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North Shore food court pays $164,397 for employment law breaches

A food court in the Northcote Shopping Centre will pay $164,397 for their serious breaches of employment law, following an investigation by the Labour Inspectorate.

Food City Limited has paid $126,897.93 in arrears to five Chinese workers who were employed as cleaners at the food court, with a further $37,500 penalty imposed by the Employment Relations Authority (ERA) in a ruling last week.

Employment breaches uncovered at Food City Limited by the Labour Inspectorate included a failure to pay minimum wage and holiday pay, or keep written employment agreements, wage or time records.

“It’s 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,” says Labour Inspectorate Regional Manager David Milne.

“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.

“Taking advantage of employees is never acceptable, particularly vulnerable workers such as the migrants in this case who were older, did not speak English, and were unaware of their rights and entitlements in New Zealand.

“The Inspectorate will not hesitate to take these cases to the ERA, and the penalties and arrears awarded against this employer should send a strong message that this kind of exploitation will not be tolerated.”

After being approached by the employees in August 2014, a Labour Inspector investigated the matter and found evidence of long running non-compliance.

The 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.

They were not allowed sick leave, and some had to stop working due to their failing health. All five employees had permanent residence.

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.

You can read the full ERA decision online. (external link)

Ministry of Business, Innovation and Employment encourage anyone concerned about the employment situation of themselves or someone they know to call its contact centre on 0800 20 90 20, where their concerns will be handled in a safe environment.