Peter Cullen Business Opinion| An Affair Can Destroy... | Stuff.co.nz

EMPLOYMENT MATTERS - PETER CULLEN

OPINION: David Petraeus resigned from his position as director of the Central Intelligence Agency recently.

The influential military man had formerly served as a four-star general and a key strategic thinker behind the ongoing wars in Afghanistan and Iraq.

We are told he offered his resignation to President Barack Obama who reluctantly accepted it.

Petraeus is a married man. The resignation came about because he was having an affair with his biographer.

Could David Petraeus have been dismissed from a similar position in New Zealand for the same conduct?

Of course, his position is political so he has to retain the confidence of both the public and those he works with to preserve his position.

Within the political sphere, there are plenty of examples of people being damaged by similar problems just as there are examples of people surviving. Less often, affairs can ruin a career in the private sector, too.

Recently, Christopher Kubasik, who was incoming chief executive of Lockheed Martin, was forced to step aside following an affair with a subordinate. The outgoing chief executive referred to Lockheed's ethics and then significantly referred to the importance of the company's standing with the Pentagon, other customers and stakeholders.

In most instances, though, having an affair with someone outside the workplace would be neither here nor there.

In New Zealand, employees can be dismissed for conduct outside of the workplace but only in limited situations where there is a connection between the worker's conduct and their employment.

It is essential that an employer has requisite trust and confidence in the worker to carry out their responsibilities. Therefore if an employee's after-hours conduct impacts on their ability to perform their work, that can demonstrate that they are no longer suitable for the role.

Furthermore, if the conduct brings the employer into disrepute, dismissal may also be justified.

Usually though, some other blame-worthy conduct will be needed if an affair is to result in a termination. A New Zealand Employment Court case involving a Dannevirke lumber company is a good example of this.

In the case, a manager at the factory was having an affair with the wife of the foreman who worked there. Because the foreman reported to the manager, he was able to use his knowledge of the foreman's working hours to discreetly carry out the affair.

The inevitable happened and the affair came to the attention of the employer. It was determined that the manager had abused his position and that there had been serious misconduct. Also as a result of the now unharmonious relationship between the manager and the foreman, it was not feasible for the manager's employment to continue.

In the end, the court did not rule on whether or not the dismissal was justified as the decision turned on a technical defence. The case is however a good illustration of how in most circumstances, there will need to be more than just an affair to warrant a dismissal.

The Petraeus scandal demonstrates that the position changes for employees who are in especially public or senior positions.

There, the ability to carry out their responsibilities may be seriously impaired as the result of an affair. Obvious examples would be leaders of, say, public bodies dealing with family or church issues. It may affect their moral standing and ability to effectively carry out their roles.

It is notable that there are few reported cases where individuals in senior public roles are dismissed and challenge their dismissal in the courts.

However the reasons are obvious. If trust and confidence no longer exists in the relationship between a senior public employee and their employer, continuing in the role is virtually impossible. Their reputation and career will survive much more intact if they reach an agreement with their employer and go quietly.

This is all the more so when there is scandal behind what has occurred. And indeed, what happened with Petraeus is exactly what would happen in New Zealand to someone in a similar role.

If their employer, say the Government of the day, had lost confidence in them, then their fate would almost certainly be sealed.

Someone who is talented and co-operative may be able to re-establish their career, although no doubt, they will find themselves restarting at a lower level.

Alas in Petraeus' case, he not only lived by the sword but he died by his own sword. Let's see if he can rise from the ashes.

Peter Cullen is a partner at Cullen - the Employment Law Firm, and may be contacted at peter@cullenlaw.co.nz.

- ? Fairfax NZ News

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Source: http://www.stuff.co.nz/business/opinion-analysis/7971019/How-an-affair-can-destroy-a-career

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