In today's dynamic work environment, the role of HR practitioners is more critical than ever, particularly when it comes to employee wellbeing. Recent employment law cases in New Zealand serve as a stark reminder of the consequences for employers who fail to provide adequate support and safe workplaces for their staff. These cases underline how crucial it is for organisations to prioritise employee wellbeing—not only as a moral obligation but also to mitigate the risk of significant legal and financial repercussions.
Case 1: Perry v The Warehouse Group (2023)
Mr. Perry, an Education Specialist at Noel Leeming (part of The Warehouse Group), raised multiple grievances during his employment, including unachievable sales targets, restructuring impacts, and a lack of after-sales support. By June 2021, he experienced severe burnout and took sick leave, informing his manager, Mr. Halling, that he could not cope with the workload. Despite this, TWG did not take formal steps to address his mental health concerns. Informal solutions, such as paid leave, were offered, but the deeper issues remained unaddressed.
In a September 2021 meeting with HR, Perry reiterated his stress and listed his grievances, but the company's response was insufficient. By October 2021, Perry resigned, citing burnout due to TWG’s failure to provide a safe working environment.
The Employment Relations Authority (ERA) ruled that TWG had breached its duty to ensure a safe workplace, noting that a fair and reasonable employer would have taken more formal and proactive steps to address Perry’s mental health. The ERA concluded that Perry’s resignation was foreseeable and directly linked to the employer's failure to act, establishing a case for constructive dismissal.
While TWG could offer some informal and temporary solutions, the Authority held that these actions were not those of a fair and reasonable employer. The months of delay between Mr Perry raising his concerns breached TWG's duties to Mr Perry. It was reasonably foreseeable that Mr Perry's employment would be untenable unless his burnout concerns and other issues were addressed.
This determination demonstrates the importance of acting promptly and formally when an employee comes to HR with concerns of burnout. There is a positive obligation of an employer to properly investigate the causes of the mental health condition if it may be related to the work environment and ensure they take all steps possible to understand their employee's mental health situation. If this is not done formally and promptly, this may be considered a breach of the employer's duty to the employee and may provide the conditions under which the contract can be regarded as repudiated.
Case 2: Parker v Magnum Hire (2023)
Parker’s case is a classic example of an employer's failure to address workplace bullying. Parker endured years of abusive behavior from his superior, which resulted in serious mental health issues including panic attacks, depression, and symptoms akin to PTSD. Despite raising concerns, Magnum Hire took no action to protect Parker, which led to a successful claim for constructive dismissal and unjustified disadvantage. The Employment Relations Authority awarded him $100,000 for the emotional harm and loss caused by the bullying, along with compensation for his suspension. Read more here.
This case underscores the critical need for HR departments to have effective systems in place to identify, prevent, and address bullying and harassment. It highlights how neglecting employee mental health can spiral into severe psychological consequences for staff and expensive legal battles for organisations.
Case 3: Wiles v University of Auckland (2024)
Associate Professor Siouxsie Wiles raised concerns about ongoing harassment and threats due to her public health advocacy during the COVID-19 pandemic. Despite the visibility of these threats, the University of Auckland was slow to implement measures that could protect her wellbeing. The Employment Court found that the University had failed in its duty to provide a safe working environment and awarded Wiles $20,000 for the harm suffered. Read more here.
This case illustrates the importance of proactive measures to safeguard employees, particularly those in public-facing roles. Timely intervention and robust protective policies are crucial in shielding employees from both physical and psychological harm. Delays or inadequate responses can have serious consequences, damaging not only the wellbeing of employees but also the employer's reputation.
The Role of HR in Supporting Wellbeing
These cases highlight the significant responsibility HR professionals have in ensuring employee wellbeing is a priority in the workplace. Here are key steps HR departments can take to mitigate risks and promote a culture of safety and support:
- Proactive Mental Health Support: HR should implement comprehensive wellbeing policies, including mental health resources, training for managers on how to handle stress and bullying, and easy-to-access support systems for employees experiencing harassment or discrimination.
- Clear and Consistent Communication: Unclear or inconsistent communication, particularly around issues like redundancy, can exacerbate workplace stress. Employees must feel informed and supported through transparent processes.
- Robust Harassment and Bullying Policies: Employers should establish clear policies and procedures for reporting and addressing bullying and harassment. Investigations must be handled fairly, independently, and in a timely manner.
- Legal Compliance and Fairness: HR needs to be well-versed in employment law and ensure that all processes—from hiring to firing—are compliant with the law. Fairness and good faith are essential to avoiding grievances that can lead to costly legal claims.
Conclusion
The wellbeing of employees is not just a buzzword—it's a legal and ethical imperative for employers. As shown in the cases of Parker, Wiles, and Amesbury, failing to address employee wellbeing can lead to significant harm to both staff and organisations. HR practitioners must take a proactive approach to ensure that workplaces are safe, supportive, and compliant with the law. The cost of neglecting this responsibility is simply too high.
By prioritising wellbeing, HR professionals can foster a healthier, more productive workplace while protecting the organisation from legal disputes and financial loss.