Farmer to pay $87,000 for serious employment law breaches

27 September 2016

Taranaki dairy farmer to pay at least $87,000 for serious employment law breaches

A Taranaki dairy farm will pay at least $87,000 for serious employment law breaches following a Labour Inspectorate investigation, including $64,000 in arrears, and a $23,000 penalty issued by the Employment Relations Authority (ERA).

The ERA has directed the discussions between the employees and Allan Marx of Vintage Farm Trust to continue, with Mr Marx accepting further arrears are owed as a result of his failure to pay minimum wage or for public holidays.

This issue has been complicated by Mr Marx’s failure to maintain records of his employees’ hours or keep copies of employment agreements.

“It is unacceptable for employers to take advantage of employees by failing to meet basic legal requirements like paying the minimum wage or keeping proper records,” says Labour Inspectorate Regional Manager Natalie Gardiner.

“With the discussion around arrears ongoing, this case perfectly illustrates the risk farmers take on when they don’t keep sufficient employment records.

“Keeping records of the days and hours your employees work is a longstanding legal requirements in New Zealand which we expect every employer to meet - ignorance is not an excuse for breaking the law.”

The investigation was also marred by allegations of bullying when two of the employees were pressured into signing an agreement to settle their claims for $8,500, well below the amount Mr Marx would later admit they were entitled to.

A Ministry of Business, Innovation and Employment (MBIE) Labour Inspector first visited the farms in November 2014 as part of a routine audit of dairy farms in the region. Two couples and a teenager were living and working between the two farms.

The couples were on joint employment agreements being paid between $25,000 and $33,000 each, which meant they were being paid well below minimum wage for the long hours they worked.

These joint employment agreements were also illegal, as every employee in New Zealand must be given a separate written employment agreement.

The investigation revealed Mr Marx failed to correctly pay his employees for working on public holidays, opting to give an extra $50 instead of their minimum entitlements.

The $64,000 in arrears paid so far have gone to the five employees who were working on the farm at the time of the Labour Inspectorate’s investigation, as well as to six former employees.

You can read the full ERA decision online.

MBIE encourages anyone concerned about the employment situation of themselves or someone they know to call its contact centre on 0800 20 90 20, where their concerns will be handled in a safe environment.

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