The sole director of a liquidated Taupo restaurant has been ordered to pay a former employee more than $40,000 in wages arrears by the Employment Relations Authority.

Authority member Shane Kinley found that New Zealand LJ Food Express Taupo Limited, trading as No 1 China Restaurant, had failed to pay the employee for annual holiday pay when he stopped working for the restaurant, while public holiday entitlements had not been provided. The employee was also not paid the minimum wage. Xian Zeng, the owner of the company, was found to be a person involved in the breaches and liable to pay arrears.

The employee worked for the restaurant between March 2019 and May 2021.

Following a complaint, the Labour Inspectorate investigated and found, among other breaches in minimum employment standards, that the employee worked around 52.5 hours per week but was only paid for 40 hours and worked on 23 public holidays for which he was not paid correct entitlements. The Inspectorate also found that the employee did not receive payment for annual holidays when he left his employment.

Mr Kinley ordered Zeng to pay the employee $40,421 in wages arrears and a penalty of $12,000, $3,000 of which is to be paid to the employee.

In addition, Zeng was ordered to pay costs of $2,250 and disbursements of $1,671.20 as well as interest on the total amount until it has been paid in full.

Mr Kinley found that New Zealand Li Food Express Taupo Limited, which went into liquidation in November 2022, and Zeng:

• Failed to keep wages and time records as required under s130 of the Employment Relations Act 2000.
• Failed to keep holiday and leave records as required under s81 of the Holidays Act 2003.
• Owed the employee $12,218.56 in unpaid annual holiday pay.
• Owed $1,377.48 for failing to pay time and a half when the employee worked on public holidays.
• Owed $2,731.28 for failing to pay alternative holidays when the employee worked on public holidays.
• Owed $118.75 for failing to pay for an unworked public holiday.
• Owed $23,975.20 in unpaid wages under s6 of the Minimum Wage Act 1983.

The total amount before interest that Zeng needs to pay is $56,342.44.

As the restaurant’s liquidators did not allow the Labour Inspectorate to continue its claims against the restaurant the Inspectorate pursued Zeng in his capacity as the sole director and shareholder as a person involved in the breaches.

Simon Humphries, Head of the Labour Inspectorate, said owners of businesses where vulnerable workers have been exploited should not expect to escape sanctions even if the business is no longer operating.

“In this case, the employer knowingly paid the employee less than the minimum wage for a sustained period, while there were also several other breaches in minimum employment standards which impacted the employee.

“While we prefer to support employers to ensure they comply with employment law, the Inspectorate will not hesitate to take enforcement action against those who take advantage of vulnerable workers,” he says.

• MBIE encourages anyone who thinks they or someone else has been treated unfairly in the workplace to contact our 0800 20 90 20 contact centre number where their concerns will be handled in a safe environment.

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