Case explores employer obligations in performance management situations
21 May 2025
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The Employment Relations Authority (ERA) recently dealt with a case involving a worker who resigned from his position after a prolonged dispute about the termination of his employment relationship.
The worker claimed he was constructively dismissed when he resigned in January 2024. He argued that his employer had breached his employment agreement and applied undue pressure, creating a situation where he felt he had no option but to resign. He sought remedies including payment for unpaid wages and annual leave.
The employer firmly rejected these claims. They maintained the worker had agreed to resign in November 2023 but then continued working beyond an agreed final date.
Employment dispute reveals performance issues
The worker started with the company in October 2022 as a food engineer working on research and development for a dairy products and pharmaceutical supplements manufacturer. His role began as part-time but became full-time in March 2023.
The employment agreement allowed either party to end the relationship with two weeks' written notice. It also included a clause permitting immediate termination if the worker failed "to perform to the standard reasonably expected by the Employer, including persistent failure to achieve targets."
By May 2023, the director had concerns about the worker's progress. He described the role as "a creative job" where performance was difficult to...
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