BULLYING FACT SHEET FOR NEW ZEALAND ©

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WORKPLACE BULLYING IS REAL!

THE DUTY OF CARE BULLYING PREVENTION SERIES

“If employers think bullying in the workplace does not cost, they should think again!”

Workplace bullying in New Zealand contributes to the loss of millions of dollars each year.

Workplace bullying is a serious and largely underestimated problem that can have a devastating effect on your business. Failure to address the problem can lead to significant cost and damage. Employers can also be personally liable unless they have taken all reasonable steps to train and educate their employees on workplace bullying including what to do should they witness or be subject to workplace bullying.

OCCUPATIONAL HEALTH AND SAFETY LAWS

Under New Zealand occupational health and safety laws, employers are not only mandated to provide health or life insurance policies but alsohave a duty to ensure the health, safety and welfare at work of all their employees. This includes providing safe plant and systems of work, information, training and adequate supervision. The risk to health can be either physical or psychological.

Under the Health and Safety in Employment Act 1992, New Zealand employers will be prosecuted if they fail to fulfil this duty. Apart from statutory penalties, employers who fail to provide a safe workplace will also become subject to legal claims and costs.

Section 13 of the Health and Safety in Employment Act specifically states the responsibility of employers to make sure their employees receive appropriate training.

BREACH OF CONTRACT

Every employer and employee has a contract of employment between them, even if it is not written down. The law also says that, as part of that employment contract, every employer has a duty to take reasonable care of an employee’s safety. The Courts have made it quite clear that the standard of care for an employee’s safety is a very high one.

Accordingly, if an employer breaches that contractual duty by failing to prevent workplace bullying, the employee can sue the employer for breach of contract and potentially obtain damages from the employer for that breach.

Additionally, the law in New Zealand is also coming to accept that an employer must not, without reasonable cause, undermine the trust and confidence that an employee places in the employment relationship. Again, exposing that employee to workplace bullying would arguably be a breach of that contractual term.

The Employment Relations Act 2000 provides for employees to lodge personal grievances arising from unjustifiable action by their employers or on the grounds of workplace bullying, discrimination, including sexual and racial discrimination.

An employee may also be forced to resign due to the occurrence of workplace bullying. In the eyes of the law, where an employee is forced to leave his or her job due to the actions or inaction of the employer then this is considered to be a constructive dismissal. When an employee is constructively dismissed, he or she may bring a claim against an employer for unfair or unlawful dismissal and seek reinstatement and/or compensation.

Under contract law once an employer becomes aware, or should have become aware of workplace bullying then the employer must take action to prevent that bullying.

PERSONAL INJURY LIABILITY

Not only does an employer have contractual obligations to an employee but an employer also has an additional duty of care to an employee, which it must not breach – this obligation arises in the law of tort, commonly known as negligence. The obligation is similar but distinct from an employer’s contractual obligation. Put simply, an employer has a legal obligation to provide a safe system of work and where the employer breaches that obligation then the employer would be liable to the employee for damages for personal injury.

In this area, there is what is known as vicarious liability. This is where an employer is liable because of what an employee has done or failed to do, despite the utmost precaution taken by the employer. Of course, vicarious liability does not extend to cover every act of an employee, as the conduct of the employee must have a close relationship to their work and the act must be negligent or intentional. However, in certain circumstances an employer may be liable for workplace bullying committed by another employee even where that employer has no knowledge of the conduct of the employee. This is particularly so in circumstances where an employer has failed to provide any training.

Under the Health & Safety in Employment Act 1992 employers are under a legal obligation to provide a safe system of work, and this includes making sure that all employees behave themselves on the job. If an employer knows that some employees are bullying others, but does nothing to stop this, then the employer will be liable if another employee suffers loss.

WORKERS COMPENSATION

Generally, a person, who has suffered a personal injury arising out of, or in the course of, his or her employment is likely receive compensation from the worker’s employer. The employer does not have to be at fault for the injury. Workers compensation injuries can include both physical and psychological injuries.

So long as employment was a substantial contributing factor to the injury, the employee will probably receive workers compensation payments. Of course, this has a significant impact on an employer’s workers compensation premium payments.

ANTI-DISCRIMINATION LAW

Increasingly, employees who have suffered because of workplace bullying may also consider complaints to either the Human Rights Commission under the Human Rights Act 1993 or under the Harassment Act 1997, claiming that they have been the victim of unlawful discrimination.

This has been common for years in the case of sexual harassment and racial discrimination, but now employees are beginning to realise that other forms of harassment, such as the bullying of young male apprentices or young female staff, may also lead to complaints that will leave them liable.

FINES AND PENALTIES FOR EMPLOYERS AND EMPLOYEES

The Health and Safety in Employment Act 1992 imposes severe penalties against employers including fines of up to $500,000 and/or two years imprisonment where an employer has acted or failed to act knowing that such action or inaction is likely to cause serious harm to any person.

Employers could also be fined up to $250,000 and/or three months imprisonment where a failure to comply with the Act causes a person serious harm.

Of course, damages and legal costs associated with common law claims could be far more financially devastating.

Your ability to demonstrate that you have provided your employees, supervisors and managers with training in this area will be a significant issue in defending any claim.