As a small business owner, you have to wear a lot of different hats – finance, marketing, sales and people management. If you are like me, you didn’t get into your business to do accounts or worry about how you are going to get your ad words in google to work. The reality is that when you are growing your business you can’t always afford a specialist to help and you have no choice but to do it yourself.
When it comes to managing staff most business owners simply want their staff to get on with the job. When things go wrong (and they do) they find themselves in a bit of a bind. Let’s imagine that you have discovered that one of your staff members has stolen a product from your retail shop. You discover the loss during a stock take and review your camera footage to see what happened. You can see your employee taking the item and putting it in their bag. So, what now? Your first reaction is going to be to call them an tell them what you found and tell them they are fired – you would be justified right? Well kind of.
In NZ employment law you need to give the employee a chance to tell you their side of the story, they need to have all the evidence that you have and have the chance to have a representative or support person at this meeting. You also need to assume that they are innocent until you have all this information. A hard thing to do if you have camera evidence!
While you would be justified in terminating their employment for theft but if you don’t follow the process you would still end up losing a personal grievance claim in the Employment Relations Authority, which can be very costly. Costs for losing a Personal grievance can run up to $30,000 when you factor in paying lost wages (usually 3 months lost wages) and hurt and humiliation payments of between $17,000 to $20,000. This seems ridiculous when you consider that the employee stole from you.
Getting this process right is both simple (with a little specialist help) and much cheaper than paying the personal grievance costs. So, you may think that getting help will be expensive, but it will save you in the long run.
Tarryn has worked in HR for over 14 years and loves to solve problems. She is a self professed employment relations junkie! She lives in Auckland with her dedicated husband, tireless toddler and three special needs cats.