Getting dismissals right – a cautionary tale

The Employment Court case of Villegas –v- Visypak (NZ) Limited is a cautionary tale of how important it is to state clearly the reason for dismissal and ensure it links to the terms of any final warning relied upon.

Mr Villegas was employed as a forklift hoist driver. He was involved in a near miss through driving his forklift in an unsafe way, and received a 6 month written warning as a result. The warning advised Mr Villegas that he was to “drive his fork hoist safely, report all incidents, listen carefully to all instructions and, if at all unsure, clarify what is required and work as a co-operative team member in the department.” The Employment Court found that this written warning was justified.

Mr Villegas was then involved in three further incidents during the lifetime of the last warning, and received a 12 month final written warning. The three incidents involved loading a full LPG cylinder unrestrained onto the forks of the fork hoist and driving it at speed; damaging a water pipe, leaving it spilling water onto electrics and tipping over a full bin of parts which, as a consequence, had to be scrapped. Again, the Court found that these incidents demonstrated blameworthy conduct.

The company’s last straw came when Mr Villegas deliberately tipped over a 3 metre stack of pallets containing cardboard boxes because, he said, he could not retrieve the top items any other way. The Employment Court found that this action had demonstrated a lack of concern for safety.

The Company decided to dismiss Mr Villegas because of the deliberate tipping incident. The reason given in the dismissal letter was “a failure to follow specific instructions.”

The Employment Court, however, found that this was an unjustified dismissal. The dismissal letter stated there was a failure to follow instructions but did not explain what those instructions actually were. The Court presumed it related to the instructions given in the two previous warning letters, but had difficulty with that interpretation as the actual event that gave rise to the dismissal bore little resemblance to the four instructions in the warning letters.

The lesson is for employers is as follows:

1 first clearly and accurately identify what breach or breaches of conduct they are unhappy with, and then investigate them specifically;

2 set out clearly in any written warning what breaches have been found and what corrective conduct is expected. State the breaches widely if possible, to give more scope for tracking back to them in any subsequent dismissal;

3 expressly cross refer back to the live warning if relying on it in any dismissal.

I hope that the new justification test which will be in place from 1 April 2011 will see a more flexible and holistic approach being taken by the ERA and the Employment Court in cases like these.