Courage v Attorney-General [2026] NZEmpC 178 - Labour Inspectorate Gloriavale decisions contained reviewable errors

Former members of the Gloriavale Community successfully challenged Labour Inspectorate decisions concerning inquiries undertaken in 2017 and 2021. The Employment Court found multiple reviewable errors, including a misunderstanding of the threshold for the Inspectorate to investigate whether employment relationships existed and a failure to address the position of child workers.

Earlier Labour Inspectorate inquiries

Concerns about work within the Gloriavale Community had been raised with the Labour Inspectorate, including by Charities Services in 2017. The Inspectorate undertook inquiries into whether people performing work were employees and therefore within its employment-standards jurisdiction.

A later inquiry followed further public concerns about working conditions and long hours. Former members challenged the Inspectorate's decisions to take no further action.

The investigation threshold was misunderstood

One of the central errors concerned the Inspectorate's understanding of its jurisdiction. The Court held that a Labour Inspector did not need to establish, on the balance of probabilities, that an employment relationship existed before making further inquiries.

Treating proof of employee status as a threshold to investigation risked making effective investigation impossible. The Inspectorate's statutory role allowed it to inquire into the facts necessary to determine whether employment standards might apply.

Child workers had to be considered

The Court was particularly critical of the omission of children and child workers from the scope of the inquiry. Given what the Inspectorate knew about the Community and the vulnerability of children, the position of children was a mandatory relevant consideration.

The failure to investigate that aspect was found irrational and manifestly unreasonable. The seriousness of the allegations, including potential fundamental-rights and child-labour issues, justified anxious judicial scrutiny of the regulator's decision-making.

Disruption to the Community was irrelevant

The Inspectorate had taken into account the risk that further investigation could disrupt the Community. The Court held that this was not a lawful reason to avoid the statutory inquiry.

The Court also found failures to make further inquiries relevant to worker status and unfairness in closing the inquiry without seeking further comment from people who had left the Community. Taken together, the errors meant the challenged decisions could not stand unaffected.

Remedies were not decided in this judgment

The judicial-review application succeeded and reviewable errors were established. The Court did not, in this judgment, finally determine what remedial orders should follow. Remedies were left to be addressed at a reconvened hearing.

That procedural posture matters. The judgment is authority about the lawfulness of the Inspectorate's investigative decisions, not a substitute for a substantive employee-status trial involving every affected worker.

Why this case matters

Courage is important because employment-status questions can determine whether minimum employment standards are practically enforceable. The Court made clear that a regulator cannot require the very conclusion an investigation is meant to test before deciding whether to investigate. The judgment is also a significant public-law employment decision on child labour, mandatory considerations and the intensity of review where fundamental rights are engaged.

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Source: Employment Court judgment and related public material.