A tech company has been ordered to pay $76,700, after the Employment Relations Authority ruled its dismissal of a senior sales and marketing manager was unjustified.
Brett Arthur was employed by OSS for five months before his employment ended in a restructuring process that disestablished his position.
The Employment Relations Authority decision, released earlier this month, found OSS failed to follow proper processes by not offering Arthur a position in the company when it became vacant during his notice period.
In April last year, OSS managing director Ian Soffe offered Arthur the job, which included key terms and conditions.
Arthur took the job, but the details to calculate a commission/bonus scheme were left undecided.
Over the ensuing months, Arthur repeatedly asked for information from the previous financial year to finalise the figures for the proposed scheme.
Soffe said the delay in getting that information was due to complexities with the recent joining of two companies to form OSS and internal issues with the finance team.
The authority declined Arthur’s claim OSS breached the employment agreement by failing to pay the variable component of his salary.
“Unfortunately for Mr Arthur the terms of his bonus were not finalised before events overtook the parties and the restructuring process commenced, Employment Relations Authority member Marija Urlich said.
“He is unable to enforce the terms of the bonus because the terms are too uncertain or incomplete to enforce.”
On September 9, Soffe wrote to Arthur setting out a proposal to disestablish his role and invited him to attend a meeting, which he could bring a support person to.
The letter said OSS was considering a restructure to contain costs and maximise profitability of the company.
Arthur’s role was one of five positions within OSS potentially affected by the restructure.
After the meeting, Arthur wrote to Soffe with feedback and concerns including that OSS had failed to keep the process private to those affected by talking about it with other staff.
He also claimed the process was not in good faith and the true reason for the proposal to disestablish his role was over his challenging of financial governance and repeated requests for information.
Arthur also said he couldn’t provide comment on the financial basis of the company’s decision because he had not received that financial information and no austerity measures had been put in place.
In a further meeting, Soffe said he was surprised by the feedback and the company did not accept the restructuring was illegitimate or that Arthur was targeted.
He said the restructure was in light of lower-than-expected occupancy and revenues.
Arthur was given two months’ redundancy notice and the option to take gardening leave, which he elected to do.
Urlich ruled OSS had justified reasons for the restructuring and there was insufficient evidence it was implemented to target Arthur.
She also wasn’t satisfied the conduct of OSS amounted to a failure to maintain confidentiality of the process, which unfairly disadvantaged Arthur.
But Urlich did rule that the company had an obligation to offer Arthur a vacant role that became available during his notice period.
Ten days after Arthur has been given notice of dismissal, a member of the sales team resigned.
But OSS ruled out the possibility of the new role as a redeployment option for Arthurbased on his salary, seniority expectations, and his reaction to the restructure.
“The assumptions OSS made were unreasonable and do not amount to consultation”, Urlich said.
She ordered the company to pay Arthur $52,500 in lost wages, $4,200 in holiday pay, and $20,000 for hurt and humiliation.
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