ERA rules timing of resignation cost 32 workers their wage increases
27 May 2025
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The Employment Relations Authority (ERA) recently dealt with a dispute involving 32 former employees who sought back pay from a collective agreement that was ratified after they had already left their employment. The workers had all resigned before their union and employer finalised wage negotiations that included retrospective pay increases.
The workers argued they deserved back pay for wage increases that were backdated to cover a period when they were still employed. They said the plain meaning of the collective agreement entitled them to these payments regardless of when they left their jobs. The workers relied on employment law provisions that allow collective agreements to have retrospective effect.
Their former employer maintained that only current employees at the time of ratification were entitled to these benefits. The employer argued the workers had become legal strangers to the collective agreement once they resigned, removing any entitlement to benefits flowing from that agreement.
The dispute involved a collective agreement between Fire and Emergency New Zealand (FENZ) and the New Zealand Professional Firefighters Union. The agreement came into force on 1 July 2021 and was set to expire on 30 June 2024. The bargaining process took 18 months, running from June 2021 to December 2022, with ratification finally taking place across...
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