Transgender woman Dakota Hemmingson was unjustifiably dismissed from her hairdressing job, the Employment Relations Authority has found.

A transgender woman who was unfairly dismissed after telling her boss she wanted to transition has won her employment fight after more than a year.

Hairdresser Dakota Hemmingson has been awarded nearly $15,000 after the Employment Relations Authority found she was unjustifiably dismissed from her job at Barkers Groom Room.

However, she said she did not expect to see any of the money because the company had gone into liquidation.

"I came to terms a long time ago that I wasn't going to see a cent of it and it was just more about the moral of the fight," she said.

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"It's not about the money, it's not about the attention, it's about fighting for what's right, fighting against transphobia and discrimination."

Hemmingson's employer, Matt Swan, was ordered to pay her $3248 in remuneration, $11,000 in distress compensation and more than $500 towards her legal costs.

Hemmingson worked at Barkers Groom Room on High St, central Auckland for about a month before she was forced out of her job in April 2015 after telling Swan she wanted to fully transition into a woman.

Hemmingson said she was told her transition did not fit with the commercial profile of the business and was forced to resign.

Swan claimed she resigned after a meeting and she could not be talked out of it.

He also claimed a post termination agreement - which she did not sign - states it was a "mutual" agreement in the best interest of Hemmingson and the business to end her employment.

However, the authority disputed those facts, finding that Swan raised the possibility of resignation and Hemmingson did not freely or voluntarily leave her job.

It found Swan's version of events "unsatisfactory" and lacking in credibility, authority member Rachel Larmer said.

"Mr Swan's actions were inconsistent with his account of what occurred and that in many respects, his evidence did not make logical sense."

Swan and his manager, Nick Everett, also raised concerns about not being able to stop clients from giving negative feedback, making adverse comments or "engaging in 'blokey banter'" that may have upset or offended Hemmingson.

They also said her transition might have made clients uncomfortable.

Larmer said those concerns were an "unjustified perception" and there was no legitimate basis that Hemmingson's transition would create or cause any safety concerns.

Hemmingson said she loves hairdressing but did not think she would return to it.

"My anxiety comes from the clients because of what Matt's put into my head, even with justification from authorities, it's still a personal and mental thing I have to deal with."

She hoped her employment case set an example about discrimination and inequality.

"We just want to work like everyone else, we just want to pay tax, we don't want any special benefits - it's really not hard to look after a transgender in the workplace."

The authority's decision has been endorsed by the advocacy group Out At Work, which represents working people who identify as gay, lesbian, bisexual, intersex, transgender, takataapui and fa'afafine.

Spokeswoman Karena Brown said it was an important, ground-breaking ruling.

"It means that employers cannot discriminate against transgender staff or staff who transition at work.

"Bosses can't just do as they please. People's employment and human rights cannot be denied because of employers' prejudices and personal beliefs," she said.

Swan could not be contacted for comment on the ruling.