant, husband and G's ("Group B") to work in business - Arrangement formalised ("shareholders arrangement") - R&R to continue as majority shareholders ("Group A") - Applicant, husband and G to own one share jointly with another 499 shares owned through 3PK Ltd - Transfer of shares not completed and registered until later date - R&R left for Australia and Group B became responsible for day to day operations - Applicant accepted work for company had changed - R&R became concerned about financial state of business - R&R had meeting with "P" - R&R instructed business consultant ("SAS") to act on RPL's behalf in all business and financial matters - SAS instructed to take whatever steps necessary to ensure continuity - Two companies incorporated to purchase assets of RPL - R&R told applicant could no longer have access to company accounts - Applicant an employee - Applicant remained responsible to and was directed by R&R - Inference from actions of parties applicants employment intended to be continuous - Authority found provisions of shareholders agreement amounted to contracting out of Employment Relations Act - Indemnity provisions of shareholders agreement illegal and unenforceable - UNJUSTIFIED DISMISSAL - Provision where Group B shareholders to indemnify R&R to be treated as removed from document -Applicant suspended under provisions of shareholder agreement - Insufficient evidence of financial information being compromised to justify suspension - Did not turn minds to applicants rights as employee - Concerns about financial situation not fairly put to applicant - Indefinite suspension made unjustified disadvantage an unjustified dismissal" |
| Result | Application granted ; Reimbursement of lost wages ($8017.33) ; Compensation for humiliation etc ($6000) ; Costs reserved |
| Main Category | Personal Grievance |
| Statutes | Companies Act 1993 Third Schedule;Companies Act 1993 Seventh Schedule;ERA s6;ERA s6A;Receiverships Act 1993 s30(2)(b);Receiverships Act 1993 s30(3) |
| Cases Cited | PBO Ltd (formerly Rush Security Ltd) v Da Cruz [2005] 1 ERNZ 808 |
| Number of Pages | 11 |
| PDF File Link: | aa 97_07.pdf [pdf 60 KB] |