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Businesses must pay employees for pre-work meetings

6 June 2018

There have been numerous headlines in the media lately regarding big businesses failing to pay their staff for attending pre work meetings.

The catalyst for this has been the recent NZ Employment Court decision where they ruled Smiths City Group must pay their employees for attending their pre work meetings.

The Smiths City case

For the last 15 years every morning, 15 minutes before Smiths City opened its store to customers, it held short meetings with sales staff. In the meetings they would discuss things like sales figures, targets, customer feedback and promotions.

Attendance at the meetings was expected but no wage and time records were kept and the sales staff were not paid for their time. They would only get paid from when the stores opened.

A Labour inspector issued an improvement notice to Smiths City stating the company failed to comply with Minimum Wages Act in that an employee has been paid below the minimum wage if the extra 15 minutes of unpaid work is taken into account and the record of hours misrepresents the true situation.

Smiths City argued the sales staff were not technically working during these meetings and therefore they are not required to keep records and pay staff. In any case they said, it could satisfy the Minimum Wage Act by taking into account commission and incentive payments earned in the relevant pay period. They also maintained the meetings were not compulsory however this was strongly denied by the employees.

The Employment Court held those 15 minute meetings attended by the employees fulfilled the definition of work under Section 6 of the Minimum Wages Act and employees would need to be paid.

Effect around NZ

Since this ruling tens of thousands of minimum wage workers are potentially collectively owed millions of dollars in unpaid wages, with 16 of New Zealand’s largest retailers now accused of forcing their employees to work without pay.

Among others, Briscoes, Bunnings, Rebel Sport, The Warehouse, Countdown, Pak n Save, Noel Leeming, Harvey Norman, and Farmers have been accused of either forcing staff to attend a daily morning meeting unpaid, or cash up stores unpaid, or both.

Unfortunately this shows the practice has become commonplace all over new Zealand.

Employers must ensure they are meeting minimum wage obligations with payment for all work (including meetings) done by employees.

We encourage employers to look at their practices and if they are unsure of their obligations contact us for guidance.