New law requires accurate records of hours worked and reduces flexibility in working hours. Plus onerous penalties can be imposed.
The Employment Standards Legislation is on its way through, with only a few amendments of note. You can expect it to be applicable from 4 April. So employment agreements signed from then on must meet the new standards. Employment agreements you already have in existence will need updating within 12 months. So what are some of the main implications for you?
Minimum Employment Standards are defined as compliance with:
- the Minimum Wage Act
- the Wages Protection Act and
- provision of (and records to track) minimum holiday entitlements under the Holidays Act.
Employment Standards are broader and include compliance with various sections of the Employment Relations Act and the Equal Pay Act.
It is compliance with the minimums that the legislation is most focused on and they have significantly ramped up their ability to enforce them and inflict penalties if they are breached. Specifically breaches can now result in personal fines up to $50,000 and corporate fines up to $100,000 and personal bans from being an employer for up to 10 years.
Do you record exact hours worked by all staff? To show compliance with Minimum Wages you must record the number of hours each employee has worked. Where salaried employees work usual hours (be that standard hours per an agreement or roster) that is sufficient – but the documents must be available to back them up, and must be readily available to a Labour Inspector or the employee. Simply employing someone on a weekly or fortnightly salary, and telling them to work whatever hours are necessary to get the work done, will now be in breach.
Do you need staff to be available to work just when they are needed? You will also not be able to have agreements with staff whereby they have to be available to work, but you do not guarantee them reasonable hours. In the same way as applies to having staff on call, you will need to make a reasonable payment to anyone you require to be available for work. And these details must be in the employment agreement. Employment agreements will need to be carefully worded to ensure you maintain flexibility in the workforce without being in breach. You may also not discriminate against someone who refuse work in this sort of set up.
Do you sometimes need to cancel shifts at short notice? The law now means you may have to pay reasonable compensation for this; and in situations where they don’t get notification before the shift starts you will have to pay them for the full shift. You may have to alter how you schedule rosters. And the details of how this works must be included in your employment agreements.
Do you want to restrict staff from taking other jobs? It will now be a legal requirement to include the genuine reasons and reasonable grounds for such restrictions in your employment agreements.
More people have access to Parental Leave rights. Parental leave is now called “Primary Carer Leave” and has been extended to anyone who has prime responsibility for the child. So people other than the parents may now become entitled to this leave. Imagine a young lass who was out of work and has a baby and then arranges for her mother to take prime responsibility for care. Her mother than becomes entitled to the paid parental leave (PPL) and to primary carer leave – so you could find yourself with someone taking 12 months off quite unexpectedly.
Paid parental leave has been extended to 18 weeks and even more if the baby is pre-term. But note that this doesn’t affect their leave entitlement and the criteria for leave and for PPL are different.
If you are self-employed you will now have an entitlement to PPL, based on your last 26 or 52 weeks’ income.
Do you find it frustrating that you cannot involve someone on parental leave until they’ve finished their PPL? Keeping in touch hours have also been introduced so that, after the first 4 weeks, someone on primary carer leave may work for up to 40 hours without it affecting their paid parental leave payments. This makes it a bit easier for staff to stay in touch and for employers who need them to sort something that only they know!
To help you all I am going round my parts of the country to conduct a free seminar on some of the more important details and will be available for individual clinics to discuss your own situation at a reduced rate. So if you have a question, register for the seminar and/or a clinic – or just make contact direct as part of my normal service to you all.