Underpaid café manager wins back wage arrears, holiday pay

ERA rules that employer committed several breaches to employment standards

Underpaid café manager wins back wage arrears, holiday pay

A former café manager has won over $8,000 after the Employment Relations Authority (ERA) ruled that her former employer failed to properly pay her correct hourly rate.

Bhupinder Kaur worked the Village Green Café in Napier from January 2020 until June 2022 as a Café Manager. As heard by the ERA, Kaur did not take any annual leave as the cafe did not have enough staff to cover her absence.

Upon leaving the café, Kaur found that she was not paid her full entitlement of annual holiday pay and it was paid at an incorrect hourly rate. She also discovered that an incorrect hourly rate had been applied to calculation of her wages on multiple other occasions throughout her employment.

Kaur took the matter to the ERA, running after payment for the times she was only paid $22 per hour instead of $22.50, two weeks-worth of wages where she worked but was paid out of her annual leave balance, pay for the remainder of her annual holiday entitlement, and interest on these amounts.

She also sought accountability from company director Joga Chamber, asking the ERA to grant leave to pursue any amounts outstanding from the director for “aiding and abetting breaches of employment standards.”

Kaur was underpaid

The ERA ruled that Kaur was indeed underpaid and has a valid claim for unpaid holiday payments, citing evidence she provided such as payslips.

According to the ERA, J&R violated the Employment Relations Act 2000 for failing to provide wages and time record, the Wages Protection Act 1983 for failing to pay the entire amount of wages to worker without deduction, and the Holidays Act 2003 for failing to pay Kaur for annual holiday in the final period of employment.

Following these rulings, the ERA ordered J&R Limited to pay the former café manager wage arrears of $840.41, annual holiday pay of $5,596.04, and interest on these amounts of $361.

A penalty of $4,000 was also handed to the employer, with $2,000 to go to Kaur, while the other half goes to the Crown bank account.

In coming up with the penalties, the ERA noted various aggravating factors, such as the employer’s seemingly “intentional” failure to pay Kaur the correct rate.

“A further aggravating factor is that J&R has not engaged with communications from Ms. Kaur or her representative, nor with any part of the Authority’s investigation,” the ERA said in its ruling.

Chamber’s involvement

Meanwhile, the ERA also ruled that Chamber “aided or abetted the breaches of employment standards by J&R” as its director.

“In the event that J&R does not pay the wage arrears and annual holiday pay owed to Ms Kaur, she has the prior leave of the Authority to recover those arrears from Mr. Chamber personally,” the ERA said.

According to the authority, Chamber was “deeply and personally involved” in the day-to-day management of J&R, trading as the Village Green Café.

“He was the ‘hands and mind’ through which the Village Green Café operated and was the only person in control of the business,” the ERA said.

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