Failing to keep records? Expect a fine

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The Employment Relations Authority recently ordered a Marlborough business operator to reimburse a migrant worker $22,000 for unpaid wages as well as an additional $10,000 fine.

Ajay Gaur, owner of Vine Strength and SP 2007, was ordered to pay $22,716 to Pushpinder Kumar, a former employee. According to reports by Stuff, it was alleged that Gaur failed to pay the minimum wage and holiday pay, while also failing to keep time and wage records. He was also accused of failing to provide an employment agreement in writing, a requirement of the Employment Relations Act.

After receiving a complaint from Kumar last year, the Ministry of Business, Innovation and Employment (MBIE) brought the case against Gaur’s two businesses.

Gaur offered Kumar a job managing Blenheim backpackers’ hostel owned by his company when they met in 2008, shortly after Kumar had moved to Auckland from India.

A fortnight after Kumar began the job – which involved moving to the hostel – Gaur informed him that he could not afford to continue to honour the employment agreement.

He was told that unless he took another job in a vineyard, he would lose his job in the hostel. Kumar subsequently started transporting workers to the vineyards, where he worked as a supervisor.
Kumar told an employment relations inspector that until his visa application was approved, he received just one payment. This process took four months.

He added that Gaur also asked him to work at a takeaway shop under the same ownership. Although he worked there for 25 hours each week, he received no payment.

Kumar eventually returned to work in the hostel and was paid, but Gaur demanded Kumar give him $10,000 for support in his residency application.

According to Kumar, a gang member who was employed by Gaur “enforced” this requirement, leaving Kumar and his wife to live off of their savings.

However, the investigation into Kumar’s claims did not prove his allegations’ validity.

“Mr Kumar's evidence fell well short of compelling,” said the investigator. “It was often incomplete with questions not being fully answered, inconsistent and contradictory.”

He added that the evidence about the involvement of a gang member was “vague and inadequate”, leading to those allegations being dismissed.

Gaur admitted that while Kumar had worked in the vineyard without pay, his wages had been paid to his wife instead. The inspector said that there was no acceptable evidence of this, and Gaur was ordered to pay Kumar $6879 including holiday pay.

He also admitted that Kumar had worked at his takeaway shop, but said that this had been voluntary work with minimal hours. The inspector found evidence that showed Kumar’s work at the shop had been frequent, ordering the company to pay him $15,837 including holiday pay.

Each of Gaur’s companies was also given a fine of $5000 which was to be paid to the MBIE.

Labour Inspectorate Regional Manager Adrian Straayer said employment records were required to be kept by law, adding that the exploitation of migrant workers was not welcome.

Darryl Voss, director at Employers Assistance, told HRM that it is vital employers keep records.

“The Employment Relations Act 2000 requires the employer to keep wages and time records for each employee,” he explained. “The Holidays Act 2003 has the requirement to maintain a holiday and leave record in addition to the requirement to maintain a wages and time record. This record may be written or electronic.”

And if they fail to do so?

“Every person who is liable to a penalty under this act is liable to a penalty of up to $10,000 for an individual, or $20,000 for a company or other corporation,” Voss said.

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