Restaurant bill: staff awarded tens of thousands after sudden closure

Smith & Co closed without warning, leading to $35,000 just in unpaid wages. Photo / File / Getty Images

Seven restaurant workers have been awarded tens of thousands of dollars in unpaid wages after they were dismissed without warning when the business they were working for suddenly closed.

Smith & Co Hospo in Paraparaumu was also found to have deducted KiwiSaver and student loan payments from staff that were never forwarded to Inland Revenue.

The Employment Relations Authority calculated there was $35,000 in unpaid wages and holiday pay, more than $7000 in KiwiSaver contributions and close to $2500 for student loan payments.

The Kapiti Coast restaurant closed on February 2019 without warning. Staff were immediately dismissed and not given any explanation.

Seven of the staff members claimed unpaid wages for time worked prior to dismissal and holiday pay.

Staff members Debra Sapphire, Challote Elliott, Natalya Maynard, Paora Smith, Caleb McKenzie, Ngaire Dolman and Maree Campbell were all awarded unpaid wages and holiday pay.

All said they had KiwiSaver contributions deducted from their pay that were not forwarded on to Inland Revenue.

Three of the staff members also said Smith & Co deducted student loan payments but failed to pass this money on to Inland Revenue as required.

The owners of the business did not respond to requests from the authority for information and no representative from the business attended the hearing.

The ERA warned the owners of the business that "directors may be held personally liable for the debt should Smith & Co fail to pay".

No one from Smith & Co attended the hearing and the ERA warned that "an employer cannot avoid its obligation to pay its staff by simply ignoring a claim it has not done so".

Smith & Co was also ordered to pay $3000 as compensation for the applicants' legal costs.

The ERA required the amount to be paid by February 11.

Smith & Co was advised that directors may be held personally liable for
the debt should Smith & Co fail to pay.

The ERA warned non-payment could lead to imposition of fines and the
sequestration of property.