Story image

Court rules retail chain must pay employees for all hours worked

14 May 18

Consumer tech retail chain Smiths City must pay their employees for the pre-work meetings it had claimed were ‘optional’, after a failed bid to escape a Labour Inspectorate Improvement Notice.

Smiths City Group Limited, which operates 34 stores throughout New Zealand with approximately 400 store-based employees, for many years, had held 15-minute sales meetings before opening the stores, which were unpaid.

The Employment Court also ruled that Smiths City Group Limited could not use the payment of commissions and incentives to satisfy their non-compliance with the Minimum Wage Act, as this was additional income earned outside the contractual hourly rate and not a substitution for it.

“As the Employment Court’s decision today reiterates, if the activity is integral to the employees’ role, and there is an expectation to attend - this is work, and employees should be paid for it,” says Labour Inspectorate regional manager Loua Ward.

“Employers should not pass the cost of doing business onto their employees. Employees must be paid for all the work they do, and this includes handover times, briefings, and in some situations, the travel time to and from a work site.

“Too often we encounter employers attempting to avoid paying their employees by dressing up activities outside of businesses hours as something that is for the benefit of the employee or something that’s not work. However, we will look beyond that at the real nature of the activity.

“We encourage any other employers who currently are failing to pay their employees for such activities - and we know there are some out there - to fix these practices, as following this decision, they cannot continue to plead ignorance.”

The Labour Inspectorate issued an Improvement Notice to Smiths City on 14 January 2016, as the failure to pay employees during these meetings meant they were not paying at least minimum wage for all hours worked.

Smiths City Group lodged an objection to the Improvement Notice in the Employment Relations Authority, arguing that the meetings were not work, and the minimum wage did not apply – with the initial determination ruled in their favour.

However, on appeal of the determination, the Employment Court ruled on the side of the Labour Inspectorate - that these meetings were work, and the employees must be paid accordingly for it.

Smiths City Group must now comply with the Improvement Notice, fix their practices to meet their obligations as an employer, and pay any arrears owed to employees.

CERT NZ highlights rise of unauthorised access incidents
“In one case, the attacker gained access and tracked the business’s emails for at least six months. They gathered extensive knowledge of the business’s billing cycles."
Report finds GCSB in compliance with NZ rights
The Inspector-General has given the GCSB its compliance tick of approval for the fourth year in a row.
Cisco dominates record-high Ethernet switch & router markets
While the market is flourishing, it’s tough-going as Cisco has increased its majority share of the pie.
Preparing for e-invoicing requirements
The New Zealand and Australian governments are working on a joint approach to create trans-Tasman standards to e-invoicing that’ll make it easier for businesses in both countries work with each other and across the globe
SAP provides partners with free access to their cloud platform
“Now that over 3,700 SAP partners have joined our cloud strategy, the free resources will help them accelerate application development."
Company-X celebrates ranking on Deloitte's Fast 500 Asia Pacific
Hamilton-based software firm Company-X has landed a spot on Deloitte Technology’s Fast 500 Asia Pacific 2018 ranking - for the second year in a row.
Gartner names Proofpoint Leader in enterprise information archiving
The report provides a detailed overview of the enterprise information archiving market and evaluates vendors based on completeness of vision and ability to execute.
WatchGuard appoints new channel distributors in A/NZ
The appointments will enable WatchGuard to expand its regional channel reseller footprint.