Spring pay requirements
Over recent years there have been an increasing number of farm employers under the eagle eye of the Ministry of Business Employment & Innovation (formerly known as the Department of Labour) for failing to pay staff the minimum wage during the calving and mating season.
Most rural employers mistakenly believe that ‘‘pay averages out over the year’’ – it doesn’t.
This issue primarily affects the lower paid employees as the increased hours they work during calving and mating can mean the employee falls below minimum wage and, as an employer, you are falling foul of the law. Employers must ensure they understand the employment contract that their employees have signed. Whether employees are paid on a hourly basis or on a salary, they must always receive at least a minimum wage of $13.75 per hour.
To calculate how many hours an employee can work before being paid extra use:
Annual salary + Rent allowance / 52 weeks / minimum wage = maximum number of hours available to work each week.
So using this calculation: An employee on an after-rent salary of $32,000 and a rent allowance of $5200 has a gross taxable package of $37,200/52 weeks = $715.38 gross per week/$13.75 (minimum pay) = 52 hours per week maximum that the employee can work before they fall below minimum wage.
For example, if an employee works 55 hours then the employer tops up his pay with an extra 3 hours @ $13.75 gross per hour equals $41.25 and the issue is resolved.
John Brosnan, CooperAitken, HR adviser