Posted on: Apr 21, 2016
An employee may bring a personal grievance for disadvantage if, “the employee’s employment, or one or more conditions thereof, is or are affected to the employee’s disadvantage by some unjustifiable action by the employer”. (Section 103 (1)(b) of the Employment Relations Act 2000).
We have found that personal grievances for disadvantage can be a bit of a grey area. Given the broad meaning of “conditions” of employment, the wide range of matters that may come within conditions and the innumerable ways in which an employee may be “disadvantaged”, this type of grievance gives employees considerable scope to challenge management discretions and decision making.
What sorts of actions actually amount to a disadvantage?
Initially, the Court took a restrictive approach to this class of personal grievance. In order to succeed a grievant was required to demonstrate that the action had caused some material or financial loss. These traditional categories of disadvantage included: demotions, suspension without pay, and the withdrawal of a benefit.
However, following the decision of the Court of Appeal in Alliance Freezing Co (Southland) Ltd v NZ Engineering Union  3 NZILR 785, it became clear that this restrictive interpretation could not be sustained and that any disadvantage may form the basis of a personal grievance.
Now, in considering whether there has been a disadvantage, the Court may consider the actual effect of the decision or action on the employment, the changes that have occurred, and assessing their impact on the employee.
What are disadvantage grievances commonly caused by?
- Transfers, promotions and demotions
- Unjustified disciplinary action
- Unfair or disparate treatment
- Failure to protect employees – eg from harassment or harm
- Unfairness in redundancies – eg poor process or inadequate consultation
- Involving the police in employment matters
The obligation of good faith in the Employment Relations Act may further widen the range of matters that may also be subject to challenge. It is arguable that good faith requires employers to exercise good/best Human Resources practices in relation to their employees. If this argument is accepted, it may have significant implications for the potential scope of disadvantage grievances. Over the coming years, we may start seeing new types of disadvantage grievances being accepted by the Authority of the Court.
Keep it simple – be fair and reasonable
In the meantime, we recommend employer to be vigilant in treating their employees fairly, and seeking advice from us before embarking on any process that could have a potentially negative impact on an employee’s employment, or the terms and conditions of their employment.
This article, and any information contained on our website is necessarily brief and general in nature, and should not be substituted for professional advice. You should always seek professional advice before taking any action in relation to the matters addressed.