Smiths City accepts ruling over below-minimum wages

National furniture and appliance retailer Smiths City says it accepts this week’s Employment Court decision and will conduct an audit to identify where wages have been paid below the statutory minimum.

For many years, Smith City Group Ltd, which has about 400 store-based employees, has been holding 15-minute sales meetings before opening its 34 stores around the country each day.

The meetings, which the company claimed were optional to attend, were unpaid.

The Ministry of Business, Innovation and Employment yesterday  released a decision by the Employment Court, which said if any such activity was integral to a worker’s role and there was an expectation to attend, it was considered work and employees should be paid for it.

Labour Inspectorate regional manager Loua Ward said companies should not pass the cost of doing business on to the people on the floor.

"Employees must be paid for all the work they do and this includes handover times, briefing and in some situations, the travel time to and from a work site.

"Too often we encounter employers attempting to avoid paying their employees by dressing up activities outside of business hours as something that is for the benefit of the employee or something that’s not work.

"However, we will look beyond that at the real nature of the activity."

Smiths City chief executive Roy Campbell said in a statement the group had "noted" the court decision, which determined the company’s morning staff meetings were work as defined by section 6 of the Minimum Wage Act 1993.

The meetings, which were  held in every Smiths City store before they opened each day at 9am, were aimed at giving staff information for the day ahead and help them in their work.

Smiths City considered the meetings voluntary and, as a result, it did not pay those staff who attended, he said.

The group now accepted the decision the meetings constituted work as defined by the Minimum Wage Act and that they resulted in some employees being paid below the minimum wage.

"We have now moved the sales meeting into employees’ normal working hours.

"We are complying with the Employment Court order we conduct an audit to identify where wages have been paid below the statutory minimum."

The audit would cover all current and previous employees for the past six years, Mr Campbell said.

The group would calculate the arrears of pay below the minimum wage and reimburse any affected employees accordingly.

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