Employment Law: the only constant is change…

It’s a New Year, a new(ish) Government… so it must be time for some new employment law! The Coalition Government managed to reach an agreed, compromise position between its partners on proposed changes to the Employment Relations Act 2000 (Act).

The Minister of Workplace Relations and Safety issued a press release and attached Employment Relations Amendment Bill Summary (Summary) yesterday (25 January 2018). This has given an indication of the first set of changes, and the proposed legislation is expected to have its first reading in the first week of February, followed by a select committee process.

So what do we know so far? The changes to be incorporated in the new amendments outlined in the Summary are:

Rights for employees

• Restoration of statutory rest and meal breaks. These will be subject to a very limited exception for workers in essential services who cannot be replaced.
• Restriction of 90 day trial periods to small medium enterprises (SME) employers (fewer than 20 employees). This is said to balance the insecurity of workers caused by 90 day trial periods, against potential barriers to hiring for small businesses.
• Reinstatement will be restored as the primary remedy for an unjustified dismissal. This remedy was initially prioritised under the Act before its status was reduced under the previous Government.
• Further protections for employees in the “vulnerable industries” identified in the Act. These changes repeal the SME exemption from coverage, provide more time for employees to decide whether to transfer to a new employer, and provide greater safeguards on transfer of inaccurate information.

Collective bargaining and union rights

• Restoration of the duty to conclude bargaining unless there is a good reason not to. This is complemented by repeal of the process to have bargaining declared over.
• Restoration of the earlier initiation timeframes for unions in collective bargaining.
• Removal of the Multi Employer Collective Agreement (MECA) opt out option where employers can refuse to bargain for a multi-employer Collective Agreement.
• Restoration of the 30 day rule where for the first 30 days new employees must be employed under terms consistent with the Collective Agreement.
• Repeal of partial strike pay deductions where employers can garnish wages for low level industrial action. The Press Release noted that employers have deducted pay for actions such as wearing t-shirts instead of uniforms.
• Restoration of union access without prior employer consent. Union access will still be subject to requirements to access at reasonable times, and places having regarding to business continuity, health and safety.

New proposals are:

• A requirement to include pay rates in Collective Agreements. Pay rates may include pay ranges or methods of calculation.
• A requirement for employers to provide reasonable paid time for union delegates to represent other workers (for example in collective bargaining).
• A requirement for employers to pass on information about unions in the workplace to prospective employees along with a form for the employee to indicate whether they want to be a member.
• Greater protections against discrimination for union members including an extension of the 12 month threshold to 18 months relating to discrimination based on union activities and new protections against discrimination on the basis of being a union member.

You may view the Employment Relations Amendment Bill Summary by clicking here.

So what does all this mean for your business?

Well, if you have a Collective Agreement, its back to the 30 day rule (or something like it) where new employees must be employed on the terms and conditions of the Collective Agreement.

Depending on your current practice, there may be a few changes to the way you allow a union to access the workplace, and the way you bargain. If a union wants to bargain for a multi-employer Collective Agreement, you’re not going to be able to opt out.

If your Collective Agreements do not have pay rates they will need to include these.

If you have fewer than 20 employees, you should be able to continue using your trial period. If not, you’re going to need to delete any trial period provision from your employment agreements. We can help with drafting you a probationary period instead.

Depending on exactly how the new legislation reads, you may also need to make some changes to provisions about rest and meal breaks.

What do you do now?

As always, the devil is in the detail. We recommend that you ‘hold fire’ for now, until we see the exact form of the new legislation, and when it is to take effect. It is likely that at the point that the legislation comes into effect, Collective Agreements that do not include wage rates will be in force, and there will be partly complete 90 day trial periods. We anticipate that there will be transition provisions in some form.

We’ll keep you updated as more information comes to hand, but if you have any questions in the meantime, please don’t hesitate to give us a call 09 375 8700 or email employment@heskethhenry.co.nz