Builder told ‘stop being a baby’ awarded $5,000

Today the NZ Herald reported a builder told to stop being a baby and get back to work after bringing up an aggressive text he was sent by his boss has been awarded $5,000.  The Employment Relations Authority found that he was subsequently unjustifiably dismissed.  He had been working for the company for 7 weeks. 

The sole director and shareholder of the building company sent an aggressive text message about proper care of work tools.  And while the use of ‘robust language’ may be part of the day to day dealings and common across the wider building industry –the text created a situation that resulted in the builder’s employment being terminated unjustifiably.

Employment Practices Liability and how it could help

Employment Practices Liability covers a business for its legal liability for a wide range of employment-related claims made against it by its employees such as:

  • Unjustifiable dismissal
  • Discrimination or harassment
  • Wrongful demotion/failure to promote.

 

Employment Practices Liability cover is usually offered as part of a group of liability policies, giving businesses an integrated liability insurance solution.

For the policy to respond in the case of dismissal of an employee, the business must seek the advice of an approved employment lawyer and rigorous procedures must be followed.  If the business has done this yet still end up in court, the policy is likely to cover court costs and any reparation costs ordered within the policy limits.

 

Directors & Officers Liability and how it could help

Directors & Officers Liability covers the directors of a company should they be held personally liable for things such as:

  • Employment practices and HR issues
  • Shareholder actions
  • Failure to comply with regulations or laws.

 

For the policy to respond in the case of dismissal of an employee, the director must be deemed by a court to be liable for damages.

 

Aggressive texter covered?

Under Employment Practices Liability Insurance – no!  This business would not have had their court costs or remedies covered by Employment Practices Liability insurance.  There was no rigorous termination procedure followed or consultation with an employment lawyer meaning the claim would have been declined.

Under Directors & Officers Liability insurance – most likely.  If the Employment Relations Authority had awarded damages to be paid by the director, the D&O policy would have come in to effect and the Directors costs would be covered by the policy.

 

It’s all about risk management

Aside from recommending appropriate insurance solutions to manage your liabilities, a good broker will be able to suggest other risk management strategies. 

Ensuring positive relationships between management and staff may have helped in the situation above.  Your broker knows where common claims arise from, so talk to them about ways to manage your businesses liability risks.


Allan Henderson

About the Author

Name: Allan Henderson        

I’m the Leader - Business Development & Sales for Rothbury’s Wellington branch. I have over 20 years experience in the insurance industry and get a kick out of finding insurance solutions for my clients.

I enjoy leading and…
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I’m the Leader - Business Development & Sales for Rothbury’s Wellington branch. I have over 20 years experience in the insurance industry and get a kick out of finding insurance solutions for my clients.

I enjoy leading and developing people (including my 3 children although they may not appreciate my leadership skills at times – or ever for that matter) and am part of a really experienced team who have a lot of fun here in Wellington.

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Disclaimer: The articles published on this blog are designed to provide general information and do not take into account any individual’s particular circumstances. We recommend that you obtain professional advice on your requirements before making any decision about a financial product.

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