Global travel giant Helloworld has been ordered to pay more than $100,000 to three former employees who lost their jobs due to the Covid-19 lockdown.

As well as ruling in favour of the sacked staff, the Employment Relations Authority was critical of the company's handling of the redundancies, stating given the level of specialised resource available to Helloworld the clear and serious flaws in this process are difficult to understand".

The company was struck by the Covid-19 pandemic but was found to have breached the Holidays Act 2003 by ordering a second close-down period over the March 2020 lockdown.

On March 13, 2020, chief executive at the time, Simon McKearney, wrote to staff in an email "the pandemic was a crisis for the business and there would likely be an impact on staff".

He urged all to have a leave balance of under 80 hours by June 30, reduce to a three or four-day working week and that the company would "actively engage ... letting people go".

Chief executive of Helloworld global, Andrew Burnes, then emailed staff on Monday March 23, 2020, saying "the tragic reality is that due to circumstances beyond any of our control, travel demand has evaporated and apart from processing cancellations, we have no work for most of you at the moment".

Helloworld was, at that stage, "in a sound financial position" but had forecast a "massive drop in revenue" and they would have to make "difficult decisions to reduce costs and guarantee the future of the business".

He then confirmed the close-down effective March 27 until June 1, 2020, and said staff would be required to take annual leave. Those who didn't have any would "need to take this time as unpaid leave".

Authority member Marija Urlich noted that under the Holidays Act, only one close-down can be ordered in a 12-month period. Helloworld closed down over the festive period each year.

Unsworth, David Libeau and Whitney Towers successfully submitted the close-down unjustifiably disadvantaged them for which they were granted outstanding wages and compensatory damages by the authority.

Unsworth and Towers, made redundant in July 2020, both questioned management about the legality and their refusal to comply and were told the decisions were being made by human resources at the Australian HQ. However, some emails were never responded to.

Urlich said the company failed by not "at least" attempting to reach an agreement on getting employees to use annual leave.

The trio also sought holiday pay arrears as well as costs and interest.

As for compensation, Unsworth said she had worked for Helloworld for almost 21 years and been a loyal, dedicated and hard-working employee and was still grieving the loss of her career.

Libeau said after 47 years in the travel industry his experience with Helloworld left him feeling "undervalued, shocked, hurt and humiliated", adding after his job ended his life "felt very empty and he felt directionless and worthless".

Towers, who had worked for Helloworld for 12 years, felt her restructuring was wrong "from start to finish".

Learning she was being made redundant on a conference call "was particularly hurtful and humiliating" and her stress was compounded after learning Helloworld bought a new cruise wholesale business in November 2020.

The staff submitted the company's process was flawed and there were no genuine reasons to disestablish their positions because there were suitable alternatives available.

Helloworld denied it had breached any terms of their employment and said its discussions around dismissals for redundancy "were substantively and procedurally justified and throughout the relevant period they were treated fairly and reasonably".

The company's counsel, Alastair Espie and Lilli Wilkinson, submitted any defects in its process were "minor and inconsequential", and remedies should reflect those
circumstances and there were no grounds for a penalty to be awarded.

Urlich found Helloworld reduced their pay without consent and breached their employment agreements.

Towers' had a wage deduction clause where she must give written consent to any deduction, while all three had a clause that "changes or additions to this agreement will not be binding unless mutually agreed and recorded in writing".

Consent to a variation wasn't sought or given by Unsworth or Towers and Urlich found Helloworld's actions in reducing their hours and salaries "was a unilateral variation to those binding terms, and I find in breach of those terms of employment".

As for Libeau, who finished in August 2020, Helloworld submitted that he "consented to the reduction through his actions" while also accepting there was no written agreement from him.

Instead, helping form its argument, they produced an April email to a manager in which Libeau said he didn't expect any staff would have full-time work for about three months.

However, that didn't fly with Urlich who said there was insufficient evidence that his hours did reduce. Libeau testified he continued to work hours necessary to fulfil the duties of his role and Urlich found there was no evidence Helloworld knew what hours he was in fact working.

She said the email, together with another from May, "can reasonably be understood as non-acceptance" as he had not signed any appropriate documentation.

While she accepted Helloworld suffered substantial impact to its business and
cash flow over the Covid-19 lockdown period "it was incumbent on it to ensure any variation to terms of employment were reached fairly with affected employees within the express terms of their employment agreements and statutory obligations".

"On the information before the Authority this did not occur and there is insufficient information before the Authority that Ms Unsworth, Mr Libeau or Ms Towers agreed to vary their terms and conditions of employment to reduce their hours of work or salary.

"It is accepted these breaches of their employment agreements caused them stress, uncertainty and caused them to lose confidence that their employer would treat them fairly and reasonably."

Urlich calculated each unjustified disadvantage for each employee; Unsworth $20,125.47, Libeau $21,464.77, and Towers $8,489.77.

She found the redundancies were genuine but the company failed with its notice and consultation requirements, stating its redundancy process "was rushed, unfair and unreasonable".

"It was incumbent on Helloworld to ensure the process was clear and supported by sufficient information provided at an appropriate time.

"This did not occur.

"Given the high level of resource available to Helloworld to manage this process these clear flaws are difficult to understand.

"Helloworld's actions have left it vulnerable to criticism" and further adding the flaws "were not, on an objective assessment, minor or inconsequential".

"The process was unreasonably rushed. On the evidence before the Authority these dismissals for redundancy are unjustified."

As for Libeau, his dismissal for redundancy "came out of the blue after he declined the unpaid leave proposal" and the matter was never discussed with him, nor was he invited to provide feedback.

Unsworth and Towers were granted compensation for humiliation of $20,000 each, while Libeau was given $18,000.

Urlich said after reviewing the evidence of loss and Unsworth's attempts to secure
employment, she awarded her three months' lost salary.

Open Justice has approached Helloworld's counsel Alastair Espie for comment.

- Belinda Feek, Open Justice