The Court of Appeal has overturned the Employment Court’s ruling that employees who did not work during New Zealand’s COVID-19 Alert Level 4 lockdown were not entitled to be paid minimum wage under the Minimum Wage Act. Ultimately, the Court of Appeal sided with the employees, finding they were entitled to be paid minimum wage for the hours of work they had agreed to, regardless of whether or not the work was performed.
The case concerned an in-flight catering service, which employed 130 workers. As an essential service, the company remained open throughout COVID-19 lockdowns. However, due to the lack of demand for in-flight catering brought on by limited air travel, the company had little work to offer its employees.
In late March 2020, the company proposed that its employees be paid 80% of their normal wage due to the reduced work, which lowered some wages below the national minimum. In response, five employees brought their case before the Employment Relations Authority.
At first instance, the Employment Relations Authority found that the employees were “ready, willing and able to work” and that the company, not the workers, decided whether or not they would work. Given this, it found that the company breached the legislation in paying below the minimum wage.
The company challenged the authority’s finding before the Employment Court. There, the majority held that, although the employees were willing and able, they did not actually perform work and,...
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