$3,500 penalty for staff underpayment...

An employer has been fined by the Employment Relations Authority after it failed to pay one of its manager’s the minimum wage on three occasions during her employment.

The manager was on a salary, but worked more hours than she was contracted to and therefore the minimum hourly rate was not paid on three occasions she worked over her contracted hours.

The employer had difficulty countering the employee’s claims because it failed to keep accurate records of the hours she worked.  This was because it did not require its managers to clock in.

The $3,500 fine was ordered to be paid directly to the employee and will come as a salutary lesson, that even staff who are on a salary must be paid the minimum wage (at least) for the hours they actually work, not just those they are contracted to work. It is also a reminder of the need to keep accurate records of hours worked for all employees (including management level staff).

Alan Knowsley

Employment Lawyer Wellington