As an employer, keeping up to date with employment relations is incredibly important to your business. Not only is following the law important for your relationship with your employees, but it’s also important to your bottom line and your business’s budget. Failing to follow employment law can result in some serious fines, backpay if you’ve compensated employees incorrectly, and/or tarnishing of your company name and reputation. Employment law changes happen constantly, and it’s your responsibility to know what rights you and your employees have. To help you out, we’ve put together a list of the key updates for 2019 that you’ll need to know as an employer.
Changes to Employment Relations Amendment Act 2018
If you’re an employer with true employees rather than contractors, you’ll likely at least have an idea of the Employment Relations Act in New Zealand. Essentially, this piece of legislation keeps both you and your employees safe, and sets out the basic requirements of your relationship to your employee and vice versa. It also sets out what to do if things go wrong, like if you need a mediator to help resolve a grievance.
Big changes have come through in December 2018 to this Act, of which you should be aware of. Let’s go through the main changes as published on Employment New Zealand’s website:
- Reinstating prescribed meal and rest breaks: Prior to this change, there was no minimum rest break, which was an update in 2015. Now, employers are required to reinstate minimum rest and meal breaks, which means an employee has the right to take their break up to a minimum amount of time, depending on how long they work. The length of break time will be set again, meaning that if an employee works x amount of hours, they will be entitled to x amount of breaks in x amount of length.
- Strengthening collective bargaining and union rights: Collective bargaining is a tool that unions use to increase their employee’s wages and employment rights. With this change, unions will have more power to be able to fight for their employees, which could see employers having to dole out higher wages. Basically, the biggest change with this one is that any collective bargaining needs to actually result in something rather than just fighting with no result, which means it often will result in a positive result for the union.
- Restoring protections for vulnerable workers, such as those in the cleaning and catering Industries, regardless of the size of their employer: This one will likely only affect you if you are in these industries. If you are, you may need to look at whether your employees are true contractors now. The definition of a contractor in NZ may be changing, allowing for employees who are regular employees with regular hours to potentially be allowed more rights like a regular employee. Backpay may be owed if you’ve classified your contractors incorrectly.
- Limiting 90-day trials to business with fewer than 20 employees: This one refers to probationary periods, which allows you to dismiss an employee within the 90 day trial period with no reason, and no due process. Now, these trials will be only available to employers with less than 20 employees.
Minimum wage continues to rise as the new government has promised. With an aim to reach $20 per hour by 2021, minimum wage is set to increase again in April 2019, to $17.70. This will require employers to update their budgets to include this increase, as well as budget for the future increases.
Back in mid 2018, paid parental leave increased to 22 weeks. As we move into 2019, employers will need to update their parental leave policy to include the extra time, and ensure employees about to go out on parental leave are informed of their rights. Going forward, additional weeks will be provided, with the aim to reach 26 weeks by 2020. Make sure you keep up to date with these changes so you’re providing your employees with their full rights.
A key update for 2019 is the Domestic Violence – Victims Protection Act. Passed just this past year in July of 2018, the Act protects people affected by domestic violence, and allows them to request time off in order to deal with the domestic violence they’ve experienced. The law will come into effect in April of 2019, and as an employer you’ll want to ensure your policies are up to date and your management team aware of the changes and have a procedure in place.
Employers are required to provide up to 10 days of paid domestic violence leave, which acts similarly to sick leave or bereavement leave, in the way employees can take the leave. While this one should be obvious, it also states you cannot adversely treat an employee for being a victim of domestic violence. Finally, employers are also required to review requests from employees who wish to vary their working arrangements on a short term basis as a result of domestic violence issues. For example, if your employee wishes to change locations as a potential safety issue, you must review their request and respond to it quickly (within 10 days). You must review your business needs against the request, and carefully consider if you can accommodate the request or find an alternative arrangement that works for both you and your employee. You can find more details in the bill, here.
Keeping up to date with all of these changes may seem like a lot, but as an employer, it is your grave responsibility to make sure your employees are treated fairly and justly. We recommend using your Human Resources team wisely and collaborating to create the best possible working environment for both you as the employer, and your employees.