North Shore food court pays $164k for employment law breaches

Friday, 30 September 2016

A North Shore food court forced its cleaners to work 60 hours despite only paying them for 40.

A food court on Auckland's North Shore will pay $164,397 for forcing its cleaners to work without pay for 20 hours a week.

Five employees worked from 10am to 10pm at the food court, six days a week, however they were only paid the minimum wage for 40 of these 60 hours.

The cleaners were 'vulnerable' Chinese migrants who were older, did not speak English and were unaware of their rights and entitlements in New Zealand, the Ministry of Business, Innovation and Employment's David Milne said.

Food City Limited, operating out of the Northcote Shopping Centre will pay a $37,500 penalty for their serious breaches of employment law, according to an Employment Relations Authority ruling.

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It has also has paid $126,897 in wage arrears to the workers.

After being approached by the employees in August 2014, an MBIE Labour Inspectorate investigation found evidence of long running non-compliance.

It found the company had failed to pay minimum wage and holiday pay, or keep written employment agreements, wage or time records.

The cleaners were not allowed sick leave, and some had to stop working due to their failing health. All five employees were permanent residents of New Zealand.

Milne said it was 'really disappointing to see this level of non-compliance where the employer has just completely failed to meet the clear expectations set out in New Zealand's employment law'.

'Pleading ignorance is no excuse - providing employees with at least the minimum wage, holiday pay, and written employment agreements are basic obligations which we expect every employer in New Zealand to meet.'

The Inspectorate filed in the ERA for recovery of minimum wages and holiday pay, with the matter then referred to mediation where the employer agreed to pay the arrears owed.

However with the employer not paying the agreed to arrears and amidst concerns that the company would be put into liquidation, the Inspectorate put a claim into the ERA to have the director made personally liable for the payment of arrears.

This jolted Food City Limited into action, who then paid out the $126,897 in arrears owed to the five workers, MBIE said.