Personal Grievance Claims – A Quick Guide for N.Z Employers
Personal grievances are among the most common and costly legal claims brought by employees in New Zealand. Under the Employment Relations Act 2000 (‘the Act’), employees can challenge unfair treatment at work, including unjustified dismissal, constructive dismissal, disadvantage, unlawful discrimination, sexual harassment and more.
They often involve significant financial remedies where employees succeed, not to mention the time, management resource and commercial drain on employer’s business to be involved in dealing with related claims.
Employers who misunderstand their obligations expose themselves to legal risk. This employer quick guide explains the common types of personal grievance claims, outlines frequent employer mistakes, and highlights recent case law to help employers manage risk.
According to recent statistics, compiled by Thomson Reuters Westlaw New Zealand, it showed that 65% of personal grievances, which includes personal grievances for unjustified dismissal determined by the Employment Relations Authority, were found in favour of employees. These statistics underscore the need for employers to have access to affordable and competent professional support when dealing with employment disputes.
Employer Pro are specialists in employment law and workplace disputes, support employers only and offer a range of affordable Employer Protection Packages, including competitive representation rates for managing personal grievance claims, which start from $150.00 plus GST per hour, depending on subscription level.
Employer Pro also has a range of resources, including employer-focused Employer Toolkits and Targeted Employer Resource Packs on managing key employment processes, including legal commentary, best practice guidelines and various templates to manage legal compliance and key employment processes.
What Is a Personal Grievance?
A personal grievance is a statutory claim an employee can bring when they believe their employer has treated them unfairly. The main grounds include:
Unjustified Dismissal: Where an employer terminates employment without valid justification or without following a fair and documented employment process.
Constructive Dismissal: Where an employee resigns because the employer’s conduct, or a material breach made continued employment untenable, leaving the employee with no choice but to resign.
Unjustified Disadvantage: Where an employer’s action causes a disadvantage to the employee in their employment, or breaches contractual obligations.
Other grounds include unlawful discrimination, duress over union membership, and breach of good faith obligations.
Employees must generally raise a personal grievance within 90 days of the action occurring, unless there are exceptional circumstance. The legal threshold for raising a claim is very low since it involves an access to justice issue. An employee does not have to articulate their claims as a specific personal grievance claim, they generally only need to raise a problem, or concern with their employer expressing some sort of dissatisfaction with their employment.
Unjustified Dismissal: What Employers Get Wrong?
Unjustified dismissal is the most common personal grievance claim. It arises where an employer dismisses an employee without a valid reason or fails to follow fair employment procedures as prescribed by law.
New Zealand employment law requires employers to act as a ‘fair and reasonable employer’, correctly managing both substantive and procedural fairness considerations at the time of dismissal. The only exclusion to this is terminating under a valid 90-day trial period, but employers often make mistakes implementing 90-day trial periods correctly, losing the legal protection a trial period affords and exposing them to successful unjustified dismissal claims as a result.
Common Employer Mistakes
Inadequate investigation: Failing to thoroughly investigate alleged misconduct or performance issues.
Poor communication: Not clearly explaining concerns and not giving the employee a fair chance to respond.
Procedural shortcuts: Skipping steps, e.g. in disciplinary or performance processes because of time pressure or misplaced urgency.
Changing reasons: Providing inconsistent reasons for dismissal at different times.
Case Law Snapshot – What Recent Decisions Tell Employers?
O’Connor v Symons [2024] NZERA 304
The employee was a courier driver for the employer for around seven months. The employee objected to some clauses in the proposed written employment agreement, including a clause related to liability for vehicle damage. The parties never signed an agreement.
The employee originally drove a business courier run. After four months, the employer changed her run saying there had been complaints about her. The employee asked for details of the complaints, but the employer did not give her any further information.
The employee was driving a courier van on a rainy day when it hit a concrete barrier on a driveway. The front bumper was partially dislodged on one side as a result. It was reattached later in the day. The employee went to the employer’s office at the end of the day to apologise when the employer became angry and accused her of being incompetent and a liar. After a meeting five days later, the employer dismissed the employee.
The Authority found the employee was unjustifiably dismissed. In doing so, it considered:
The procedural flaws in the employer’s investigation were significant and led to the employee being treated unfairly.
The employee was not told that she could bring a support person, or representative to the disciplinary meeting. Nor was she told that the meeting may result in the termination of her employment.
The employer raised alleged previous complaints during the meeting but did not provide any detail of them to the employee.
The employer had asked around to try to find “dirt” on the employee.
The employer gave different reasons for the dismissal at different times.
There was effectively no damage to the courier van.
A fair and reasonable employer could not have conducted an unfair investigation and then dismissed the employee in the circumstances.
The Authority ruled the employee was unjustifiably dismissed, awarding her over $25,000 in financial remedies.
Employer Takeaway: Procedural fairness is critical. Misconduct concerns can lead to a finding of unjustified dismissal if an employer fails to properly investigate, clearly communicate allegations, provide access to all relevant information and notify the employee of the potential outcomes, advise the employee of their rights, and ensure proportionate outcomes. A dismissal that is rushed, designed to unfairly expedite an employee or predetermined will almost certainly expose the employer to significant liability.
Perry v The Warehouse Group Limited [2023] NZERA 773
Mr Stephen Perry was employed as an Education Specialist with Noel Leeming (part of The Warehouse Group). Over time his role was significantly altered by organisational change, including removal of after-sales support and additional duties without proper consultation. These changes increased his workload and impacted his ability to meet sales targets.
By mid-2021, Mr Perry told his employer he was suffering from burnout and was “broken by the workload.” Despite expressing severe stress and job-related health impacts, the employer’s response remained informal – suggesting he use EAP support and offering leave “off the books.” Formal, proactive engagement with his mental health concerns did not occur.
Mr Perry resigned in October/November 2021 and raised a personal grievance for constructive dismissal, arguing that the employer’s failure to respond appropriately to his serious stress and workload concerns made continued employment untenable. The Authority applied the third category of constructive dismissal – where an employer’s breach of duty causes an employee to resign, and where the possibility of resignation in response is foreseeable.
The Authority found:
Although some support was offered, a fair and reasonable employer with the resources available would have taken formal, proactive steps to understand and address Mr Perry’s mental health issues and workload concerns rather than relying on informal support and leave.
The employer’s failure to meaningfully engage with his stress and individual circumstances was a breach of its duty to provide a safe working environment, and it was reasonably foreseeable that the situation would lead to resignation.
As a result, the Authority concluded that Mr Perry’s resignation was a constructive dismissal.
The Authority determined that Mr Perry was constructively dismissed, awarding him over $46,000 in financial remedies (excluding the employer’s own legal costs).
Employer Takeaway: When employees raise serious workload, stress or mental health concerns, employers must respond formally and proactively. Reliance on informal support measures (such as EAP referrals or ad hoc leave) without addressing underlying role changes or workload risks, including those impacting burn-out can breach obligations. Failure to meaningfully engage may make resignation reasonably foreseeable and expose the employer to constructive dismissal liability and significant financial remedies.
Constructive Dismissal: When Resignation Is a Claim?
A constructive dismissal arises from employer conduct that effectively leaves the employee no practical choice but to resign. The onus is high: the employee must show that the employer’s conduct – even if not deliberate – was serious enough to breach the employment relationship, make continued employment untenable and that resignation was reasonably foreseeable.
What Employers Often Miss
Delaying action on serious concerns: Ignoring or belatedly responding to workplace issues that affect employee wellbeing.
Minimising worker distress: Treating mental health or burnout as non-work related, rather than engaging formally with concerns and developing an action plan to address a situation.
Lack of formal process: Offering informal support without structured follow-up or proactive engagement.
Unjustified Disadvantage
Even without dismissal, an employee can raise a personal grievance if the employer’s actions have unjustifiably disadvantaged them. Examples include withdrawal of agreed benefits, unconsented, or consulted significant changes to employment conditions, or workplace environments that breach good faith duties.
Common Scenarios
Changing job duties without agreement.
Failing to consult on workplace changes that affect terms and conditions.
Retaliatory conduct following complaints or protected disclosures.
While not always leading to dismissal claims, unjustified disadvantage grievances still expose employers to compensation awards and require careful management.
Remedies and Employer Risk
If a personal grievance is upheld, remedies can include:
Compensation for injury to feelings and loss of dignity.
Lost wages or benefits, including notice or unpaid entitlements.
Reinstatement (rare but possible).
Costs or penalties in limited circumstances.
Employer Pro Premium – Dealing with a Personal Grievance, or Employment Dispute?
Employer Pro offers a range of employer-focused services and support options, including our targeted Employer Premium Membership Package. This package includes ten hours of consultancy or representation-based support, unlimited advisory consultations, and built-in representation for managing an employment mediation. The Employer Premium Membership is a cost-effective employer protection solution for employers navigating complex employment disputes. It is first to market in New Zealand when compared with other employer service providers and represents exceptional value for money.
Comparable levels of support delivered through a traditional employment law firm can easily exceed $10,000, making the Employer Premium Membership a compelling and predictable alternative for employers managing workplace risk.
Compliance Warning
Personal grievance liability most commonly arises from process failures. Employers who dismiss employees, manage performance, or respond to workplace concerns without following fair and reasonable procedures risk findings of unjustified or constructive dismissal – even where there are legitimate business concerns.
Key risk areas include inadequate investigations, poor communication, failure to consult and manage a legally compliant employment process, informal handling of serious issues, and decisions that appear predetermined. Non-compliance can result in significant financial remedies, including compensation for hurt and humiliation, lost wages, legal costs and reputational damage.
Bottom line: disciplined, documented and procedurally fair decision-making is essential. Employers should slow down, follow their policies, and seek professional advice before taking action that may trigger a personal grievance.
This article is provided for general information only and does not replace professional advice. Employers should seek advice specific to their circumstances from Employer Pro when managing personal grievance claims, including termination procedures and key employment process management. Employer Pro has a range of employer focused resources and services available through our competitive Employer Protection Packages.
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