Unpaid wages: penalties, arrears, and employer liability
The Employment Relations Authority is able to award penalties against an employer where the employer has sustainably failed to pay wages and minimum entitlements.
Unpaid wages claims are not only about repayment. In many cases, penalties can also be awarded where the breach is serious, repeated, or deliberate. Penalties change the leverage in settlement negotiations.
What employers and employees should understand
- Wage arrears repay what should have been paid.
- Penalties are separate and can be ordered where the conduct justifies it.
- Records matter: timesheets, pay slips, rosters, and employment agreement terms.
Awarding a penalty against a party
Section 133A of the Employment Relations Act 2000 requires the Authority to have regard to the object of the Act, the nature and extent of the breach, whether they were intentional or not, the nature and extent of any loss or damage, steps to mitigate effects of the breach, circumstances of the breach and any vulnerability and finally previous conduct.
If you are dealing with unpaid wages, holiday pay disputes, deductions, minimum wage issues, or penalty exposure, contact us.
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