This month in law we’ll review the latest breaches in employment law (because there’s always at least one!), look into some crackdowns around the country, and review the Employment Relations Amendment Act that comes into effect this year.

Holiday Act Breaches

Unfortunately, we can’t go a month without some company or business breaching employment law. The good thing about this, however, is that we always have something to learn from these breaches as well as it being a warning for other companies thinking about taking a shortcut or a cheaper way out. Let’s review this latest breach of the Holiday Act 2003 and look into some ways that companies can avoid these costly breaches.

A restaurant owner in Auckland, New Zealand, will be paying a fine of $5,000 NZD due to breaching the Holiday Act by poor record keeping and paying time and a half on public holidays. Part of the reason for this fine was because the owner had already been audited by the Labour Inspectorate, and had been given an improvement notice. This is a notice given to employers to allow them some time to fix their records or wage errors and to avoid a fine. Unfortunately, this business owner did not do enough, and was fined. An important takeaway from this lesson is that many employers, especially small business owners, might try and sell the business or switch ownership when given an improvement notice, and this will not fix the problem. We’ll now look into some ways to avoid these fines.

  • Improvement Notices: As we’ve just seen, if your company is given one of these, you must comply or risk being heavily fined. Besides the fine, damage to your business’s reputation is at stake, as well as the trust and respect of your staff. Make sure to follow the notice’s recommendation fully and make every effort to correct the issues. You can find more about how non-compliance of the Holiday Act is addressed, here.
  • Paying Holiday Pay: For many restaurants and other service industries, you may have employees working on Public Holidays. If your employees are not working the holiday, you will likely either owe them their relevant daily pay or average daily pay, and you can find more information about those here. If you are having employees work on the holiday, they must receive time and a half pay, as well as an alternative holiday if it’s a day the employee normally works.

Orchards getting the Employment Law Crackdown

Orchards in New Zealand are almost as common as the number of sheep in the fields. Okay, so maybe not that common, but there are plenty of the spotted around the country! Unfortunately with many orchards (but not all), there has been a history of issues with worker exploitation. Many young people come to New Zealand on a Working Holiday Visa and are unaware of their employment rights or are looking for quick and simple work. They either simply don’t care that their rights are not being met, are unaware, or don’t want to put up a fight about them.

For these reasons, the Labour Inspectorate often visits and inspects orchards around the country to ensure they are keeping accurate records and providing employees with correct entitlements. In early May, the Bay of Plenty orchards were visited, while others may be visited later in the year. These visits are often random and no warning is given to the site to prepare for the visit. Serious breaches of employment law can see a fine up to $100,000 for the entire company, so it’s vital that all businesses take a deep look into their pay, holidays and record keeping to ensure they are within the law.

One of the best ways to ensure that companies are complying with employment standards is to keep accurate records. This way, if you are visited or audited, you already have the records showing that you have paid correctly and have appropriate staff records on file. If there is an issue, it will be easier to remedy if you already have the records. Here is some important information about keeping employee records.

Employment Relations Amendment Act 2018 enacted

The Employment Relations Amendment Act 2018 was passed into law back in December of 2018, but it is only just now become effective in May. The biggest changes that come with this amendment are greater protections for vulnerable workers, as well as making collective bargaining and union rights stronger. Let’s look into what this means for employers.

If you have a unionised workforce:

  • You may need to allow union representatives into the workplace without consent if your employees are covered under a collective bargain. Naturally, a union representative still cannot disturb the peace by entering a restricted zone, such as a dangerous construction area, or come before or after normal operating hours.
  • You’ll need to pay union delegates for their time spent doing union activities. You can deny time off if it’s unreasonable for the business, but you’ll need to have a good business reason as to why you’re denying the time, as well as providing alternate times.
  • Agreements must be reached for collective bargaining. There are reasonable grounds to not reach an agreement, but you must be able to prove this.  

If you employ vulnerable workers (i.e. cleaning or catering types of businesses):

  • These workers are entitled to transfer over their same terms and conditions if the company gets restructured or transferred.

Other changes:

    • Meal and rest breaks are set based on number of hours worked. The law sets down set times for the breaks to be taken which must be followed unless you and the employee agree to alternate times.

This list is certainly not exhaustive, so please make sure that you look into the Amendment Act to see if any other changes apply to you. A full list of the changes, including important details, can be found here.

We hope this article has provided you with the most important updates in law for this month, and that you’ll be better prepared for any upcoming audits or additional employment law changes.

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