NZ employer fined $7500 after poor attendance dismissal

Published 16 Sep 2025 | 2 min read

The Employment Relations Authority (ERA) awarded a New Zealand council worker $7,500 in lost wages after ruling his dismissal for poor attendance was unjustified. The employer failed to issue warnings, skipped fair process, and did not consider medical incapacity procedures, which Employment NZ requires when illness or injury may affect an employee’s performance.

The dilemma for New Zealand employers

When a staff member repeatedly fails to attend work and gives little or no notice, it disrupts operations and burdens colleagues. Many managers feel compelled to act quickly to restore stability.

But even when performance issues are obvious, skipping required legal steps can turn a valid concern into a costly loss. The key challenge is balancing workplace needs with strict legal obligations.

What happened in this case

A council hired an employee to work standard full-time hours. Within weeks, they began missing multiple rostered days, often without timely updates. Over several months, attendance fell to less than half of scheduled days.

Despite repeated requests for medical certificates and updates, communication stayed inconsistent. The employer eventually terminated the role for serious misconduct without issuing any formal warnings.

Why the case became complex

On the surface, the attendance record and poor communication appeared to justify immediate dismissal. The Employment Relations Authority agreed the behaviour was disruptive and warranted formal action.

However, the ERA found the employer failed to follow its own progressive warning policy and did not explore a no-fault medical incapacity process before ending employment. These omissions turned a potential misconduct case into an unjustified dismissal.

Lessons from the ERA decision

The ERA accepted that the attendance issues and lack of timely communication were genuine problems for the business. But serious misconduct findings must be proportionate, and fair process is non-negotiable under New Zealand employment law.

The employer skipped critical steps such as giving formal warnings, setting clear performance expectations in writing, and investigating whether health issues prevented the employee from working.

As a result, they were ordered to pay $7500 in lost wages, though no distress compensation was awarded due to the employee’s contribution to the situation.

What New Zealand employers should take away

This case proves that managing staff issues is not just about having valid reasons, the process matters just as much. Employers should document concerns, communicate expectations clearly, and issue appropriate warnings before considering termination.

If health concerns may be affecting performance, medical incapacity procedures should be explored to protect both the employee’s rights and the business from legal risk.

Acting too quickly without following the correct steps can turn a defensible decision into an avoidable liability.

Employer Checklist: Dismissing for poor attendance in NZ

Before considering termination, Kiwi employers should:

• Document absences and communication records
• Request and record medical certificates when absences are health-related
• Issue progressive warnings in writing
• Explore medical incapacity or medical retirement processes if illness or injury is a factor.
• Apply internal policies consistently and fairly
• Allow time for employee feedback and rehabilitation options

FAQs

Can an employee in NZ be dismissed for poor attendance?

Yes, but only after fair process. Employers must set expectations, issue warnings, and, if illness is involved, consider medical incapacity procedures.

What happens if an employer skips the warning process?

The ERA may rule dismissal unjustified. Employers can be ordered to pay lost wages and, in some cases, distress compensation.

What is medical incapacity in NZ employment law?

It is when an employee cannot perform their role due to illness or injury. Employers must fairly investigate, gather medical evidence, and consider alternatives before dismissal.

How long must employers keep a job open for a sick employee?

There’s no fixed timeframe. Employers must balance operational needs with fairness, considering the nature of the job, medical advice, and the employee’s service length.

What is medical retirement?

Medical retirement is a mutual agreement allowing an employee to leave their role with dignity. It avoids dismissal for incapacity and may include financial or career support.

How much compensation can employers be ordered to pay?

It varies. In this case, the employer was ordered to pay $7,500 in lost wages, but no compensation for distress due to the employee’s contribution.

What next?

If you're seeing suspicious sick leave use, our friendly HR and employment experts are just an email or a phone call away. 

Email us at info@eqconsultants.co.nz, or call us on 03 366 4034 for professional, one-on-one guidance.

This article is not intended as legal advice but is intended to alert employers to relevant topics of interest and how to be prepared.

Note: This information is based on official details from Employment New Zealand and is subject to change. Always refer to the latest guidelines for the most accurate information. Visit Employment New Zealand here.