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First Union prepares to do battle with other employers after Smiths City ruling

Wednesday 16th May 2018

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A major union in the finance, retail, manufacturing and industrial space has come out fighting for low-paid staff expected to work for nothing. This follows an Employment Court decision last week that furniture and appliance store chain Smiths City must pay workers for time spent in pre-work meetings.

Following the decision, workers in sectors including finance, health and education, as well as other retailers, have come forward to say the practice of not paying staff for extra time spent doing their job is rife. 

First Union, which covers workers in the retail, finance, transport logistics and manufacturing sectors says it has received 1,500 complaints over the last 48 hours through a public survey. Of these, 30 percent claim they have been required by their employer to work without pay. More complaints have come through the union's 0800 number.

Retail, finance and commerce secretary Tali Williams says First Union will be working with companies over the coming weeks to ensure employees aren't asked to work without pay.

Some may find themselves in court.

“Those who do not comply with the law may face legal action from our members who feel they have been short-changed.”

Williams says many retail workers are on low wages already and can't afford to work for free. “If someone is on minimum wage it effectively means they’re not only being paid below the minimum wage, but are missing out on around $800 a year, so this is a big issue for these workers.”

The practice is happening right across the work spectrum. Contact centre workers asked to arrive early to boot up their systems, shop workers expected to cash-up or tidy the store after closing time, nurses and aged care workers having to do patient handovers outside their shift hours, childcare staff expected to be at staff meetings they aren't paid for.

The Employment Court ruled on Friday that Christchurch-based Smiths City had to pay staff for pre-work meetings, and ordered the company to cough up six years' of backpay for the 15-minute meetings for low paid staff. For a minimum wage employee working full time, this could add up to a bonus of almost $5000.

Smiths City argued the meetings were voluntary and had contested a Labour Inspectorate notice two years ago that by not paying staff who attended pre-work meetings it failed to meet minimum wage obligations.

First Union national organiser, finance, Stephen Parry said bank staff are often expected to stay behind at the end of their day to finish work, particularly back-office tasks they haven’t been able to get to. And at many contact centres in the finance and other sectors, workers are expected to clear backlogs of calls at the end of the day - even when their shift is finished. Some call centres expect staff to arrive at work 10-15 minutes early to boot up their IT systems and be call-ready at the beginning of their shift.

“These practices vary from employer to employer, and often sit in a grey area where workers complete unpaid work because of pressure from their workload and/or understaffing, rather than an explicit instruction from their employer,” Parry said.

He said the union welcomes the renewed attention the Smiths City case has brought to the issue.

Labour Inspectorate regional manager Loua Ward said if the activity is integral to the employees’ role, and there is an expectation to attend, that counts as work, and employees should be paid for it.

"Employers should not pass the cost of doing business onto their employees. Employees must be paid for all the work they do, and this includes handover times, briefings, and in some situations, the travel time to and from a work site."

First Union spokesperson Tali Williams said the situation is rife in the retail sector. Williams told Radio NZ that the union has received a large number of messages and reports from members since the Employment Court decision was announced late last week, saying they too were expected to attend pre-work meetings and do store cash-up sessions they weren't paid for.

"It's possibly even wider than we imagined, even going to the finance sector as well," Williams said on Morning Report.

Stores mentioned in the story included Rebel Sport, Briscoes and Noel Leeming. Shoe shop chain Hannahs has admitted it doesn't pay staff for overtime after stores close.

But the decision has ramification beyond the retail and finance sectors.

For example workers in early childhood education centres, particularly in the private sector, are often expected to do planning, meetings and professional development outside their paid hours, sometimes at weekends.

Virginia Oakly, the early childhood representative on the national executive of education union NZEI, said unpaid work is added ECE teachers and staff sometimes aren’t even earning minimum wage.

“We’re really stretched as professionals, but we’re dedicated to the children and are going to do whatever it takes to keep our centre operating. And that includes things like fundraising, working bees and planning outside hours. But it’s not fair that it should have to be that way.”

The worst cases tend to involve private and commercial daycare centres where there are low hourly rates of pay, especially for unqualified teachers, Oakly said. And staff are often worried about complaining.

“One centre manager approached about this issue brushed it off as ‘company policy’ and the staff member was too intimidated to take it further."

Oakly said NZEI’s legal team will be looking at the ruling to determine any impact it may have on the union’s members.

“The Smiths City case will likely result in more members contacting us to complain. We’ll continue to approach employers about their legal responsibilities and hopefully this case will prompt more of them to do the right thing by their staff – both before and after we ask them to.”

Cee Paynel is industrial services manager for the New Zealand Nurses Organisation (NZNO), and understands all too well the situation for nurses and aged care workers both in the public and the private sector. She said the Smiths City decision is important.

“It’s become routine in many workplaces that you get off shifts late because of workloads, or that employers have expectations staff will come in to do training in their own time,” Paynel said. “I’ve dealt with situations where companies want staff to come to a fire briefing [but not get paid]. It’s still work.”

Many contracts allow for workers to be paid overtime and Paynel said she “would encourage people to put in claims”. But this isn’t the case everywhere.

“This [judgment] is a good outcome,” Paynel said. “It’s reinforcing to New Zealanders as a whole you don’t have to work for free. People will be saying, ‘Hang on, this is happening in my workplace. I’m doing things like training and staff meeting in my own time’.”

Paynel said the law is there and her union has never got to the stage where it’s had to resort to legal action to enforce overtime payments. But the Smiths City case makes it even clearer.

First Union's Stephen Parry agrees. “The Union has been systematically addressing this issue through both collective bargaining and the application of the existing availability provisions in the Employment Relations Act,” he said. “While the Smiths City decision will not be directly applicable to most instances of unpaid labour in the finance sector, we welcome the renewed attention that the case has brought to the issue.”


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