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Does an employer need to consult with employees before introducing new technology?

January 30, 2020

Joy Kaur Solicitor
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Yes, said the Employment Relations Authority in the case of Fensom v KME Services NZ Pty Ltd. The Authority held that the employer should have consulted with employees about the nature of new face recognition technology and the consultation should have included details of the other options available to the employer for attendance recording, for example swipe cards and fingerprint scanning.


Mr Fensom was held to be unjustifiably dismissed on 30 October 2018 for refusing to use a face scanning technology that KME Services NZ Pty Ltd (KME) had introduced to record attendance. This new technology was introduced to replace the manual sign in/out sheets that the employees were previously required to complete. This was introduced as part of KME’s new health and safety policy.


In the new policy KME stated that the new technology was being introduced to fulfil its health and safety obligations. KME did not engage in any consultation with its employees about the new technology before it was decided upon and did not provide sufficiently detailed answers to the questions that the employees raised.


Mr Fensom was on annual leave when the system was implemented. Before going on leave, KME told Mr Fensom that if he did not use the new technology on his return then he would be in breach of his employment agreement and “may get a warning letter”.


Upon his return to work, Mr Fensom refused to use the face recognition system and was first given a written warning and then dismissed the following day for serious misconduct for refusing to follow instructions when he continued to refuse using the face recognition system. Therefore, Mr Fensom was given a written warning and then dismissed within two days of returning to work.


The Authority held that KME unjustifiably dismissed and unjustifiably disadvantaged Mr Fensom for the following reasons:


KME did not act fairly as it did not do what a fair and reasonable employer could have in all circumstances:

  • KME did not raise its concerns with Mr Fensom before dismissing him
  • KME did not give him a chance to respond to any concerns. As a result KME did not genuinely consider Mr Fensom’s explanation.
  • KME did not give Mr Fensom an opportunity to seek advice or representation.


KME did not have reasonable grounds to dismiss Mr Fensom:

  • Mr Fensom did not refuse to perform any reasonable duties or to follow reasonable instructions.
  • KME did not consult with the employees before implementing the face recognition system. The time spent answering the employees’ questions could not be considered consultation because KME did not provide sufficient information in its answers and in any event, had already made the decision to implement the technology by then. Therefore, KME breached its good faith obligations that it owed to its employees.
  • KME failed to provide sufficient information to justify the need to use the new technology over a less invasive alternative.


The lack of consultation and lack of process cost KME $11,286 in lost wages and $12,000 compensation for hurt and humiliation.


Feel free to get in touch with any of our team members to ensure that you are fulfilling your legal obligations before taking any action that will impact your employees.

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