Employment Issues
EMPLOYMENT CONTRACTS
Anyone employed after 2 October 2000 must have a written employment agreement. This contract can be either an individual agreement or a collective one.
CREATING A CONTRACT
We have found that many of our members believe creating an employment contract is a complex and time consuming process, so the Chamber has put together two options to help members create their own contracts quickly and easily. These two options provide guidance to employers and employees on what content to use in the creation of individual full or part time employment agreements.
Remember this information is a starting point for creating a contract that best suits your company needs and we advise that you consult an employment lawyer or HR consultant before finalising your contracts.
An option is to visit the Department of Labour’s website and use their ’Employment Agreement Builder’ tool which allows you to tailor a contract literally at the click of a few buttons. The site also provides examples of covering letters to help employers meet the requirements of the Employment Relations Act when offering employment.
Click here to go to the Employment Agreement Builder
Click here to download the staff handbook template
If you require a more in-depth or specific contract we suggest you consult one of Chamber members who are experienced in this area. Contact the Chamber for list.
INDUCTION PROCEDURES
Induction manuals or handbooks are basic human resources tools used for communicating information to employees. There is no law that requires you to provide an induction programme for your new employee. There are a number of good reasons why you should.
A well thought out induction manual and programme will answer most of the questions that any new employee would want to ask.
Publishing the company rules and policies leaves nothing to doubt and will reassure an employee that everyone is treated fairly and consistently.
Certain information must be provided to employees by law. An induction manual can easily fulfill some of these needs.
The manual should summarise the relationship between you and your employee and briefly describe what management expects. They should be given to and read by all employees.
The manual should contain general information about:
1. The company and its mission;
2. The rules and procedures an employee needs to know to be successful in their position,
3. The salary, pay issues and benefits.
4. The manual should also provide a framework for the orientation of new employees to help them better understand the company’s operations and structure.
An example of the structure of an induction manual could be:
INTRODUCTION
About this handbook
Equal employment opportunity
Company structure and mission statement
EMPLOYMENT
Job description
Probationary period
Performance appraisals
Code of conduct
Company policies such as phone use, computer use, smoking and drugs and alcohol
Disciplinary procedure and the complaint and appeal procedure
Sexual harassment and the complaints procedure
Health and safety information and policy
Occupational health information and procedure
LEAVE ENTITLEMENT
Holidays
Special and sick leave
Jury duty
Parental leave
WORK ENVIRONMENT
Salary/wages and payroll information
Office phone and extension numbers
Staff list
Emergency evacuation procedures
Parking
Arranging travel and accommodation
Dress code
Who is the health and safety representative
Benefits such as health insurance
Identification cards
Stationary supplies
The induction process should begin as soon as the selection decision is made and should continue for a period after the employee starts work. An effective programme would include:
Physical orientation - where everything is and how to use the equipment
Meet the team - how they fit into the company, key staff
Their role – job description, what’s expected and terms and conditions
A well designed plan can be amended to suit each new employee containing areas specific to their role as well as more generic company information. You might want to break this down into day, week and monthly elements. A check list for each part of the induction plan will ensure that all necessary parts of the induction have been covered. In particular the mandatory areas such as health and safety, policies and procedures, and the job description.
At the end of the induction programme you should ask the employee to sign an agreement confirming that they have read and understood the information. You might like to add a feedback questionnaire to help you improve the process and if you are really keen you could ask the employee to complete a quiz testing their knowledge.
An induction programme and more information can be found on this site. For more personal assistance please contact the Chamber.
PERFORMANCE PROCEDURES
Regular performance reviews will help you stimulate, develop and encourage your staff to be more pro-active within a successful team environment.
Key Performance Indicators (KPI’s) should be part of the job description. You then have the ability to identify areas of accountability should performance issues arise. The employment agreement should state clearly the levels of performance the employee is expected to reach, the skills necessary and the expected outcomes.
It should ideally be two-way process. The performance bit outlining the outcomes expected, the management bit building the relationship between you and your employee. Performance management and appraisal is the means by which you monitor and develop someone’s performance for the benefit of the person and the company as a whole.
Performance management should be seen as positive. A way to encourage, coach and develop staff that are able to achieve. Informal quarterly reviews provide two way feedback for both the employee and employer and are a valuable forum for discussions of future expectations.
Performance management procedures should be appropriate to the environment. Those for warehouse staff may be more task focused than perhaps the sales team which might be more target driven. The performance measures may be set by discussion between yourself and your staff member. Sound performance measurement procedures should prepare the ground for your succession planning and greatly assist in increased retention of staff and valuable skills within your company.
The process should set a framework that clearly defines performance expectations including those not being met and allows you to follow a fair and reasonable disciplinary procedure should it become necessary. You can not discipline a staff member for repeated poor performance if the parameters have not previously been clearly defined and discussed. Annual performance appraisals are not sufficient. The staff member should be well aware of any lack of performance well before any disciplinary action is taken.
While retaining and developing under performing staff is expensive, it is usually far more costly to be continually recruiting and training new staff. People are the assets of an organisation and can be the backbone behind a company’s competitive advantage.
With sound performance management processes in place dismissal for poor performance will become a rare event but it takes time ad effort. They will enable you to identify any issues early and take steps to provide training, development and support for the staff member. Without it the employee could believe that their level of performance is satisfactory and they may leave the rest of the team to pick up the pieces. A solid performance procedure can result in an employee improving and becoming a valued member of staff. Employment Court decisions have forced companies to give an employee time to show steady improvement.
And if you are to lose the staff member then the use of exit interviews as the final part of performance management can shed valuable light on areas of training and development and ideas for the future retention of staff. The reasons for leaving can often be enlightening and should never be ignored. If at all possible exit interviews should be carried out after the employee has left the role. They will be less emotional about leaving friends and colleagues and not subject to the stress of starting a new job.
Various styles of performance appraisals and an exit interview templates are available. Please contact the Chamber.
DISCIPLINARY PROCEDURES
DISCIPLINING AND DISMISSING EMPLOYEES
Any employee who is not contributing to your company and its goals through poor performance or unacceptable behaviour should be asked to leave. Or at least that’s what you might like to do. However you must by law make sure you have gone through a discipline process that is procedurally fair. This will also protect you should an unfair dismissal claim be filed against you and you have to get involved in mediation or court. You must guard against being accused of firing the person without due process.
There are some more important and positive reasons for following the disciplinary procedure as set down in the Employment Relations Act 2000:
You may be able to turn the employee around and gain a well functioning employee.
You may find out what is wrong with your work rules and polices which can be changed to make the work environment for your employees more effective.
By evaluating the employee and providing him or her with training and assistance you may find out what is wrong with your selection process.
By allowing an employee a chance to change their performance before you discipline you demonstrate to other employees that you are fair and willing to give employees a chance.
Disciplinary procedure means that you move through increasingly stronger counselling or training in an attempt to bring the employee’s performance or behaviour to an acceptable level. The critical ingredients are due notice, a chance to improve, and a review process.
The following are the usual steps:
Counselling
Oral warning
Written warning
Final written warning
Termination
ANY stage can be used depending on the severity of the misconduct.
Disciplinary matters should be:
Avoided wherever possible by redirection, retraining, coaching, counselling etc.
Dealt with by those who have authority to handle such matters.
Dealt with promptly and thoroughly. Get and check all the facts.
Dealt with in a manner that is procedurally fair.
You may feel that disciplinary action is necessary where there is:
Persistent poor performance.
Absenteeism.
Breaches of company rules.
Serious misconduct.
The question of what a fair procedure is differs in each case. The Courts have given guidelines to what they consider is procedurally fair. Some of the minimum requirements are:
The employee is fully aware of the expectations of their job description
The employee is told exactly what the shortcomings are.
The employee is given adequate warnings that the shortcomings must not continue and that dismissal will be considered if they do continue. Oral and written warnings should be given when appropriate.
The employee is to be given adequate opportunity to correct the shortcomings mentioned.
The employer is to provide adequate training where incompetence is suggested.
The employee is given a fair hearing when the misconduct or incompetence continues.
Employees are given the right to representation and time to arrange such representation at disciplinary meetings.
The employee is given the opportunity to respond and question statements and to ask questions.
The employee is given assistance and sufficient time to correct the shortcomings complained of.
The right of appeal.
Counselling is used to try and change the employee’s behaviour / performance through listening to the employee and if appropriate, offering options to assist them.
You should speak to the employee, define the problem as they see it and ask the employee whether they see it in the same light.
Describe the performance/behaviour that is required and work with the employee to develop a course of action that will help them reach the required standard.
Use as many counselling and problem-solving sessions as is appropriate.
This approach usually resolves most problems. An informal note should be kept of all counselling and problem solving meetings with employees.
DISCIPLINARY ACTION, INVESTIGATION OR MEETING
(Oral, Written and Final Written Warnings and Dismissals)
STEP 1 – PRELIMINARY INVESTIGATION
Investigation should take place as soon as possible after the alleged incident.
If appropriate, check with all witnesses.
Assemble facts and evidence relating to the misconduct/allegation.
Check and eliminate alibis or excuses.
STEP 2 - ADVICE TO EMPLOYEES
Advice employee of nature of allegation/misconduct/performance issues.
Advise employee of potential impact on employment if allegation is sustained.
Advise employee of meeting time and arrange a private room.
Advise employee of their right to have representation.
Advise employee the matter will be fully investigated and opportunity given to explain misconduct/poor performance.
The employee must be offered representation. They have the right to refuse such representation. You should also have a company witness present.
STEP 2A - SUSPENSION
Suspension is useful to take the heat out of a situation, or give time to investigate the allegations fully, but is should only be used if:
The allegation directly impinges on the employee’s ability to carry out their duties e.g. unauthorised possession of company property, gross misconduct / negligence or violent behaviour.
Does not predetermine the outcome of the investigation.
Is necessary for a proper investigation or further investigation.
Does not prejudice the employee’s ability to prepare themselves for that interview.
Inform the employee that suspension :
May be necessary to allow a full investigation.
Employee advised they may take advice from representation before proceeding.
Inform the employee about allegations and possibility of formal disciplinary action or dismissal.
Advise the employee they will consider suspension on pay pending outcome of investigation.
Advise the employee that suspension is not disciplinary action but is appropriate while investigation takes place.
Suspension without good cause is a breach of contract.
Investigation should be carried out as quickly as possible.
Full notes should be taken and kept of the interview at which the employee is informed of suspension. Record who was present, what was said and who said it plus date, time and location. The supervisor should have a company witness present.
NOTES:
The employee must be given the opportunity to put forward their view opposing suspension and these views must be considered by the employer prior to any decision being made.
Employee remains on full pay while suspended.
STEP 2B - FORMAL INVESTIGATION
A formal investigation should involve:
Checking with any witnesses, if applicable.
Assembling facts and evidence regarding the allegation.
STEP 3 - DISCIPLINE INTERVIEW
You should conduct the interview with a representative of the company as a witness in a private meeting room.
All facts, allegations and issues must be put to the employee.
Employee should be told the consequences if the allegations are sustained.
Employee must be given a real chance to explain or justify their actions.
Full notes must be taken during the interview. They should note who was present, what was said and who said it, the date, time and location. Notes must contain the employee’s responses/explanation to the allegations.
Any suggestion that management had made up its mind before the interview, will seriously prejudice chances of sustaining the disciplinary action if it is challenged. IT IS GOOD MANAGEMENT TO GIVE EVERY EMPLOYEE A FAIR HEARING!
The employee should be informed that you will retire to consider the outcome of the meeting and that a further meeting will be arranged with the employee when a decision on how to proceed has been made. This meeting should be as soon as possible but not with too much haste. You need to be seen to giving full consideration to the employees’ explanations.
If after objective consideration of the employee’s explanation you decide that a warning is appropriate, you must notify the employee Orally of the level of warning that will be issued (i.e. written warning or final written warning). You must advise the employee that if the problem is not corrected within a reasonable period of time, then further disciplinary action will be taken.
You must advise that the warning will be kept on file. Write and place a letter on file that describes specifically what the problem is, what action has been taken to solve the problem and what solution is necessary.
The letter should be shown to the employee inviting them to sign it as an acknowledgement that it records accurately what was discussed. The employee may add their own comments if they wish. Employees should be made aware that they can appeal disciplinary action at any stage.
ORAL WARNING
In cases of continued poor performance or the first instance of minor misconduct a Oral Warning is the most appropriate step. Use Oral Warnings where counsellings have failed to produce an improvement or when a single incident is serious enough to warrant a formal warning.
WRITTEN WARNING
This is for instances where a performance problem or instance of misconduct continues following a Oral warning or the level of misconduct is significant enough to justify going straight to the written warning.
FINAL WRITTEN WARNING
Use a final written warning in cases where performance or behaviour continues to be a problem following a written warning or where the level of misconduct or poor performance is significant enough to justify going straight to a final written warning e.g. fighting or unlawful possession of company property.
All warning letters must state the following:
Be specific (quality of work, attendance, breach of company policy, specific misconduct).
State exactly what improvement is required and how it is to be measured.
The review date where the warning is issued for poor performance.
How long the warning will remain in effect.
A warning should expire after 12 months.
Termination can only take place when all other steps have failed or where the employee has committed a serious breach of their employment contract.
For more comprehensive assistance please contact the Chamber.
TRAINING
Before trying to implement any training solutions it is important to identify what needs may exist for both individuals and team environments. A needs/gap analysis should be conducted bearing in mind both current skill base and future requirements for procession planning.
Areas to consider:
Business needs: Identify who decided that training should be conducted, why a training program has been recommended as a solution to a business problem, what previous training has been provided by the organisation.
User: Who will get the training, what is there level of existing knowledge on the subject, what is their learning style, and who will conduct the training.
Work: Look closely at the tasks being performed in the job and the level of performance expected. A job profile or competency matrix can help with determining the main duties and skill level required. When this information is matched with the detail on the person to be trained you will be able to identify the type of training required and ensure that it is linked to the needs of the job.
Suitability: Training is one of several solutions to employment problems. However, it may not always be the best solution. It is important to determine if training will be effective.
Cost: What will be your return on investment? The right training will result in a return of value to the organisation that is greater than the initial investment to produce or administer the training.
A training assessment guide and check list is available to assist with the processes.
For more information please contact the Chamber.
HEALTH AND SAFETY
The principle objective of the Health and Safety in Employment Act or HASE is to prevent harm from occurring to employees while they are at work. It does this by imposing a wide range of responsibilities on employers and managers to develop systems.
You have legal responsibilities to your staff and any breach of these could result in legal action against you as an individual, resulting in heavy fines.
You are obliged to show that you have taken “all practicable steps” to provide and maintain a safe working environment by using the following procedures:
Hazard identification and control
Provide information, training and supervision
Accident reporting and investigation
Emergency procedures
Principles, contractors and subcontractors
The Health and Safety in Employment Amendment Act which came into force on May 5th 2003, increased the accountability of the employer. As an employer you need to be aware of the processes and duties introduced in these reforms and the practical implications.
You now have a duty to involve your employees in health and safety matters. You will need to develop a system to comply with this duty. If you employ more than 30 people, or an employee requests it, this system must be devised and implemented by 5th November 2003. There is flexibility but if you haven’t set up your own systems by this date the system set out in the act incorporating health and safety representatives will apply.
You will need to review all your company’s existing health and safety and employment policies. You must be able to share information with Health and Safety Representatives as well as employees.
Ensure you have:
A procedure for monitoring fatigue and minimising the potential stress caused by over work. Overtime and restoring must be carefully reviewed.
Develop a process for supporting employees who indicate they have a stress issue and for assisting those who have to work in stressful environments.
Provide support for trainees, volunteers and people such as those on work experience.
As an employer or company owner it is prudent to become familiar with the processes by which the health and safety representatives can issue hazard and infringement notices. Make sure you and your line managers are aware of and able to address such issues and deal with the process.
Stay abreast of all relevant codes of practice issues by OSH.
Review your suppliers of plant and make sure they have undertaken to design, make, install and maintain the equipment in accordance with the health and safety regulations.
Your accident register must now also include self-employed people contracted to work for you.
Staff that take on the role of Health and Safety Representatives are entitled to paid time off to attend approved training courses.
The most talked about aspect of the amendments would be those surrounding work in a stress free environment. You need to balance the need to be faster, more effective and provide better levels of service to your customers with providing a workplace free from the potential harm of stress.
This might mean sharing the workload more appropriately, perhaps a different staff member with different skills should be allocated the workload. It would pay to check that realistic time lines are being given for the completion of work and that pricing allows for adequate staffing of the project.
The positive aspect of these amendments is that properly organised, health and safety procedures provide staff with a better work environment and produce a more motivated and productive team.
For more information contact the Chamber.
SEXUAL HARASSMENT
Sexual and racial harassment is illegal. It contravenes both the Human Rights Act 1993 and the Employment Relations Act 2000. It could cost you dearly. Damages awarded have been as high as $76,000.00. The average award is around $7,000.00.
In addition most people who are sexually or racially harassed at work, leave. So you could end up writing a cheque and loosing an experienced member of staff which will cost you in terms of recruitment and re-training. Lets not forget the effect on the rest of your staff, low morale, lost productivity and increased absenteeism and then there are your legal fees.
If the harassment occurs at work then both the employee who harasses another member of staff and you (the company) could be liable even if you knew nothing about it.
Avoiding these risks is relatively easy. Put in place a sexual harassment policy and procedure. You will then be able to demonstrate that you have taken “such steps as are reasonably practicable to prevent” sexual harassment taking place.
Sexual harassment can occur:
When a request is made of any employee of a company for any form of sexual behaviour leading to:
A promise of preferential treatment at work
A threat of detrimental treatment at work
A threat about future employment status
By use of pornographic material, written or spoken words or physical behaviour of a sexual nature that is unwelcome or offensive to the employee, and which is either repeated or of such a significant nature that it has a detrimental effect on the person’s employment, job performance or job satisfaction.
By an employee’s use of behaviour of a sexual nature, which is unwelcome or offensive to a client of the company or a member of the public.
Please note:
Sexual harassment can be by a more senior member of the staff, a team member, or one of the company’s customers.
Incidents that occur outside work hours and work premises, but with a work connection, may still constitute sexual harassment.
It is conduct that it has a detrimental effect on the individual’s employment, job performance or job satisfaction.
A single act of a sexual nature, be it words or physical behaviour, may if sufficiently serious, constitute sexual harassment.
It is conduct subjectively unwelcome or offensive to that person. The test is whether the behaviour is freely and mutually welcomed by both parties.
The fact that a person does not mention or complain that certain behaviour is unwelcome or offensive at the time, does not mean that the behaviour is acceptable and that no harassment has taken place, and is no defence later on.
EXAMPLES
Sexual harassment may include:
Sexually offensive comments
Sexual or smutty jokes
Comments of teasing about someone’s alleged sexual activities or private life
Persistent, unwelcome social invitations or phone calls from other employees
Offensive hand or body gestures
Patting, pinching, touching or putting an arm around another person
Pictures or posters or e-mail of a sexual nature such as girlie calendars
Sexual assault or rape
Harassment is not limited to just these actions and can be experienced by both men and women.
RACIAL HARASSMENT
Racial harassment includes such behaviour as:
Unwelcome and offensive comments, gestures or off-colour jokes about race, colour, religious or ethnic beliefs.
Use of derogatory names or terms.
WHAT TO DO IF YOU RECEIVE A COMPLAINT
Complaints don’t have to be in writing, oral complaints must also be acted upon. Either way they should be taken seriously. You should:
Interview the person who has complained and let them know in advance of the time of an arranged meeting and that that they may bring a support person.
DO NOT JUDGE the person.
Take full notes and ask the person with the complaint to sign them as a correct record of the discussion.
Some people may not wish to take any further action and just want to get it off their chest.
Ask for any witnesses who may be able to verify their complaint.
Ask them not to discuss the complaint with others.
If you are unsure contact the Chamber and we will connect you with one of our experienced members for advice and assistance early in the process.
Every company should:
1. Designate an employee to whom complaints can be taken. This person should:
Be given training on sexual harassment prevention.
Be expected to promote the policy and inform employees about their rights and responsibilities.
Keep up to date on developments in the area of sexual harassment.
Establish formal and informal complaint procedures.
2. Form a company statement.
The harassment policy statement should say that sexual harassment will not be tolerated in the workplace and that action will be taken should harassment occur. It should also include a description of what sexual harassment is.
3. Have a formal complaints procedure the process of which should be readily available to staff. It should include:
Explanations that complaints of sexual harassment will be handled promptly, privately and in a fair manner.
The contact details of the designated employee to whom staff can go to with inquiries or complaints.
Assurance that all discussions and any investigations are to be conducted in the strictest confidence.
Clearly set out procedures that are understood by both staff and management.
4. Make sure all staff are aware of their rights
If you have an induction programme and/or company policy it would be appropriate to include the harassment policy in both. A sexual harassment prevention programme will reduce the risk of the harassment occurring and protect you from liability should it occur.
ANNUAL HOLIDAYS AND OTHER LEAVE
HOW IS HOLIDAY PAY WORKED OUT?
Holiday pay for a full year’s entitlement is calculated in three steps:
Work out an employee’s weekly average of their total gross earnings by dividing the “total gross earnings” for the whole year and divide by 52 (weeks). This gives the “average weekly earnings”. (Note: “total gross earnings” means all salary, wages, overtime pay, allowances, commission, and any previous holiday pay paid.)
Work out the ordinary weekly pay by multiplying the ordinary hourly rate of pay by the number of hours normally worked each week. This gives the “ordinary weekly pay”.
Whichever of these amounts is the larger is the rate of weekly holiday pay. For example:
Total gross earnings October 2001 – 2002 : $32000.00. Divide this by 52 to get the average weekly earnings of $615.38.
Ordinary weekly pay: $625.00.
The larger of these is ordinary weekly pay and therefore holiday pay for each week of your holiday is $625.00.
WHEN SHOULD HOLIDAY PAY BE PAID TO AN EMPLOYEE?
Holiday pay must be paid before the start of an employee’s holiday. Holiday pay is taxable.
in certain limited circumstances, the Courts have allowed holiday pay to be paid on a “pay as you go” basis. This is often the case with casual employees. An employee’s employment contract would need to provide explicitly for such an arrangement.
Experience has shown that “pay as you go” arrangements can cause some difficulty. Employers wishing to adopt this practice should seek qualified advice on where such an arrangement would be acceptable and how it can be provided for in employment contracts.
CHRISTMAS AND SEASONAL SHUTDOWN
An employer is entitled to customarily close its premises without consultation once per year. An employer must pay an employee an amount equal to 6% of gross earnings during the time the premises are closed. If holidays have previously been taken in advance by agreement, the amount paid during that holiday period should be deducted from the amount payable during the closure. The employee is not then entitled to any other holidays or payment for holidays for the period up to the closure. The employee’s next employment year, and period of calculation for any further holidays, begins from the shutdown date.
CAN HOLIDAYS BE TAKEN IN ADVANCE?
Yes, but only if you, the employer, agrees.
CAN AN EMPLOYER FORCE AN EMPLOYEE TO TAKE HOLIDAYS?
Yes, but as an employer, you must give at least seven days’ notice of the date on which any annual holidays are to be taken. This is the case whether or not your workplace is closing down for that time. Entitlement to more notice may be required if a longer period is specified in an employee’s employment agreement.
WHAT HAPPENS IF AN EMPLOYEE DOESN’T TAKE ALL HIS/HER LEAVE ENTITLEMENT?
The employee’s Annual holidays do not automatically expire and they will continue to accrue until they are taken.
DOES SICK LEAVE AFFECT THE THREE WEEKS’ HOLIDAY ENTITLEMENT?
No, but when calculating holiday pay for the employment year, the amount of unpaid sick leave affects the calculation of average weekly earnings. Any sick leave taken without pay should be counted as leave on ordinary pay for the purpose of the calculation. Sick leave does not affect the calculation of ordinary pay.
WHAT IF AN EMPLOYEE LEAVES THE JOB?
If an employee has worked for less than three weeks, holiday pay is calculated at 6% of total ordinary pay.
If an employee has worked for more than three weeks but less than a year, holiday pay is calculated at 6% of total gross earnings.
If employment has been for over a year and leave for all that period is due, holiday pay will be the total of the amount due for the completed year, plus a further amount calculated at 6% of total gross earnings for the part of the following year worked.
Any paid holidays taken in advance are deducted from these entitlements.
Holiday pay must be paid at the time an employee leaves his/her job.
WHAT IF A PERSON IS EMPLOYED AS A "FIXED-TERM" EMPLOYEE?
Some employees are employed temporarily, for a set period of time or for the duration of a project or for seasonal work. Fixed-term employees have the same rights as other employees. If they work for less than one year, then the rules are the same as those set out under the “What if an employee leaves the job?” above.
For further information, call the 0800 CHAMBER advice line or visit the Department of Labour website at http://www.ers.dol.govt.nz/
LEAVE ENTITLEMENTS
WHAT DOES THE LEGISLATION PROVIDE FOR?
As of April the 1st 2004 the Holidays Act 2003 will replace the current legislation for public holidays, annual holidays and sick and bereavement leave. This new legislation will apply to all employees whether they are employed full-time, part time or casually. The Act provides for 11 public holidays. These include holidays at Christmas, New Year, Easter, Anzac Day, Waitangi Day, Queen’s Birthday, Labour Day and the Anniversary Day of the Province. The Act provides for a minimum of three weeks annual holidays each year. The sick leave entitlement is five days and the bereavement leave is three days for each immediate family bereavement and one day for other close associations.
The Department of Labour website www.ers.dol.govt.nz details what holidays and leave employees are legally entitled to.
WHEN ARE THE PUBLIC (OR STATUTORY) HOLIDAYS?
The following are NZ public holidays on pay in addition to annual leave:
New Years Day (1 January)
Day after New Years Day (2 January)
Waitangi Day (6 February)
Good Friday (varies)
Easter Monday (varies)
ANZAC Day (25 April)
Queen’s Birthday (1st Monday in June)
Anniversary Day of the Province (varies)
Labour Day (4th Monday in October)
Christmas Day (25 December)
Boxing Day (26 December)
An employee is entitled to these eleven public holidays if they fall on days on which they would normally work. Employees are entitled to a whole alternative day if they work on a public holiday that is a day they would normally work.
An employee cannot be compelled to work on a public holiday unless it is a term of their employment agreement or they otherwise agree. All employees whether they are salaried or casual, must be paid time and a half for the hours that they work on a public holiday (an employment agreement cannot provide for a lower rate of pay). This represents a new statutory minimum rate of payment for all employees who work on a public holiday.
Public Holidays fall into two categories:
Christmas Day and Boxing day - 25th/26th December and New Years Day/and the day after - 1st/2nd January.
From Christmas 2004 if the Christmas and New Year public holidays fall on or over a weekend, and an employee does not normally work the weekend the holidays will be transferred to the following Monday and Tuesday. If an employee does work on the weekend then the holidays will remain on those traditional days and the employee is entitled to those days off on pay.
All the other Public Holidays (including Waitangi and ANZAC Days).
For the purposes of clarity and certainty, all the other public holidays (incl Waitangi and ANZAC Days) will be celebrated where they fall. So if the holiday falls on a normal working day for an employee they will be entitled to an alternative day plus time and a half for the hours they have worked. But if a holiday falls on say a Saturday or a Sunday and an employee does not usually work on this day they have no entitlement to a day in lieu or pay.
SPECIAL LEAVE
“Special leave” has now been separated out into “sick” and “bereavement” leave. An employee is entitled to sick leave and bereavement leave upon the completion of six months current continuous employment or if they work an average of ten hours a week including at least one hour a week or forty hours a month over the last six months.
SICK LEAVE
Currently an employee is entitled to five days sick leave per year. This leave can accrue up to 20 days as 15 days sick leave may be carried over from one period to the next and can be used as well as the five sick days allowed for the current period. Unused or accumulated sick leave is not paid out upon termination of employment. An employee is entitled to sick leave where they, their spouse, or someone who depends on them for care is sick or injured An employer cannot require proof of entitlement to sick leave unless the period of leave is longer than three consecutive days (whether or not the employee would have otherwise worked on all those days). This clarifies an area that has caused dispute and litigation in the past because the Act was silent on the issue.
BEREAVEMENT LEAVE
An employee is entitled to:
Three days bereavement leave upon the death of an employee’s spouse/partner, parent, child, sibling, grandparent, grandchild or spouse/partner’s parent.
One day of bereavement leave on any other occasion where, in good faith, the employer accepts the employee has suffered a bereavement and taking into account relevant factors, including:
The closeness of the association between the employee and the deceased person;
Whether the employee has to take significant responsibility for all or any of the arrangements for the ceremonies relating to the death; and
Any cultural responsibilities of the employee in relation to the death.
For further information or assistance, call the 0800 CHAMBER advice line or visit the Dept of Labour website at http://www.ers.dol.govt.nz/
The EEO Trust has a new interactive tool - Employers of Choice Action Track that may be of interest to your business.
The Action Track helps you identify your key workplace issues and leads you through an action planning process to address them. It’s packed with useful tips, tools and resources to help you on your way.
For more information about the Action Track click here.
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This document and all other documents on this website are provided as resources only. They do not purport to constitute or substitute for legal advice. The Northland Chamber of Commerce do not accept responsibility for the consequences of use of this document nor for any errors/omissions or misdescriptions of any kind. This disclaimer shall be a term of use of this and other documents on this website.
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