Courier company Fastway paid holiday pay to employee illegally for 11 years

Courier company Fastway found to be illegally paying staffer holiday pay for 13 years. Photo / File

A former Fastway employee has been awarded more than $35,000 after the courier company had been illegally paying her holiday pay for 11 years.

Karen Leonard had been working for Fastway Global Ltd in New Zealand as a fulltime permanent employee from April 2007 to October 2018.

During that time, her holiday pay - which was 8 per cent of her gross earnings - had been added to monthly income and any annual leave she took was unpaid.

The Employment Relations Authority found the company had breached the Holiday Act 2003 by paying Leonard on a "pay-as-you-go" basis.

This method of holiday payment only applies to employees who are on a fixed term agreement for less than 12 months, or where the employee's work is irregular - not to those who work regular hours on a permanent basis, the authority said.

"It is very clear Fastway breached the HA [Holiday Act] over an extended period in paying Ms Leonard her holiday pay entitlement on a monthly basis rather than in compliance with its statutory obligations.

"Paying Ms Leonard her holiday pay on a monthly basis potentially deprived her of the
opportunity for rest and recreation and the opportunity to balance her work commitments
with other aspects of her life," Trish MacKinnon, member of the Employment Relations Authority, said in the decision document.

The authority also found that there were flaws in Fastway's methodology, which resulted in its calculation being inaccurate.

One flaw was that it deducted from each year's calculation the days it said Leonard had taken as leave in those years, which is not in accordance to the Holiday Act.

Fastway was ordered to pay Leonard holiday pay of $35,747.21 gross for April 2007 to October 2018.

The company was also told to pay $483.88 to Leonard for KiwiSaver contributions and was fined $5000 as a penalty.