Unsecured wage underpayment agreement illegal
Davies Ndumiso Sibanda, Labour Matters
MANY employers have wage and salary agreements with employees that are way below the legal minimums for the particular jobs in terms of the appropriate industry regulations resulting in many legal challenges when the employee leaves employment for whatever reason.
Jane worked in a retail outlet earning $140 a month after an internal verbal agreement on the wage. The wage was way below the national employment council (NEC) minimum and Jane worked under this arrangement for over five years and when she resigned she approached the NEC and claimed underpayment, unpaid leave days and unpaid overtime. She tendered photo copies of the wages book and clocking book as her evidence.
When the employer received the notification, he tried to get an out of court settlement with Jane but without success. When the matter got to the NEC the employer was found to have underpaid Jane. Unlawfully as the wages underpayment had not been secured through getting an exemption from paying the minimum wage.
On overtime, the wages book showed that Jane had been working hours much longer than stipulated hours in the industry’s collective bargaining agreement. The employer was ordered to pay the overtime.
Jane alleged that she had not taken vacation leave and the employer had no record of the vacation leave that had been taken. The NEC ordered the employer to pay cash in lieu of vacation going back three years as prescribed by the Labour Act at the legal minimum rate of salary for people in Jane’s grade.
Overall, Jane’s claim added up to over $11 000, an amount which is about the total value of the merchandise in the shop. Many employers get to this position because they wrongly think that they can avoid the law by negotiating “private wage agreements” not knowing that such agreements are overridden by legislation.
Some employ relatives and underpay them and others bring workers from the village into town and underpay them and only to wake up when the workers litigate.
Experience has shown that when it comes to money there is no relative. I have handled many labour disputes where workers are suing relatives over underpayment, overtime and leave dues. These cases are common in the retail industry and domestic work.
Employers need to appreciate that they cannot take shortcuts when it comes to employment law and that they have to get a professional to assist them.
Contracts downloaded from internet or collected from a friend usually do not help as they fail to meet legal minimums and leave the business exposed.
In conclusion, where the employer cannot pay minimum wages, he should get professional guidance and apply for exemption. Better still, the employer can have a service retainer arrangement with a human resources consultant who manages key human resources issues leaving the employer to focus on his core business.
Davies Ndumiso Sibanda can be contacted on: Email: [email protected]