UPDATED: Keith Hill and his partner (and part-time employer) Kaye Thomas are challenging a determination by the Employment Relations Authority (ERA) that awarded penalties to Hill’s former employer Cookright Filtering Services Ltd for breaching a restraint of trade.
We reported on this in December when the injunction was imposed.
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At the time, we sent a draft of the article to Cookright’s lawyer Megan Inwood and invited her to comment. Inwood’s response was “At present, the Authority has only granted an interim injunction at the preliminary hearing stage. While the substantive matter is still before the Authority, Cookright has no further comment.”
Eight months later the substantive matter has been determined. The injunction lapsed a couple of months ago and Hill is back at work, but he has just been ordered to pay Cookright $14,854.38 in damages and a penalty of $8,000. Thomas was also ordered to pay Cookright a $6,000 penalty for aiding and abetting Hill’s breaches.
Costs for a two-day investigation meeting would generally be around $8,000. That’s a total of $37,000 (£17,000) between them, not including their own legal costs that they can no longer afford. Hill, 63, can only work part time because of a hip operation in January, and this has no doubt been exacerbated by the ordeal of being pursued in the ERA.
In our previous article we noted that Hill did not appear to have put up much of a fight, and the latest determination notes that while Thomas participated in the proceedings, Hill’s participation was minimal, and he got hammered. For example, the damages figure of nearly $15,000 did not take into account the wage and other expenses Cookright would have incurred if it had performed that work across several sites. Something didn’t add up.
A second attempt to find contact details for Keith Hill yielded a Facebook page for Kaye Thomas’ business A1 Vat Services. Thomas is, as the determination notes, a GST registered sole trader. After a couple of phone calls, Hill’s lack of engagement in the ERA proceedings started to make a lot more sense.
Male assaults female charges
During the six months Hill was out of action, there was an incident involving Thomas’ remaining employee, a young woman. We have been provided with video footage that appears to show the female employee being assaulted while she sat in a van, by two young males, both employees of Cookright. Police have laid assault charges and we understand that intimidation charges for various other incidents followed, and a jury trial is imminent. Out of an abundance of caution, as we don’t wish to prejudice criminal or civil proceedings, we have only shown a screenshot of the van parked in a yard with the female occupant inside (but not really visible). The defendants must be presumed innocent until proven guilty in the criminal jurisdiction.
Thomas’ employee left the job soon after the alleged assault.
In the employment jurisdiction Cookright is vicariously liable for some the actions of its employees. Normally, video evidence of the alleged assault would be assessed by the ERA Member or Employment Court judge, applying the civil burden of proof. That means the member or judge can make a finding on the balance of probabilities. The effect on that finding on the quantum of damages, and even whether an award should be made at all, would then need to be determined. However, this appears not to have happened here.
Aside from the personal safety and intimidation issues, Hill’s salary was not competitive which was a factor in his decision to resign. It would be difficult to see how his salary could have included a valuable consideration that might have supported a valid restraint of trade clause. Similarly, his employment agreement required a 60 day resignation period, and even though he didn’t make an issue of it, it appears excessive given his modest remuneration. What we suspect the ERA was unaware of was the way in which former Cookright customers were picked up by A1 Vat Services – after Hill left Cookright and its remaining employees were stretched, food businesses started contacting Hill directly.
Labour Inspector v Ahuja [2016]
In December 2016 the ERA ordered Chirag Ahuja to pay penalties of $20,000 (later reduced to $12,000 by the Employment Court) for intimidating witnesses. After his two clothing companies were put into liquidation, Ahuja was found to have sent a gang member to visit one claimant and make a threatening phone call to another, possibly via an agent. Member Eleanor Robinson concluded:
[96] I also consider that what occurred to be a possible contempt of the Authority. I therefore direct that a copy of this determination is made available to the Solicitor-General, and that any further information requested by the Solicitor-General be forwarded to her.
See the similarities, readers?
Reputational risk
As previously mentioned, Hill and Thomas have the right to challenge Member David Beck’s determination to the Employment Court, where the assault allegations are likely to be raised. They may also be able to apply to have the determination recalled given that it was skewed by personal safety concerns, or apply for a Judicial Settlement Conference (with an Employment Court judge as mediator).
As to the conduct of certain Cookright employees including the alleged assault on a female in April, that company has a right to investigate whether their conduct threatens its reputation and amounts to serious misconduct and grounds for dismissal. But who are we to tell Cookright’s HR department how to do its job?
Either way, we don’t think Cookright will get a cent out of Keith Hill or Kaye Thomas.
Tristam Price
Editor, Leighton Associates
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