THIS WEEK’S ARTICLES
Issue 4 26 Feb 2021
No work, no pay, Employment Court says p1
Managing employees and the Covid-19 jab p3
Fraudulent calumny: a new cause of action p5
LawNews adls.org.nz
EMPLOYMENT LAW/COVID-19
Covid-19: Employment Court says no work, no pay By Jenni McManus
Photo by Kondor83/Getty Images
Workers furloughed by their employers because of the Covid-19 pandemic are not entitled to be paid the minimum wage during the stand-down period, even if they have signed employment agreements guaranteeing them the minimum wage and a fulltime 40-hour week. In a split 2:1 decision, the Employment Court has held that five workers stood down by Gate Gourmet NZ Ltd at the start of the government’s level 4 lockdown on 26 March last year were not “working” for the purposes of s 6 of the Minimum Wage Act 1983 (MWA) and were therefore not entitled to the statutory minimum wage. Gate Gourmet, which supplies catering services to domestic and international airlines, was deemed by the government to be an essential service, meaning it had to remain open during lockdown. But because 99% of flights were cancelled, the business had no work. It was forced to shut down a substantial part of its operations and run with only a skeleton staff. The Aviation Workers United Inc Union, which covered Gate Gourmet’s workers, agreed that workers on furlough would be paid only 80% of the normal wages but balked when the company refused to pay them the new minimum wage of $18.90 an hour ($756 a week) which came into effect a few days after the level 4 lockdown began. The small number of staff remaining at work were paid at the new rate but those sent home received 80% of the old minimum wage of $17.70 an hour. The union objected, saying those sent home should receive the full minimum wage. A week later, Gate agreed to bump everyone up to $18.90 an hour whether they were working or not but said it was obligated to pay employees who were not working only 80% of their normal pay. The union filed a notice of problem with the Employment
You can cut their hours but don’t touch their pay, chief judge says
If the Court of Appeal were to overturn the Employment Court’s decision, there would be a substantial liability for business Relations Authority, claiming a breach of the MWA, and won its case. Gate Gourmet filed an appeal with the Employment Court. The decision In their majority decision, the Employment Court’s Judge Joanna Holden and Judge Kathryn Beck have overturned the Employment Relations Authority’s ruling.
“When the defendants stayed home, they were not working for the purposes of s 6 of the MWA, the MWA was not engaged and no statutory minimum wage entitlement arose,” they said. While the pandemic upended employment in New Zealand, creating unique circumstances that required a rapid response, Covid-19 “did not act to suspend employee rights or employer obligations”. But they said the “expansive” definition of ‘work’ put forward by the five defendants that included employer-mandated downtime in the definition would undermine the core concept of s 6 of the MWA – the exchange of payment for work. While the preservation of minimum employment rights is “of central importance”, this did not provide a free rein around statutory interpretation, they said. Being ready, willing and able to work is not the same as ‘working’. Therefore, Gate Continued on page 2