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Labour Officer v Haque [2015] FJET 2; ERT Criminal Case 17.2014 (2 July 2015)

IN THE STATUTORY TRIBUNAL, FIJI ISLANDS
SITTING AS THE EMPLOYMENT RELATIONS TRIBUNAL

Decision

Section 230 Employment Relations Promulgation 2007

FAILURE TO KEEP WAGES AND TIME RECORDS; FAILURE TO PAY WAGES DUE TO A WORKER UPON DEMAND BY LABOUR INSPECTOR; RECOVERY OF WAGES; ENFOREMENT OF WAGES ORDERS – Sections 45, 55, 214 and 247(b) Employment Relations Promulgation 2007

Background

1. There are two Complaints the subject of proceedings that have been brought by the Labour Officer pursuant to Section 18 of the Employment Relations Promulgation 2007, together with a third action seeking the recovery of wages pursuant to Section 214 of the Promulgation. The first Complaint alleges the failure by an Employer to keep prescribed wages and time records for a worker in contravention of Section 45(1) of the Promulgation. The second Complaint is made under Section 247(b) of the Promulgation, alleging the failure of the Employer to pay upon demand of a Labour Inspector any wages due to a worker. The third Complaint, albeit perhaps incorrectly commenced under Section 56 of the Criminal Procedure Decree, alleges that there has been default in payment to a worker of wages or other money in accordance with Section 214 of the Promulgation.[1] This Complaint could have very easily been recast another way to allege the failure by an Employer to comply with various provisions of a Wages Regulation Order.
   
2. At the first occasion that the Defendant was legally represented in proceedings on 14 April 2015, the Complainant in response to the inquiry by the Tribunal as to why a business name was the purported entity being prosecuted, sought leave to amend the charges by bringing them against Mr Inamul Haque, the Defendant in his capacity as a sole trader. In accordance with Order XIV of the Magistrates Court Rules the Tribunal allowed for the amendment of the Complaints to reflect the name of the Defendant employer.[2] During the course of that process, the Tribunal was provided from Ms Mataigusu, with a photocopy of the Form 4 'Statement of change in the particulars registered by a firm or an individual trading under a business name desiring to form a firm under the same business name'.[3] That document appears to have entered the current business owner as Inam Investments Limited, rather than the Defendant. [4] It should be noted that the amendment to the Complaints were made, based on the understanding that the business owner was at the relevant time, Mr Haque acting as a sole trader rather than the limited liability company. [5]
   
3. At the time of writing this judgment and in the absence of any further clarification by the parties, the Tribunal intends to proceed with the prosecution of the charges against Mr Haque as an individual. If though that is not the correct state of events, the Tribunal will rely on Section 57(3) of the Criminal Procedure Decree 2009, to further correct any mistake pertaining to the named Defendant.[6] The Complaints arise out of a statement provided to the Labour Office by Mr Pranil Sharma, a 25 year old former employee of the Defendant, who claims he was terminated in his employment after a period of only several months engaged by the employer. The particulars of the alleged offences provide the relevant employment period as being from 28 November 2013 to 28 January 2014.
   
4. The Employer has pleaded not guilty to the first two Complaints and denies liability in relation to the third Complaint.
   

Evidence of Mr Sharma

5. The former employee claims to have worked for the Employer for a period of approximately two months. He claims to have been terminated by the Employer and sought to make his complaint for failure to receive proper wages and entitlements as an employee. His evidence was that he applied for the position as kitchen hand when it was advertised in the local newspaper. He indicated that after commencing employment, he was told he would be undertaking cooking at the venue. According to Mr Sharma, a typical day while engaged with the former Employer, would involve, arriving at 7 am and preparing dalo, rice and bhajia. Later in the morning, he would be involved in preparing such meals as chicken curry, chicken palau and other vegetable dishes. Mr Sharma's evidence was that he worked 7 am to 8 pm for 7 days a week, during the employment period. Mr Sharma stated that the Employer had indicated he would increase his wages and give him a contract, but this did not happen. In his evidence Mr Sharma said there was no 'sign on' register and he received weekly wages in the amount of $70. He claims to have qualifications and work experience gained from the Suva Vocational School where he gained experience in cooking, hotel services and catering.
   
6. In cross examination, Mr Naidu of Counsel challenged the claim by Mr Sharma that he had commenced his employment on 28 November 2013. Mr Naidu provided the witness with a photocopy of an extract of the employment vacancies section within the Fiji Times dated 7 December 2013, in which an advertisement for kitchen hand was identified.[7] In addition, the witness was shown a typed application for position that it was said was received by the Employer from Mr Sharma, in response to that advertisement.[8] The witness claimed that the signature on the job application was not his.[9] He also disputed the proposition put to him by Mr Naidu that he was only working around 8 ½ hours each day Monday to Friday. The witness was shown an extract from what Counsel described as the 'Red Wages Book'[10] and responded to Counsel by indicating that the sheet in question did not contain his signature.
   

Ms Farisha Ali

7. The next witness to give evidence was the then Investigating Officer, who had previously been engaged as a Labour Inspector for six years. Ms Farisha Ali was the staff member who received the complaint from the former employee. According to her evidence, she carried out an inspection of the wages books of the employees, though he was unable to produce them to her at his premises. Ms Ali indicated to the Tribunal that the Defendant had said that the wages book was at home. She stated, that he ultimately produced a single sheet and he was subsequently issued with a Fixed Penalty Notice. Ms Ali said that in response to the times claimed to have been worked by the former employee, that she had calculated his outstanding entitlements based on his claim and issued a demand notice for the amount. According to the witness, the Defendant refused to pay the amount demanded.[11] It was her evidence that the Defendant disputed the hours of work and also the nature of the tasks undertaken by Mr Sharma. According to Ms Ali, a further fixed penalty notice was issued in response to the failure to meet the demand.[12]
   

The Time and Wages Records of the Employee

8. The specific request for the time and wages record was made by the Labour Inspector on 13 February 2014. According to Ms Ali the Defendant brought a record of only one page to her within a week of that request. The witness observed that the document provided had no record of actual 'time in' and 'time out' or calculated wage amounts. Under cross examination, the witness conceded that on the further date of 17 June 2014, she had asked the Defendant's wife to produce the time and wages record and not the Defendant. According to the witness, the Defendant's wife had indicated that the wages book was always kept at home. Ms Ali also indicated that she interviewed only one other worker as part of that investigation, a Ms Shaleshni who advised her that she worked 45 hours per week over 6 working days. In re-examination of the witness, Ms Mataigusu confirmed that during the period 13 February 2014 to 17 June 2014, it would appear that the wages records were not held on site.
   

Evidence of Mr Jack Anthony Frazer

9. The next witness called by the Complainant, was presently an inmate of the Suva Correctional Centre. Mr Frazer gave evidence that he use to frequent the Defendant's takeaway business and observe Mr Sharma cooking. In fact he claimed to request a particular meal that he says was prepared by Mr Sharma for him. Under cross examination, Mr Naidu adduced evidence from the witness that he had been working at Garden City, Raiwaqa at the relevant time. According to Mr Frazer he attended the restaurant approximately three times a week during this period.
   

Evidence of Arun Lata

10. The first witness to give evidence on behalf of the Defendant was Ms Arun Lata, who has worked with the Defendant for four years. Ms Arun indicated that she was one of four to five employees working for the Defendant during the relevant period. Her evidence was that the working days would be between 8.00am to 5.00pm, with a lunch break of 30 minutes. According to Ms Arun, staff who agreed were provided with both breakfast and lunch. Ms Arun could not recall the names of those employees who were provided with meals and who had such expenses deducted from employee's wages. She advised the Tribunal that Mr Sharma had been undertaking work as a cleaner and kitchen hand. She said that she was the cook during the period in which Mr Sharma was employed. Her evidence was that during this period, no staff were required to work on weekends. Under cross examination, the witness said that Mr Sharma would fight with her, when she was cooking. Further she stated that Mr Sharma would change his clothes in front of the ladies and would ask for money.
    

Evidence of Mohini Lata

11. The next witness to be called was Ms Mohini Lata, who had been employed with the Defendant for a period of approximately 2 years and was at the time of hearing, on leave from work. Ms Mohini gave evidence that she had worked with Mr Sharma and that he was engaged as both a kitchen hand and cleaner. She gave evidence of a working day of approximately 7.30 am to 4.30 pm Monday to Friday, intimating that it would be rare to be called in on the weekend to work. Ms Mohini stated that her employer was a good man, who spoke nicely to her, assisted with leave arrangements and would loan her money. When cross examined by Ms Mataigusu, the witness corroborated the account of events as described by her co-worker Ms Arun that related to the provision of meals by the employer and the voluntary nature of that work arrangement.
    

Evidence of Inamul Haque

12. The final witness to give evidence was the Defendant employer. Mr Haque advised the Tribunal that he had registered his business in 2009. He said that Mr Sharma applied for the position of kitchen hand and was interviewed. Mr Haque stated that Mr Sharma commenced his employment on 10 December 2013. The position, he said involved washing dishes, cleaning and helping out in the kitchen. According to the witness, he was the cook as well as one other. The witness was clear that Mr Sharma was not involved in cooking meals. Mr Haque said that when employed, Mr Sharma was required to work from 8.00am to 5.00pm, on five days per week and that there was a requirement on "maybe one or two times" that the employee came to work on Saturday. According to Mr Haque the worker resigned following an altercation over food wastage. When asked by Counsel for the Complainant, "Did Mr Haque maintain a wages record?", the witness said "yes" and identified the Exhibit D4 as the present Wages Register for the business.
    
13. According to Mr Haque he was called by the Labour Inspector who requested to see the time and wages record. This he claims to have provided her, whereupon it was photocopied. Mr Haque claims that on the second occasion he was contacted by Ms Ali to produce records, he was not in the shop, but within 5 minutes had arrived with the wages book in the car. He said, "they wanted wages book from ..I have it". The witness stated, "at same time I had attendance book .. they didn't ask for it". After that they gave me a $5000 fine and left. According to the witness, on 17 June 2014, there was no request made of him regarding the production of the attendance register. In relation to the deduction of meal expenses, the witness claimed that this had been agreed with Mr Sharma to be deducted from his pay. Mr Haque advised that the witness was paid at the rate of $2.73 per hour. [13] He also gave evidence to the effect that the core business time for serving customers was between 10 am to 2 pm daily. Under cross examination, the witness advised that Mr Sharma did not sign an attendance book. In relation to the records inspection undertaken by Ms Ali, the witness indicated that he had gone to pick his son up from school when the Labour Inspector called. The witness confirmed that if he was at the business on a Sunday it would be for his own preparation work.
    

Closing Submissions of the Parties

14. Within the Complainant's Closing Submissions[14], it is alleged that the Defendant has committed the offence of failing to keep proper Wages and Time Records for its worker Pranil Sharma. It is stated that "In breaching charge 1, he has invariably breached charge 2 as well as he has no strong written evidence to refute the Complainant's alleged overtime worked.
    
15. The submission of the Complainant goes on further, to suggest that:
    

The Prosecution humbly seeks the maximum penalty and costs to the Ministry so as to teach this employer a lesson and to all other sole traders out there to not exploit poor workers who are also struggling to survive in this country.[15]

16. The submissions of the Defendant on the other hand, takes a different tact. In relation to Charge 1[16], it is correctly submitted that once an Employer pays a prescribed penalty under a Penalty Notice, that Section 48(5) of the Employment Relations (Administration) Regulations 2008 precludes the further prosecution of an additional fine as a result of that (specific) offence.[17] In relation to the Second Charge of failing to submit to a demand for the payment of wages, the submission of the Defendant is that there is no such evidence before the Tribunal of the demand actually being made. It is also submitted that the demand is defective, insofar as it was issued against an incorrect entity.[18] Finally, the Defendant argues that any recovery action that should be undertaken by the Complainant needs to take place in a manner consistent with Section 214(1)(b) of the Promulgation. That is,
    

by action commenced in the prescribed manner in the Tribunal

17. It is argued by the Defendant that the combined effect of Sections 18(b) and Section 238(2)(a) of the Promulgation would render that the appropriate step to be taken is that for a civil proceedings.[19]
    

Complaint 1 – Offence under Section 45 (4) of the Promulgation

18. The particulars in relation to the first complaint are quite clear. The complaint relates to the time and wages record of Mr Sharma. Based on Exhibit D 3, the records that were maintained at the relevant time, were not in a form as prescribed by Section 45(1) of the Promulgation, that states:-
    

An employer who employs a worker whose wages or rates of wages are prescribed or paid under an employment contract or under this Promulgation must keep a record (called the wages and time record) showing, for each worker—

(a) the name of the worker;

(b) the date of birth;

(c) the worker's address;

(d) the kind of work on which the worker is usually employed;

(e) the employment contract under which the worker is employed;

(f) the classification or designation of the worker according to which the worker is paid;

(g) a daily attendance register incorporating the hours between which the worker is employed on each day, and the days of the worker's employment during each week;

(h) the wages paid to the worker each week and the method of calculation;

(i) any payment made under Part 11; and

(j) other prescribed particulars.

19. Document Exhibit D3 is clearly not in that form. A Fixed Penalty Notice was thereafter issued on 17 March 2014 requiring that the Defendant pay the sum of $100.00 within 21 days and remedy non-compliance by 7 April 2014. It does not appear to be in dispute that the Defendant paid that penalty amount on 20 March 2014. In relation to the issue of non-compliance though and as the particulars of the Complaint relate to Mr Sharma, the Complainant is thereafter prevented from prosecuting for that particular offence, by virtue of Section 48(5) of the Employment Relations (Administration) Regulations 2008. If on the other hand, that further non-compliance of Section 45(1) existed, whether in relation to a failure to take remedial action as required under the Penalty Notice or independently as required and envisaged under Section 45(4) of the Promulgation, then a fresh complaint could be issued. The difficulty for the Complainant in this regard, is that it is accepted that the employment relationship was at an end by 28 January 2014. No such fresh complaint pertaining to events on or after 7 April 2014 has been made. To that end the first Complaint alleging an offence in accordance with Section 45(4) of the Promulgation, must fail.
    

Complaint 2- Offence under Section 247(b) of the Promulgation

20. While the Defendant is technically correct that the letter of demand was not in evidence before this Tribunal, there is no doubt from the evidence of Ms Ali, that the Complainant did construct a table of claimed outstanding entitlements and demand that it be paid. The fact that the demand was posted to the company name rather than the sole trader, which it is alleged is the owner of the business is not that pertinent on this occasion. There is no evidence before the Tribunal to suggest that the business owner Mr Haque was not aware of the demand.[20] That to my mind for present purposes is sufficient to invoke the jurisdiction of the Tribunal. The name of the employee, the period in which he was claimed to work, the amount of outstanding entitlements were all identified by Ms Ali as forming part of that demand. Mr Haque was also alive to the fact that the wages and times records of the business were under scrutiny and he had attended a meeting at the Labour Office in relation to this matter. The closing submission of the Employer includes the demand notice as issued, which in turn references an attached schedule which is incorporated in the Closing Submissions of the Complainant and was referred to within the proceedings as Exhibit C1. As mentioned earlier, the Complaints made were allowed to be amended as the Complainant had commenced proceedings against a business name, rather than a legal entity. If it is the case that the demand letter was issued against the company rather than the individual, the Tribunal remains satisfied that it was an issue alive to the Defendant, of which he understood he had an obligation to respond. The extract of the record of the business name that has been provided to the Tribunal suggests that the company itself was the operator of the business. The Tribunal is not going to allow the frustration of proceedings, at least on this occasion, for that reason. [21]
    
21. The Defendant has not provided any excuse why it did not submit to the demand, other than it would appear that it did not believe that the former employee was entitled to those outstanding wage amounts. Arising out of this failure to submit to the demand, the Complainant has issued a Fixed Penalty Notice in the amount of $5,000.00 which the Defendant has not paid. In the absence of such payment of the penalty, the Complainant may prosecute the matter under Section 247 of the Promulgation. The threshold test at this point, appears though to be of a higher order than that at least in a prima facie sense, required or envisaged by the issuing of a prescribed Penalty Notice. Based on the facts before the Tribunal, the issue is not so much whether a demand has been made, but whether or not it arises out of a "demand to pay any wages due to a worker".
    
22. If in fact, there are no wages due at law, it is hard to comprehend how there could be a failure to submit to a demand, where such demand would otherwise be an invalid one. Based on the material before the Tribunal, the evidence in this regard does not favour the employee, Mr Sharma. There is simply nothing to corroborate his account of events, other than the evidence of Mr Frazer, which deals only with certain occasions in which he claimed Mr Sharma had prepared him meals. The impression of that evidence is that it would appear a long way to drive from Raiwaqa to the Olympic Pool Car Park in order to have a meal.[22] The Tribunal is not content to accept that evidence as corroborative as to the claim for outstanding wages that has as its foundation the incorrect payment of the employee due to his classification under the Wages Order. Nor does the Tribunal accept the evidence of Mr Sharma that he commenced work on 28 November 2013. The job application in response to the application made on 7 December 2013, is suggestive of a commencement date some time after that time. Had the employee maintained some form of contemporaneous records regarding starting and finishing times, had he obtained corroborative evidence in relation to opening hours and his work role, the case may have turned differently. My impression of the evidence is though, that the Employer and Mr Sharma had a falling out over various issues. Mr Sharma has alleged that this was due to being made to watch pornographic videos while at work, Mr Haque on the other hand, has suggested that the cause of this was due to the employee's wastage or spoilage of food at work. There is simply insufficient evidence to support the Complaint and the lawful demand must as a result, be deemed to have been defectively made.
    

Complaint 3 – Recovery of Wages under Section 214 of the Promulgation

23. The final Complaint can be disposed of relatively quickly. Counsel for the Defendant is correct insofar as this provision does not appear to be the correct form by which to prosecute for recovery of wages. Firstly, the Complainant should draw the distinction between the statutory entitlement and the contractual. The Complainant would have been free to have brought criminal proceedings under the Promulgation for the failure to comply with the terms of a Wages Order in accordance with Section 55(2). Flowing from that course, there would also be provision to order for the recovery of wages arising from such breach, where established, in accordance with Section 55(3) of the Promulgation.[23] In addition and as Section 55(5) makes clear, there would be nothing preventing the Complainant pursuing a claim for the recovery of contractual or statutory entitlements within 6 years after the day on which the money became due and payable.[24] It is noted that Section 214 of the Promulgation envisages that such actions for recovery of wages are "commenced in the prescribed manner in the Tribunal". In the absence of any prescribed form, it would seem an action commenced by Writ or Statement of Claim, made in accordance with the Magistrates Court Rules would suffice.[25] As the Complainant has not in any event established the necessary preconditions to supporting any such claim for recovery, on this occasion despite the fact that the third Complaint is likely to have been defective, regardless of the ability of Section 57(3) of the Criminal Procedure Decree 2009 to correct such defect, it must nonetheless be dismissed. There is simply insufficient evidence or particulars to support the claim for recovery of alleged entitlements.
    

Conclusions

24. For the above reasons, all three Complaints must fail. Having said that, it is clear that the Defendant's conduct in this matter has not been exemplary. Time and wages records must by law, be maintained in accordance with Section 45(1) of the Employment Relations Promulgation 2007. They should be maintained daily. They should not be maintained and updated monthly, quarterly or yearly, but they must exist as a living daily record of attendance and as a later consequence, used for the calculation of entitlement. In accordance with Section 44 of the Promulgation, employees should also be provided with Wages Statements, (pay slips) coinciding with the receipt of their wages, that should also make clear the number of hours worked, any special penalty or overtime payments and any leave that may have accrued or be expended. In that way, there is a mutual understanding by all parties of what is being provided whether at contract or statute.[26] Having said that, there was certainly no evidence after 7 April 2014, that the Defendant had complied with the request to remedy as made by the Complainant in its original Penalty Notice.[27] The very purpose of ensuring proper time and wages records are kept, is to avoid these kinds of disputes between the parties. The Defendant is now put on notice in this regard.
    

Decision

The Tribunal dismisses all three Complaints the subject of these proceedings.

Mr Andrew J See
Resident Magistrate

^[1] For reasons which will be canvassed later in this decision, this third Complaint appears to be defective and one which should not be commenced as a Complaint without reliance on an offence provision, for example such as Section 55(2).
^[2] The parties should pay special attention to the scope of Order XIV, having regard to what it is empowered to correct and the underpinning purpose in providing such power.
^[3] See Section 7 Registration of Business Names Act (Cap 249)
^[4] Note date of change 13 March 2012.
^[5] Income tax returns and other information available from the Titles Office shall easily clarify that fact.
^[6] The further implications of that will be identified, in relation to the demand made by the Complainant against the ostensible employer in accordance with Section 247 (b) of the Promulgation. Of course Counsel for the Defendant has a positive obligation to the Tribunal to advise of any known error in this regard.
^[7] See Exhibit D1.
^[8] The document marked as Exhibit D 2, refers to an advertisement dated 7 December 2013.
^[9] The Tribunal considers on balance, that this application is likely to have been that of Mr Sharma, particularly given it contained supporting documentation from referees.

^[10] Marked for Identification as “C” and subsequently tendered as Exhibit D3.
^[11] Refer calculations contained in Exhibit C1.
^[12] The date of issue of this notice appears to be 17 June 2014, though this did not form part of the Prosecutor’s Exhibits.
^[13] This rate appears to coincide with the rate for kitchen hand (other than licensed undertaking) as contained in Schedule 1 of the Wages Regulation (Hotel and Catering Trades) Order 2012.
^[14] See document as filed on 5 June 2015.
^[15] See Paragraph 6.4 of the Closing Submission.
^[16] The word Charge and Complaint are used interchangeably by the parties.
^[17] See Section 3 of the Employer’s Closing Submission filed on 16 June 2015.
^[18] This appears to be the case as Document C within the Employer’s Submission is written to Inam Investments Ltd and not Mr Haque in his capacity as a sole trader.
^[19] As mention earlier, the other option for pursuit of statutory entitlements alone, would be to prosecute a matter in accordance with Section 55(2) and (3) of the Promulgation.
^[20] This is said not as an attempt to argue that there should or should not be a ‘piercing’ of any corporate veil, but moreso because the ostensible evidence before the Tribunal is that the named company was at the relevant time the registered owner of the business.
^[21] If there is to be an inquiry in relation to that issue, what would be needed is to understand the state of the Company Register as at 14 April 2015. That is, what person was recorded on that record as being the operator of the business at that time? In this regard, Counsel for the Defendant has a positive duty to clarify such confusion.
^[22] That is not to say that it is not an unreasonable account of events, only that it would seem on balance when weighed against the other evidence, less likely.
^[23] Keep in mind though there are time limits involved in prosecuting offences under the Promulgation.
^[24] This is a common recovery period for breach of contract.
^[25] A prescribed form for the recovery of such claims would greatly assist in this regard.
^[26] Strangely this issue has not arisen out of proceedings and would also have been relevant to any assessment of the respective evidence of the parties.
^[27] Had the first Complaint been brought generally on behalf of all workers to have effect beyond that time, a different legal scenario may have presented.