The agreement stated it would take effect on December 11, 2023, and included a clause allowing either party to terminate the employment on December 11, 2024 by giving two weeks’ notice. On November 11, 2024, owner Vicky Lin emailed Jiang to inform him the company would not renew his contract when it expired. The email cited “due to the unexpectedly low market conditions, daily sales at the Wellsford Branch have not been sufficient to cover routine expenses, including staff wages.”
Jiang challenged the dismissal. The Authority agreed he was unjustifiably dismissed, finding that Smartrade failed to meet statutory requirements for a lawful fixed-term agreement on multiple fronts.
The problems started before the contract was even signed. There was no evidence that genuine reasons for the fixed-term were discussed with Jiang beforehand. New Zealand law requires employers to have genuine reasons based on reasonable grounds before entering a fixed-term arrangement, and to communicate those reasons to the employee in advance.
The written agreement itself had a fatal flaw. While it stated when the employment would end, it never explained why. This is a mandatory requirement under the Employment Relations Act.
Member Marija Urlich accepted Jiang’s account that the fixed-term provision was never drawn to his attention when he received the pre-signed document. Without evidence to the contrary, the Authority found no proof that Smartrade had communicated any reasons for the fixed-term before Jiang signed.