A Café worker was recently awarded $9000 for one day of ‘work’ when she was undertaking a work trial as part of the recruitment process. This is not the first decision to reach a similar conclusion. It raises the question of when does a pre-employment assessment cross over to be ‘employment’?
In this case the applicant, Mawhinney, had attended an interview with the Café owners and was asked to come back the next day to work in one of their Cafes. Mawhinney was told at the end of the day it was a work trial and she wasn’t going to be paid. She was also offered the job but turned to it down, asking to be paid for the day. The Café refused. Mawhinney raised a personal grievance claiming she was an employee and had been constructively dismissed. She was awarded $7000 in compensation for distress, plus $119 for the one day of work and four weeks pay in lieu of notice ($1890) because she was deemed to be an employee.
This case is a reminder of the 2013 Employment Court case The Salad Bowl Ltd v Howe-Thornley. The Employment Court found Howe-Thornley had become an employee because she had done more than simply observe the operation or even undertake practical tests. Rather than undertake, for example a test to make a coffee, she had “actually performed the work that needed to be undertaken in the business …She was required to dress in the business’s uniform, to present herself as a permanent employee would”.
In the Salad Bowl case the owner Randi Westphal advertised for an employee, and Amberleigh Howe-Thornley applied for the position. At the end of an interview Howe-Thornley was told there would be a three hour work trial. On two consecutive days she worked 1.5 hours and 1.75 hours.
Westphal cashed up the till on the second day to discover $50 was missing. She concluded Howe-Thornley had taken it. She contacted a referee that had been provided by Howe-Thornley, and that referee raised concerns about Howe-Thornley’s conduct when she was serving friends. No job was offered.
The first question for the Court was whether Howe-Thornley was an employee, and therefore entitled to raise a grievance. The ERA and Court in their rulings had determined that it was normal practice for Westphal to pay people who did a work trial, and the only reason she didn’t on this occasion was the missing $50. As such, because the person is paid, they are an employee. The Authority concluded also that ‘trial periods’ are required under the legislation to be in writing before employment begins. The ERA stated: “ … They are also, according to this statutory scheme, paid employment and there is no facility for unpaid experiments. It is arguable the industry practice Ms Westphal evidenced of a short unpaid trial followed by a formal 90 day paid trial is an unlawful [device] which deprives prospective employees of their statutory rights. Finally, and putting aside, the debate about what was said in the interview, there is an argument Ms Howe-Thornley was a person intending to work and may pursue a personal grievance in any event.”
It is important to treat work trials with caution. They may be deemed to be employment depending on how the employer conducts them, which would mean they should be paid. Once the applicant is paid they become an employee. If the person is subsequently employed the employer can’t utilise the 90 day trial period because the person have previously been an employee.
In the Judge’s final comments he said ‘I do not underestimate the practical consequences of this decision to employers in the retail food and beverage sector wishing to assess the merits of prospective employees.’
Our advice is the keep any work trial to a very structured process, ensuring you are testing specific skills, keep it limited in time, and be very clear to the applicant at the beginning of the process that their time is part of the recruitment process and will not be paid.