Accountants pinged for redundancy

CATHERINE HARRIS
Last updated 15:39 24/05/2013

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The Employment Court has fined a Tauranga accounting firm for the way it made a senior employee redundant soon after she disclosed she was receiving cancer treatment.

Judith Brake was employed by Grace Team Accounting from October 2009 to April 2010.

This month, Employment Court Judge Barrie Travis awarded her $65,000 in lost salary and $20,000 compensation, plus costs, for unjustified dismissal.

The court was told Brake had left a long-term job as a senior accountant at KPMG after being approached by Grace Team.

She sought and got assurances that her position would be permanent, even though she was replacing a staff member taking maternity leave, and there was no hint of restructuring at the time.

Six months later, she was one of three staff who was taken aside and told that the firm was in financial trouble and would have to make cuts.

The same day, she had asked for leave to have a routine checkup at Auckland Hospital for her leukaemia. She had not previously discussed it with her managers, but said she was fit and well and that her condition was under control.

Judge Travis heard evidence from Grace Team's lawyer that the decision to make at least two staff redundant had already been made, based on financial calculations that later proved to be inaccurate.

The defence argued that Brake became the third person on the list because of the the "last-on, first-off" principle.

An expert witness gave evidence that if the firm had properly estimated its turnover and had waited for a review of fees and workloads, it would have found that Brake's dismissal was not required.

Judge Travis said he found Grace Team's behaviour was unjustified "because the procedure was so flawed and lacking in good faith it amounted to substantive unfairness".

He found that Brake had good reason to believe her medical condition had kicked off her redundancy process as she was not given adequate reasons or knew other people were involved.

" ... the timing of the announcement of the redundancy proposal less than three hours after she had sought leave to attend Auckland Hospital was most unfortunate and added greatly to her distress."

However, he was satisfied the plaintiff's chronic illness was not a factor.

Grace Team had held her in high regard and there seemed to be no underlying performance or personality issues. "This was a genuine, but mistaken, dismissal."

Nevertheless, Brake had suffered serious consequences from the redundancy. She was single, dependent on her income, had been unable to get her old job back or other work and been knocked back for other jobs.

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Judge Travis awarded her 12 months' earnings and $20,000 for humiliation, loss of dignity and hurt feelings.

- BusinessDay.co.nz

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