Nā Alice Anderson

In a previous LawTalk contribution I suggested that the concepts of employment law somewhat mirror the principles of Te Tiriti o Waitangi.

The duty of “good faith” underpins both Te Tiriti partnership and employment relationships. I often hear the term being used, but am not convinced that it is truly understood, let alone upheld, by those who are bound by it.

Te Rōpū Whakamana i Te Tiriti o Waitangi (the Waitangi Tribunal) continues to find that the Crown has acted inconsistently the principle of partnership and its duty of good faith to Māori. In the employment jurisdiction, the scope and meaning of good faith has become better understood over time, yet personal grievances and disputes remain plentiful.

Rather than looking for a prescriptive explanation of what the duty of good faith requires, those who are bound by it may be better to focus on creating the foundation of their own relationship, if they are to truly act in good faith.

Employment law

Parties to an employment relationship owe each other a duty of good faith. This duty underpins the objectives of the Employment Relations Act 2000 (ERA) and the employment relationship.

The ERA provides that the duty of good faith is wider than the implied duty of trust and confidence, and without limiting it, requires:

• the parties to be “active and constructive” in establishing and maintaining a productive employment relationship, including to be “responsive and communicative”;
• the parties not to do anything that will, or is likely to, mislead or deceive the other;
• where an employer is proposing to make decisions that will, or are likely to, have an adverse effect on the continuation of an employee’s employment, the employer must provide the employee with access to relevant information, and an opportunity to comment on that.

The ERA prescribes a non-exhaustive list of situations where the duty of good faith applies, which is particularly well-established in the context of collective bargaining. It is also pivotal, although less prescriptive, in the context of individual employment relationships.

A principle of Te Tiriti

The texts of Te Tiriti do not contain what we now know as the principles. Rather, these have evolved over time, having been explored within various contexts.

The principle of partnership has been described in Te Puni Kōkiri resources as “an overarching tenet, from which other key principles have been derived”.

President Cooke in the Landscase (1987) described the duty of partnership as “infinitely more than a formality”, emphasising that Te Tiriti partners have a duty to act reasonably, honourably, and in good faith.

The Court of Appeal in both the Lands (New Zealand Maori Council v Attorney-General[1987] 1 NZLR 641) and Forests (New Zealand Maori Council v Attorney-General[1989] 2 NZLR 142) cases considered principles of good faith inherent in partnerships in civil law to aid its interpretation of Te Tiriti principles. Later inPaki v Attorney General[2009] NZCA 584 the Court of Appeal specifically considered the role of good faith at employment law when contemplating a relational duty of good faith between Crown-Māori.

The Waitangi Tribunal refers to the duty to act reasonably, honourably, and in good faith, within the principles of reciprocity and mutual benefit. In the Napier Hospital and Health Services Report,the Tribunal said the duty of good faith conduct establishes ‘the general character of the relationship’ between Māori and the Crown.

The relationships (or the Seed)

There are parallels between what the duty of good faith requires of Te Tiriti partners and parties to an employment relationship, including responsiveness, communication, access to relevant information, and the ability to be heard.

Though the duty of good faith applies to employers, employees, and unions, the ERA acknowledges that there is an inherent power imbalance in the employment relationship, which it addresses by placing additional obligations on the employer.

Similarly, the Tribunal in Te Whānau o Waipareira Reportconsidered that where the power imbalance in the Māori-Crown relationship favours the Crown, it is the Crown’s responsibility to ensure that Māori are not disadvantaged in the relationship.

TeTiriti partners, as part of the good faith obligation, are required to reasonably co-operate and make a genuine effort to resolve issues arising between them, with judicial intervention being the last resort.

Similarly, to build productive employment relationships in good faith, the ERA promotes the prompt raising of employment relationship problems, with mediation as the primary problem-solving mechanism, reducing the need for judicial intervention.

Despite all of this, Chief Judge Inglis of the Employment Court suggested in a 2019 paper Defining good faith (and Mona Lisa’s Smile)that Parliament’s vision for the concept of good faith is yet to be fully realised.She says that it “cannot (and should not) be pinned down and defined by way of reference to a clear-cut legal rule. Rather it is a standard which applies flexibly depending on the particular circumstances of the case. It necessitates an evaluation of the alleged breach in its human dimension”.

The sentiments shared by the Chief Judge can translate and be applied to consideration of the duty in Te Tiriti context and Crown-Māori interactions.

The need to nurture

Employment relationships are ongoing, special and unique, as is the Crown-Māori relationship and Te Tiriti partnership. To reflect this, and presumably to preserve and strengthen the relationships, the parties owe each other a duty good faith.

However, this duty continues to be aspirational, and we are yet to see it achieve its potential. Unfortunately, we continue to see fractured and damaged relationships between Crown and Māori, and employers, employees and unions.

There can be a tendency in the employment jurisdiction for partiesto adopt a regimented ‘tick-box’ approach, as opposed to meaningfully engaging with the other party on issues as they arise. That cannot truly be giving effect to what Parliament intended when placing this duty of good faith on the parties.

Tikanga-based dispute resolution places emphasis on inclusion and participation in the resolution process; the process itself being just as important as the outcome. A common grievance forMāori is the failure of the Crown to involve Māori in the process of decision-making, ensuring that their voice is heard in matters that affect them.

In Te Tiriti context, the Crown cannot expect to undertake the same engagement process on every kaupapa. Likewise, employers cannot approach every employee or problem that may arise in the workplace the same. This fails to acknowledge and address the issues in their “human dimension”.

Part of the answer to this lies in whakawhanaungatanga; the process of establishing relationships, making connections and relating to people. For parties to act in good faith, it is fundamental to respect the other and spend time understanding who you are engaging with. Whakawhanaungatanga enables parties to create the foundation of their relationship early, reinforcing and appreciating the commitment and responsibilities they have to each other.

It is no coincidence that the principles of employment law mirror the principles of Te Tiriti in some respects. Both reflect relationships that seek mutual benefit and reciprocity, but which require the parties to act in good faith toward the other in order to achieve that. The duty of good faith is not a term that should be thrown around lightly or be paid mere lip service; rather, parties should focus on understanding who they are in the relationship with, in order to truly give effect to their duty of good faith.

Until the parties nurture these relationships from the outset, they cannot truly expect them to blossom.

Alice Anderson, Ngāi Tahu, is a Solicitor at Dundas Street Employment Lawyers in Te Whanganui-a-Tara.