ERA steps in after Thai restaurant refuses to pay ex-worker costs

Thai Orchid Christchurch owner Julian Stokes submitted he couldn't afford to pay costs after losing an ERA hearing in February. Photo / Google Maps

The Employment Relations Authority has had to step in and order the owner of a Thai Restaurant to pay costs after the owner lost an earlier hearing for abusing the Government's Covid-19 wage subsidy scheme.

Crazy Horse Ltd, which operates as Thai Orchid restaurant under owner and sole director Julian Stokes, was found to have unjustifiably dismissed his former front-of-house staff member after she took umbrage at him for using her annual leave to bump up her wages during the first Covid-19 lockdown.

The authority issued a number of payments in the staff member's favour including $2258.87 in seven weeks' adjusted lost wages and $5000 for hurt and humiliation at her experience.

It heard in February that Stokes was granted the Government's wage subsidy and despite paying her first week as entitled, for the remaining seven weeks he began paying the staff member 80 per cent of the wage subsidy and topping it up with the woman's annual leave - despite not having approval and the woman later protesting.

He would later tell the authority he used the excess from the staff member's subsidy to top up more highly paid chefs in his team.

In May 2020, following the nationwide lockdown, Stokes told the staffer that due to business downturn by Covid-19 he couldn't employ her at the same number of hours she had previously worked and began a redundancy process while offering to continue to employ her at reduced hours.

She in turn asked for more hours, however Stokes declined and ended her employment after more than two years at the restaurant.

The authority found that given the subsidy payments ran from March 26 to about June 16, Stokes had an obligation to "use best endeavours" to retain her job until that date.

"Instead, he terminated her employment on May 22, 2020, with her notice being paid up to May 29, 2020.

"It is at best unfortunate that Mr Stokes chose not to continue [her] employment for the short number of days it would have taken to comply with the subsidy obligations."

Along with payments for short-paid wages, short-paid notice, and three unworked public holidays, the applicant was granted nearly $12,000 in total.

However, that figure is now set to rise by about 75 per cent.

Authority member Claire English, who made the earlier ruling, said she had left the issue of costs to be sorted out by the respective parties.

"The parties have been unable to do so," English wrote in her decision.

Counsel for the restaurant submitted that costs should lie where they fell as they had made a reasonable Calderbank offer prior to the hearing, the staff member was awarded less than she sought with mixed success and it can't afford to pay costs.

But English disagreed.

"In the present case, [staff member] was the successful party.

"It is correct that the Authority awarded [her] less than she claimed for hurt and humiliation in particular, but she still achieved success under this head, and indeed, on all the other heads of claim.

"This does not amount to 'mixed success' as the respondent argues.

"[Staff member] was the successful party, and is entitled to an award of costs."

English not only award the usual amount of $6250 but uplifted it by a further $1500 due to the Stokes causing repeated delays throughout the whole hearing, as well as disbursements of $305.31.