A former general manager for the American continent at local software developer OpenCloud, has lost a bid to have a court case against the company heard locally.
Ned Chini filed an application to New Zealand’s Employment Relations Authority, seeking to have employment issues he encountered while working at OpenCloud heard by the ERA.
However, in a determination issued late last year the ERA found that Chini’s grievances couldn’t be heard locally, because his employment contract with OpenCloud specified that the contract was covered by Californian law.
In its determination the ERA noted that, “During his employment Mr Chini had issues about the rate of pay and the size of bonuses paid to him.
“Subsequently, he was dismissed by OpenCloud NZ and now seeks remedies for an alleged unjustified dismissal, as well as unpaid wages and bonuses.”
OpenCloud’s parent company, UK-based OpenCloud, later filed legal proceedings against Chini in California.
The ERA found in favour of OpenCloud NZ, finding that the clause in Chini’s contract with OpenCloud specifically stated that employment matters were covered by Californian law and this prevented the ERA from considering Chini’s grievances.
The ERA noted there are precedents in which similar clauses have been found to be insufficient to prevent an employment case being heard in New Zealand.
However, these involved different circumstances, such as the employee being based in New Zealand during the time of their employment.
Chini argued that his contract was signed in New Zealand and that OpenCloud NZ is a local company with no assets in California.
He also noted it is difficult to enforce a judgment in California against a New Zealand company. As well, he was unable to counterclaim against OpenCloud NZ because it was not the local operation, but its UK-based parent, that had brought proceedings against him in California.
However, the ERA noted, “It is clear from the jurisprudence that the modern approach to this matter favours dealing with Mr Chini’s issues in California, because that is where the work was carried out”, and that “furthermore, the contract Mr Chini entered into clearly states that California is where any legal issues should be dealt with”.
A request for further information about OpenCloud’s US case against Chini, emailed a public relations firm listed on OpenCloud’s website as the contact for media inquiries, was not replied to by Computerworld’s deadline last week.