Employer gets minimum pay and holiday pay all wrong...

A motel operator has been ordered by the Employment Relations Authority to pay a former employee over $38,000 after a successful claim by a Labour Inspector for underpaid wages and holiday pay.

The employer claimed that holiday pay was included in the monthly salary paid to the employee. 

The ERA held that the employer was entitled to pay holiday pay on an as you go basis (as the employee was on a fixed term of less than 12 months) but the employer failed to separately identify the holiday pay in each pay and failed to make it clear in the employment agreement holiday pay would be paid each month ($4,491 payable).

The ERA also ordered payment of $1,205 for public holidays worked but unpaid, and $2,431 pay for unpaid alternate holidays for public holidays worked.

The big hit was, however, for underpaid wages.  The effective hourly rate paid by salary was only $7.80 as the employee was on call 11 hours per day, seven days per week. 

An order was made for payment of $30,018 for short paid wages to bring payment up to the minimum wage level.

 

Alan Knowsley