Employment Court confirms employee’s pay cannot be under minimum wage after deductions
The recent Employment Court case of Soapi v. Pick Hawke’s Bay Inc [2025] NZEmpC 208, emphasises the risks of making deductions to wages and what amounts to an unlawful wage deduction, particularly for workers employed under the Recognised Seasonal Employer (RSE) scheme.
The RSE scheme allows accredited New Zealand employers to employ workers from specified Pacific Island countries for work in the horticulture and viticulture industries in New Zealand.
In Soapi, three RSE workers employed by Pick Hawke’s Bay – a not-for-profit organization that supplies seasonal labour to those industries - challenged the lawfulness of deductions made from their minimum wage payments. The court agreed with the employees and ordered Pick Hawkes Bay to reimburse the employees for the deductions. It also has yet to consider penalties for breaches of good faith by the employer.
Unlawful wage deductions
Key takeaways for employers:
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For migrant workers, wage deductions that had not been submitted to, and approved by, Immigration New Zealand are unlawful.
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Wage deductions to recover the cost of personal protective equipment (PPE) provided by the employer are unlawful.
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Contractual wage deductions that reduce an employee’s pay below the minimum wage are unlawful, even if the employee consents to the deduction.
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Deductions for accommodation provided by the employer were unlawful as they were not fixed by the workers’ employment agreements and exceeded five per cent of their minimum rates of pay.
Jessie Lapthorne is a Partner in the employment and health and safety team at Duncan Cotterill in Auckland. Maddy Brownlee is a Solicitor at Duncan Cotterill in Nelson, specialising in litigation and family law. Stephen Galbreath is an Associate at Duncan Cotterill in Nelson, specialising in employment law and dispute resolution.
