26.10.2012

Public Sector Changes – Protection, Control and Redundancy

The State Sector and Public Finance Reform Bill was introduced to Parliament in late August, and is currently awaiting its first reading.

The government has introduced a Bill to change aspects of employment law for public sector employees.  Some commentators have remarked that the Bill ‘sets off the snooze button’, while others believe it makes significant changes.  While not necessarily a particularly exciting topic, the Bill does seek to implement several changes that public sector employers and employees should be aware of.

The State Sector and Public Finance Reform Bill was introduced to Parliament in late August, and is currently awaiting its first reading.  The Bill, if passed, will amend the State Sector Act 1988, the Public Finance Act 1989, and the Crown Entities Act 2004.  Essentially, the Bill fits in with the government’s policy of streamlining the state sector to deliver better public services by making it easier for government departments and other agencies to work together.

A portion of the Bill would amend the State Sector Act 1998, the primary piece of legislation that sets out how the state sector operates and promotes responsible management and integrity.

The proposed amendments to the State Sector Act 1988, according to the explanatory note that accompanies the Bill, would:

  • Strengthen the role of the State Service Commissioner to lead state services;
  • Extend the responsibilities of chief executives of government departments so that they must consider the collective interests of government when making a decision; and
  • Create “departmental agencies” to sit within a larger government department.  The idea behind the creation of such agencies is to reduce fragmentation in state services and absorb functions carried out by separate agencies.

Although not one of the more public changes, the Bill also proposes to clarify the immunity that public service chief executives and employees have from civil proceedings, provided that their actions (or omissions) were in good faith and occurred while they were pursuing their duties, functions, or powers.  In practice, this will be one of the more important amendments to public sector employees, as the relationship between this immunity and the Crown Proceedings Act 1950 had become somewhat complex following the decision of the Supreme Court in Couch v Attorney General.

The Bill introduces the term “key position” to the State Sector Act 1988.  Should the Bill pass, then the State Services Commissioner would have the power to designate a position as a key position.  This would be done on the basis that the position is critical to the public service, or, alternatively, because of the position’s potential to develop senior leaders in the state sector.  If a position is designated a “key position”, then employees can only be appointed to that position with the agreement of the State Services Commissioner.

The Bill also introduces the concept of “ministerial staff” to the State Sector Act 1988.  Ministerial staff are defined as employees (this includes acting, temporary, or casual employees) of a government department who are employed on events-based employment agreements to work directly for a Minister, as opposed to for a department.  If a particular event occurs, the employment of these employees can be terminated.  An example in the Bill of an event giving rise to termination is where the particular Minister no longer holds that particular ministerial portfolio.  In essence, ministerial staff would be fixed-term employees.

The Bill also proposes to make changes to provisions relating to redundancy payments where an employee is offered another position within the state sector.  At present, the State Sector Act 1988 gives chief executives certain powers to transfer employees within or between departments (subject, of course, to the terms of the employee’s employment agreement) where they are surplus to requirements, provided that:

  • The chief executive consults with the affected employee before any transfer appointment is made; and
  • The employee is not subject to conditions of employment any less favourable than their old position.

Many state sector employment agreements provide for redundancy compensation when such a transfer occurs.  Under the proposed amendments in the Bill, an employee will no longer be entitled to a redundancy payment where, before their employment has ended, they:

  • Are offered and accepts another position in the state sector (which includes government departments, Crown entities, and Crown companies); or
  • Are offered an alternative position in the state sector with comparable duties and responsibilities to their current position, the alternative position is in the same general locality (or within reasonable commuting distance), and on terms and conditions of employment no less favourable overall, and is treated as if it were continuous service.

If you have any questions regarding these issues email us on employmentnews@heskethhenry.co.nz or call us on (09) 375 8699.

Do you need expert legal advice?
Contact the expert team at Hesketh Henry.
Kerry
Media contact - Kerry Browne
Please contact Kerry with any media enquiries and with any questions related to marketing or sponsorships on +64 9 375 8747 or via email.

Related Articles / Insights & Opinion

Mind your business: What happens when an employer uses an employee’s personal information?
A recent decision by the Human Rights Review Tribunal (the Tribunal) provides a noteworthy reminder of the importance of privacy rights and obligations in the workplace.  In BMN v Stonewood Group Lim...
14.02.2025 Posted in Employment
Construction Framework Wide BW
Public consultation on NZS 3916:2025 and NZS 3917:2025
Public consultation on the draft DZ 3916 Conditions of contract for building and civil engineering – Design and construct and DZ 3917 Conditions of contract for building and civil engineering – F...
13.02.2025 Posted in Construction
Court of Appeal rules Gloriavale’s challenges to BNZ decision to close its account are not seriously arguable
Background BNZ made the decision to close the accounts of 16 entities associated with the Gloriavale Christian Community following a decision by senior management that this action was appropriate give...
07.02.2025 Posted in Disputes & Insurance
Milford sound
Government unveils ‘Invest New Zealand’ agency to position NZ as premier FDI destination
Yesterday, the Prime Minister Rt Hon Christopher Luxon announced the Government’s plan to establish a new foreign investment agency, as part of his ‘State of the Nation’ speech in Auckland.  We...
Construction Framework Wide BW
Construction insurance cover: Sky UK Ltd v Riverstone Managing Agency Ltd
Parties to a building contract usually take out insurance to protect the contract works from damage from unintended events such as vandalism or a flood.  The policy is intended to cover the cost of r...
23.01.2025 Posted in Construction & Insurance
Family sunset BW
Have you updated your Will since becoming a parent? The importance of nominating a Testamentary Guardian
For parents, preparing a Will or Deed that appoints a testamentary guardian is an important step to ensure the well-being of your children if you die. A testamentary guardian is a person who after a p...
22.01.2025 Posted in Private Wealth
vecteezy calendar and santa on table happy new year and xmas concept  ext e
Let me check my calen-deer – Leave entitlements over the festive period
What you need to know about holiday and leave entitlements over the festive season
18.12.2024 Posted in Employment
SEND AN ENQUIRY
Send us an enquiry

For expert legal advice, please complete the form below or call us on (09) 375 8700.