Major Employment Case Law Development | Unjustified disadvantage

An unjustified disadvantage

A recent case of Paulsen v the Electoral Commission [[2025] NZERA 40; 24/01/25; S Kennedy-Martin] highlights the importance of procedural fairness to avoid successful personal grievance action by the employee along with reputational and financial costs.

Background

Mr Paulsen commenced employment at the Electoral Commission (EC) on 18 September 2023 as a solutions architect. He raised a disadvantage grievance claim with the Employment Relations Authority (the Authority) on the grounds that he was suspended without consultation, had his access to the Commission’s servers removed and not fully reinstated for approximately four months, and was issued a written warning for serious misconduct that was, in his view, procedurally and substantively unjustified.

On 2 October 2023, while Mr Paulsen was on leave, the Electoral Commission noted a security breach in their systems, which it identified as Mr Paulsen setting up a virtual machine on their cloud network. His access to the systems was consequently suspended. At a meeting 5 October 2023 after he returned from leave, he was not told what the purpose of the meeting was and locked out of his account. He was instructed to hand over his work laptop, and escorted from the building and asked not to return until further notice. His access to Electoral Commission systems was revoked and shortly thereafter, so was his building access.

Mr. Paulsen was subsequently issued with a first written warning after a series of further meetings in October 2023. His full system access was not restored until March 2024. He subsequently raised a disadvantage personal grievance with the Authority.

Decision

The Authority considered t the way in Mr Paulsen was asked to leave the workplace amounted to a suspension. He was not consulted about this nor given the chance to seek advice on the proposal. Those procedural flaws rendered the suspension unjustified. While the EC argued he was asked to work from home while the matters against him were investigated, limiting his access to EC systems made any work impossible.

The EC was wrong not to tell Mr Paulsen that the meeting 5 October 2023 was part of a disciplinary investigation meeting. Nor did EC provide him with a copy of the notes from the meeting or a report from a cybersecurity analyst. The Authority determined that Mr Paulsen had established an unjustified disadvantage regarding the written warning and had not fully considered his explanation The time taken to restore his access to EC systems created a disadvantage.

Penatlies

The Electoral Commission was ordered to pay Mr Paulsen $16,000 as compensation for hurt and humiliation. This was reduced due to Mr Paulsen’s contributory conduct. Costs were reserved.

Key takeways

  1. Employees’ should not be ‘ambushed’ that a meeting is a disciplinary investigation meeting and part of a disciplinary investigation process

  2. An employee must be given copies of all information that relate to allegations made against them to be able to respond to

  3. Employer’s must consult and seek the views of employees and have the opportunity to seek advice before they are suspended.

  4. Blocking access to work systems while stating employee working from home during an investigation can be construed as a unlawful suspension.

Summary

Make sure when initiating disciplinary investigation processes that you have a good understanding of what is required and seek professional advice to make sure you are not being exposed to employee relations risk.

More information on this case can be found here.

We can help

For specialist advice in this area, or to discuss how we Business Canterbury can support you, please contact us at hradvice@cecc.org.nz.