Director ordered to pay $48,000 in penalties

The company, Alam Horticulture (2017) Limited, was ordered to pay $32,000 and the business owner, Morshed Alam, a further $16,000 in penalties.

Authority member Shane Kinley also ordered the company and Alam pay four employees a total of $2,565 in wage arrears.

However, this amount could increase as Mr Kinley ordered the Labour Inspectorate to re-calculate the arrears owed to one of the employees.

It was determined that the company and Alam had breached the Employment Relations Act 2000 and the Holidays Act 2003 by:

• Not keeping sufficient wage and time records;
• Not keeping sufficient holidays and leave records;
• Not paying employees for not working on a public holiday which was otherwise a working day;
• Not paying employees at least time and a half for working on a public holiday.

The hearing followed a Labour Inspectorate investigation in the Hawke’s Bay in 2021 during which a labour inspector identified potential breaches of the Employment Relations Act at Alam Horticulture (2017) Ltd.

It was also noted in the inspector’s report that Alam was banned from directorship and management of any business yet was a part owner of Alam Horticulture (2017) Ltd and appeared to be involved in the day to day running and operations of the business.

The labour inspector said when they visited the company’s premises it was Alam who answered questions and he was the person who replied to emails on behalf of the business.

During the investigation, the Labour Inspectorate on numerous occasions asked for the employment records of workers they were monitoring but these were not provided.

In his determination, Kinley found that Alam was a person involved in breaches of employment standards “by virtue of the role he played as an officer of Alam Horticulture (2017) Ltd, where he had significant influence over the management and administration”.

Simon Humphries, head of the Labour Inspectorate, says that although arrears involved were for relatively small amounts, failure to pay four workers what they were owed was a flagrant abuse of their rights.

“The amount is not relevant,” Humphries says. “Not paying employees what they are legally entitled to is unacceptable no matter whether the amount involved is $100 or $10,000.”

He says that although the breaches identified appeared to be systemic in nature, poor record-keeping meant these could not be fully investigated.

“Record keeping is a fundamental requirement for all employers, and the Labour Inspectorate takes failure to keep complete records seriously. As has happened in this case, employers who fail to keep complete records are liable for penalties.”