A recent decision of the Employment Relations Authority demonstrates that an employer must be very conscious of whether an employee is “working” overnight (and therefore entitled to be paid) when the employee works and lives on site. This issue arises out of “sleepover” cases over the last 2 to 3 years in which employees have been found to be “working” when “sleeping”.
In Hill v Shand an employee of the Murchison camping ground was paid an annual salary of $30,000 and was also entitled to free accommodation in a house on site.
In the summer months, when the camping ground was particularly busy, Mr Hill worked 15 hours a day, seven days a week, generally starting at 7am and finishing at 11pm. After 11pm, Mr Hill stayed in his accommodation, but still had significant responsibilities, including ensuring the security of the camp ground and everyone in it, and also to be available to check in guests, and be alert to any incidents occurring in the camp overnight.
In the off-season, he worked eight hours a day and his responsibilities were much less than in the summer months.
Despite these constraints on his freedom overnight and his responsibilities, the Authority concluded that Mr Hill was not “working” after 11pm. However, it was a close run thing and the Authority made it clear if the situation had been slightly different, it may well have determined that he was in fact working during that time.
The decision serves as a reminder that there are significant issues for an employer to consider where employees are provided with accommodation, and live on the same site where they perform their work.
The factors that the Authority or Court will consider in a claim by an employee to be paid wages while sleeping will be (1) the constraints placed on employee during the sleepover period, (2) the responsibilities of the employee during the period, and (3) the benefit to the employer of having the employee sleeping over. Where there is an increase in the degree and extent of each factor it is more likely that the sleepover period will be regarded as “work”.
While the employer in this particular case was fortunate that the Authority didn’t determine that the employee was “working” during periods of sleep over, the case does demonstrate the obligation of an employer to pay minimum wages in those periods in some circumstances.
In this case, ultimately, the Authority determined that Mr Hill had been underpaid because his salary did not provide him with at least the minimum wage for each hour that he worked. Again, this is a reminder to employers that employees’ salaries – especially those with long hours – must be at least as much as the minimum wage legislation for each period of work.