Resolving employment problems
Labour inspectors
Who are labour inspectors and how can they help?
Labour inspectors work for the Ministry of Business, Innovation & Employment (MBIE). They can be contacted through the MBIE contact centre on 0800 20 90 20.
Labour inspectors can investigate breaches of laws relating to minimum employment conditions and protections, such as:
- equal pay
- holiday pay
- the minimum wage
- parental leave
- wage deductions, and
- “in between travel” payments for home and community support workers.
What powers do labour inspectors have?
Employment Relations Act 2000, ss 223, 229
Labour inspectors have wide powers to enter workplaces at reasonable times, to interview employees and employers about compliance with employment standards, and to inspect and copy any wage and time records. An employer must make these available straight away.
Employment Relations Act 2000, s 229A
A labour inspector can also investigate to find out if any place is a workplace and if someone is an employee (as opposed to a contractor or volunteer). They have the same powers to enter and interview and inspect records as above.
A labour inspector can’t give you advice about employment disputes or pay rates (except about minimum wage rates).
What actions can a labour inspector take against an employer?
Employment Relations Act 2000, ss 223B, 224, 229, 235A
Actions a labour inspector can take include:
- securing an “enforceable undertaking” from an employer – this is an agreement in writing that the employer will pay the money owed or otherwise fix the breach by a set date
- issuing improvement notices (which state the failure and the steps your employer needs to take to fix it)
- issuing infringement notices for breaches of record keeping, with fines (like a speeding ticket)
- issuing a “demand notice” for minimum wage or holiday pay claims if the inspector is satisfied that the money is owed and that the employer is unwilling to pay
- taking action for breaches of minimum standards – this can include taking action against company directors who were knowingly and intentionally involved in the breach
- applying to the ERA for penalties for breaches of employment standards
- applying to the Employment Court for a declaration of breach if there’s been a serious breach of minimum entitlements. If this declaration is granted, the inspector can apply for:
- a penalty of up to $50,000 for individuals, or for companies either up to $100,000 or three times the financial gain made by the company as a result of the breach, whichever is more
- a compensation order for lost wages
- a banning order stopping a person from being an employer or hiring employees.
