Rogue em­ploy­ers face a day of reck­on­ing

The Dominion Post - - Business - SU­SAN HORNSBY-GELUK

OPIN­ION: In a New Zealand first, the for­mer owner of a Christchurch bar and eatery has been banned from em­ploy­ing staff for three years.

Gor­don Free­man, and his com­pany, Vic­to­ria 88, were found by the Em­ploy­ment Court to have in­ten­tion­ally and per­sis­tently breached min­i­mum em­ploy­ment stan­dards.

As a re­sult, Free­man was banned by the Labour In­spec­torate from hir­ing staff, be­ing in­volved in hir­ing staff or be­ing an of­fi­cer of an em­ployer, for three years. Free­man was also re­quired to pay a penalty of $20,000, of which $7845 was paid to af­fected em­ploy­ees.

The power to ban an em­ployer in this way was in­tro­duced by the for­mer Gov­ern­ment in 2016, but this is the first time that it has been used. It is ar­guably an ex­treme mea­sure but equally, it is only likely to be used in se­ri­ous cases. In this re­gard the pur­pose of the law is to en­force min­i­mum em­ploy­ment stan­dards where they are con­sis­tently and fla­grantly breached.

In Free­man’s case, he per­sisted in in­clud­ing an il­le­gal clause in his em­ploy­ment agree­ments, which at­tempted to hold back hol­i­day pay where em­ploy­ees gave less than six weeks’ no­tice when re­sign­ing. This was even after the author­ity de­clared the pro­vi­sion il­le­gal and fined Free­man.

You might say, what did the guy ex­pect? Or to put it an­other way, he got what he de­served.

So, what are the other sit­u­a­tions in which an em­ployer might be banned from em­ploy­ing staff?

Under the Em­ploy­ment Re­la­tions Act, the court can im­pose a ban­ning or­der for up to 10 years where an em­ployer has been found guilty of a se­ri­ous breach, where the court is sat­is­fied that the em­ployer has per­sis­tently breached one or more em­ploy­ment stan­dards, or where the em­ployer has been con­victed of an of­fence under sec­tion 351 of the Im­mi­gra­tion Act 2009. Only a labour in­spec­tor or an im­mi­gra­tion of­fi­cer can ap­ply for a ban­ning or­der – em­ploy­ees can­not.

Al­though this is the first time in New Zealand that an em­ployer has been banned from hir­ing any staff, a num­ber of em­ploy­ers have re­cently been banned from em­ploy­ing mi­grant work­ers.

This fol­lows an amend­ment to the im­mi­gra­tion rules in 2017, with the ef­fect that em­ploy­ers who are found to have breached em­ploy­ment or im­mi­gra­tion laws by ex­ploit­ing mi­grants now face stand-down pe­ri­ods pre­vent­ing them from hir­ing mi­grant work­ers for up to two years.

As at April 11, 2018, stand-down pe­ri­ods had been im­posed on more than 100 em­ploy­ers.

Auck­land restau­rant Ur­ban Tur­ban was banned from hir­ing mi­grant work­ers for 11⁄2 years after it was found that the busi­ness had breached the min­i­mum en­ti­tle­ments of mi­grant worker Sachin Nayak.

Nayak claimed that he was of­ten re­quired to work more than 12 hours per day, six days a week, but was paid for only 45 hours per week. Fur­ther, he claimed that for more than a year he was paid $2 less than the min­i­mum wage. He also said that he was given a day’s no­tice that he would be work­ing part-time and that his salary would be re­duced by 50 per cent.

When Nayak re­quested that he be given three weeks’ no­tice be­fore his hours and salary were re­duced, to work out how he would now sup­port his fam­ily, his re­quest was de­clined. As he could not af­ford to sup­port his fam­ily on a part-time wage, he re­signed.

Fol­low­ing his res­ig­na­tion, Nayak claimed that he did not re­ceive his fi­nal pay or his en­ti­tle­ment to hol­i­day pay and when he brought a claim for ar­rears, his em­ployer threat­ened him with un­spec­i­fied al­le­ga­tions.

The author­ity ac­cepted Nayak’s claims and, as well as be­ing banned from hir­ing mi­grant work­ers, Ur­ban Tur­ban was or­dered to pay $40,000 to Nayak and $30,000 in penal­ties. In its de­ci­sion, the author­ity was scathing of the way the com­pany had treated Nayak.

There is a clear trend towards greater penal­ties be­ing im­posed on em­ploy­ers who fla­grantly and per­sis­tently breach min­i­mum em­ploy­ment stan­dards. These in­clude hefty fines and even bans on em­ploy­ing staff.

This should be a wake-up call to rogue em­ploy­ers who think that they are above the law, and can abuse vul­ner­a­ble em­ploy­ees. Un­for­tu­nately there will al­ways be some em­ploy­ers who fall into this cat­e­gory, but em­pow­er­ing the au­thor­i­ties to ban them from hir­ing staff is a sig­nif­i­cant step towards stamp­ing out these prac­tices.

There is a clear trend towards greater penal­ties be­ing im­posed on em­ploy­ers who fla­grantly and per­sis­tently breach min­i­mum em­ploy­ment stan­dards.

❚ Su­san Hornsby-Geluk is part­ner at Dun­das Street Em­ploy­ment Lawyers.

Newspapers in English

Newspapers from New Zealand

© PressReader. All rights reserved.