Identifying the employer is not as simple as you might think
Everybody knows who their boss is right? The reality is that often employees will not bother to look at their employment agreement to see who they are contracting with. This, of course, assumes that the employee is even provided with a written agreement in the first place. Many employees consider “the boss” to be their employer – the person who sits in the big chair and gives the directions.
McLachlan v Crabb t/a Communication Gurus Ltd
Mr McLachlan was hired by Ms Crabb who was trading under the name Communication Gurus. They signed an individual employment agreement to that effect. Several months after Mr McLachlan commenced work, Ms Crabb incorporated a company, Communication Gurus Limited, intending this company to now become the employer. Shortly after the incorporation, Mr McLachlan left the employment relationship without having signed a new agreement with the company. His final pay was paid by the company.
Enosa v Black & White Fire Systems Limited
In 2011 the Authority ordered that Black and White Fire Systems Ltd (Black and White) pay Mr Enosa approximately $10,000. About a third of that amount was paid and the remainder withheld by Black and White. Shortly afterwards, Black and White ceased trading and its sole director, Mr Vaisevuraki, moved to Wellington and incorporated a new company – Black and White Fire Systems (2011) Limited (Black and White 2011).
How we can help
Jackson Russell is experienced in dealing with all aspects of employment law. The cases above discuss two situations which highlight the potential difficulties there can be in identifying the legal entity liable to disgruntled employees. To attempt to avoid situations like this it is important to ensure that you have employment agreements that are clear and that these are regularly reviewed to ensure they accurately reflect the employment relationship.
The information contained in this publication is of a general nature and is not intended as legal advice. It is important that you seek legal advice that is specific to your circumstances.
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Glenn Finnigan, PARTNER
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