Can they legally do this?

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9 years 5 months ago #39027 by kai
OH works for an international company with a huge workforce.
Today they had a meeting saying instead of paying them two weeks in areas fortnightly, they will pay them a month in areas fortnightly.

Now obviously this due to the size of the payroll this is going to make the company thousands in interest due to the money being in their bank accounts for an extra fortnight. In practice this means the employees are going to miss out on a paycheck in February. They were told sign this piece of paper and we will give you an interim payment and then gradually deduct it over a couple of months, if you don't sign you don't get the payment and will have to cope with no wages for a fortnight. There is no talk of compensating the workers for either interest lost or bank charges incurred in case of any over-draughts. Effectively it is an enforced pay cut. As far as I can tell there was no union consultation in this at all.

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9 years 5 months ago #501161 by Ruth
Replied by Ruth on topic Can they legally do this?
Capitalism. Why not? They can do anything. Wouldn't be legal here, probably.

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9 years 5 months ago #501162 by Blueberry
Replied by Blueberry on topic Can they legally do this?
What do you mean with 'in areas"?

wages are always paid 'after the fact' - e.g. you have to work for a week / fortnight / month before you get paid.

and why would they pay them "a month in areas fortnightly"?

in a lot of countries, wages are paid monthly. this reduces the workload for the payroll, the bank fees etc. of course it's of interest for an employer to do it this way. it's called streamlining the admin costs, and the employer is entitle to do this.

If your hubby has an Individual Employment Agreement, then you might want to check that. i'm pretty sure it states when wages are to be paid. if it's a blanket agreement a union is responsible for, then all the employer needs is the Unions agreement.

when moving from fortnightly to monthly, of course there is going to be a gap somewhere. having said that:

if you are usually paid say on the 15th and on the 30th, and they want to now only pay you on the 30th, then the process should be as follows: payment on the 15th of January for two weeks, on the 30th of January for 2 weeks, and then on the 28th of February for 4 weeks, on the 30th of March for 4 weeks and so forth.

[;)] Blueberry
treading lightly on mother earth

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9 years 5 months ago #501163 by reggit
Replied by reggit on topic Can they legally do this?
Depends on the employment agreement he is under...

Take a break...while I take care of your home, your block, your pets, your stock! [;)] PM me...

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9 years 5 months ago #501167 by kai
Replied by kai on topic Can they legally do this?

Blueberry;507022 wrote: What do you mean with 'in areas"?

sorry typo - in arrears

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9 years 5 months ago #501168 by kai
Replied by kai on topic Can they legally do this?
I will try to explain again.

Firstly I am talking lunar months.

What happens currently is he works week 1, week 2 and gets paid the middle of the following week for the work done in week 1 & 2, this is fairly normal and was in his original contract.

If he was to get paid monthly he would work weeks 1,2,3,4 and get paid for those 4 weeks the middle of the week after. However this is NOT what they are proposing.

The payroll will still be run every fortnight, so there is no argument for saving admin costs.

What will happen next month is he will have to work week 1,2,3,4 and then the middle of the next week he will be paid for weeks 1 & 2 only. In effect they are withholding 2 weeks worth of money almost like a deposit. They have been told they will get this money when they leave the company and not before.

They have been told sign to say you agree and then we will give you a small loan to tide you over, if you don't sign, you don't get a loan and we will do it anyway and make life difficult for you.

There are a lot of people working for this company who will be on low wages and if they have a family they could be struggling badly when this comes into force.

It means that for everyone person employed; which is several thousand; the company will be banking the interest from two weeks wages from each employee indefinitely until they either die or leaves the company.

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9 years 5 months ago #501169 by Hawkspur
Replied by Hawkspur on topic Can they legally do this?
OK, so what is changing is the length of time in arrears for each payment rather than the interval between payments.

If you don't sign they cannot do it anyway, as " Employers cannot change the normal pay day without the agreement of the employee. "
but yes, they can make life difficult if you don't.

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9 years 5 months ago #501170 by Blueberry
Replied by Blueberry on topic Can they legally do this?

kai;507028 wrote: I will try to explain again.

. In effect they are withholding 2 weeks worth of money almost like a deposit. They have been told they will get this money when they leave the company and not before.

They have been told sign to say you agree and then we will give you a small loan to tide you over, if you don't sign, you don't get a loan and we will do it anyway and make life difficult for you.

T.

now THAT is illegal.

check this out: www.dol.govt.nz/er/pay/paymentanddeductions/index.asp

and here's the contact number: www.dol.govt.nz/contact/

this behavior is abhorrent and the ministry needs to take note of it. it's a clear abuse of power by the employer.

[;)] Blueberry
treading lightly on mother earth

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9 years 5 months ago #501172 by kai
Replied by kai on topic Can they legally do this?
I need to read the document he was made to sign under duress first. At the moment I am going on what he told me over the phone. If it as he has said, I personally would like to take it further.

No advance warning was given and they were pressured on the spot to sign, without being given a chance to read up on the legalities of it. Also as it comes into effect next month, no one has had time to save up a bit, especially as for most they will have spent a lot at xmas. Also their option of sign and we will give you a loan, don't sign and we won't and will still do it is almost blackmail.

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9 years 5 months ago #501173 by kai
Replied by kai on topic Can they legally do this?
I gave the ministry a quick call, without naming the company at this point. The initial response was to go to mediation, however I cannot see any individual wanting to stick their heads up above the parapet.

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9 years 5 months ago #501177 by kai
Replied by kai on topic Can they legally do this?
From the sound of things none of them have signed and the signing thing bit was just related to, do you want a loan seeing as we won't be paying you. I am tempted to email the guys (a lot of whom I know anyway) from a different email address so it can't be traced back to me and then to OH, pointing them in the direction of the links provided.

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9 years 5 months ago #501188 by kai
Replied by kai on topic Can they legally do this?
I have a copy of the document provided, I don't want to post the content publicly but they are claiming the employees are "contractually obliged" to allow their pay dates to be changed. Though I am pretty sure no employment contract was ever written saying "and should we chose not to pay you for a fortnight, you cannot object". There are a few other outstanding statements in it as well.

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9 years 5 months ago #501200 by Organix
Replied by Organix on topic Can they legally do this?
From your interpretation it sounds a little like the company (or at least its NZ entity) have a cashflow issue that they plan to address by way of a one-off payroll 'adjustment'. If that is the case how secure will the funds that they intend to 'put on hold' be if their economic situation deteriorates?

Harm Less Solutions.co.nz
NZ & AU distributor of Eco Wood Treatment stains and Bambu Dru bamboo fabrics and clothing

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9 years 5 months ago #501202 by Blueberry
Replied by Blueberry on topic Can they legally do this?
it's pretty clear to me that the company counts heavily on the fact that no-one will take legal action against them. what a shameful way to act for a company.

i concur with Organix's statement; they are intending to save a fortnights worth of wages. Wages are not secured; if they go bust, which seems a distinct possibility, your money is gone. which means, when they go bust, you may loose up to a months worth of wages (the 'jumped' 2 weeks, plus the 2 weeks of the period right before they go insolvent)

if i were in this position, i would be looking for new employment quick smart.

i would also keep all this paperwork, and on the day you quit, you raise a personal grievance, to help out all those still stuck with this employer. this needs to be addressed, but i totally understand that no one will be the one to stir the mud.

[;)] Blueberry
treading lightly on mother earth

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9 years 5 months ago #501205 by kai
Replied by kai on topic Can they legally do this?
Organix, in this case I do not think the company is likely to go bust, at least not for the foreseeable future, however that is a good point to raise as an objection.

An update: the guys have banded together, the union rep is signing everyone up, they are going to hold a meeting outside of work and hopefully will put up a united front to the management. The jungle drums are drumming and the other effected office is also joining in. (NB, it is not the entire company effected as I thought at first (or at least that is what they are saying), but I don't know if there are other sectors who they will be trying this on with as well)

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