Two main areas of dispute were the focus of the ERA hearing, including the requirement for an employee to \u201cvolunteer\u201d to work on a public holiday to be eligible for payment, and the issue of whether Christmas Day could be an otherwise working day for any employee.<\/p>\n
Lendco\u2019s payroll system required employees to \u201cvolunteer\u201d for public holiday shifts through its rostering system before those days could be considered \u201cotherwise working days\u201d.<\/p>\n
Lendco argued that because Wendy\u2019s restaurants were closed on Christmas Day, no employee could have an expectation of working that day, and therefore it was not an \u201cotherwise working day\u201d.<\/p>\n
But ERA member Jeremy Lynch rejected the arguments, and said Lendco had effectively excluded employees from their statutory entitlement to paid public holidays.<\/p>\n
\u201cUnder Lendco\u2019s approach, the only way an affected employee can get a paid day off for a public holiday, is to first volunteer to work on the public holiday and then hope they will not be rostered to work the particular public holiday. The illogical nature of this approach is obvious,\u201d Lynch said.<\/p>\n
Labour Inspectorate investigation manager Katriona Ikenasio said the ERA\u2019s ruling sends a strong signal to employers that they need to ensure they get the basics right regarding public holidays.<\/p>\n
\u201cEmployers who look for loopholes in the system to avoid their statutory obligations need to know there are consequences,\u201d Ikenasio said.<\/p>\n
\u201cFailure to comply with employment law may not only result in improvement notices \u2013 it could also lead to financial penalties and reputational damage.\u201d<\/p>\n
Lynch directed Lendco and the Labour Inspectorate to attend mediation to resolve other issues Lendco has raised relating to the improvement notice.<\/p>\n
Danielle Lendich was chief executive of Wendy’s NZ for 23 years. Photo \/ Supplied<\/p>\n
Lendich responds<\/p>\n
Danielle Lendich, daughter of Wendy\u2019s NZ founders Danny and Dianne Lendich and former chief executive of the fast-food chain, said she was disappointed by the ERA\u2019s determination.<\/p>\n
Lendich said the business had received formal sign-off from the Labour Inspector in 2020 confirming its compliance with the Holidays Act following a significant remediation process.<\/p>\n
She said the decision had wider implications for all employers. <\/p>\n
\u201cIt highlights how changing interpretations of the Holidays Act by the Labour Inspectorate can result in repeated and costly re-remediation, even for organisations that have already met the then required standards,\u201d Lendich said.<\/p>\n
\u201cOur intention has always been to provide flexibility for our people. By giving employees full control over their rosters, we believed we were offering a meaningful benefit that removed any expectation to work on public holidays \u2013 or on any particular day \u2013 unless they chose to do so.”<\/p>\n
Lendich said the determination also raised serious issues for employers operating variable roster systems across a seven-day week.<\/p>\n
That would include employers in hospitality, tourism, retail, healthcare, aged care, security and the gig economy.<\/p>\n
She said that under the interpretation, any day of the week could be classified as an \u201cotherwise working day\u201d.<\/p>\n
This could \u201cpotentially require additional payments for a sixth or even seventh day in weeks containing a public holiday, despite employees typically working only five days or less\u201d.<\/p>\n
\u201cWe question whether this outcome reflects Parliament\u2019s original intent when drafting the Holidays Act, or whether it signals a growing misalignment between the law and the realities of an increasingly diverse and flexible workforce.\u201d<\/p>\n
It\u2019s not the first time the Labour Inspectorate has dealt with Lendco.<\/p>\n
In 2015 the company was issued an improvement notice for failing to calculate alternative holidays correctly, which Lendco subsequently complied with in 2017.<\/p>\n
In 2016, Lendco entered into an enforceable undertaking for failing to provide entitlement and payment for annual holidays, both of which enforcement actions were complied with.<\/p>\n
In May 2024 Wendy\u2019s NZ was bought by American franchise operator Flynn Group<\/a> for an undisclosed sum.<\/p>\n Tom Raynel is a multimedia business journalist for the Herald, covering small business, retail and tourism.<\/p>\n