Decision affirms Employment Relations Authority’s interpretation of work hours clause
In a recent case, New Zealand’s Employment Court upheld the Employment Relations Authority’s interpretation of an employment agreement’s provision on work hours and ordered the employer to pay an employee the amount owed for unpaid hours.
In Happy Belly Production Limited v Dawson, NZEmpC 92, the plaintiff company owned and operated a bar and restaurant and employed the defendant as an acting duty manager, which was a full-time position. Their employment agreement contained a work hours clause.
The employee brought a grievance before the authority. He alleged that the employer did not pay him under the agreement’s terms. The employer argued that he failed to show up for work numerous times, which the employee denied.
The authority saw inadequate evidence proving that the employee failed to be ready, willing, and able to work the weekly minimum of 40 hours as the employer rostered under the agreement. The authority determined that the employer failed to pay him in line with the contractual entitlements.
Thus, the authority ordered the employer to pay the employee $1,726.64 for unpaid hours, interest, and $71.55 to reimburse the authority’s lodgement fee.
The employer challenged the authority’s determination. The employer claimed that it guaranteed the employee a weekly minimum of 32 hours but offered him an opportunity to work up to 40 hours per week.
The Employment Court of New Zealand dismissed the employer’s challenge and agreed with the Employment Relations Authority’s conclusion. The court ordered the employer to pay the employee:
First, the court ruled on the natural and ordinary meaning of the work hours clause – the employer would roster the employee for at least 40 hours weekly and pay him for that time. The court disagreed with the employer’s interpretation of the provision.
The court noted that, through the clause, the employee expressly agreed to work a weekly minimum of 40 hours that the employer rostered. The court explained that the hours stated in the provision referred to a baseline.
Next, the court cross-checked the natural and ordinary meaning of the work hours clause against the context. The court held that nothing in the context of this case altered the work hours provision’s natural and ordinary meaning.
The employer cited the New Zealand employment guidelines, which defined full-time work as 30 hours or more. The court responded that the clause specified that the employee would have a weekly minimum of 40 work hours, not that he would have full-time hours.
Lastly, the court concluded that the employer failed to pay the employee for 64.5 hours, as supported by the material provided in the case. The court deemed it appropriate to award him arrears of wages plus interest on that amount.
