Cases of Interest: August 2025

NZEI Te Riu Roa Inc v Secretary for Education [2025] NZEmpC 171

Employment Court – Employment Relations Act 2000, section 95A(1) – Employer’s right to deduct wages during partial strike

Employment Court – Collective bargaining – Partial strike – Application for injunction to stop deduction of wages

At issue was whether the Employment Court (the Court) should issue an injunction to stop the employer from deducting money from the pay of union members who were named in a strike notice.

The applicant, a union, was engaged in collective bargaining with the employer. During bargaining, the union gave the employer notice of a proposed partial strike by union members. The strike involved (see paragraph 12):

(a) a ban on working more than 7.6 hours per day;

(b) a ban on working more than 38 hours per week; and

(c) a ban on any work on new cases.

Two days before the strike was to begin, the employer gave notice under section 95B of the Employment Relations Act 2000(external link) (the Act) that it would make deductions from the pay of strike participants.

The union told counsel for the employer that it considered the deductions were unlawful because (see paragraph 19):

• Most employees were not affected by a ban on new cases.
• Most employees had not taken any action in response to the partial strike, except arguably in relation to the ban on overtime.
• The section 95B notice was premised on a misunderstanding that because union members were covered by the strike notice they were party to a strike.
• It was not clear that the person who issued the section 95B notice had the Authority to do so.

Following the partial strikes, the employer notified employees who took part that it would make deductions from their pay in the next pay period. The union sought an urgent interim injunction to stop the deductions from going ahead.

The Court declined to award an injunction. It found that “overall justice” favoured not issuing an injunction (see paragraph 85). The Court took into account that:

• The strike notices showed that “what was intended was a partial strike” as defined in section 82AA of the Act(external link) (see paragraphs 34, 35). It was strongly arguable that (see paragraph 58):
  • Working on new cases was part of the employees’ normal duties.
  • “[B]anning any work on new cases resulted in a reduction of normal performance of work, normal output and/or normal rate of work for employees”.
• It was arguable that employees named in the strike notices, who did not advise the employer they would be accepting and undertaking work on new cases, either (see paragraphs 45, 49, 58):
  • collectively supported the strike, or
  • were not undertaking work on new cases.
• It was not strongly arguable that:
  • The employer was intending to make deductions in relation to refusal to do paid overtime, which would be contrary to section 95A(2)(c) of the Act(external link) (see paragraphs 59, 60).
  • The employer’s section 95B notice informing the union of the proposed pay deductions (see paragraph 69):
    • was not issued by the employer, or
    • was not valid because it was not signed.
  • The employer’s deduction of a flat 10 per cent from affected employees’ wages for the period of the strike was a miscalculation (see paragraphs 70–75).
• While the union had an arguable case that the deductions were unlawful (see paragraph 77), the balance of convenience favoured not granting an injunction (see paragraphs 84, 85) as:
  • The employer could compensate the striking employees for any deductions later found to be unlawful; whereas it would be difficult to recover lawful deductions as an overpayment (see paragraphs 79, 80).
  • While the Union provided an undertaking as to damages, the amount involved would be sizable, being in the vicinity of $400,000 or higher (see paragraphs 24, 81).
  • The Court could offer a date for the substantive hearing promptly (see paragraph 83).

NZEI Te Riu Roa Inc v Secretary for Education [2025] NZEmpC 171(external link)

Tōpūtanga Tapuhi Kaitiaki O Aotearoa – New Zealand Nurses Organisation Inc v Health New Zealand [2025] NZEmpC 189

Employment Court – Employment Relations Act 2000, section 95A(1) – Employer’s right to deduct wages during partial strike

Employment Court – Collective bargaining – Partial strike – Application for injunction to stop deduction of wages

At issue was whether the Employment Court (the Court) should issue an injunction to stop the employer from deducting money from the pay of union members who undertook a partial strike.

The New Zealand Nurses Organisation (the union) was bargaining with the employer for a collective agreement. It gave the employer notice of a strike under which some of its members would not do work:

• outside of the surgical ward (in one case)
• outside of an intensive care unit (in another case).

A Life Preserving Services Agreement was put in place to provide for patient safety during the strike.

The Court found the ban would (see paragraph 110):

• prevent nurses from being redeployed to other parts of the hospital when needed
• stop nurses from doing work such as:
  • delivering patients to surgery
  • delivering specimens to the lab
  • taking patients for investigative procedures.

Prior to the strike taking effect the employer:

• notified the union it intended to deduct 10 per cent of the wages of the union members who were covered by the strike notices
• issued a notice of specified pay deductions to each employee named in the strike notices
• sought confirmation from employees as to whether they would be accepting work outside their principal place of work.

The union claimed the employer’s notice was unlawful as notice under section 95B(4) of the Act(external link) could not be given in anticipation of the strike commencing. Consequently, approximately six hours after the strike began, the employer issued a further notice of specified pay deductions to the union (but not to each affected employee).

The union said the employer’s notice under section 95B of the Act was not lawful, because:

• The employer did not give notice to each employee who would be party to the strike, as required under section 95B(4).
• The employer did not give notice as soon as was reasonably practicable, as required under section 95B(3)(c)(i) of the Act.
• The notice did not specify the relevant pay periods in which the deductions would be made.

The Court granted the union an interim injunction restraining the employer from making deductions (see paragraph 50). The Court took into account that:

• The union had an arguable case that the employer’s section 95B notice was unlawful, because:
  • The notice did not specify the pay periods which would be subject to deductions as required under section 95B(3) (see paragraph 29–32).
  • Arguably, the employer did not give affected employees the notice “as soon as reasonably practicable” in the circumstances (see paragraph 35).
• The balance of convenience was finely balanced, but favoured the union and its members (see paragraphs 44, 45) as:
  • Union members would be adversely affected if 10 per cent of their pay for the period was withheld, possibly for some time, until the substantive hearing was heard and decided (see paragraphs 39, 44).
  • The total amount of deductions for approximately 200 nurses was approximately $45,000 or less, which was a modest amount for an organisation of the employer’s size (see paragraph 40).
  • The employer could use the Wages Protection Act 1983, section 6(external link) to recover overpayments, through actions in the Employment Relations Authority if necessary (see paragraphs 41, 44).
• Overall justice favoured the union as:
  •  Making deductions for partial strikes, although now permitted, was a serious departure from the general position that (see paragraph 47):
    • Wages are a contractual payment protected by statute.
    • Deductions are to be constrained.
  • The employer had provided little evidence of (see paragraph 48):
    • the cost to it of the partial strikes
    • whether it was likely to be more or less than the $45,000 it may be entitled to deduct from wages.

Tōpūtanga Tapuhi Kaitiaki o Aotearoa – New Zealand Nurses Organisation Inc v Health New Zealand [2025] NZEmpC 189(external link)

Singh v Chand [2025] NZEmpC 163

Employment Court – Failure to comply with compliance order – Fine

At issue was whether the Employment Court (the Court) should impose a fine on a director, for not complying with a compliance order issued by the Employment Relations Authority (the Authority).

The employer and its director entered into a settlement agreement, in November 2023, under which it agreed to pay the employee $13,000 in outstanding salary and holiday pay, in 13 instalments of $1,000. Under the settlement agreement, the employer and the director were jointly and severally liable for the amount owing. The final payment was to be made in December 2024.

The employer paid some of the money due in the first two months and then did not pay anything for the next five months. The employee sought a compliance order in the Authority to enforce the settlement agreement. The employer by that time had gone into liquidation.

In July 2024, the Authority made orders against the director, ordering him to pay:

• the $5,692 that had not been paid when due, so far
• $500 in costs and the filing fee for the compliance proceeding
• a $500 penalty.

The Authority noted that the director was still liable for the remaining instalments.

The director did not pay the amounts ordered in the determination, or the amounts due in following months. In January 2025, the Authority issued a further compliance order, ordering the employer to pay:

• $11,692 still owing under the settlement agreement
• $571.55 in costs and the filing fee ordered under the previous determination
• another $571.55 for costs and the filing fee for the current compliance proceeding.

By February 2025, the director had still not made any further payments and had also not challenged either determination. The employee then sought a fine against the director in the Court. The director did not appear at the hearing.

The Court was satisfied the director did not comply with the Authority’s compliance orders (see paragraph 24). It ordered the employer to pay a fine of $13,000, with $7,800 to go to the employee (see paragraphs 72, 73). In arriving at that amount the Court took into account that:

• It was exacerbating that:
  • The compliance orders were for salary and holiday payments, which were minimum entitlements (see paragraph 25).
  • The employee was vulnerable, as a migrant employed under the Accredited Employer Work Visa scheme (see paragraphs 35, 38, 45).
• The failure to make payments was deliberate, intentional and ongoing (see paragraphs 28–30).
• There was no evidence of previous compliance orders which the director had not complied with.
• There was no evidence that the director was not able to pay a fine. There was evidence he was joint owner of a property and continued to run a business (see paragraphs 32, 33).
• The failure to pay the employee correctly for his wages and holiday pay during his employment caused him a hardship, including a period of homelessness, which impacted his family, including a young child and caused him mental distress (see paragraph 35).
• The failure to make payments owing under the Authority’s compliance orders caused further distress for the employee (see paragraph 36).
• Looking at other cases, $13,000 was an appropriate fine (see paragraphs 41–48).

The Court also ordered the employer to pay  $12,308.50 in costs and $1,040.70 in disbursements (see paragraph 76).

Singh v Chand [2025] NZEmpC 163(external link)

Zhu v Rong Rong Ltd [2025] NZERA 505

Employment Relations Authority – Migrant employee – Breach of minimum employment standards – Breach of employment agreement – Liability of director for arrears

At issue was:

• Whether the employer owed the employee arrears of wages and holiday pay.
• Whether the employer’s director should be personally liable for any arrears.

The employer recruited the employee from China to work as a chef in a restaurant. Under the employment agreement, the employee was to “work 6 days a week up to 60 hours”, and have a “weekly net income of $700 NZD after taxes” (see paragraph 7). The employee said this is what happened – for the 10 months that he worked at the restaurant, he worked a 6-day week from 10:30am to 9:00pm, including on statutory holidays, without any extra payment for the statutory holidays.

After the employee had been in the role for just over 9 months, the employer’s director stepped down from being a shareholder-director. Her ex-husband took over as sole director, after having previously been just a shareholder. The new director claimed:

• He was not responsible for claims relating to the period of time when his wife ran the business.
• The claim should be dismissed because the employee did not provide documents demonstrating he had not been paid.
• There was no demonstration that the payments made to the employee violated section 49 of the Holidays Act 2003(external link).

The new director accepted the employee was paid a flat $700 per week throughout.

The Employment Relations Authority (the Authority) noted that (see paragraph 26):

A change in the shareholding or directorship of the respondent company does not change the obligations on the company itself. … Any awards will be made against the company, regardless of changes to its directors and/or shareholders.

The Authority accepted that the employee “worked 10 hours per day, 6 days per week” as claimed, without being paid extra for public holidays (see paragraphs 45). The Authority said that, as the employer did not provide any records, it was exercising its discretion under section 132 of the Employment Relations Act 2000(external link) to take the employee’s records as proven  (see paragraph 44). The Authority noted that the employer was obliged to keep and produce wage and time records, not the employee (see paragraph 43).

The Authority ordered the employer to pay the employee:

• $36,602 in unpaid wages
• $720 gross for public holidays for which the employee was not paid time-and-a-half
• $5,414.40 in holiday pay that was owing to the employee on termination.

The Authority said the new director (see paragraphs 48–53):

• was involved in minimum employment standards breaches while he was a shareholder and then director.
• was therefore personally liable for the above arrears.

Zhu v Rong Rong Ltd [2025] NZERA 505(external link)