This has ramifications for those employers who employ staff on “salary” and expect them to do more than say a 40 hour week.
It is important for employers to remember that the Employment Relations Act 2000 has requirements placed on employers with respect to the collection and retention of certain wages information.
The Act, at section 130, says amongst other things that employers must keep records which record the hours between which the employee is employed on each day and the days of the employee’s employment during each pay period.
It is important that employers, particularly dairy farm employers at the moment, have those records which verify what hours the employees actually worked.
We are seeing a number of dairy farmers who were under the misapprehension that because the employee was paid a salary they were exempt from keeping such records. They also seem to think that because they paid more than the minimum wage for a 40 hour week they could have their employees work longer hours without incurring a further liability.
This is far from the truth.
Employers must remember that they are always liable, under minimum wage legislation to pay at least $12.00 per hour (gross) to an adult, for each and every hour worked in the pay period.
This will affect those employers who pay a salary and expect to have peaks and troughs in hours worked on an annual basis. The Labour Department is apparently looking at enforcing the minimum wage legislation on a pay period basis. This means that in a week where the employee works a large number of hours, they will be expecting the employee to be paid at least $12.00 per hour (for an adult) for each and every hour worked. This period of “overs” cannot be offset against another period of “unders” where the person worked considerably shorter hours, especially where such “overs” and “unders” are in different pay periods.
Also where the employer fails to keep a record of hours worked and the employee does keep such a record then the employee’s record is likely to be taken as the “gospel truth” if a wage arrears action is ever undertaken. It is vitally important that employers keep their own records of hours worked.
This article originally appeared in the Southland Times Work To Rule column. Mary-Jane Thomas is head of Preston Russell's employment law team. Contact her by clicking here
