Employer dismissed worker while ACC actively worked on a return-to-work plan
New Zealand's Employment Court ruled that a charitable trust unjustifiably dismissed a worker suffering workplace-induced PTSD.
In Sheridan v Pact Group, delivered on 18 March 2026, Chief Judge Christina Inglis overturned a finding of the Employment Relations Authority, which had previously ruled in Pact Group's favour, and ordered the company to pay $30,000 in compensation and lost wages to Roseanne Sheridan, a community support worker the company dismissed in July 2021.
Sheridan worked at a Pact Group community house in Ōamaru, supporting residents with physical and intellectual disabilities. Sheridan gave evidence that certain residents had committed serious violent assaults. In January 2021, a resident threatened to slit her throat during a dinner shift. Sheridan subsequently developed complex PTSD and lodged an Accident Compensation Corporation (ACC) claim for a mental injury at work.
Rather than pursuing a rehabilitation process, Pact Group pressed Sheridan for medical information she did not hold, as the details remained pending from ACC's specialist assessment. Within two months of her going on sick leave, the company warned that it might not be able to keep her position open.
By late July 2021, Pact Group dismissed Sheridan for medical incapacity, just as ACC accepted her claim and was working towards developing a return-to-work plan. The company also refused two direct requests to attend mediation.
Chief Judge Inglis found that Pact Group dismissed Sheridan after only six months and declined to wait for ACC's specialist report, despite knowing ACC was actively working on a return-to-work plan and that a return to work looked positive. The court also found that Pact Group failed to apply its own rehabilitation policy, which committed the organisation to proactively support employees injured during their employment. Witnesses for Pact Group confirmed they were unaware of that policy at the relevant time.
The court rejected Pact Group's operational justification for the dismissal. Evidence showed that recruitment for a permanent replacement only began after the company had already decided to dismiss Sheridan. A separate staff resignation, whose departure overlapped with Sheridan's absence, compounded the operational pressure Pact Group cited, though the court found the company took very little action to manage either absence.
On remedies, Chief Judge Inglis placed Sheridan's losses in the middle of the second compensation band and awarded $30,000 under the Employment Relations Act 2000. The Court ordered a sum equivalent to six months' lost wages, minus ACC payments Sheridan received during that period. Counsel for Sheridan suggested that 20 percent compensation for the period of lost wages was appropriate. The court understood Pact Group to agree with that approach in the event that lost wages were ordered, a remedy it had opposed. The exact amount is to be confirmed by the parties or determined by the court within 30 days. The court declined to reduce any award for contribution, finding that Sheridan did not engage in blameworthy conduct. Costs are reserved.
