Posted on: Jan 11, 2013
Compensation for the loss of the benefit of an employer’s contribution to an employee’s KiwiSaver account can be claimed but the Employment Relations Authority does not have jurisdiction to order an employer to make KiwiSaver contributions to an employee’s fund. That being the case, when an employer fails to make the required KiwiSaver contribution, employees should bring a personal grievance against the employer and claim a remedy for loss of a benefit rather than ask the Authority to order the employer to make the payment.
In McAlister v Hadley Francis Ltd [2012] NZERA Christchurch 143, an ex-employee alleged that his employer had failed to pay employer contributions to Inland Revenue in respect of the employee’s KiwiSaver account and asked the Authority to order the employer to pay him the amount in question. The Authority said that the employee was clearly entitled to the sum he sought but that the Authority had no power to make an order in relation to KiwiSaver at all. It said the employee’s redress lay under the KiwiSaver Act 2006 and the Tax Administration Act 1994. However, in Benge v Canterbury Language College Ltd t/a Canterbury College Ltd [2012] NZERA Christchurch 141, an employee who had been awarded four months’ lost wages claimed that she had also lost holiday pay for that four-month period and her KiwiSaver employer contribution. She said they were benefits she could reasonably have expected to have obtained if her grievance had not arisen. The Authority agreed with her and quantified the leave benefit lost by multiplying the four months’ lost wages by 8% and the KiwiSaver benefit lost by multiplying the four months’ lost wages by 2%.
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