Shah Enterprise NZ Limited, a superette in Tauranga trading as Greerton Foodmarket, was ordered by the Employment Relations Authority (ERA) to pay $32,000 in penalties.
This was for breaching minimum employment standards. Its director, Sapan Jagdishbhai Shah, was ordered to pay a further $16,000.
Thirty per cent of the total penalties are to be paid to the exploited employee who worked at the superette as a retail assistant.
An investigation by the Labour Inspectorate found that the employee worked for more than seventy hours per week but was only paid for 20 hours, at $15.75, the minimum wage at the time. The employer also failed to provide the employee with their holiday entitlements and did not keep accurate employment records.
The ERA ordered Shah Enterprise to repay the employee $11,648 in outstanding wages and holiday pay, in addition to the penalties.
“The employee was an international student and was living with his employer, which made him especially vulnerable,” says Labour Inspectorate retail sector strategy lead Loua Ward.
“It’s disappointing the employer took advantage of the power imbalance for their personal gain undermining the worker’s rights and gaining an unfair advantage over the majority of businesses that do comply with the law.
“As this case shows, exploitation is not a sustainable business model. Personal liability, means the individual responsible for the exploitation will be liable for penalties even if they close their business.
“In addition to the financial costs of breaching the law, employers should think of the reputational damage to their brand. How employers treat their workers is becoming increasingly important to suppliers, financiers and consumers and those who knowingly break the law will face the consequences.”
The Labour Inspectorate encourages anyone concerned about their employment situation or the situation of someone they know phone the Ministry’s service centre on 0800 20 90 20 where concerns are handled in a safe environment.