Records, Evidence, Powers & Offences: Evidence; consideration and clarification of contracts
The legislation that applies to this page is as follows:
* National Minimum Wage Act 1998, sections 9 and 14
During the course of an investigation it is necessary for a NMW Officer to consider the nature of the arrangements entered into by the employer and worker(s). Such arrangements may form part of the contractual arrangements between the parties and an understanding of those arrangements may assist in forming a view on, for example:
- Whether a person is a worker (NMWM04000)
- Type of work (NMWM07000)
- The planned/actual working hours (NMWM08000)
- Pay and deductions (NMWM09000, NMWM10000 and NMWM11000).
Contracts (NMWM04030) can be written, verbal or implied and may not always accurately reflect the actual working arrangements in place. It is therefore important that the NMW Officer checks the arrangements and understanding between all the parties of the contract.
In cases where non-compliance is identified and enforcement action may be required it is appropriate to retain copies of any contracts and documentation obtained during the investigation. Where employers are unable to provide copies of required records the NMW Officer has the power to remove the records from the employer in order to copy them. Records should be returned as soon as possible. (NMWM12210).
Where any of the documentation obtained is inconsistent with other documents or reported arrangements the NMW Officer should obtain explanations regarding the discrepancy from all the parties to the arrangement before considering and forming an opinion on the evidence.
Written contracts and associated documents are a good starting point for understanding the arrangements between parties however it is entirely possible that the contract may have been varied by what actually has taken place. For example, an employer may provide a contract for a worker to work in a shop for 20 hours per week but they actually work 40 hours a week. For national minimum wage purposes the additional hours will be considered to be time worked under the contract.
Where there are no written contracts or documents the NMW Officer will need the details of the arrangements by speaking to both the employer and worker(s) to;
- establish each party’s own understanding of the contractual arrangements in place, and
- determine whether the understanding of the arrangements are consistent and reflect what actually happens in practice.