In the pursuit of justice, if the merits of a case offer good reason for court action, one may decide to have their day in court. Within the bigger picture of having one’s day in court, one must not overlook the details and, specifically, the starting point. The starting is always the point of “jurisdiction”. In other words – which particular authority, tribunal, or court would be the most appropriate forum to hear and decide a particular case.

Relatively recent cases have commented on the issue of jurisdiction. This article, specifically, will address the respective jurisdictional boundaries of the Employment Relations Authority (ERA), Employment Court, and High Court.

General Points

The High Court has an inherent jurisdiction. Quite distinct to an inherent jurisdiction, the ERA’s exclusive jurisdiction is prescribed by section 161 of the Employment Relations Act 2000 (the Act).[1]

Section 161(1)(r) states “The Authority has exclusive jurisdiction to make determinations about employment relationship problems generally, including any other action (being an action that is not directly within the jurisdiction of the court) arising from or related to the employment relationship or related to the interpretation of this Act (other than an action founded on tort)”.[2]

The ERA’s jurisdiction is not based on specific causes of actions. Therefore, what it can hear and determine partly depends on argumentation and interpretation of what the employment legislative framework should encompass from both a coverage and technical perspective.

Cases and Comments

Cases

Listed below are a handful of cases that have analysed the issue of jurisdiction, to varying extents. 

BDM Grange Limited v Parkers & Ors [2006] 1 NZLR 353;

Aztec Packaging Ltd v Malevris [2012] NZHC 243;

Hibernian Catholic Benefit Society v Hagai [2014] NZHC 24;

JP Morgan Chase Bank NA v Lewis [2015] NZCA 255;

 Comments

From BDM Grange Limited, and several cases preceding this decision, the position was that:

(a)    The ERA did have jurisdiction to determine:[2]

(i)     Claims that were based on employment laws;

(ii)    The granting remedies stipulated in the Act. This included a broad power to grant relief for breaches of contract. Excluded, however, was the ability to grant equitable reliefs.

(b)   The ERA did not have jurisdiction to determine:[4]

(i)     Causes of action based in tort; and

(ii)    Factual scenarios that involved a non-employee or non-former-employee defendants, subject to exceptions. 

Aztec and Hibernian were subsequent cases that altered this position. The factual similarity of these two cases was that the employer attempted to recover money that was stolen by a former employee. It was held in both cases that irrespective of how the claim was pleaded, it came within the ambit of the ERA’s jurisdiction.[5] This meant the claim could not be brought in the High Court.

For both cases to have reached this result, a wider interpretation of “…arising from or related to…” was taken, as compared to BDM Grange Limited. One underlying assumption of the decisions was that the ERA could grant remedies equivalent to the High Court in the context of equitable causes of actions. There are practical consequences with a wider interpretation, within this context. If an employer plaintiff wanted to seek recovery from a former employee and a third party, it would have to file separate proceedings across both jurisdictions against the parties from which it seeks recovery.

From a broader perspective, the contrast between the decisions of BDM Grange Limited and Aztec and Hibernian have, to an extent, caused the jurisdictional boundaries between the High Court and employment arena to tangle, creating more complication than certainty.

The result of the JP Morgan litigation in the Court of Appeal was noteworthy. The Court commented that the Employment Court was:[6]

(a)    Right, in law, to hold that it had jurisdiction to hear a challenge to a determination of the Employment Relations Authority pursuant to ss 179(1) and 187(1) of the Act in circumstances where the determination related to a claim about an alleged breach of a settlement agreement whereas the claim before the Employment Court was based on an alleged variation to the employment agreement;

(b)   Wrong, in law, to say that it has jurisdiction to award damages for breach of a settlement agreement; and

(c)    Wrong, in law, to hold that the written agreement dated 4 March 2010 was capable of being characterised either wholly or in part as a variation to an employment agreement.

Concluding Remarks

Much before the story of a litigation begins and takes its relatively uncertain course, the premise of where the hearing should be heard, must first be established. Sometimes it is clear and conclusive. Other times, the hazy fog needs to be delicately lifted, to see the path that one is traversing. Developments and issues in this area of the law should be followed with interest.

 Copyright Steve Keall, all rights reserved, 2020

[1] Employment Relations Act 2001, s 161.

[2] Section 161(r).

[3] BDM Grange Limited v Parkers & Ors [2006] 1 NZLR 353 at 369 and 370.

[4] At 354, 364, 369, and 376.

[5] Aztec Packaging Ltd v Malevris [2012] NZHC 243 at [12]; Hibernian Catholic Benefit Society v Hagai [2014] NZHC 24 at [28] and [42].

[6] JP Morgan Chase Bank NA v Lewis [2015] NZCA 255 at [118].