Former director not found personally liable for a liquidated company's unpaid wages

An employee of a new business claimed unpaid wages, holiday pay and KiwiSaver contributions. The company went into liquidation after the investigation meeting, so the claim could not continue against it without the liquidator's consent or a High Court order. The employee instead sought the arrears from a former director under s 142Y, which the Authority treated as requiring three things: a default in payment, a breach of employment standards, and that the director was involved in the breach under s 142W.

The Authority found the first two made out: $725.88 gross for a first week in which 62 hours were worked and 20.74 were paid, and $289.45 of holiday pay. The third was not. Applying the Court of Appeal in [2021] NZCA 705, the Authority required evidence that the director knew the essential facts. Payroll and records sat with another director, and there was no evidence he knew of the shortfall. The s 142Y claim failed and costs lay where they fell.

What role, if any, does the allocation of duties between a company's directors play in the Authority's assessment of a director's involvement?

[2026] NZERA 704