The Employment Relations Authority (ERA) has found that an email containing disparaging remarks about an employer breached the record of settlement between the employer and an employee.

The employee has been ordered to pay a penalty of $2,000, with $1,500 to go to the employer and $500 to the ERA.

In Silver Fern Farms Ltd v Norton [2017] NZERA Christchurch 54 (12 April 2017), Mr Norton and Silver Fern signed a record of full and final settlement after it was reached in mediation.

The Record of Settlement required the parties to speak about each other in positive or neutral terms so that they did not disparage the other party.

About two months after the settlement, Mr Norton sent an email to five people, including one employed by Silver Fern. The ERA says that in that email Mr Norton made disparaging comments about Silver Fern.

"Mr Norton concluded his email by calling for a boycott of [Silver Fern] products. This part of the email is confused and rambling but it appears to be suggesting that people should not support [Silver Fern]," the ERA says.

The ERA says it is satisfied that the comments were disparaging, and the email breached the Record of Settlement.

Appropriate penalty

The ERA noted that section 149(4) of the Employment Relations Act 2000 provides that a person who breaches an agreed term of settlement in a record of settlement signed pursuant to section 149 is liable to a penalty imposed by the ERA.

Considering the factors set out in section 133A, the ERA concluded that the breach was blatant and deliberate, and also designed to cause harm to Silver Fern.

"This kind of flagrant behaviour cannot be condoned. A penalty should be imposed based upon the nature of the breach, and the need for general and specific deterrence," it says.

Following the four-stage process set out in Labour Inspector v Preet Pvt Ltd [2016] NZEmpC 143, the ERA concluded that the appropriate penalty was $2,000.

It was appropriate that part of the penalty be paid to Silver Fern as it suffered the impact of the breach and had been obliged to take steps to enforce its rights.