The recent court decision ordering retailer Smiths City to pay their staff for attending years of un-paid pre-work meetings is a good reminder to all employers that requesting employees to undertake duties outside of their contracted work hours requires payment.
All employees must be paid for the hours they are asked to be present at work. This sounds very logical, doesn’t it? But with companies like Smiths City Group being held accountable recently for scheduling unpaid pre-work meetings, it is a timely reminder to look at some employment practices and how they might breach the Minimum Wage Act.
Smiths City Group was recently ordered to back pay all employees earning at or near the minimum wage for attending pre-work meetings they claimed were optional, over a 6-year period. The key point here is that they must compensate those earning at or near the minimum wage. The reason for the limitation is that when the additional un-paid hours were accounted for, some employees were earning below the minimum wage, and therefore Smiths City Group was in breach of the Minimum Wage Act.
The reported seven-figure payout will have a huge impact on this company who employ over 450 staff, so imagine the effect a ruling like this could have on smaller businesses. If your employees are earning at or around the minimum wage, it is important to understand the precedent set by this court ruling can impact you. Ask yourself these questions:
If you answered yes to these questions, it is important that your employees are compensated for their time, and if they are not, we recommend reviewing your practices to ensure you are not breaching the Minimum Wage Act.
Employee satisfaction is key to running a successful business, and whilst the Smiths City ruling has determined that those earning at or around the minimum wage will receive a payout, it is important that all employees, regardless of their pay rate, are paid for the hours they are required to be present at work.
For more information, we recommend you visit these sites:
https://www.employment.govt.nz
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