Managing director's 'come clean' comment revealed fatal flaw in investigation approach

A New Zealand employer proved serious employee misconduct but still paid $12,000 in compensation after critical procedural missteps derailed an otherwise justified dismissal.

Kyle Spencer, the general manager of Modern Transport Engineers Limited's Hamilton workshop, was terminated in February 2024 after the company discovered he had authorized work on his personal boat, a family member's campervan, and another relative's car using company time, staff, and resources during work hours.

The evidence was substantial. MTE employees confirmed they had worked on Spencer's boat for over 170 hours and the campervan for hundreds more hours. Invoices showed Spencer had ordered boat parts including a marine stereo and speakers. Spencer himself admitted during testimony that $2,000 was a fair amount for the work performed on the family car. No payment had been made for any of this work.

But the Employment Relations Authority determination, issued February 5, 2026, found that while the dismissal was substantively justified, the process was fundamentally flawed.

The problems began when Managing Director Robin Ratcliffe spoke to staff and told them Spencer had been "stood down" before Spencer was even notified of the allegations. When Spencer heard about the concerns and returned early from holiday on January 10, 2024, he was handed a letter and immediately suspended without being given any opportunity...

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