Gloriavale could be liable for millions of dollars in unpaid wages

Thursday, 12 May 2022

The isolated West Coast Christian community of Gloriavale has set itself apart from the rest of society for more than 50 years.

A former Gloriavale leader says it is only fair people are compensated for the work they did in creating wealth for the community.

The bill could add up to as much as $20 million – but even that wouldn't bankrupt the asset-rich community, he says.

The compensation would be as a result of Chief Judge Christina Inglis’ judgment, released on Tuesday, which found three former members were employees when they worked in the community’s commercial businesses from the age of 6 under strict control by community leaders.

Zion Pilgrim was a senior leader, or servant, at Gloriavale until he left in 2020, and gave evidence against the community at the Employment Court hearing which was brought by his son Daniel Pilgrim, along with two other former members Levi and Hosea Courage.

**READ MORE:

Zion Pilgrim, who gave evidence against Gloriavale.

* Gloriavale: The daily life, the dark side and uncertain future explained

* Gloriavale leavers launch petition and protests to get Government inquiry

* Former Gloriavale man reunited with family inside the community

Using rough calculations based on Gloriavale’s school rolls and minimum wage rates, the estimated annual wage bill for males in the community over the age of 6 would be $5.5m.

A case is currently before the Employment Court to determine if women and girls are employees.

According to the Gloriavale Leavers’ Support Trust about 220 people have left the community since 2013 – if half of those are men who worked for an average of five years for 40 hours a week at the minimum wage, that bill comes to $24m.

Gloriavale has a large property and several commercial businesses on the West Coast.

Pilgrim said money was not the motivation behind the case, rather it was to ensure Gloriavale was upholding human rights.

“Those people deserve the same rights and opportunities as everyone else in New Zealand so now I really think that this ruling is a landmark decision and it’s a real turning point for the people of Gloriavale,” he said.

However, it was only fair people got paid for their life’s work. Some elderly people who had left recently had donated sizeable amounts of money when they joined up and were now left with no savings or retirement plan and some were forcibly kicked out of the community.

“Gloriavale has amassed tens of millions of dollars worth of assets on the backs of past and present workers including children over the last 50 years,” Pilgrim said.

“It’s been done in an exploitive way so it’s only fair that those people are cared for and paid properly for their effort.”

According to its 2021 annual return to Charities Services, the trust had a profit of almost $2.8m and assets of $41m. Its annual revenue was $18m – down from $20m in 2019.

A case has been brought by a group of former Gloriavale women in the Employment Court (file photo)

Pilgrim said Gloriavale had no debt so could easily mortgage or sell one of its properties to cover the cost.

He said it was difficult to quantify how much Gloriavale would have to pay as each person worked for different lengths of time and under 16s did not have to be paid the minimum wage.

“You’ve only got to do some basic maths you might be talking $15m or $20m and that’s still not even a third of Gloriavale’s asset value. That’s still not big of a deal really,” he said.

He said people who left Gloriavale with nothing were struggling.

“Even for our own family, we’ve got a large family and financial pressure is real. We’re not unique in that but we haven’t been remunerated properly or fairly for decades of work and that’s only good and right that that should happen.”

Employment lawyer Kathryn Dalziel says the judge criticised the Labour Inspectorate for failing to consider control

He called for the court or the Government to put in an “external controller of the assets” to ensure “things can be done correctly and put in order”.

Employment lawyer Kathryn Dalziel said the decision meant Gloriavale would have to pay all of its hundreds of workers, not just the plaintiffs, in a process that could happen through the Employment Relations Authority.

Former Gloriavale members protested outside the Press Leaders’ debate calling for a Government inquiry.

“This is something that other workers can piggyback on, so they would be able to put in some claims as well for arrears of wages, payments of holiday leave, and payment of public holidays.”

One potential issue was a six-year limitation on bringing claims, so people could only make a claim for arrears occurred in the past six years.

However, Dalziel said the court could rule the arrears had not arisen until the employees had reasonable notification of them – so they would have six years from the release of the judgement declaring them employees to make a claim.

“I think we'll see some interesting arguments about that because we haven’t got case law on it,” she said.

“There could be an argument that young people at Gloriavale would not have known they could get paid until now. I think there will be some sympathy for that.”

Dalziel said the decision was a wake-up call for the Labour Inspectorate and WorkSafe.

It also raised issues for the police to look at.

“Hopeful Christian was prosecuted in the 90s [for indecent assault] so the police have been looking at this for a very long time.”