The worker was paid just $34,000 over 16 months - the shortfall ran to five figures
A worker who was underpaid for more than a year is now owed over $60,000 - and the company's directors may have to foot the bill personally.
The Employment Relations Authority ordered PA Service 2018 Limited to pay the worker $60,656.60 in a determination issued on September 28. The amount covers unpaid wages, time-and-a-half payments, alternative holidays and annual holiday pay stretching back to late 2022.
There is a problem, though. PA Service is in liquidation.
The High Court at Auckland wound the company up on February 4, after the Commissioner of Inland Revenue petitioned to have it liquidated. So the money the Authority says is owed may never come from the company itself.
That is where the directors come in.
In an earlier determination issued on July 1, the Authority found the worker had been treated unfairly by his employer - a finding known in New Zealand employment law as unjustified disadvantage. It also found PA Service had breached employment standards and ruled the company's two directors could be held personally responsible for the unpaid amounts, as people involved in those breaches.
The sticking point at that stage was the numbers. The Authority accepted the worker had been underpaid but could not calculate exactly how much on the information available.
The worker then filed a detailed breakdown. Between mid-October 2022 and mid-February 2024, he calculated he was paid $34,435.80 in total. The shortfall in wages, time-and-a-half and alternative holidays came to $56,103.32. Annual holiday pay for one year and four months added another $4,553.28.
Neither director responded. Neither contacted the Authority after the earlier determination was served on them.
With no challenge to the worker's figures, the Authority accepted his calculations. It relied on provisions in the Employment Relations Act and Holidays Act that allow it to determine amounts owed when an employer has failed to keep proper wage and time records - effectively shifting the burden onto the employer to prove the worker wrong, which PA Service never did.
The order requires the company to pay both amounts - $56,103.32 and $4,553.28 - within 28 days. If PA Service cannot pay, the two directors are personally liable for the same amounts.
Costs were reserved, with the Authority indicating it would determine them on its standard basis if the parties cannot agree.
For HR teams and business owners, the case is a pointed illustration of what happens when record-keeping falls short and a company folds: the debt does not disappear. It follows the directors home.
