Dundas Street Employment Lawyers – The untimely demise of the CallActive call centre has placed its former employees in an unenviable position. Opened in 2013 with the promise of providing employment to up to 2,000 people, CallActive was seen as an opportunity for Wellington to reverse a recent spate of employers leaving the city for Auckland.
These hopes appear to have been dashed with the announcement of liquidators being brought in and staff being told to pack up and leave.
This has left 60 people without jobs before Christmas. To make matters worse, workers have reportedly been told that their notice and holiday pay entitlements might not be paid out as there may not be enough money to go round. Some employees reportedly took matters into their own hands by removing computers and other office items as they left the premises for the last time.
What to do?
So what are the rights of workers left out of pocket? When a company is placed into liquidation, a process of settling its outstanding debts kicks into action. A liquidator is appointed to gather together any available money and assets, and then distribute these proceeds amongst creditors.
The law sets out who gets preference – at the top of the list are secured creditors, then come preferential creditors including the liquidator, followed only then by employees. Unsecured creditors get to fight over what’s left after that, if anything.
Employees left out of pocket therefore must lodge their claim with the liquidator and hope that there is something left for them after the banks and others have taken what they are owed. There is no guarantee that there will be money left to pay these people who are in the most vulnerable position.
Despite what may have occurred at CallActive, the law does not allow workers to take their employer’s property to offset their losses. Removing an employer’s property runs the risk of a Police investigation and possible theft charges.
Little Known Legislation
There is a little-known piece of legislation called the Wages Protection and Contractors’ Liens Act Repeal Act 1987, which allows someone who has been working on a chattel owned by another party to auction it and keep the proceeds if payment for the work has not been received within two months of falling due. While this may apply to situations where you send an appliance away for repair and never pick it up, it doesn’t apply to the former CallActive workers.
Certain industries have special processes in law available to them. Seafarers can seek a lien (a legal interest in someone else’s property) over the ship they have been working on where the ship’s owners or operators have not paid what is owed. The seafarer applies to the High Court for an order seeking the seizure of the ship until such time as the wages owed have been paid. The ship can even be sold by the Court so as to meet the employee’s outstanding pay claims.
Unfortunately this does not help the now unemployed call centre workers at CallActive. They cannot claim some form of lien over their former employer’s property, and reports suggest that their former employer is already considering involving the Police. Whether, as preferential creditors, they will see their outstanding wages and holiday pay remains to be seen.
This situation raises the question as to whether the most vulnerable creditors, the now-unemployed workers, should be given greater preference by the law to any money left over as a result of the company going under. Unlike seafarers who enjoy special rights, the CallActive workers unfortunately may be left all at sea.
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