Ruling sees prejudice to employer, which succeeded before Employment Relations Authority
The New Zealand Employment Court has granted a former employer’s application for an extension of time to file its statement of defence against its ex-employee’s claim that his resignation on 12 March 2024 was a constructive dismissal.
In XDC v Allied Investments Limited [2026] NZEmpC 113, the plaintiff alleging constructive dismissal also requested reinstatement, compensation, reimbursement of lost wages, and interest.
The plaintiff unsuccessfully brought a personal grievance claim before the Employment Relations Authority (ERA). On 7 January 2026, the plaintiff filed a statement of claim to challenge the ERA determination that found no constructive dismissal.
On 20 February 2026, in the absence of a filed statement of defence, the plaintiff applied without notice for a default judgment. The Employment Court ordered the service of the application for a default judgment upon the defendant.
The plaintiff’s counsel advised that CourierPost delivered the documents at the defendant’s registered address for service on 25 February 2026.
After a directions conference on 20 March 2026, the Employment Court ordered the registry to set down the proceeding for a formal proof hearing and to send a copy of the court’s minutes to the defendant’s recorded email address.
Upon receiving the registry’s email, the defendant’s general manager replied that he had not been served with any documents. He confirmed the defendant’s plan to defend against the proceedings.
On 30 March 2026, the defendant applied for leave to extend time to file a statement of defence and filed a draft statement of defence.
The Employment Court of New Zealand found it in the interests of justice to extend the time for the defendant ex-employer to file a statement of defence against the plaintiff ex-employee’s claim.
First, the Employment Court found the reasons for the delay credible. The defendant accepted that the plaintiff properly served the documents at its registered office. However, the defendant’s general manager said he did not receive notice of the statement of claim until the email.
Second, the Employment Court did not consider the delay substantial or excessive. The court noted that the defendant’s general manager speedily responded to the email.
The court added that the defendant prepared an application for leave and draft statement of defence within 10 days from its general manager’s receipt of the email, as well as engaged fully with the ERA investigation in the first instance.
The court determined that expedient procedural steps in the future could help mitigate the delay in the progress of the proceedings.
Third, the Employment Court found no real undue hardship to the plaintiff, apart from having to deal with a defence to the de novo challenge.
On the other hand, the court saw significant prejudice to the defendant. According to the court, refusing leave would prevent the defendant, which had been successful before the ERA, from defending the serious claims against it.
Lastly, the Employment Court preferred to determine the merits of the proceeding with the benefit of both parties’ perspectives, rather than resolving it based on procedural defects.
The court accepted the impossibility of assessing the merits of the proceeding at this stage and acknowledged the potential that the plaintiff could succeed in his challenge.
However, the court noted that logic dictated that the defendant must have had a meritorious position, given its success before the ERA.
