Three years on from the Marsden Point refinery closing, employees are still owed an estimated $4.5 million in payouts. Photo / NZME
Three years on from the Marsden Point refinery closing, employees are still owed an estimated $4.5 million in payouts. Photo / NZME
Three years after a multimillion-dollar international company laid off more than 120 employees, it still owes them money, with one worker passing away while awaiting his final redundancy payout.
Now, the Employment Court has ordered the company to place almost $4.5 million into a holding account until the court case is over.
Channel Infrastructure, previously Refining NZ, operated New Zealand’s only oil refinery, at Marsden Point south of Whangārei, for almost 60 years before converting to an import-only fuel terminal in August 2021.
As a result of the conversion, the company terminated 121 workers because of redundancy, but the journey to get what was owed has turned into a lengthy and complex legal battle.
The applicants were E Tū or First Union members covered by a co-joint collective employment agreement (CEA) between June 2021 and December 2022.
Shortly after the notices of redundancy were issued in November 2021, Channel offered its employees a one-time opportunity to cash out some of their accrued leave entitlements that some employees accepted.
The employees' last day was May 31, 2022, and the company calculated its redundancy compensation based on its interpretation of “gross earnings” excluding the leave buyout payments and certain other holiday payments.
When redundancy payouts came around, Channel excluded the leave buyout payments from the employees' gross earnings, claiming they were not required and any payment made as a result of the leave buyout scheme was discretionary.
The employees' contracts provided a specific redundancy compensation based on full and final gross earnings that left many of the employees owed money, forcing them to take Channel to the Employment Relations Authority (ERA) on the grounds the redundancy was calculated incorrectly.
In May, a hearing was held at the ERA where several witnesses gave evidence including lead plaintiff Aaron Holroyd.
Channel submitted there were five stages in consultation of redundancy and none of the issues were raised then; however, the ERA found the lack of objections did not negate the employees' rights under the CEA.
Control room operator Aaron Holroyd is still owed redundancy payouts after 35 years with Channel Infrastructure. Photo / Michael Cunningham
Channel lost the case and the ERA ordered a recalculation with the inclusion of accrued leave as part of full salary and gave them 90 days to submit the new figure.
The company has appealed the ERA decision to the Employment Court and sought a stay of execution, meaning pausing redundancy payouts until their challenge was heard.
In granting the stay of execution, however, the Employment Court ordered Channel to deposit $4,486,744.70 into a court account by November 15 and said the amount was the best estimate of a potential final judgment sum.
“The plaintiff will pay into court the sum of $4,486,744.70, representing the current best attempt to calculate the amount pending the outcome of the court’s judgment, as security for payment of the judgment sum if the challenge is unsuccessful,” Judge Kathryn Beck said in her recent decision.
NZME approached First Union, Channel Infrastructure and Holroyd for comment. They advised they would prefer not to comment on matters because they were before the courts.
Shannon Pitman is a Whangārei based reporter for Open Justice covering courts in the Te Tai Tokerau region. She is of Ngāpuhi/ Ngāti Pūkenga descent and has worked in digital media for the past five years. She joined NZME in 2023.
