Company fined $125,000 by Employment Relations Authority

A building company has been slapped with a huge fine for breaching minimum employment standards during the construction of a hotel in Auckland

Huiyun Ling instigated an investigation with the Employment Relations Authority (ERA) after he laid a complaint because wasn’t paid a salary or holiday pay by SDCIC NZ Construction. He also alleged the company, which has employed him as a safety manager since 2018, had breached its duty of good faith.

SDCIC was contracted to build a hotel in Auckland. To manage the job, it sent across four directors from China to supplement six others on the management team. It also employed around 40 construction workers.

Ling’s employment was for a fixed-term period from 7 May 2018 until the end of the work at the Park Hyatt Auckland project, and would be paid an annual salary of $90,000 per annum. According to the ERA, his contract said: “It (the contract) will automatically end without notice or pay instead of notice, unless the employee ends it earlier in line with this agreement. We anticipate that the project will end on or before 31/03/2019.”

Money not paid

In February 2020, almost 12 months after the anticipated end of the project, construction ceased and SDCIC were told to leave the hotel site. Ling argued that at the cessation of the project, he was owed wages for January and February 2020 as well as holiday pay.

In March 2020, Ling was asked to sell the company’s assets of three vehicles – however, ERA heard that before the vehicles could be sold, an SDCIC supplier named Hua Wu transferred ownership of the vehicles to himself and reported them as stolen.

Wu then became sole director of SDCIC and applied for the Covid wage subsidy, of which Lin received two payments totalling  $3,920, one on 23 April and one on 8 June. However, after June 2020 Lin received no salary or payments from SDCIC. In February 2021, he began working as a self-employed accountant.

Despite Lin’s contract stating it would end when the construction project finished, ERA found that he had been retained in employment to assist with the sale of SDCIC vehicles to raise money to pay the remaining employees.

“The last date Mr Ling received any form of payment from SDCIC was on 8 June 2020. Mr Ling said he had contacted Mr Wu about his unpaid salary and holiday pay, but received no response,” said ERA.

Result of complaint

The determination found that Ling did not receive a notice entitlement, was owed unpaid wages by SDIC from January until August 2020 and was owed his full annual leave entitlement. Ling was awarded $6,923.07 for unpaid four weeks’ notice, $56,080.00 in respect of unpaid salary, $15,200 in respect of unpaid annual leave as well as interest on the unpaid wages and holiday pay and $4,000 of a $40,000 fine paid to the Crown for failing to provide wage and time records.