Unpaid work meetings are going to cost your business a pretty penny
The Employment Court ruled in favour of the Labour Inspectorate earlier this month when they ruled that the Smith City Group must pay their Employees for pre-work meetings, which Smith City Group claimed were optional.
Smith City is a large retail chain which operates 34 of its stores nation-wide and has about 400 Employees based in store. For about the previous 15 years, Smith City has held 15-minute morning meetings with their staff before opening their stores at 9:00am.
Smith City did not pay their Employees to attend such meetings, as they claim that they were optional. However, the Labour Inspectorate argued that the meetings were work, and the Employees must be paid accordingly.
The authorities were first made aware of the meetings occurring at Smith City when the Labour Inspectorate issued an improvement notice to Smith City in January 2016. The Labour Inspectorate was of the opinion that failure to pay Employees for their attendance at the pre-work meetings meant that they were not receiving the minimum wage for all hours worked.
Smith City objected the view of the Labour Inspectorate and lodged such objection with the Employment Relations Authority. Smith City argued that the meetings were not considered work time and therefore the minimum wage did not apply.
Initially, the Employment Relations Authority ruled in favour of Smith City. However, upon the Labour Inspectorate’s appeal to the Employment Court, the Court ruled in their favour and stated that the meetings were considered work time and so Employees must be paid accordingly. The Court also stated that Smith City could not use commissions or incentive based payments to make up for their non-compliance with the Wages Protections Act 1983.
Smith City has been ordered to audit the past six (6) years of wage records, including records of Employees who no longer work within the Company, determine what it owed, and then pay any arrears owing to all affected Employees.
So what does a determination like this mean for you as an Employer? To ensure that you are complying with the Wages Protection Act, pay for your Employees’ attendance at all staff meetings whether they occur inside or out of normal working hours.
If you request an Employee’s attendance at a meeting, or that they show up 10 – 15 minutes before their scheduled start time, your Employee must be paid for this time. If such an activity is considered to be integral to the Employee’s role, and there is an expectation to attend the activity, then this is work and Employees should be paid for it as Employers should not pass the cost of doing business onto their Employees says Labour Inspectorate Regional Manager, Loua Ward.
If you do not wish to pay additional wages to your Employees for their attendance at a particular activity, such as pre-work meetings, then you should be scheduling such meetings during normal working hours to avoid paying additional costs.
If you have any questions about anything in this article, or wish to seek advice in respect of your businesses compliance with the Wages Protection Act, feel free to give one of the team at Russell Drake Consulting a call. We would be more than happy to help – 07 838 0018.