DAVID SAVAGE v CAPITAL & COAST DISTRICT HEALTH BOARD NZEmpC WELLINGTON [2016]

NZEmpC 83 [30 June 2016]

IN THE EMPLOYMENT COURT

WELLINGTON

[2016] NZEmpC 83

EMPC 374/2015

IN THE MATTER OF

a challege to a determination of the

Employment Relations Authority

BETWEEN

DAVID SAVAGE

Plaintiff

AND

CAPITAL & COAST DISTRICT

HEALTH BOARD

Defendant

Hearing:

18-19 April 2016

(heard at Wellington)

Appearances:

G O'Sullivan and N Flint, counsel for the plaintiff

H Kynaston and J Howes, counsel for the defendant

Judgment:

30 June 2016

JUDGMENT OF JUDGE B A CORKILL

The problem: casual or permanent?

[1] Mr Savage is a Registered Nurse (RN) who wished in 2011 to be employed

on a casual basis rather than on a permanent basis. The Capital & Coast District

Health Board (the Board) agreed to his request. In May 2014, after a complaint had

been lodged against Mr Savage, the Board said it would not offer him any more

work as a casual. He says that at all times the reality of the employment

arrangements were that he was permanent, so the Board could not cease employing

him.

[2] The Employment Relations Authority (the Authority) investigated as a

preliminary question the issue of status, the parties having agreed that if it was held

Mr Savage was in permanent employment the Authority would need to go on and

consider whether he was entitled to a compliance order. However, the Authority

determined he was a casual employee.1 Mr Savage challenged that determination on

a de novo basis.

[3] The issues for this Court are:

a) What did the parties agree as to Mr Savage’s employment status in

February 2011?

b) What was the nature of the relationship in May 2014?

Chronology

[4] Mr Savage became a permanent RN on 1 September 2005. Thereafter he was

employed by the Board under several employment arrangements.

[5] The first of these was as a RN from August 2006. In December 2008, he

resigned from that permanent position, stating that for family-related reasons he

needed flexibility. He told Mr Cate, who was the Casual Pool Coordinator of the

Mental Health Services Directorate, that he was unable to commit to the rostering

and rotation required of a full-time or permanent employee, given child-care

responsibilities.

[6] Mr Savage was accordingly offered a position as a casual RN, with a

commencement date of 14 January 2009. In this capacity he worked in six wards.

He was not part of a standard roster, although he worked each week. This

arrangement continued until February 2010.

[7] Later that year Mr Savage applied for and was appointed to a full-time

fixed-term role as a RN, from May to July 2010.

[8] Next, Mr Savage applied for and was appointed to a permanent RN role as an

RN from 21 August 2010. He worked solely at Purehurehu, on a regular roster.

[9] On 20 January 2011, Mr Savage wrote to Mr Cate and his colleague Mr Klue,

who was a Team Leader and Associate Operations Manager. In his email,

1 Savage v Capital & Coast District Health Board [2015] NZERA Wellington 111.

Mr Savage stated that he wished to be transferred to the casual pool. He said he was

finding it increasingly difficult to manage a roster that had a four-on, two-off pattern

for family reasons; he thought the flexible nature of the casual pool would enable

him to meet his objectives, and he would be able to reduce his hours a little to meet

his needs. He recognised that he would no longer be working only at Purehurehu.

He therefore gave notice of his wish to terminate his employment as a permanent

RN, providing his request to be a member of the casual pool was granted.

[10] This request was considered and granted. Mr Savage was offered a position

as a casual RN by letter dated 7 February 2011. A commencement date of

21 February 2011 was proposed.

[11] The letter of offer referred to the fact that Mr Savage would hold the position

of “Casual Mental Health Staff Nurse”, on these terms:

A casual employee is one who is engaged to work as and when required with

no set hours or days of work. Each engagement undertaken by you is a

stand-alone employment arrangement which ends at the completion of the

work required. No severance is payable to you when you complete any

casual engagement with C&CDHB. There is no obligation on C&CDHB to

offer you employment, and likewise you are under no obligation to accept

offers of casual work.

…

Attached is the role/position description which outlines the functions of this

position. The role/position description will be reviewed with you on a

regular basis, and mutually agreed changes will be made, as appropriate, to

keep it up to date.

As you are an existing member of the PSA, your salary will be based on

the DHBs/PSA Mental Health and Public Health Nursing MECA which

is $61,273 per annum, proportionate to hours worked, which is Step 5 of

the PSA Mental Health Inpatient Nurses Scale.

…

As a casual employee you will be paid 8% of your taxable earnings at the

completion of each casual engagement, in full recognition of your holiday

entitlements.

If you are engaged on a frequent basis, you may become eligible for sick and

bereavement leave provided the extent of your engagement meets the

minimum requirements stipulated in the Holidays Act 2003 and its

Amendment Act 2004. During periods of casual engagement you will be

insured for work related personal injury.

Because of the flexibility that casual employees enjoy, there is a potential for

such employees to end up working excessive hours which may become a

safety and health risk for the employee. You are required to declare to your

employing manager before each engagement if you have already exceeded

40 hours in any five consecutive days and if you have not had at least a

9 hour break since the last engagement working at C&CDHB or any other

organisation.

Capital and Coast DHB has a range of policies and it is a condition of your

employment that you comply with these … these include among others:

the Code of Conduct (which you should read and understand);

our policies and requirements for managing and applying for all

types of leave, …

[12] The letter was accompanied by an acceptance form, which amongst other

things referred to the fact that Mr Savage was entitled to seek independent advice

about the offer and the agreement; also attached was a position description for a

registered nurse operating from the casual pool.

[13] On the casual employment offer form, Mr Savage recorded that he was a PSA

member and as such he accepted the casual employment offer on the basis he would

be employed under the New Zealand (except Auckland Region) District Health

Board/PSA Mental Health & Public Health Nursing Multi-Employer Collective

Agreement (the MECA); that document covered the period 1 April 2010 to 30 April

2012.

[14] It defined permanent, fixed-term and casual employees as follows:

Casual employee means an employee who has no set hours or days of work

and who is normally asked to work as and when required. Casual

arrangements shall not be used to deny staff security of employment. The

employer reserves the right, however, to employ casual employees where

necessary to meet the demands of service delivery.

…

Full-time employees means an employee who works not less than the

ordinary or normal working hours set out under the hours of work clause in

this Agreement.

…

Normal/Ordinary hours means 80 hours per fortnight.

Part-time employee means an employee, other than a casual employee,

employed on a permanent basis but works less than the ordinary or normal

hours set out in the hours of work clause. Any wages and benefits e.g. leave;

will be pro rata according to the hours worked unless specifically stated

otherwise in this Agreement.

…

Permanent employee means an employee who is employed for an indefinite

term; that is, an employee who is not employed on a temporary or casual

basis.

[15] There are no standalone provisions relating to casual employees in the

MECA. References to such employees are contained in provisions which also relate

to other classes of employee. This is not ideal because at times it is difficult to

discern precisely what provisions apply to particular classes of employee.

[16] The definition of full-time employee contains a cross-reference to an “hours

of work clause”. That is a reference to cl 10 of the MECA which contains detailed

provisions relating to ordinary hours of work (normally 80 hours in each two-week

period). Usually a roster period would be four weeks or greater, notified at least

three weeks prior to commencement of the roster period. There were particular

requirements for hours of work, (including the times of day, days of the week and

any over-time or on-call requirements; all of which had to be specified) and as to

processes for either occasional variations of employment, or long-term/permanent

changes to hours of work requirements.

[17] The MECA which was in force on the date of the letter of offer was replaced

with a new MECA on 28 October 2011 which underpinned the employment

arrangements from then on. Although it was due to expire on 30 April 2014,

bargaining had been initiated so that it continued in force by virtue of s 53(2) of the

Employment Relations Act 2000 (the Act), and its terms continued until a subsequent

MECA was signed on 4 November 2014.

[18] Mr Savage worked as a member of the casual pool from 21 February 2011 to

27 May 2014, when the Board wrote to him stating that it would not be rostering him

on for duty until further notice. The letter recorded that since Mr Savage had

accepted a position as a casual employee, the Board was under no obligation to offer

him employment, and he was under no obligation to accept any offer of casual work.

In the particular roster period during which the letter was sent, Mr Savage had been

offered casual work on four subsequent days, which the DHB stated he would not be

required to work, although he would receive payment for those days. The letter

confirmed that no further shifts would be offered.

[19] It went on to state that a complaint had been received from another staff

member against Mr Savage, and that any investigation by the Board would “be put

aside” until inquiries by an external agency which was also considering the

complaint were finished.

What does each party contend?

[20] Mr Savage says that the agreement of 7 February 2011 was not an

arrangement that he would be employed as a casual employee. He says that from the

start he worked on an “ongoing casual basis”, which meant he was a permanent

employee. The MECA required such a conclusion when it stated that agreements

could not be used to deny staff security of employment.

[21] Mr Savage described himself as being a “permanent employee with flexible

work hours and duty stations”. He said this was confirmed by the fact that he

worked regularly every week for over three years; that he could take sick and

bereavement leave, and was treated as a permanent employee on matters such as

applying for leave, and for training purposes.

[22] Alternatively, Mr O’Sullivan, counsel for the plaintiff, argued that were the

Court to conclude that the effect of the documentation entered into on

7 February 2011 was that Mr Savage was a casual employee, that status altered over

time. After six months a pattern of work and the acquiring of entitlements such as

sick leave meant Mr Savage had a legitimate expectation of employment on a

permanent basis.

[23] Turning to the Board’s case, Mr Kynaston, counsel for the defendant,

submitted that the intention of the parties was very clear: they had entered into and

remained in a casual employment relationship. It was essential for the Board to have

access to a pool of casual employees in Mental Health Addiction and Intellectual

Disability Services (MHAIDS). As a member of that pool, Mr Savage was able to

determine where, when, how often and for how long he worked at any time, which

was important to him for family and financial reasons. Mr Savage had worked

previously as a permanent employee on two occasions, and once on a fixed-term

agreement; twice he had chosen to leave permanent for casual employment. If he

wanted a permanent RN position, he could have stayed in his permanent role, or he

could later have applied for one. However, he wanted to work as a casual employee,

and it was agreed that he could do so.

[24] Were the Court now to decide that Mr Savage was a permanent employee so

that the Board was obliged to offer him work, that would fundamentally change not

only the parties’ bargain, but the real nature of the relationship between them. Such

a conclusion would be inequitable, because Mr Savage would in effect have received

all of the benefits of casual employment such as the flexibility to work when he

wanted to, together with the benefits of permanent employment, primarily security of

work in employment, contrary to the parties’ express agreement.

Casual or permanent – the legal tests

[25] As I have already mentioned, the Court must first determine what obligations

were assumed by the parties at the outset; then it must decide the nature of the

relationship which had been created, by the time the relationship problem arose, that

is as at 27 May 2014.

[26] In determining what was agreed at the outset, it is necessary to construe the

documents which go to make up the parties employment agreement. As Tipping J

stated in Vector Gas Ltd v Bay of Plenty Energy Ltd, the ultimate objective is to

establish the meaning the parties intended their words to bear.2 The necessary

inquiry concerns what a reasonable and properly informed third party would

consider the parties intended the words of their contract to mean. The starting point

is the natural and ordinary meaning of the language used by the parties; if the words

used are not on their face ambiguous, then the Court should not readily accept that

2 Vector Gas Ltd v Bay of Plenty Energy Ltd [2010] NZSC 5, [2010] 2 NZLR 444.

there is any error in the contractual text. But it is nonetheless a valid part of the

interpretation exercise for the Court to “cross-check” its provisional view of what the

words mean against the contractual context.3

[27] Evidence as to what one party thought the agreement meant is not relevant,

and parties are not allowed on an interpretation issue to tell the Court what they

intended the words to mean or what they thought the words meant.4

[28] Having established what the relationship was when it was first established,

and because the nature of relationships can change over time, it is then necessary to

assess the nature of the relationship at the appropriate time, here May 2014. Did the

relationship change over time? The question requires an analysis of the evidence

provided by the parties as to how their relationship operated in practice.

[29] At both stages, it will be necessary to consider whether Mr Savage was

employed casually. On that topic, the dicta of Judge Couch in Jinkinson v Oceania

Gold (NZ) is helpful.5 He explained that a question of status may well turn on

whether there was a “sufficient mutuality of obligation between the parties” at the

relevant time.6 The Judge went on to say:

[40] Against this background, it is also important to understand what is

meant by the terms ‘casual’ and ‘ongoing’ or ‘permanent’. Whatever the

nature of the employment relationship, the parties will have mutual

obligations during periods of actual work or engagement. The distinction

between casual employment and ongoing employment lies in the extent to

which the parties have mutual employment-related obligations between

periods of work. If those obligations only exist during periods of work, the

employment will be regarded as casual. If there are mutual obligations

which continue between periods of work, there will be an ongoing

employment relationship.

[41] The strongest indicator of ongoing employment will be that the

employer has an obligation to offer the employee further work which may

become available and that the employee has an obligation to carry out that

work. Other obligations may also indicate an ongoing employment

relationship but, if there are truly no obligations to provide and perform

work, they are unlikely to suffice. Whether such obligations exist and there

extent will largely be questions of fact.

3 Vector Gas Ltd, above n 2, at [80] per McGrath J, [19] and [26] per Tipping J.

4 Gibbons Holdings Ltd v Wholesale Distributors Ltd [2007] NZSC 37, [2008] 1 NZLR 277 at

[56] per Tipping J. 5 Jinkinson v Oceania Gold (NZ) [2009] ERNZ 225 (EmpC) at [37].

6 At [39].

(Emphasis added)

[30] In various cases, courts have referred to a range of indicia which might assist

the assessment of the real nature of the relationship. Both parties focused on the

description of indicia referred to by Judge Couch in Jinkinson, as follows:7

a) the number of hours worked each week;

b) whether work is allocated in advance by a roster;

c) whether there is a regular pattern of work;

d) whether there is a mutual expectation of continuity of employment;

e) whether the employer requires notice before an employee is absent or

on leave; and

f) whether the employee works to consistent starting and finishing times.

[31] Since both parties shaped their submissions around these criteria, I shall

consider these factors in detail.

[32] I emphasise that the key question for present purposes will be whether, when

considering the nature of the employment relationship, the parties have mutual

employment related obligations between periods of work.8

What did the parties agree at the outset?

Letter of offer

[33] On its face, the letter of offer clearly stipulated that Mr Savage would be a

casual employee. It confirmed:

He would be engaged to work as and when required.

There would be no set hours or days of work.

7 Jinkinson v Oceania Gold (NZ), above n 5, at [47]. See also Lee v Minor Developments Ltd t/a

Before Six Childcare Centre EmpC Auckland AC 52/08, 23 December 2008, and Baker v St John

Central Regional Trust Board [2013] NZEmpC 34, [2013] ERNZ 449 at 455. 8 Jinkinson v Oceania Gold (NZ), above n 5, at [40].

Each engagement would be a standalone employment arrangement.

No severance would be payable when a casual engagement was

concluded.

The Board had no obligation to offer employment, and Mr Savage had

no obligation to accept offers of casual work.

Payment was determined by reference to a salary figure, but it was

expressly stated that payment would be proportionate to hours of work.

Holiday entitlements would be paid at the completion of each casual

engagement, at eight per cent of taxable earnings.

Sick and bereavement leave entitlements would be paid according to

statutory entitlements for casual workers under the Holidays Act 2003.

As a casual employee, the arrangements would be “flexible”.

[34] Although these features point to Mr Savage being a casual employee at the

outset, reliance is placed on two aspects of the letter of offer which Mr O’Sullivan

contends point the other way.

[35] The first of these is a reference to a requirement that Mr Savage was to

comply with the Board’s Code of Conduct. Emphasis was placed on the definitions

of misconduct and serious misconduct which refer to behaviour that is likely to bring

the Board into disrepute. The document also endorses the standards of integrity and

conduct described by the State Services Commission, one of which relates to

trustworthiness; activities are to be avoided which may harm the reputation of the

employer, whether those activities are “work or non-work” related.

[36] In my view, these ethical obligations apply just as much to a casual employee

between periods of work as they do to a permanent employee. But, whilst a casual

employee has a “non-work” obligation between periods of work, that obligation is

not so significant as to lead to a conclusion that the individual is a permanent

employee. That is because it is outweighed by the more significant point that

between assignments, the employer has no obligation to offer the employee further

work which may become available, and the employee has no obligation to carry out

that work. It is that factor which is the strongest indicator of ongoing employment.9

[37] Secondly, Mr O’Sullivan submitted that a reference in the letter of offer to

comply with the Board’s policies, and specifically those which required applications

to be made for “all types of leave,” was also a strong pointer to Mr Savage being a

permanent employee. For instance, one of the policies related to “the granting of

leave without pay”, for which an application should be made.

[38] The policy itself contains no exclusion for casual employees. However,

common sense suggests that a person who is genuinely employed on a casual basis

does not have to apply for leave without pay. The employee simply declines a

request to work. I find that, considered objectively, the parties would not have

intended that such a policy would apply to a casual employee.

[39] The policy as to annual holidays specifically refers to the fact that casual

employees would receive an additional percentage of their pay in lieu of annual

leave. Again, an application for holiday leave would not arise for a casual. Any

issues as to the taking of a break by such an employee would be dealt with by the

employee simply stating that he/she would not be available for work at a particular

time. I note that Mr Savage said he believed he needed to apply for this type of

leave, but that is not what the arrangements which the parties entered into required.10

[40] A policy was produced for bereavement leave; it contained a cross-reference

to s 63 of the Holidays Act 2003, which it said would apply for casual employees. I

will discuss this provision more fully later, but its effect is that after a period of six

months when certain thresholds have been met, there is an entitlement for

bereavement leave, and the employee must notify the employer of his/her intention

to take such leave.11

So, if a casual employee had been booked to work a particular

shift and then wished to utilise bereavement leave, a request would understandably

need to be made. That does not mean the employee was permanent.

9 See Judge Couch’s observation in Jinkinson v Oceania Gold (NZ), above n 5, at [41].

10 See this judgment at [27].

11 Holidays Act 2003, ss 63 and 64.

[41] I find that the effect of this particular policy was to confirm that the relevant

statutory provisions would apply. The same provisions of the Holidays Act 2003

apply to the domestic leave policy, and to the same effect.

[42] Mr Savage relied on a provision in the MECA which provided for 10 days

sick leave for full-time employees and an obligation to apply for leave.12

He was not

a full-time employee according to the definition of that term, so the MECA provision

did not apply to him; rather the provision of the Holidays Act 2003 did.

[43] The reference in the letter of offer to applications for leave is not a factor

suggesting that the parties intended Mr Savage would be a permanent employee.

[44] Assessed on an objective basis, I find that the offer which Mr Savage

accepted was to work as a casual employee.

Role description

[45] This document accompanied the letter of offer. It referred to the position of

RN, who would operate within the casual pool. This was described as follows:

Service perspective – Casual Pool

This is a staffing pool which hires individuals on a casual basis to fill

staffing gaps arising from planned and unplanned leave of permanent

employees or due to sudden and temporary need for additional resources.

The individuals may be kept on the books on an ongoing basis for easy

access to them in the future but there is no obligation on the employer to

rehire them or the employee to make themselves available. They are hired to

work, as and when required for that period only after which there is no

further relationship.

[46] After describing the casual pool, the document referred to a “role

perspective”. It was explained that a prerequisite for the RN role was registration

with the New Zealand Nursing Council, and the maintenance of a current annual

practicing certificate. Then followed this sentence:

Application onto the C&CDHB Professional Development and Recognition

Programme (PDRP) at competent, proficient or expert level is required.

12

Clause 22.1.

[47] Mr Cate explained that this was a programme of competency which operated

at three levels. It was offered to permanent employees and not to casual staff, at

least in these terms. The benefits which an RN would obtain by moving through the

three levels such as enhanced wages were not benefits available to a casual

employee. Mr Cate said the reference to PDRP was erroneously included in the job

description. That said, a casual nurse would be required to maintain annual core

competencies and area specific competency requirements, as referred to elsewhere in

the document.

[48] I do not consider that the erroneous reference to PDRP being a programme

applying to a permanent employee should outweigh the specific and elaborate

references in that document to the casual status of the employee.

[49] The document also sets out in some detail the requirements of an RN; that

information does not point one way or the other, because a casual RN would plainly

need to carry out the same tasks as would a permanent RN who was being replaced

temporarily on a particular shift.

[50] I find that the job description confirms that a casual role was intended; and

that it confirmed that work would not be offered between assignments.

MECA

[51] The letter of offer referred to the MECA. It clearly provided for the

possibility of casual employment, which would not involve set hours.

[52] However, the issue which was raised for Mr Savage was the acknowledgment

that casual agreements were not to be used to deny staff security of employment.

[53] Mr O’Sullivan relied strongly on the observations of Chief Judge Colgan in

Muldoon v Nelson Marlborough District Health Board, when consideration was

given to the definition of “casual” employee in the MECA which applies in this

case.13

The Court said:

13

Muldoon v Nelson Marlborough District Health Board [2011] NZEmpC 203, [2011] ERNZ 271.

… That means that District Health Boards must not engage staff either as

casual or fixed-term employees other than for bona fide purposes as

contemplated by the employment agreement. In the case of casuals, the

common law of employment and, in the case of fixed-term employees, s 66

of the Employment Relations Act 2000 limit District Health Boards as

employers from misusing casual or temporary staff for the inherent

advantages of those arrangements to employers and corresponding

disadvantages to employees. This constraint is intended to encourage

Boards to engage permanent employees while still allowing for appropriate

use of casual and temporary staff. In the case of nurses, the evidence

establishes that there is at least an informal career structure with the

defendant by which nurses wishing to be appointed to permanent positions

can progress from casual and/or temporary assignments to full-time or

part-time permanent status, albeit on merit rather than simply by seniority.

[8] So, in the case of casual nurses, the definition of ‘casual employee’

denies the Board the ability to engage a nurse who works set hours or days

of work, or otherwise than as and when required, on what I would describe

as an ongoing casual basis. To do so would be to deny such staff security of

employment.

[54] The Court went on to emphasise that the definition also reserved to the

employer the entitlement to employ casuals “where necessary to meet the demands

of service delivery”.14

[55] It is evident from the discussion in Muldoon that on the one hand casual

employees could be employed, but on the other this option should not be used to

deny staff security of employment. The retention of casuals needed to be undertaken

on a bona fide basis. Specific reference was made to the possibility that nurses

wishing to be appointed to permanent positions could progress from casual

assignments to permanent assignments, as an aspect of career progression.

[56] The present circumstances, however, involve an entirely different factual

context. For personal reasons Mr Savage resigned from a permanent role so as to

obtain the flexibility inherent in a casual role. I am satisfied that his reasons for

doing so were carefully scrutinised by Mr Cate and Mr Klue, and they agreed to

accommodate this wish because the request was genuine. Mr Cate was certain that

when discussing the prospect of Mr Savage assuming such a role, he would have

made it clear that it was “risky to be on the casual pool”. He said that he would have

emphasised that there was no promise of work.

14

At [10].

[57] For his part, Mr Savage said that he did not understand that he would be

working as a casual employee on an ongoing basis and all he was interested in was

flexibility. Given his previous experience of working both on a permanent and a

non-permanent basis (fixed-term and casual), his specific request to move from a

permanent role to a casual role, and the specificity of the documentation with which

he was provided, I do not accept that the consequences of taking this step were

unclear to Mr Savage. I prefer the account given by Mr Cate, particularly as he was

certain he would have made the distinction clear to Mr Savage.

[58] Given the particular circumstances, I find that the Board’s offer to employ

Mr Savage on a casual basis was bona fide; in no way was it intended to compromise

Mr Savage’s career options. The casual arrangement was not being used to deny

Mr Savage security of his employment.

[59] The second issue to arise from a consideration of the MECA relates to the

position during periods of actual work or engagement.

[60] It is clear from the definitions referred to earlier that there is a fundamental

distinction between a casual employee, and a permanent employee whether full-time

or part-time. Under the MECA, a casual has no set hours or days of work, and is

normally asked to work as and when required. That is, the employer would decide

when it wished to ask the employee to accept work; but the employee could only be

“asked”. The employer could not insist that the employee work on any particular

shift. This is to be contrasted with the position of a permanent employee, who would

normally be required to work the days and hours assigned to that person.

[61] The effect of these arrangements is that there is no mutuality of obligation

between work assignments for a casual employee.

Conclusion as to parties’ agreement at the outset

[62] There is no doubt that from an objective standpoint, the parties entered into

an agreement that Mr Savage would be a casual employee. A cross-check of that

conclusion against the context confirms that this is what was intended. As

Mr Kynaston put it, Mr Savage wanted to be a casual employee and that is what he

got.

What was the nature of the relationship as at 27 May 2014?

[63] As explained earlier, the issue as to the nature of the parties’ employment

relationship as at 27 May 2014 may be assessed by considering various indicia,

which I now consider.

The significance of the allocation of work by roster

[64] In some previous decisions, the introduction or existence of a roster was of

particular significance, particularly if it was the means by which work was offered

well in advance of the time at which it was to be performed.15

In other decisions,

however, the use of a roster where it was a tool for determining availability of

workers has not been regarded as a determinative factor.16

The short point is that the

use of a roster is but one factor to be considered in the overall assessment as to

whether there was ongoing employment, and the manner in which the roster was

used will need to be considered.

[65] It is therefore necessary to describe Mr Savage’s actual work arrangements in

some detail.

[66] During the period under review, there were over 100 mental health support

workers and RNs who were members of the Board’s casual pool. They provided

short term cover for sickness, leave or training of permanent staff across 11 units of

MHAIDS, and provided support for high-needs clients when required.

[67] Members of the pool would also fill such gaps as may exist due to a perpetual

shortage of RNs. Casual staff would be used both for ordinary hours as well as

overtime.

15

For example Jinkinson v Oceania Gold (NZ), above n 5, at [36]; and Barnes (formerly Kissell) v

Whangarei Returned Services Association (Inc) [1997] ERNZ 626 (EmpC), at 636. 16

For example Baker v St John Central Regional Trust Board [2013] NZEmpC 34, [2013] ERNZ

449 at [25].

[68] The evidence establishes that 80 percent of RN’s hours within the service

were provided for by permanent staff; 20 per cent of hours were offered to casual

RNs.

[69] Permanent employees are required to work rostered and rotating shifts – that

is, morning, afternoon and night shifts. They are employed to work in a specific unit

or team, and may not be moved to different work areas without negotiation and

agreement.

[70] In the first instance, a ward generates a roster up to several months in

advance, delineated into weeks. That document is populated with the names of

permanent staff automatically.

[71] Permanent staff may have applied for and been granted leave in accordance

with the Board’s policies; if so, the roster will reflect this. In addition, staff may ask

and be permitted to swap, alter or add to their assigned shifts.

[72] Where as a result of these processes there were gaps in the roster, a team

leader or Mr Cate would fill them if possible by using permanent staff; if this was

not possible casual staff would be contacted and asked if they could be available. If

agreement was reached that a casual employee would work a particular shift, the

name of that person would be recorded in the roster by hand.

[73] There was a significant divergence between the parties as to how long in

advance a casual employee would be booked in this way. Mr Cate said that this

usually occurred on a week by week basis, although the team leader of Rangatahi

would book shifts for casual employees “a few weeks” in advance when there was a

known gap, for example, where it was known that a permanent employee would be

away on leave.

[74] Mr Cate said that casual employees such as Mr Savage were also called at

short notice to see if they would be available to work overtime even if already

booked for a particular shift. He said that Mr Savage was regularly offered work in

this way and he would often say that he was not available, or did not feel like

working.

[75] For his part, Mr Savage initially said in evidence that 90 percent of his shifts

were pre-booked. When giving his oral evidence, he said this occurred for

98 per cent of his shifts.

[76] Mr Savage said he worked for three particular wards – Ward 27, Purehurehu

and Rangatahi. He would often communicate directly with staff on particular

wards, which would result in a booking. He said that his work roster was always

pre-booked, sometimes one week ahead, but often up to two months in advance.

Then in his oral evidence he stated that his shifts were pre-booked “many months” in

advance, although he qualified that by stating that sometimes this would be a week

prior, but most of the time it would be at least three weeks in advance.

[77] I do not accept Mr Savage’s evidence that booking occurred “many months”

prior to a particular shift or shifts. Synthesising the evidence, I am satisfied that

shifts were regularly booked some weeks prior to the work assignment, often three

weeks in advance. However, it is not possible to be more accurate on this topic,

because the evidence of the parties was inevitably general in nature relating as it did

to a practice which spanned some three years; and no documents were produced

which might have shed greater light on the issue.

[78] In his submissions, Mr O’Sullivan placed particular weight on the terms of

the letter of 27 May 2014, because it referred to the process of allocating work by

roster in advance. He submitted that for the period during which the letter was

written, the roster had obviously been established more than one week in advance;

this was because the letter had been written on 27 May, yet it showed that Mr Savage

had been rostered on for several shifts up to 7 June.

[79] In evidence, it was also suggested to Mr Cate that some significance should

be taken from the fact that in the letter the Board said it would pay Mr Savage for the

balance of the days for which he had been rostered, although he was not required to

work on those days. Mr Cate said that although he was not involved in sending the

letter because he was away, this appeared to have been an act of good faith given that

an unusual and difficult situation had arisen. I accept that atypical circumstances

were dealt with in the letter.

[80] In my view, the use of a roster to establish whether there was a gap that

needed to be filled, and then to record agreements reached with Mr Savage from

time to time does not point to a conclusion that there was ongoing employment. In

the first instance, the roster included the names of permanent staff; the document was

then used to establish whether there were any gaps which other permanent staff

could fill, or casual employees if they were willing to assist. I accept Mr Cate’s

evidence that Mr Savage was not engaged in a formal “patterned roster of work”.

Although it was foreseeable that Mr Savage would be asked to work, it was not

guaranteed and he was not obliged to accept any request to work.

[81] Rather than Mr Savage’s name being generated by the rosters which were

produced for each unit automatically, his name was kept on a running sheet which

Mr Cate maintained of casual staff who could be available, an arrangement which

was described in the job description given to Mr Savage at the outset.

[82] Mr Savage emphasised that because he was pre-booked, he would not decline

work, although he reluctantly acknowledged that on rare occasions he would do so if

he had family commitments, sometimes conferring first with his wife, or if he was

already scheduled for shifts which would provide the level of remuneration he

needed.

[83] On this issue, the important point is that Mr Savage did not have an

obligation to accept the work which was offered. The relevant clause in the MECA

emphasised that a casual employee had to be asked to work as and when required.

This was the practice. Mr Cate said he spoke to Mr Savage each week to ask him to

work; this was to enable Mr Savage to decide whether to accept or decline a shift.

Mr Cate said that Mr Savage often adopted a humorous catch-phrase in reply which

was “I can’t be arsed”, particularly at times when it did not suit him to work. In fact

he could be asked, but he was entitled to refuse.

[84] Having regard to these contextual factors, I do not regard the handwritten

endorsement of Mr Savage’s name on a roster which had been generated previously

as being a factor which should lead to a conclusion that he was a permanent

employee rather than a casual employee; indeed, the irregular and unpredictable

practice which was adopted between the parties, evidences the flexible arrangements

which the parties had agreed to in the first instance.

Hours of work and days of work

[85] For Mr Savage it was submitted that although the number of hours worked

each week fluctuated, there was an average of nearly 30 hours in each week over a

three-year period. That meant the relationship was not, in reality, a casual one.

There was “ongoing casual work”.

[86] For the Board, it was submitted that Mr Savage worked a wide range of hours

and only on days that were convenient to him which was not the position for a

permanent employee.

[87] The following table reflects the range of hours worked over 170 weeks:17

Hours on duty (including overtime)

Number of weeks

0

> 0 and ≥20

> 20 and ≥30

> 30 and ≥40

> 40 and ≥50

> 50

6

26

49

54

28

7

TOTAL WEEKS 170

[88] The six weeks for which no work was undertaken were periods when

Mr Savage chose to have a break, which he could of course take whenever he

wished.

17

That is, from 21 February 2011 to 25 May 2014.

[89] What can be taken from this evidence is that Mr Savage did not work a

regular number of hours in each week; whether he worked and if so the extent to

which he worked depended on the particular needs of the Board in any work period,

and then whether Mr Savage accepted a particular offer to work, according to his

personal circumstances.

[90] In spite of the fact that Mr Savage said in evidence that he worked “set hours

and set days of work regularly”, the reality was otherwise. The hours worked were

erratic.

[91] A table was produced as to the days of the week which were worked in the

same period, as follows:

Day of week

Days worked

Monday

Tuesday

Wednesday

Thursday

Friday

Saturday

Sunday

31

48

48

65

94

141

142

TOTAL DAYS 569

[92] The majority of days worked were according to Mr Savage’s preferences, and

when he agreed to work if asked regularly on Fridays to Sundays.

[93] These preferences are to be contrasted with the contractual requirements for

permanent employees, who would be rostered on a rotating basis. Mr Cate explained

that permanent employees have a pattern to the shifts they work, since their shifts are

prearranged and agreed to in advance; the days they worked were accordingly more

evenly distributed. Permanent staff were also required to work in a specific unit or

team. By contrast, Mr Savage had a choice on all these issues.

[94] Analysed from this perspective, these factors point towards casual

employment status, as was agreed at the outset.

Whether there was a regular pattern of work

[95] For Mr Savage it was submitted that the evidence of the parties indicated that

over the three-year period there was clearly a regular and predictable pattern of

work. Mr Savage was allocated work whenever he wanted it.

[96] The Board emphasised that having regard to the manner in which work was

offered to Mr Savage, it could not be said that he became a permanent employee,

since when and where he would work was unpredictable and he had the right to

refuse to work on any particular shift.

[97] I accept the submission made for the Board. Having regard to the analysis of

hours worked and days of the week worked as above, any “pattern” was erratic and

unpredictable. Whilst there was a reasonable certainty that work would be available

for casual staff to the extent that a pool of such employees was maintained, it was

always open to Mr Savage to decline any particular offer, and when he wished to he

did. This was as originally agreed, and this aspect of his employment did not alter.

It was a key point of difference between a casual employee and a permanent one.

Was there a mutual expectation of continuity of employment?

[98] For Mr Savage, emphasis was placed on four particular factors which it was

submitted created a mutual expectation of continuity of employment. The first was

the ongoing rostering of work to Mr Savage in advance. The second was the

reference in the letter of offer to the fact that Mr Savage’s role/position description

would be reviewed on a regular basis and that mutually agreed changes would be

made as appropriate to keep it up-to-date. The third was the statement in the same

letter that if Mr Savage was engaged on a frequent basis, certain entitlements for sick

and bereavement leave would arise under the Holidays Act 2003. The final factor

related to the obligation to comply with the Board’s Code of Conduct at all times.

[99] All these matters have been touched on already, but it is appropriate to repeat

my earlier conclusions because this particular factor is the strongest point advanced

for Mr Savage.

[100] In the circumstances of this case, I do not consider that the fact Mr Savage

was asked regularly if he wished to work on particular occasions, and his acceptance

of those requests, leads to a conclusion that the nature of the relationship changed. I

have already found that on each such occasion Mr Savage had a choice whether to

accept or not.

[101] This was not a situation where an employee wished to advance his career by

moving from casual to permanent status. Rather, converse circumstances gave rise

to the employment agreement. Furthermore, once he agreed to be a casual

employee, Mr Savage did not request that his casual employment agreement be

brought to an end so that he could become a permanent employee again, a process

which he had initiated previously. There is no evidence that a continuation of the

casual agreement was to preclude Mr Savage having security of employment.

[102] Next, I refer to the intention to review the role/position description on a

regular basis. The evidence is this did not happen. But it is not a significant factor

for present purposes, since the intention was only to review the position description;

there was no commitment to review Mr Savage’s status. In any event, as experience

showed, Mr Savage could apply to be a permanent employee; he did not do so.

[103] Turning to the acknowledgment in the letter of offer that entitlements would

arise under the Holidays Act 2003 for sick and bereavement leave, I do not consider

that this reference assists on the question of status. As far as the letter itself is

concerned, it was confirmed that those entitlements would arise if Mr Savage was

“engaged on a frequent basis”. The letter did not state that in such an event, the

continuation of the agreement itself would need to be reviewed; nor do the criteria of

s 63 of that Act, which I discussed earlier, turn on whether the employee is employed

on a casual or permanent basis.

[104] What is of greater significance in my view is the fact that when setting up a

casual agreement, the parties specifically foresaw the possibility that Mr Savage

could be engaged frequently as a casual employee.

[105] The final factor for the purposes of this submission is the reference in the

same letter to the Code of Conduct. I have already discussed this factor, and do not

regard it as determinative.

[106] In short, whilst there was a reasonable expectation that work would be

offered to Mr Savage and that he would have the choice of agreeing to undertake it,

he was not bound to do so; he was not rostered on a regular and rotating basis as

would be the case for a permanent employee.

The provision of notice before being absent or on leave

[107] Mr O’Sullivan submitted that Mr Savage believed he was required to advise

his employer that he was going to be absent or on leave, and that he always did this.

He relied on the fact that the letter of offer specifically referred to the Board’s

policies and requirements for managing and applying for all types of leave. This was

accordingly a strong factor pointing to permanent status.

[108] I have already analysed the various policies.18

The policy relating to annual

holidays specifically provided that casual employees would be paid on a “pay as you

go basis”; and as I have already found, if Mr Savage wanted a break, he could

decline to work when asked. He was not required to give a reason, even if he did as

a matter of courtesy. The reference in the policy to leave applications must be

regarded as a provision relating to a permanent employee.

[109] The policy as to bereavement leave also referred to the position of casual

employees; reference was made to the provisions of the Holidays Act 2003, and any

notice for the taking of bereavement leave (where it had previously been agreed that

work would be undertaken) was on the basis that the applicant for leave was a

casual. The domestic leave policy did not incorporate the same distinction, although

it would operate in the same fashion; that is where a casual employee had a sick

18

At [38] – [42].

leave entitlement under the provisions of the Holidays Act 2003, agreed to work on a

particular shift or shifts but subsequently became ill, commonsense would suggest

that it was appropriate for that employee to inform the employer of the changed

circumstances.

[110] Arrangements of this type do not in my view mean that Mr Savage should be

regarded as a permanent employee.

Were there consistent start and finish times?

[111] Mr O’Sullivan submitted that shifts started at pre-determined times and

concluded at pre-determined times, and that this too was a factor suggesting

permanency.

[112] In fact, Mr Savage’s evidence was that shifts were not of a fixed duration. He

said that as a RN he was not permitted to finish a shift until his workplace was

declared safe, and he was covered by another staff member. He said that at times he

had been required to stay significantly beyond the end of a shift in order to meet

these criteria.

[113] Mr Cate said that Mr Savage would sometimes work a 7.00 am to 1.30 pm

shift, which was not a standard shift because permanent staff who started at 7.00 am

were required to finish at 4.05 pm, or in the instance of a particular ward, 3.30 pm.

He said that additionally, Mr Savage would sometimes finish a 2.30 pm shift at

10.30 pm, whereas a permanent staff would finish at 11.05 pm. Although each shift

had a handover period where there was an overlap of staff finishing a shift and

beginning a shift, some team leaders did not wish to have casual staff such as

Mr Savage work to the end of a shift if they were not needed during the overlap. He

said this was to save money. That is, unlike a permanent employee who worked and

was paid to work on a rostered shift basis, a casual employee worked as required,

and was paid accordingly.

[114] On the totality of the evidence on this point, I find that there was a sufficient

distinction between start and finish times for casual workers such as Mr Savage on

the one hand, and permanent employees on the other, that this was not a factor giving

rise to permanent status.

Conclusion as to position as at 27 May 2014

[115] The effect of my consideration of the foregoing factors is that none of the

indicia which the Court has been required to consider lead to a conclusion that in

reality the relationship was one of permanent employment. This was not a situation

where in practice there were ongoing mutual obligations between periods of work

which lead to a conclusion that the relationship changed over time. I find that the

casual status which was requested and agreed at the outset, continued to apply until

27 May 2014.

Conclusion

[116] Having found that an arrangement of casual employment was entered into at

the outset, and not altered subsequently, the challenge must fail. I agree with the

conclusion reached by the Authority in its determination.

[117] I reserve costs. The Board is entitled to costs unless there are factors which

fall for consideration of which the Court is unaware. The parties should attempt to

agree this issue directly. If that does not prove possible, the Board may file and

serve a submission as to costs within 21 days of the date of this judgment; and

Mr Savage may file and serve a response within 21 days thereafter.

B A Corkill

Judge

Judgment signed on 30 June 2016 at 12.15 pm