Updated: May 2
On 23 April Stuff (Marty Sharpe) reported on a sexual harassment matter that cost Wairoa District Council ratepayers $55,000 in compensation and legal costs. The Council has now been criticised for discontinuing the workplace investigation.
VUW Law Professor Gordon Anderson said the investigation should have been completed “... just for reassurance and to ensure there's not a repetition of it." and “....It would appear some sort of settlement was involved, which suggests there is some substance to it, although without knowing the details I have no idea”.
Wellington employment lawyer Susan Hornsby-Geluk had a similar view: "...so having been put on notice of an issue they should properly investigate that to ensure there's no ongoing risk... having said that, there are situations where, if an employee withdraws a complaint, it's quite convenient for the employer just to discontinue the process. The fact a settlement has been reached in this instance suggests that that could be the case."
Local government expert and senior lecturer at Massey University, Andy Asquith said "to me this isn't about employment law. It's about governance and conduct in public office... the ratepayers of Wairoa have had to spend $55,000 that could have been spent on essential services," he said.
"I think there is an obligation to be transparent... (the complaint) appears to have been fudged by what would appear to be a compromise agreement... would he have been re-elected if the full facts had been known?"
Nanaia Mahuta said: "As Minister of Local Government, I do not have powers to intervene in the conduct of individual elected members of a local authority".
Sadly, this is very common. There are around 11,000 mediations each year and most result in the employee exiting the organisation with some kind of payout and a gag clause (non-disparagement or non-disclosure). The secrecy around employment mediations seems to take on national security level importance. The Holy RoS (Record of Settlement) can be used to prevent the employee and others from:
- Reporting health hazards to Worksafe (I’ve actually heard a judge say that in open court)
- Reporting suspected criminal conduct to NZ Police (confirmed by then Chief Judge Colgan)
- Challenging the RoS in the ERA (only enforcement is claimed to be possible – usually by employers)
- Making protected disclosures to the employer or former employer under the Protected Disclosures Act.
- Obtaining access to HR files and other records.
We have heard from a reliable source that part of the settlement agreement included a continuation of the workplace investigation after the employee had departed, but this was apparently reneged on.
We have seen similar treatment of non-disparagement clauses which have then played out in the ERA after the employees concerned found out they had been blacklisted by a former manager (either directly or by proxy) after leaving because usually the HR manager is in the mediation as opposed to the line manager. Any manager not in mediation cannot sign the agreement which means they cannot be bound by it.
But some employees who are party to a RoS could be forgiven for thinking that such a private contract prevents them from later complaining to WorkSafe, regulatory bodies the employee is registered with, or the Police, or even telling anyone about the existence of the contract. And they could be right, if this 2015 EmpC judgement is any indication.
Based on the above judgement, who knows what else these Holy RoS can cover up? Assault? Fraud? Forgery of files for bogus employment investigations? Money Laundering?