‘Take Advice’ on Employment Law Situations

‘Take Advice’ on Employment Law Situations

The interests of employees and employers are sometimes not aligned. This misalignment is most apparent when an employer is considering terminating an employee’s employment. One step a fair employer will take prior to dismissal is to remind the employee of their right to take legal advice. But what happens if the employee does not take up the opportunity? Does fair employer need to do anything further, like insist or persuade an employee to take advice, or ensure that the advice the employee receives is competent?

This issue was recently considered by the Employment Court in the decision of Cotzee v Oamaru Meats. Mr Cotzee was an employee of Oamaru Meats and his employer proposed a restructure which may have led to the redundancy of Mr Cotzee’s position. During the consultation period the parties entered into a “full and final” settlement which ended Mr Cotzee’s employment on agreed terms. At a later date, Mr Cotzee then tried to overturn the settlement agreement so he could raise a personal grievance for unjustified dismissal.

On four separate occasions the employer had advised Mr Cotzee of his right to a legal representative, which he had declined. However, Mr Cotzee argued that only informing him of his right to a representative was not enough. He argued that his employer should have been more specific and also informed him of his right to take legal advice before he signed the agreement.

The Court rejected the distinction between legal ‘advice’ and ‘representation’. It found that Mr Cotzee was given the opportunity to be represented and take advice but decided not to take it. It agreed with earlier decisions which held that once an employee is informed of their right to legal representation, it is their responsibility to arrange any representation or advice. The Court did note that a more “nuanced” response may be required if warranted by the circumstances of the employee, if they were a vulnerable person, but Mr Cotzee did not fall into this category.

Employment relationships require good faith even when there is a disagreement. However, good faith does not require an employer to take a paternalistic role and push employees to make the ‘right’ decision. Once an employee is informed of their right to take legal advice, the ball is in their court.

Relevantly, if you would like to take advice on a range of employment law situations as an employer or employee, please get in touch with the Watermark team directly. We are happy to advise you.

Kylie Hudson

Associate