JB Hi-Fi star salesman awarded $66,316 after unjustified dismissal

June 13, 2019

Electronics retailer JB Hi-Fi has been ordered to pay one of its top salesmen more than $66,000 after sacking him following an investigation that was carried out behind his back.


HR Matters Tip:

If an employee is suspected of misconduct or serious misconduct, ensure that they are informed of these allegations prior to any investigations being undertaken. The employee also must be given reasonable time to respond before conclusions are drawn.


Shailen Kumar worked for JB Hi-Fi in Albany. 


He had been named the company's top salesman multiple times throughout his eight-year employment.


But in June 2018 his employment abruptly ended when he was handed 16 pages of documents with allegations suggesting he was selling electronics to parallel importers.


JB Hi-Fi has been trying to crack down on resellers for sometime and in 2017 area manager Mikey Murray warned managers in an email to be wary of resellers arriving in groups to purchase Apple iPhones in particular.


The resellers usually shopped in groups of six and used multiple credit cards to bypass JB Hi Fi's commercial sales rules.


As a result, a new restriction was put in place to limiting one iPhone per customer, unless the sale was approved by a manager.


JB Hi-Fi had concerns over Kumar's sales at least a month before these were communicated to him.


In May 2018, Murray was alerted of Kumar selling 27 phones to one buyer. It was alleged Kumar had failed to seek management approval for the sale and this led to an unusually low profit margin that day.


When it was found the phones had been bought by a reseller, Murray visited the store, and the owner claimed to know Kumar personally.


Murray assumed this meant the two had worked together. He failed to take down notes during or after this meeting.


He became concerned by other transactions by Kumar, as iPads were being sold at a low price. But store managers confirmed there was mistake in pricing.


Murray said he waited for over a month before informing Kumar of the investigation because he wanted to gather all the data beforehand.


Kumar was finally informed he was being investigated on June 12 and was asked to attend a meeting on June 14 over allegations he sold multiple products at a loss over the last year.


On the day of the meeting Murray showed Kumar 16 pages of allegations from his investigation.


Kumar said all his sales had been approved by his managers, and he did not know the reseller.


He asked for 48 hours to read the documents but Murray only gave him 30 minutes.


Shortly after, Kumar was told he was dismissed.


On June 29, 2018, Kumar receive a letter that stated why he was fired, citing serious misconduct for "engaging in prohibited conduct and failing to follow management instructions".


However, the Employment Relations Authority said, this letter was not a dismissal letter as he had already been fired. 


There were three allegations that resulted in serious misconduct: Selling four iPads in two separate transactions to a reseller, selling four iPhones to a reseller, and selling 27 clearance phones to one buyer.


In the case of the iPads the authority found Kumar actually only sold one iPad at a price that was incorrectly displayed on the PDA, a hand-held device that indicates prices to the sales staff.


Kumar acknowledged he should not have done that as the merchandising manager had told him not to sell iPads at that price.


With regards to the iPhones, there were four phones sold in two transactions and were one minute apart. 


Two different credit cards were used. At the disciplinary meeting Kumar had asked Murray to check with his manager who had approved the sales. But Murray dismissed this.


Murray assumed his manager would just lie to cover up for Kumar.

The third allegation about multiple phones being sold was again found to be authorised by management.


The authority could not find evidence to show there was an inappropriate relationship between the reseller and Kumar.


The authority said the investigation was carried out unfairly as Kumar was not given an opportunity to respond to his investigation claims and subsequently fired for those allegations.


"They did not have an open mind to the prospect that Mr Kumar...might not have known about the reseller as an organisation.


"There was no willingness to explore other explanations," the authority said.

Kumar has been awarded $37,507 in remuneration, $18,000 in compensation for hurt and humiliation and $10,809 in lost benefits such as sales incentives as a result of the unjustified dismissal.


His job has not been reinstated due to a loss of trust in Kumar by JB Hi-Fi.


- Full Article: https://www.stuff.co.nz/business/113415876/jb-hifi-star-salesman-awarded-66316-after-unjustified-dismissal?cid=app-iPad



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