Court Win for Leavers and a Court Loss for the Labour Inspectorate and Gloriavale. The Time Bar Issue
Quick Overview
In the ongoing Employment Court sage between Gloriavale Leavers, Gloriavale and the Labour Inspectorate, the judgment on 28 May 2026 delivered an important win for former Gloriavale members seeking compensation for years of unpaid work. Chief Judge Inglis ruled that the leavers were within time to bring their claims and she offered an opportunity to hear their personal grievance claims, even though the limitation period had passed.
But in the same breath, this judgement delivered a loss for the Labour Inspectorate that might impact other current and former members of Gloriavale. Judge Inglis ruled that the Labour Inspectorate were out of time to assist the plaintiffs in receiving their compensation from Gloriavale and out of time to pursue Gloriavale for penalties for worker exploitation.
Keep reading to find out why the judge seems upset at the Labour Inspectorate and how this may end up in a change of direction for how other leavers will pursue their wage claims.
Background Summary:
Since 2022 the Courage and Pilgrim cases have been heading through the Employment Court, charting a course for other leavers to pursue wage arrears and other employment-related claims should they desire. There have been many judgments along the way including a declaration of employee, employee determination, jurisdiction arguments, and now time-bar issues. (There are still more to come – namely appeals and quantum rulings). (ADD LINKS)
After the declaration in 2023 that the Overseeing Shepherd and/or his office was the employer, the Labour Inspectorate wanted to enforce the decision in Gloriavale. This meant they set about to ensure Gloriavale understood its obligations to be a good employer. In return Gloriavale had no choice but to begin the process, (unwillingly), to migrate their workers to self-employed contracts and some classic employment arrangements).
Within 90 days of the employer ruling, the Labour Inspectorate also brought proceedings against Gloriavale, with a desire to pursue penalties from them (ie fine them for exploitation), and to assist the nine former members to receive their money back from Gloriavale.
However, in NZ there are time limitations outlining how long you can leave a complaint before acting on it. Gloriavale claimed both the leavers and the Labour Inspectorate were out of time for most of their claims.
Time Limitations
- Pecurinary penalties (ie for the Labour Inspectorate to fine Gloriavale): 12 months from the time the breach “first became known” or the date it “should reasonably have become known” to one.
- Wage arrears: six years “after the course of action arose”
- Personal Grievance: 90 days, or 12 months for sexual harassment
Ordinarily under Section 142 of the Act, former members would only be able to seek wage arrears for six years previously. Some of them had left Gloriavale a few years earlier, meaning they might only receive 1-2 years worth of wages. They wanted to the judge to waive the Time Bar given their exceptional circumstances so they could recover everything from age six (males) and age 12 (females).
The Time Limitation argument was heard in November 2025 over a two-day hearing.
What did the judge think about the Leavers? Were they out of time?
Gloriavale argued the leavers were out of time to claim wage arrears from six (males) and 12 years of age (females). The Court disagreed with Gloriavale stating,
“the limitation period clock would not have started ticking until they were free from the disabling restrictions imposed by the leadership and What We Believe.”
She said Gloriavale’s proposition would logically lead to a situation where, “An employer could, for example, escape liability for maintaining an exploitative work environment simply because the exploitation was successful enough to keep the employee ignorant of it for at least six years.”
The clock could not simply start while they were inside Gloriavale
This is probably the most important part of the judgment. The Court recognised the reality of the environment these workers were living in. She stated,
“The psychological subordination and the strict control of information within the Community meant that, so long as the plaintiffs remained there, they were effectively prevented from understanding the material facts required to bring a claim”
“It is divorced from reality to expect them to have the necessary frame of reference to even contemplate an employment relationship.”
“any inquiry as to ‘reasonable discoverability’ would need to account for the time required to deconstruct a lifetime of indoctrination”
The judge was right. Former members did not have ordinary access to legal information or understand that the work they were doing could give rise to employment rights. And they were living within a system where complaining to outside authorities was simply not a realistic option.
The Court found that the circumstances within Gloriavale prevented the workers from understanding the facts they needed and the opportunity necessary, to bring a claim. She stated,
“Can a six-year-old who is in an employment relationship reasonably be expected to prepare and lodge an application for wage arrears and holiday pay, or for a declaration of employment status and pay the prescribed fee?”
She determined that the six-year clock therefore did not necessarily start running when the work was performed, but she applied the principle of reasonable discoverability – essentially asking when each person was realistically in a position to know the material facts necessary to bring their claim.
For these workers, that was sometime after they left Gloriavale. For this collection of plaintiffs all of them filed proceedings within less than five years of leaving, and so she affirmed their wage claims would be upheld.
Interestingly the judge made a point of noting that even if the plaintiffs were found by her court to be out-of-time, she noted the provision in law to waive the time bar in “exceptional circumstances”. (She made a point to saying that unusual circumstances includes “unusual, outside the common run”, and specifically notes that the ages of the plaintiffs and the uniquely prohibitive circumstances in the Gloriavale community may be relevant.)
To sum it up, the judge commented that,
“It is not attractive to come to the conclusion that the Pilgrim and Courage plaintiffs ought reasonably to have discovered that they had a claim, when the government agency responsible for enforcing employment standards came to the opposite conclusion.”
Which brings us to the Labour Inspectorate
There is an extraordinary contrast in the judgment.
In 2024 the Labour Inspectorate, having understood and accepted the earlier Employment Court rulings, filed in support of the plaintiffs claims for compensation, and sued Gloriavale for the wage arrears and penalties.
Gloriavale also claimed the Labour Inspectorate were out of time to bring these orders (12 months for penalties and 6 years for wage claims).
And the judge agreed with Gloriavale. She did not show the Labour Inspectorate any grace and denied their requests and dismissed their claims saying,
“The Labour Inspector can[not] simply wait for an employee to bring their own status claim and then piggy-back on that finding.”
You can interpret that as the judge being unimpressed that these exploited workers had to bring their own case to the Employment Court to be resolved, when it should have been the Labour Inspectorate’s job.
The Chief Judge’s unhappiness with the Labour Inspectorate continued.
She noted that they had investigated Gloriavale years earlier and in its own 2017 report it recorded the long hours people were working without pay. Although the Inspectorate [wrongly] concluded they were not employees, the report stated that if they were employees there would be serious breaches of employment standards.
Accordingly, the judge determined that their clock started from 2017 – when they should have reasonably known there was worker exploitation. Their proceedings were not filed until September 2024. She said they were too late and dismissed all of the Labour Inspectorate’s claims.
And importantly, the Judge noted that even if there had been discretion to extend the limitation period, the Inspectorate’s failure to bring proceedings within a year of the Court’s 2022 employee-status judgment would have weighed significantly against allowing an extension.
What happens now?
After years of litigation, former Gloriavale workers will not be prevented from pursuing their historic wage claims simply because the exploitation happened a long time ago. The plaintiffs can advance their wage and holiday pay claims through her court.
The Judge invited them to bring their personal grievance claims to court (since they had also fallen outside the usual 90-day limitation period).
Moving forwards, now that the time bar issues are mostly settled, the plaintiffs are awaiting a hearing to determine how much compensation they will ultimately receive.
The Court has recognised something that should perhaps have been obvious from the beginning:
You cannot reasonably expect people living inside a closed and controlling community to enforce rights they did not know they had, through legal systems they could not freely access.
Unexpected Roadblocks
Looking more broadly though there is a concern that the ruling might paralyse the Labour Inspectorate from further action in assisting others leavers and current members receiving compensation. Have their hands been tied?
The judge said the Labour Inspectorate had constructive knowledge, although not necessarily actual knowledge that an employment relationship existed.
In other words, they could see with their own eyes that work was occurring in Gloriavale, but because they decided it wasn’t an employment relationship, it fell outside their jurisdiction to take action. [A reminder for our readers – the Labour Inspectorate should have taken this case to court in order to seek clarity about whether an employment relationship existed. If they did this the whole saga would not have had to be dragged through the courts by the former members themselves].
*Update* What did the Labour Inspectorate have to say?
After the judgment We sent an email to the Labour Inspectorate asking how this ruling might affect their ability to act in the Gloriavale space moving forwards. They came back to us (presumably after legal advice) and indicated they too had many questions and could not determine with clarity where they stood moving forwards with other leavers’ claims. [It had been leavers’ hopes that after the Courage and Pilgrim cases were completed, that the Labour Inspectorate would be able to work on behalf of the rest of the leavers to advance their claims for wage arrears. This ruling appears to cut off that pathway.]
The Labour Inspectorate informed us they had appealed the ruling.
Gloriavale as also appealed the ruling – but for different reasons. One can only presume they are happy the Labour Inspectorate is not allowed to pursue them for penalties. But unhappy they will need to pay the young men back pay from 6 years and the ladies from 12 years.
Where to for the other leavers (not the 9 plaintiffs)?
With the lack of clarity regarding future pathways for wage compensation, the leavers’ legal team have kindly stepped up and are assisting leavers to lodge claims through the Employment Relations Authority, instead of relying on the Labour Inspectorate to do this work for them. These will be lodged by 26 August 2026.
This will be NZ’s biggest wage claim in history – and possibly an international first.
There is still a long road ahead.
Other blog posts of interest: Time Bar hearing Day 1 (Leavers Lawyer Brian Henry), Day 2 Gloriavale’s arguments, Day 3 Mr Kirkness (judge counsel assist) and summary from Brian Henry
News Coverage of the Time Bar issue and court ruling:
Stuff article: https://www.stuff.co.nz/nz-news/360989611/state-watchdog-slammed-judge-waiting-too-long-act-gloriavale-abuses