A few weeks ago we wrote about the need to keep proper records to comply with employment laws, and the risk of penalties if you fail in meeting those requirements.
Our last piece talked about a case involving truly casual labour, and we said that while it was no excuse it was easy to see how someone who employs casual labour could make the mistake of not complying with the law.
In a new case a diary farmer employing ordinary permanent employees has made some similar mistakes. The dairy farmer has been ordered to pay arrears of $64,000.00 and penalties of $23,000.00 so far, and there is the prospect of more to come for the particular employer involved.
One thing that is just the same as the last case we discussed is that this wasn’t a case where a disgruntled employee went and “dobbed in” their ex boss for a bit of pay-back. Again the employment law breaches were found as a result of a visit by a labour inspector during a routine audit of an industry and area.
So where did this employer go wrong?
First it was employing two couples with each couple on a joint employment agreement. Joint employment agreements are illegal in New Zealand, as every employee must have a separate written employment agreement.
Second each couple was being paid between $25,000.00 and $33,000.00 for the couple. When divided between the two people in a couple and the long hours they worked, the salaries were well below minimum wage.
Third the employer had failed to keep proper records of its employee’s work hours.
Fourth the employer failed to properly observe employee’s minimum entitlements for public holidays.
The main message we have to give out of all of this is that getting the basics of employment law and employee’s entitlements right is hugely important for a business. If a labour inspector doesn’t walk in your door, chances are if you have employees who aren’t getting their minimum entitlements they will talk to someone and figure it out.
It would be tough enough to come up with arrears when the money has been applied elsewhere. It could be downright painful coming up with the money for penalties.
If you require any advice or further information on the matters dealt with in this publication please contact the lawyer at Farry and Co. who normally advises you, or alternatively contact:
Wallace Revell
wrevell@farry.co.nz
09 379 0055 or 03 477 8870
The information contained in this publication is intended as a guide only. It does not constitute legal advice and should not be relied upon as such. Professional advice should be sought before applying any of the information to particular circumstances. While every reasonable care has been taken in the preparation of this publication, Farry and Co. does not accept liability for any errors it may contain.