Our German Desk
2023 has had a turbulent start to the year. We know that many of you are affected in Northland, Coromandel and Auckland, and the scale of the devastation in Hawkes Bay and Tairawhiti is beyond comprehension. As we all know in this line of work, navigating and predicting human behaviour can be tricky, and it can be difficult to get everyone on the same page. However, the sense of community and willingness to help each other in the regions worst affected has been nothing short of sensational. We have spoken to some of you, our thoughts are with all of you, and we are so proud of the Kiwi spirit that has seen so many in the community step in and step up. People working together can really do amazing things well beyond what seems possible at the outset.
Welcome to the Team
We have some exciting news. Hesketh Henry welcomes Kirby Kleingeld to the Employment Team. Kirby studied at the University of Auckland and obtained a Bachelor of Laws and a Bachelor of Commerce double majoring in International Business and Commercial Law. Kirby joins us as a solicitor following three and a half years of practice at a boutique employment law firm in Auckland.
Bridget Perkins has joined us as a Law Graduate. Bridget summer clerked at Hesketh Henry between November 2021 and February 2022. As part of her rotation, she worked with the Employment Team. Bridget has now completed a Bachelor of Laws (Hons) and a Bachelor of Arts majoring in Politics and International Relations at the University of Auckland. We are so thrilled to have them both onboard.
Fair Pay Agreements
The Fair Pay Agreement Act 2022 came into force at the end of last year and eligible unions and employer associations have started to apply to commence bargaining. Fair Pay Agreements (“FPA”) allow eligible unions and employer associations to band together to bargain for minimum employment terms which will cover all employees in a particular occupation or industry. There are currently four FPA applications which have been submitted to the Ministry of Business, Innovation and Employment and are under assessment. Those application are in the following industries:
- Hospitality (covering accommodation, cafes, restaurants and takeaway food services [except catering], casino operations and motion picture exhibition) which was submitted on 1 December 2022;
- interurban, rural and urban bus transport (covering bus drivers, charter and tour bus drivers, passenger coach drivers and cleaners) which was submitted on 21 December 2022;
- “supermarket and grocery store” (covering supermarkets, bulk food retailing and grocery retailing) which was submitted on 23 December 2022; and
- interurban and rural bus transport (covering bus drivers, coach drivers and cleaners/refuellers) which was submitted on 30 January 2023.
We will continue to track the progress of these applications and provide relevant updates as and when they arise.
The Minimum Wage
On 8 February 2022, the Prime Minister announced that there would be a further increase to the minimum wage rates which would come into force on 1 April 2023. The minimum wages will be as follows:
- The adult minimum wage will increase from $21.20 to $22.70 an hour; and
- The training and starting-out minimum wages will both increase from $16.69 to an hourly rate of $18.16 (this continues to be 80% of the adult minimum wage).
For employers, these changes must be reflected in your payroll to ensure that you do not fall afoul of the Minimum Wage Act 1983. The minimum wage rates will undergo further review at the end of this year.
The New Zealand Income Insurance Scheme
On 20 May 2021, the Honorable Grant Robertson announced that the Government, Business New Zealand and the New Zealand Council of Trade Unions would be liaising with one another to design a Social Unemployment Insurance scheme (now referred to as the New Zealand Income Insurance Scheme [“NZIIS”]) to provide a new way of protecting workers following the loss of their employment.
On 2 February 2022, further details were released regarding the proposed NZIIS which intended to address the substantial number of workers who had been made redundant, laid off, or ceased working as a result of a health condition or disability (and therefore were unable to work, or were required to work reduced hours). The ACC administered scheme would be funded by levies on wages and salaries, with both workers and employers paying an estimated 1.39%. Those funds would be used to support eligible workers by providing them with 80% of their usual salary for up to seven months. This aims to afford those individuals with the time and financial security to look for alternative employment and engage in training or rehabilitation. Due to the work involved in getting the scheme up and running it was projected that the NZIIS would not be operational until 2024.
However, on 8 February 2023, the Prime Minister revealed that in a bid to focus on the cost-of-living crisis a raft of programs would be delayed or cancelled. One of those programs was the proposed NZIIS which was said to be “off the table” and would not proceed without substantial economic improvement. The government has stated that despite tabling the scheme it will continue to look for long-term solutions to address the inequalities once the economy has improved.
Disclaimer: The information contained in this article is current at the date of publishing and is of a general nature. It should be used as a guide only and not as a substitute for obtaining legal advice. Specific legal advice should be sought where required.
