Employment Legislation Changes - What You Need to Know
In 2016, the Government placed a stronger emphasis on the need for greater protection of a worker’s right to a safe and balanced work environment, through a series of legislative bills such as the Health and Safety Reform Bill, the Parental Leave and Employment Production Amendment Bill (No 2), and the Employment Standards Legislation Bill. In addition to these law changes, employees are now legally entitled to a minimum wage of $15.25. This is positive news and could lead to many long term benefits. However, as an employer, how do you stay on top of all this, and oversee these implementation of new administrative guidelines? Here is a quick breakdown of four important changes you need to be aware of.
1. Individual Responsibilities Are Emphasised Under the New Health and Safety Law
One of the most important recent changes in employment law is the Health and Safety Reform Bill. This law change was developed in response to the Pike River Coal Mine tragedy, and is part of the government’s “Working Safer: a Blueprint for Health and Safety at Work" initiative. The blueprint aims to reduce workplace injury and death toll by 25% by 2020. The new law brings an increased emphasis on risk control. Employers now have more responsibility to develop health and safety guidelines, oversee the conduct of their employees, and motivate workers to engage with the model procedures.
The Bill defines three main parties: Person Conducting a Business or Undertaking (PCBU), Officers, and Workers, each of which have varying degree of responsibility to ensure safety in workplace. It is the PCBU’s duty to ensure workers are consulted about health and safety matters, while Workers are required to comply with the guidelines and ensure individual safety. Officers are individuals who can exercise influence on the business’ health and safety practices, and are required to do their due diligence and ensure that PCBUs fulfil their responsibilities. The new law abandons the previous one-size-fits-all approach in the health and safety law, and now businesses are required to do what is “reasonably practicable” for their size and level of risk. Click here to find out more.
2. Parental Leave Has Been Extended
The parental leave payment period has been extended to 18 weeks by the new Parental Leave and Employment Production Amendment Bill. The Bill also extends the benefit of parental leave to non-permanent contracts, such as temporary, casual or seasonal workers. Before the law change, parental leave was guaranteed only to adoptive parents on standard employment contracts. However, now employees who have worked for more than ten hours a week for a minimum of six months are entitled to parental leave, although conditions of the leave may vary. Now non-adoptive parents, grandparents, whāngai, or other persons who are not birth mothers can be assigned as a primary carer of the new born child, and are therefore eligible for parental leave.
The new legislation also introduces “keeping-in-touch days,” which can commence 28 days into the paid leave, and allow employers to arrange up to 40 hours of work or training. Constructive use of keeping-in-touch-days may ease the employee’s transition back to the workplace, and minimise the loss of productivity suffered by the business while high performing employees are on leave.
3. Zero Hour Contracts Are Addressed
The Employment Standard Legislation Bill aims to ensure that all jobs will provide a reasonable level of security. Zero hour contracts have been an increasing concern in New Zealand, as more and more employees have complained that they were fighting for hours. Under the new legislation, the employment agreement must state the hours of work, including details about the duration of the shift, the start and finish time, and the days of the week.
If there is a need for flexible arrangement of shifts, that must be stated in the contract as well, with a clear indication that both the employer and the employee are aware of the provision and fully agree to its terms. However, employees are not obliged to work additional hours, and may decline any shifts that are not promised in the contract. Employers are now also required to provide reasonable notice before cancelling a shift. If you were unable to notify the employee well beforehand, then you must provide sufficient compensation for the employee.
4. Increase in Minimum Wage
On 1 April 2016, the adult minimum wage was raised to $15.25 an hour, with the starting-out and training wage increasing to $12.20. The Minimum Wage Review 2015 provides a comprehensive background on the Government’s decision. Although the increase in minimum wage has the most direct impact on entry-level jobs, pay equity should be taken into consideration as well. Senior employees may expect a proportional increase in pay as well, so this change may have an indirect impact on your business even if you do not hire many entry-level workers.
While workers who are paid better are likely to be more engaged and loyal, if you keep a large workforce, or lack flexibility to meet the change in your budget, then the increase in minimum wage may call for a serious brainstorming session. With additional costs, you’ll want to ensure that you get additional value from your workforce. Involve your team where possible in the serious brainstorming session. For example, you may be able to save overtime payments through implementation of new processes and more efficient ways of doing things.
Summary
New legislation is definitely a step in the right direction, designed to initiate better working relationships based on mutual trust. Stay informed about what it means for you, and how it affects you and your business, and you will gain a competitive advantage. If you’re looking for more information on how these changes might affect your recruitment strategy, feel free to get in touch with us today.