Workplace Incompatibility

Anthony Drake, Senior Associate | February 2002

While personality conflicts between work colleagues are not uncommon, in some instances they can cripple a workplace. Often they lead to lost production, poor morale and can consume managers' time.

The Court of Appeal has confirmed that an employer can dismiss an employee for incompatibility. However, in most cases, warnings are required.

In Reid v New Zealand Fire Services Commission (1998) the Court of Appeal accepted that in unusual and rare cases an employer can justify an employee's dismissal because of an irreconcilable breakdown of trust and confidence in the employment relationship rather than on the more usual grounds of what is known colloquially as serious misconduct, or in contractual terms what is a fundamental breach of contract.

Other cases decided by the Employment Court make it clear there is an obligation on management to "nip the unpleasantness in the bud". This requires the employer to follow a proper process to try and resolve incompatibility problems. This might include counselling or a conference between the protagonist and the employee or employer. There may also need to be a disciplinary process involving warnings together with a reasonable opportunity to improve. Another option might be to redeploy employees involved.

In a recent case, Mabry v West Auckland Living Skills Home Trust Board, (19 December 2001) the Employment Court said that where incompatability brings an employment relationship to an end, the employer must justify the dismissal by showing that the necessary level of incompatibility exists. Once this burden has been discharged, the next issue to consider is whether the dismissal was substantively justified and procedurally fair.

The Mabry case involved a community service worker employed by the Trust Board. After a few months on the job, the worker was told of some concerns by her supervisor. She became upset and the relationship deteriorated. She was insulting and insubordinate to her supervisor. The Trust Board issued warnings and provided opportunities to improve. Over many weeks the worker showed little sign of improvement in spite of warnings and meetings. The relationship was irreparable and she was dismissed.

In deciding that Ms Mabry's dismissal was justified, the Employment Court said the employer must show that the incompatibility was largely the employee's fault. The test is essentially whether the decision to dismiss was one, which a reasonable and fair employer could have taken in the particular circumstances. In carrying out a dismissal, the employer must adopt a fair procedure. However, it is not relevant in the circumstances, whether or not personnel policies laid down for general guidance had been minutely followed, as a fair process was followed. Of course, the necessary level of incompatibility will depend on the circumstances of each case.

Key Points

• An employer can dismiss an employee for incompatibility;
  
  
• An employer must justify any disciplinary action against an employee;
  
  
• An employer must follow a proper disciplinary process which can be broken down into various steps:
  
  Complaint - The employer should carry out an investigation of all relevant facts prior to confronting the employee. After having carried out a preliminary investigation and prior to deciding what action should be taken, arrange an interview with the employee to discuss the matter. Inform the employee, in advance of the interview meeting, of the specific details of the concerns or allegations. Inform the employee of their right to bring a legal representative to the meeting.
  
  Interview employee - The interview must be carried out in a fair and reasonable manner. This will involve giving the employee a full and proper opportunity to answer and explain any allegations or to mitigate his or her conduct. The employee may be given a warning and should be given the opportunity to correct their performance prior to dismissal. Any warning should be explicit and fair - describing how the employee's behaviour is thought to be unsatisfactory, give clear information about what improvement is required, how that will be measured or monitored and that if the behaviour does not improve, their employment will be in jeopardy.
  
  Investigation - Follow up explanations offered and give consideration to its validity. The employee's behaviour must be monitored and reviewed at the end of a reasonable time. If the unsatisfactory behaviour persists this must be raised with the employee at meetings. If the issues can be resolved by counselling or redeploying the employee, then the employer should consider those options.
  
  Decision - If, at the end of a reasonable period, there is no improvement in the employee's behaviour, the employer must decide whether the employee's behaviour is so sub-standard as to justify dismissal. Any dismissal must be carried out in accordance with the employee's employment agreement.