Employer extorted cash from worker

01:46, Jun 24 2014
Mary-Jane Thomas
Southland Times Work to Rule employment law columnist Mary-Jane Thomas

I know that sometimes employers think the law is unfairly weighted against them. Occasionally, however, it is helpful to remind ourselves that protections are in place because sometimes employers take advantage of vulnerable employees.

A recent case in Auckland is such an example. Ms T was on a working visa and employed in a cafe. Over a six-month period her boss, Mr Z, required her to hand back to him in cash $200 of the wages already credited to her bank account each pay day.

Ms T made those payments because Mr Z told her the business was not profitable and they were needed for her to keep her work visa with the company. In other words, if she didn't pay, she would have no job.

This arrangement breached several provisions of the Wages Protection Act. Firstly section 12, which I wasn't familiar with until this case, says, in layman's terms, your boss can't tell you how to spend your wages nor sack you for how or where you spend them.

The arrangement also breached section 12A of the act, which is a prohibition on charging a premium for employment - I have written articles on this section in the past.

In this case, the labour inspector brought the claim for the worker. Section 13 of the act empowers the authority to impose a penalty on any employer that contravenes the act's provisions. In addition to being ordered to pay the wages back to the employee, the employer was ordered to pay $8000 in penalties.


The authority imposed the penalties to send an "unequivocal message" that this sort of conduct is wholly unacceptable.

A vulnerable employee on a work visa was faced with losing her visa if she did not comply with her employer's illegal wishes. In addition to the harm done to this worker, the authority noted the employer's behaviour was an affront to many other businesses that make the effort and expend the cost and time to properly observe the expected community standards as expressed in the legislation enacted by Parliament.

The authority imposed a penalty of $5000 on the employer to punish him and to deter other employers who might engage in such conduct.

A further $3000 penalty was imposed for failing to comply with an improvement notice served by the labour inspector - the improvement notice was to provide written employment agreements.

Mary-Jane Thomas is a partner at Preston Russell Law. She is always interested in ideas for articles. Email her at Mary-Jane.Thomas@prlaw.co.nz.

The Southland Times