No jab, no job?

23 December 2021

As New Zealand moved to the new COVID-19 Protection Framework, more employees were required to be vaccinated against COVID-19 in order to perform their roles.  Where employees are not prepared to do so, then employers are faced with the decision of whether to terminate their employment or not.

Less heralded changes also took place to the Employment Relations Act.  As well as providing employees with paid time off to be vaccinated, new Schedule 3A to the Act now outlines a process for the termination of unvaccinated employees.  It (combined with an employer's usual obligations of good faith and fair and reasonable dealing) will result in a three step process.

First, what is the basis for mandating COVID-19 vaccinations for employees?  The Act states that this can either be under a Government COVID-19 order not to carry out work unless they are vaccinated, or where the employer "has determined the employee must be vaccinated to carry out the work of the employee".

Such a determination should be supported by a health and safety risk assessment.  However, we consider that an employer may also determine that vaccination is required where its customers or clients only allow vaccinated contractors and suppliers to come on site (which should also be broadly based on a health and safety risk assessment).  In either case, the employer must provide reasonable written notice of the date specified by which the employee must be vaccinated.

Secondly, and importantly, the employer must consult with the employee on the implications of the requirement to be vaccinated and what may be its impact on their ongoing employment.  In terms of Schedule 3A to the Act, "all other reasonable alternatives that would not lead to termination of the employee’s employment" must "have been exhausted".  This will involve:

  • Clearly explaining how the employee is covered by the Government order or setting out the basis for the employer's determination. If the employer is relying on a health and safety risk assessment, then the employee's input into this should also be sought before it is finalised.  Where a customer or client has implemented a vaccination requirement, the employer should enquire into the reasons for the requirement, and to discuss whether there are any alternative options or ways of managing the situation available;
  • Understanding the reasons for the employee's refusal to be vaccinated, and offering education and access to further information. If a medical reason is relied upon, then the employee should be encouraged to seek a medical exemption (although these are relatively rare);
  • Exploring whether reasonable accommodations can be made to the employee's role or the employer's operations in order to reduce the risk to a manageable level. Consideration should also be given to whether they could be redeployed to another role.  The Employment Court recently highlighted the importance of doing this in a case involving Auckland International Airport.  After an airport mechanical maintenance technician was dismissed for refusing to get vaccinated, the Court found that the employer may not have given adequate consideration to a proposal advanced by the worker.  Where a "no jab, no job" outcome is under consideration, the Court emphasised there is an "active obligation" on the employer to "constructively consider and consult on alternatives" where there is an objectively justifiable reason not to be vaccinated; and
  • Clearly outlining from the outset the possible consequences of a continued refusal to be vaccinated. This is usually termination of employment, however, other options may be available such as taking accrued leave or going on unpaid leave.

Thirdly, once the consultation process is complete and all reasonable alternatives are exhausted, then the employer may terminate the affected employee's employment by providing four weeks' paid written notice of termination, or their contractual notice period if this is longer.  If notice is given, it is cancelled and of no effect if, during the notice period, the employee becomes vaccinated or is otherwise permitted to perform the work (eg receives a medical exemption), unless cancelling the notice would unreasonably disrupt the employer's business.