Global Cover fined for dismissing ‘shareholder’

An insurance broker who lost his job for refusing to take out a personal loan to help his company has been awarded $40,883.95

Global Cover fined for dismissing ‘shareholder’
An insurance broker who lost his job after refusing to take out a personal loan to help the company he worked for has been awarded $40,883.95.

The Employment Relations Authority (ERA) has ordered Global Cover Insurances, part of broking network Steadfast, to pay Mustafa Bhamji $40,883.95, after it ruled that he was constructively dismissed, RadioNZ reported.

Late last year, the Auckland-based insurer told Bhamji he had been given company shares. Although surprised by the gesture as there had been no discussion about it, Bhamji took it as a sign of his success within the company, ERA has been told.

However, when Bhamji soon after didn’t receive his fortnightly wage, he was told by company director Jiuria Raijeli Mario that the firm had no funds or income.

Bhamji was asked, as a shareholder, to take out a personal loan to help the company pay for its debts and his wages. But because he could not service a loan, Bhamjie refused, the report said.

When Bhamji approached the ERA to recover his wages, Global Cover confiscated his company car, work phone, and files. Bhamji’s wife was also approached by Mario at work without warning, and was threatened with legal action, RadioNZ said.

The Bhamjis felt that this was a breach to their privacy, and was “very distressing” that Mustafa afterwards required medical support.

The $40,883.95 fine covers compensation and owed wages as well as $21,751.90 in PAYE arrears to Inland Revenue.
 

Free newsletter

Our daily newsletter is FREE and keeps you up-to-date with the world of HR. Please complete the form below and click on subscribe for daily newsletters from HRD New Zealand.

Recent articles & video

Should HR ban workplace dress codes?

Restaurant fined $62K after worker falls into vat of hot water

How can HR build resilience in the workplace?

CEO apologises for seemingly echoing Nazi slogan

Most Read Articles

When can employers insist on a doctor's note?

Inside Krispy Kreme's recruitment strategy

Do Kiwis really trust their employer?