Foreign seasonal workers were finding their wages reduced to zero some weeks as deductions they say were unlawful were being taken out of their pay packets.
The money was being taken for expenses such as travel, insurance, wet weather gear, storage, even for kitchen equipment which went missing from their hostel, court documents say.
Three of them complained the deductions were unreasonable and unlawful – first to the Employment Relations Authority (ERA) and then in the Employment Court.
That complaint has now snowballed to become potentially a major court case affecting hundreds of employers and thousands of employees – not just foreign seasonal workers, but others on low wages.
The case originated in 2020 with Lyn Soapi and a married couple, Danny and Mary Lau, who came from the Solomon Islands to work in Hawke’s Bay over a number of seasons either side of 2018-2019, as workers under the Recognised Seasonal Employer (RSE) scheme.
The scheme brings in workers from overseas on temporary visas to fill seasonal demand in the horticulture and viticulture industries.
The three have taken the case against their former employer, Pick Hawke’s Bay, seeking arrears of pay. Soapi and Mary Lau are also seeking penalties.
After the case was transferred from the ERA to the Employment Court, the Human Rights Commission and the Council of Trade Unions were given permission to become “interveners” - parties who have an interest in the issues raised and can make submissions to the judge.
Horticulture New Zealand, which advocates on behalf of commercial fruit and vegetable growers, has now also applied successfully to the Employment Court to be given intervener status.
This means the industry group can be heard during the case, but it cannot produce evidence or cross-examine witnesses.
About 150 of Horticulture NZ’s members participate in the RSE scheme and depend on workers hired from overseas.
It says many of its members will be affected by the issues being contested in the court.
Pick Hawke’s Bay, an incorporated not-for-profit organisation, denies it has acted either in breach of the law or the workers’ employment agreements. It says the deductions were made for lawful purposes.
According to its own rules, Pick Hawke’s Bay aims to “promote best practice” in its industries and ensure that workers are adequately paid.
However, Soapi and the Lau say that the organisation unlawfully deducted expenses from their wages for costs such as transport, food, clothing and storage.
They say that these deductions were not authorised by Immigration New Zealand, which has oversight of the RSE scheme, and were unlawful under either the Wages Protection Act or Minimum Wage Act, or were in breach of health and safety law.
The three workers, through their lawyer Tim Oldfield, said the legislation created a code which had been breached by the deductions imposed by Pick Hawke’s Bay.
“The claimed breach arose because, for several weeks after they began work [each season], the amounts deducted for accommodation and other costs reduced what the plaintiffs were actually paid, in some cases, to nothing,” Employment Court Judge Kerry Smith said in a procedural decision.
“Those deductions continued until such time as their income wiped out the deficit created by the expenses they incurred.”
Among their claims, the workers say that deductions were made for wet weather gear, which their employer was required to provide as “personal protective equipment” under the Health and Safety at Work Act.
Oldfield has told the court that some of the issues raised about deductions from pay are likely to “resonate” with the wider New Zealand workforce.
He gave two examples.
One of them was where an employee receiving a minimum wage had a deduction from his or her final pay for not returning a work uniform.
Such a deduction may reduce the employee’s earnings to below the minimum wage.
The other was where an employee on minimum wage failed to work out his or her notice and then suffered a pay deduction from the final pay with the same effect.
The court case is likely to test whether these sorts of deductions are lawful or unlawful.
The Employment Court registry says no date has been set yet for the next hearing in the case. It is likely to be heard in Hawke’s Bay.
Ric Stevens spent many years working for the former New Zealand Press Association news agency, including as a political reporter at Parliament, before holding senior positions at various daily newspapers. He joined NZME’s Open Justice team in 2022 and is based in Hawke’s Bay.
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