Under Section 149 of the Employment Relations Act 2000, it is almost impossible to bring a mediated settlement agreement before the Employment Relations Authority except for enforcement purposes. We’re aware of examples of extraordinary efforts being made to get an employee into mediation (eg: verbal threats and/or wilful damage to the employee’s property) where the main purpose is to exit the employee with a gag clause, or where mediation has failed, by seeking ex-parte orders. Whistleblowers are often targeted.
Often, employees who go into mediation are satisfied with the exit package negotiated, ie: they sold their job and right to air their grievances for a fair price. Sometimes the only way an employer can resolve a problem is by chucking money at it and this may be a sound business decision and in terms of continuing professional development, a learning experience for the managers concerned.
An employee involved in an employment relationship problem, who for example might feel that working relationships are toxic but are confident that their skills are portable enough, can simply resign at their convenience. Even if they forgo the exit package , they keep their right of free expression under NZBORA and the right not to be blacklisted under the Privacy Act. If the employee gets out of a toxic workplace before problems end up in mediation, that saves a lot of stress, expense (notwithstanding the cost of replacing that employee), and loss of autonomy. With that said, we realise this is not always possible.
Because of the inherent secrecy associated with employment mediations it is difficult to collect information on what goes on inside the mediation; we know it can involve ambushing the employee’s counsel with documents that the employee cannot verify the authenticity of because they are usually in a separate room. We are aware of documents being surrendered in mediations in such a way that any OIA or Privacy Act request will yield nothing incriminating of the employer, and whatever the employee is being gagged about is often hidden from the Chief Executive or equivalent.
In 2015 then Chief Judge Colgan said a former employee in the medical industry (both parties anonymised) was gagged under s149 thus:
(Para 3) ...The parties will not disclose to any other person or entity that such an agreement has been reached or any of the circumstances/allegations leading to the Employee’s resignation. The parties agree that neither will take any further action in respect of the employment relationship or termination thereof. This includes, but is not limited to, making a complaint to the Police, the [relevant professional association] or raising a personal grievance. (TGP v TFE, EmpC 60, 2015).
This is horrifying. We’ve also heard a judge state in open court that an employee who is party to a settlement agreement with NDA can’t make a report to WorkSafe. But we are also learning that even without mediation, ERA Members have been issuing:
- Compliance Orders against former employees relying on nothing but boilerplate employment agreements (including orders that are illegal or ultra vires).
In 2019 ERA Member Trotman interfered with High Court proceedings by issuing a Compliance Order against a witness to those proceedings (Zelande v McCurdy) and was reported to the Law Society under Rule 2.8 (misconduct).
- Oral directions for former employees to effectively suspend their rights under NZBORA and not talk about their former employer.
One such oral direction from ERA Member Anna Fitzgibbon gave rise to a SLAPP against a former employee of Bay of Plenty DHB, along with her employment advocate. This will play out in the Employment Court on 29 June before Judge Corkill, the scope of that hearing limited to whether Ms Fitzgibbon had the right to make that direction in the first place and whether the Employment Court has the jurisdiction to rule on the first ever “Contempt of Authority” case in the 20 year history of the Employment Relations Act. See our “Stalker” and “Contempt” posts from 13 December and 13 May for details. This will be a landmark case and we look forward to reporting on the outcome in a few months.