Employment Relations Authority says significant penalty was needed to deter others
The Employment Relations Authority has fined a liquor company $25,000 after it breached several employment standards, causing three migrant workers to be underpaid. The case provides an important reminder for employers to keep up to date with their obligations under the Minimum Wage Act and the Holidays Act.
The primary issue before the Authority was whether or not a particular worker was paid minimum wage between March 2017 and January 2018. The Labour Inspector produced the worker’s bank records to show transactions made at or near his workplace on several days that the worker was not paid.
The company suggested that the worker may have made some transactions during days that he swapped a shift and failed to record the change. The Authority was not satisfied with this explanation, commenting that enabling the company to rely on the “inaccuracy and inadequacy of its own records” would allow it to “benefit from its own failure to meet the statutory obligation to keep full records.”
This led the Authority to conclude that, on at least eight days during 2017 and 2018, the company failed to pay the worker minimum wage. It also noted several other company faults affecting all three workers, including their failure to keep time and wage records and pay annual leave entitlements and public holiday rates.
The Authority noted that the company was previously inspected in August 2016, and any failure to meet employment standards “could therefore not be attributed to lack of awareness.”
“Ultimately, this employer deprived three low-paid migrant workers who were on work visas of the pay they were entitled to and benefited from an improved cash flow. This helped them gain an unfair advantage over similar businesses,” the Authority said, adding that a significant penalty was necessary to deter similar action in the future.
Having considered these factors, the Authority imposed a fine of $25,000 on the company and $9,000 on a director for his involvement in the conduct.
