A farmer/worker relationship – frustrating but not frustration

The Court of Appeal has published its decision in a case about whether an employment agreement had been frustrated in law when the employee fell under suspicion of sexual abuse of the employer’s young son. (A Worker v a Farmer - CA552/2009 [2010] NZCA 547)

Putting aside the legal aspects for a moment, the case illustrates vividly the difficulties that can sometimes arise when employer and employee live and work together. When the farmer’s 4 year old son suggested he had been touched sexually by the worker who lived on the farm, the farmer and his wife understandably wanted the man out immediately. The worker denied the charges, but left voluntarily.

However, despite what seems an extensive police investigation, including using DNA analysis, the police were unable to substantiate the allegations and no charges were brought. The worker brought claims of unjustifiable dismissal.

He won his claim in the Employment Relations Authority but lost on appeal to the Employment Court, which decided that the employment contract had been frustrated once the farmer’s son had made his allegation of indecent assault. The employment relationship came to an end then and there, the Court said, and the worker had not been dismissed. The Employment Court accordingly found that the personal grievance of unjustifiable dismissal had not been sustained and the appeal was allowed.

The worker then appealed to the Court of Appeal. The Court of Appeal looked at the law of frustration and found that, as the Employment Relations Act imposes statutory requirements, including dealing in good faith and providing the employee with an opportunity to comment on information relevant to a proposed termination of employment, it could not be said that the employment contract did not make sufficient provision for what had occurred, a prerequisite for the concept of contractual frustration to apply.

So, the contract had not been frustrated, and the worker had been dismissed. The case has now been remitted to the Employment Court to find out if the dismissal had been unjustified. As no dismissal process had been followed, it probably will be found to have been unjustified.

Whatever the outcome, this is an awful situation that must have caused considerable distress to everyone concerned.