The right employment agreement

Jason Ennor, Co-founder and CEO at MyHR
By Jason Ennor, Co-founder and CEO at MyHR

The case of a “casual” nanny who was sacked by text message getting paid out more than $5K highlights the importance of getting the nature of the employment relationship and the supporting documentation right.

“Kate Fisher was employed by Wanaka-based, American model Carrie O’Brien to care for her five children. Ms Fisher was sacked by text message after the children, now aged 5-13, complained she swore at them and drove too fast.

After losing her job, Ms Fisher went to the Employment Relations Authority, which ruled in her favour in January, awarding her almost $6000 for unfair dismissal.”

Since this story was published, much has been made of text sacking. I think we all understand that texting is not a good way to sack anybody, or to communicate any important employment issue for that matter.

And obviously, my first piece of advice to any employer is don’t sack anyone by text.

But in this case, the employer appeared to genuinely believe that the nanny was a casual employee and so sending the “don’t come Monday” text was not (in her mind) a sacking, but just an end of the casual relationship.

The Employment Relations Authority didn’t agree and determined that because the nanny worked regular, consistent hours over a period of time, she was in fact a permanent employee.

Casual or permanent employee?

This case emphasises the importance of defining the employment relationship correctly and having the right documentation to support this.

Employment agreements are so easy to get right and there are some basic tests which will help you determine what sort of relationship you have. When they’re right, there is limited room for misunderstanding.

If there is a regular, on-going requirement for work, with set hours each week, then it is probably not a casual relationship.

Don’t get caught taking the term “casual” too literally. Just because it might seem like an “informal” and flexible relationship, doesn’t always make it casual by legal definition.

An employment agreement is a legal contract. As an employer you should take some time to get it right because it is so extremely important. It is the foundation of the relationship between you and your employee. And please do make sure the employee has read and signed the agreement before they start working for you, otherwise you might struggle to enforce the trial period.

Achieving compliance doesn’t have to be hard or costly. MyHR will give you advice on the best agreement for your purposes and we’ll write them for you, they will always be up-to-date with current employment law. Plus, you’ll have a place to store them securely, in the cloud.

In this case the employer might have saved $5,000 (plus whatever they spent in legal support) if only they’d taken some time to sort things at the beginning of the relationship.

Learn more about common employment agreement mistakes.