The New Zealand Metropolitan Trotting Club Inc. (the Trotting Club) has been ordered to pay a $10,000 penalty by the Employment Relations Authority (ERA) for failure to pay more than 50 employees their correct holiday pay.
Following a Labour Inspectorate investigation, it was found that the Trotting Club set up its payroll system in a way that resulted in non-compliance with the Holidays Act.
Labour Inspectorate Regional Manager, Jeanie Borsboom says, “The Trotting Club was taken to the ERA to ensure they fixed issues in their payroll system.
“The Trotting Club was originally issued with an improvement notice which gave it an opportunity to make necessary improvements and pay staff without a penalty being applied. However, the Trotting Club refused to cooperate and only did so once compliance action was commenced in the ERA by the Inspectorate.
“This is a clear message to employers that the Labour Inspectorate expects employers to actively engage with their obligations as employers. A failure to do so will result in serious penalties.
“We strongly suggest employers take steps to understand their Holidays Act obligations, including with their advisors. They need to carefully assess whether any payroll system used is capable of complying with the Holidays Act and that their business systems continue to support that.
“Reliance on an electronic system alone with a ‘set and forget’ attitude will almost certainly result in non-compliance and risk penalties,” says Ms Borsboom.
Employment New Zealand has developed a number of resources to help employers comply with the Holidays Act and New Zealand employment law, including detailed guidance on the Holidays Act and a checklist to assess payroll systems.
MBIE encourages anyone who has information or is concerned about minimum employment standards not being met to phone the Ministry’s service centre where calls will be handled in a confidential manner on 0800 20 90 20.
A Holidays Act Taskforce has been established by the Government to carry out a full review of the Holidays Act. Read more here.