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Unpaid work: Businesses could go under back-paying staff

More employees are coming forward to speak up about not being paid for work meetings, and the Labour Inspectorate says back-paying them could force businesses to close.

Last week the employment court ordered Smiths City to back-pay staff six years' worth of lost wages - a payout that could reach seven figures.

Since then, employees at other stores around the country are also coming forward to claim that they were being short-changed for pre-work meetings or from doing the evening cash up.

Labour Inspectorate national manager Stu Lumsden told Morning Report he believed the issue was widespread.

"We are seeing it in a lot of areas. We are seeing it in respective handover times, health and safety inductions, cash-ups, putting clothes back on the racks after the store closes and cleaning the store or equipment, and we believe it goes into a lot of industries."

Audio: "We're seeing it in a lot of areas" - Labour Inspectorate national manager Stu Lumsden

duration 5:28 from Morning Report

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Mr Lumsden said he would approach the hospitality and retail industry groups, as well as the Institute of Directors.

"We're going to help them understand the implications of this decision and will ensure they're helping their members get this right in the future and addressing arrears that may be owed.

"We believe it is really important that directors take responsibility for the businesses they are on the board of."

Mr Lumsden said some small businesses could go under as a result of back-paying staff.

"It could have significant results."

Do you have a story to share? Send us an email: iwitness@radionz.co.nz

Mr Lumsden encouraged employees who thought this applied to them to contact them on 0800 20 90 20 to follow it up.

Last night, three former employees at retail chain Spotlight told Checkpoint they were forced to attend a 15-minute morning meeting every day for at least a decade without being paid for it.

They said it was compulsory and that they were not allowed to include it in their timesheets, so were never paid for it.

Unions and the government also both believed the practice was widespread.

First Union spokesperson Tali Williams said the union was receiving messages and reports from retail workers who had not realised until now that they were entitled to be paid.

"A lot of retail workers are on minimum wage and so then they're missing out on roughly $800 a year by attending these free meetings every morning," she said.

Workplace Relations and Safety Minister Iain Lees-Galloway said he was troubled by the number of businesses being accused of underpaying minimum wage workers.

"I'm extremely concerned that businesses still think they can get away with this," he said.

He said he applauded the Labour Inspectorate for taking this case.

"It demonstrates exactly why we need more labour inspectors on the ground proactively enforcing our employment law."


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