Unfair Dismissal

Procedural and substantial justification is required for an employer to justify dismissal. Employers must act in good faith, have a good reason to terminate an employee's employment and follow a fair an reasonable process. The employer bears onus of demonstrating that a dismissal is justified.

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What is Unfair Dismissal?

"The right to employment is a substantial right requiring protection. Therefore, the starting-point for a dismissal to be valid is that it must be justifiable and fair."
Hayashi v Sky City Management Ltd

"The test is whether the employer’s actions, and how the employer acted, were what a fair and reasonable employer could have done in all the circumstances at the time the dismissal or action occurred."
Section 103A Test of Justification, Employment Relations Act 2000

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In New Zealand, an unfair dismissal is commonly pursued as a Personal Grievance (PG). The practical question is not just “was there an issue?” — it is whether the employer had good reason and followed a fair process. When the process is rushed, evidence is withheld, or the outcome is effectively pre-decided, that often creates liability and settlement leverage.

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Common reasons employers rely on

Both Procedural and Substantial justification must be met. The employer bears the onus of showing that a dismissal is justified. Common reasons for dismissal include and are not limited to:

• Misconduct and Serious Misconduct
• Misconduct outside of the workplace
• A breakdown in trust and confidence
• Unsatisfactory work performance
• Breaches of workplace policies and rules
• Disobedience and insubordination
• Dishonesty, Negligence, Incompetence or Inability
• Misrepresentation of skillset
• Incapacity and long-term illness
• Irreconcilable breakdown or incompatibility
• Misuse of drugs and alcohol
• Misuse of computers and information systems
• Workplace violence and intimidation

The above list is not exhaustive. Whatever the reason for dismissal, the Employment Relations Authority (ERA) and Employment Court assess whether dismissal was justifiable given the circumstances. In each case, certain tests must be met.

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The 4 core process checks (s103A(3))

As a starting point the Court considers the four matters prescribed in
Section 103A(3) Test of Justification, Employment Relations Act 2000

1. Whether, having regard to the resources available to the employer, the employer sufficiently investigated the allegations against the employee before dismissing or taking action against the employee; and
2. Whether the employer raised the concerns that the employer had with the employee before dismissing or taking action against the employee; and
3. Whether the employer gave the employee a reasonable opportunity to respond to the employer’s concerns before dismissing or taking action against the employee; and
4. Whether the employer genuinely considered the employee’s explanation (if any) in relation to the allegations against the employee before dismissing or taking action against the employee.

"The Employment Court: could really only conclude that the Authority and the Court should try to give sensible interpretation to this provision."
Angus v Ports of Auckland Ltd

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What to do right now (practical)

If you have been dismissed (or you are about to be dismissed), these steps materially improve your position:

1. Get it in writing: the dismissal letter, the reasons, and the effective date/time.
2. Request the evidence: meeting notes, investigation material, statements, CCTV, policies relied on.
3. Preserve everything: texts, emails, rosters, screenshots, medical notes, performance reviews.
4. Write a timeline: short, dated, factual (it becomes your roadmap).
5. Do not sign settlement/exit documents without review (clauses matter).
6. Start job search evidence: keep records of applications/acknowledgements (often relevant to lost wages).

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Remedies and outcomes (what you can seek)

Depending on the case, outcomes can include:

• Lost wages (and associated entitlements)
• Compensation for humiliation, loss of dignity, and injury to feelings
• Holiday pay / final pay corrections
• Reference wording and clean separation terms
• Agreed settlement (often via negotiation or mediation)
• ERA determination if resolution is not achieved

Many matters resolve without going to a hearing when issues are clearly identified, evidence is organised, and the employer understands risk. If required, we can move the matter through mediation and into the ERA process. See the Resolution pathway.

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FAQs

Is “having a reason” enough to dismiss me?

Not by itself. The employer must also follow a fair process (disclosure, time to respond, genuine consideration, proportional outcome). Many “easy” employer narratives collapse when the process is tested.

What if the employer says “serious misconduct”?

“Serious misconduct” is frequently over-claimed. The label does not make it true. The conduct, evidence, and fairness of the process are what matter.

What if I was forced out / pressured to resign?

That may be constructive dismissal. These matters are highly fact-dependent. Preserve your evidence and get advice early.

Do you offer No Win No Fee?

We offer No Win No Fee for suitable matters with strong prospects and meaningful remedy potential. We confirm eligibility and terms before work starts.

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Often we find major procedural defects where an employer has come to reach a decision to dismiss an employee. Whether you have been dismissed from your employment, or your employer has commenced a investigation or disciplinary process in relation to you, call us to discuss your situation and we will assess the merits of your case.