Minimum Wage and Wage Records
Tuesday June 21, 2016
All employees must be paid at least the minimum wage for every hour that they work.
Minimum wage requirements apply equally to salaried employees. Problems can arise where salaried employees are employed in circumstances which require them to be available, or on call all day 6-7 days a week, and sometimes in to the evening or throughout the night.
Problems may also arise with the process of averaging, a process commonly adopted in the dairy industry. Averaging does not preclude the obligation to pay the minimum wage for each hour worked.
The consequences of getting it wrong can be costly. In a 2014 Employment Relations Authority case (Hill v Shand,  NZERA Christchurch 66), the manager of a motor camp was awarded some $69,000.00 in unpaid wages.
The question is what an employer requires of an employee, and whether that constitutes work. Factors considered include:
- what constraints were placed on the employee’s freedom, i.e. would he/she have otherwise been able to do what he/she pleases;
- the nature and the extent of an employee’s responsibilities;
- what benefit there is to an employer by the employee performing that role.
The Employment Relations Authority’s determination is made on the individual facts of the particular case. If what an employer requires constitutes work, an employee must receive the minimum wage for that work.
If accommodation is provided, the value of the accommodation (for minimum wage purposes) should be agreed and recorded in the employee’s Individual Employment Agreement. If it is not, the default provisions of the Minimum Wage Act will apply.
A wage and time record is required for each employee, recording:
- the name of the employee;
- the employee's age, if under 20 years of age;
- the employee's postal address;
- the kind of work on which the employee is usually employed;
- whether the employee is employed under an individual employment agreement or a collective agreement;
- in the case of an employee employed under a collective agreement, the title and expiry date of the agreement, and the employee's classification under it;
- the number of hours worked each day in a pay period and the pay for those hours;
- the wages paid to the employee each pay period and the method of calculation;
- details of any employment relations education leave taken;
- such other particulars as may be required.
A wage and time record must be in written form, or in a form easily converted to written form. Records must be kept for six years and must be provided to a person authorised to request them.
Article by Jim Wynyard, Senior Solicitor, Holland Beckett Lawyers, Tauranga
This article is only a general overview of the law in this area. If you require specific advice or assistance, please contact one of the lawyers in the Employment Team at Holland Beckett on 07 578 2199.
This article does not constitute legal advice. Readers should obtain specific legal advice before making any decisions or taking any action based upon information contained in this article.