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Entitled, much? By Tristam Price

Updated: Sep 30, 2023

Coverstaff Recruitment employed consultants Mr Byrne and Mr Lemisio in March 2020. They both incorporated a company called Titan, in competition with Coverstaff almost a year later.

Three disputes arising from that ended up in the Employment Relations Authority, as per Member Robin Arthur’s determination below.

2023-NZERA-549.pdf (25 September 2023)

[3] In the first application Andrew Byrne asked the Authority to resolve a personal grievance claim about his dismissal on 15 March 2021 from his role as New Business Development Manager for Shamrock. On 14 March he gave four weeks’ notice of resignation. Shamrock’s chief operating officer Roanna Carran, who was also a director of Shamrock [Coverstaff] at the time, met with Mr Byrne the next day. After a brief discussion Ms Carran dismissed him without notice. [Coverstaff] said his dismissal was justified because Ms Carran had discovered Mr Byrne had set up a competing company, Titan Collective Limited (Titan), and that company was already carrying out business in the same sector of the recruitment industry as Shamrock.

[4] The second application was [Coverstaff] claim that Mr Byrne had breached the terms of his employment, including a restraint of trade, by using its information about clients and work candidates and by competing with [Coverstaff] in his new business, Titan. [Coverstaff] sought orders for penalties and an award of damages against Mr Byrne.

[5] The third application was a claim by [Coverstaff] against Filimino Lemisio.

The Companies register indicates that Titan was incorporated three weeks before Mr Byrne handed in his notice (and was summarily dismissed the next day). Because Titan is a competitor of Coverstaff, that was a conflict of interests, which put Coverstaff COO Ms Carran in a position where summary dismissal or garden leave were the only real options.

72 (c) He took for his own use business information sent to him in his capacity as a [Coverstaff] employee, by emailing information about jobs at a client business to his personal email address, breaching the term on use of confidential information.

And if Coverstaff had decided not to pursue it, that should have been the end of the matter. But it wasn’t.

Why would Mr Byrne bother raising a personal grievance claim for four week’s wages at a job he was leaving anyway, especially with the demands of running a startup company? Win or lose, he risked triggering a counterclaim that may not have otherwise seen the light of day.

In fact, that counterclaim did happen, not only against Mr Byrne, but also against his co-director Mr Lemisio.

The determination

  • While Coverstaff’s process in summarily dismissing Mr Byrne was slightly defective, no remedies were awarded.

  • Mr Byrne was ordered to pay Coverstaff $25,000 in penalties for seven breaches of his employment agreement.

  • Mr Lemisio was ordered to pay a $2,000 penalty which we understand was for deleting contacts and emails from his phone which was also broken when he returned it, plus $6755.57, mostly for the unpaid portion of a relocation allowance. If he’d stayed with Coverstaff for six more weeks until his first anniversary, Coverstaff would not have been able to claw back the $10,000 relocation allowance.

Plus they’re up for around $4,500 in costs between them.

Not such a smart idea raising a PG, was it? It wasn't that long ago (2015) that I went into competition with my last employer importing parts from China, and I had to respond to two letters from a lawyer that threatened legal action. With that on top of running a small business, especially a startup, it ain’t easy. So I hope these boys know what they’re doing.

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