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Law Changes from 6 May

Further changes to NZ's employment law come into effect on 6 May 2019. These changes arise from the government's law reforms that were set out in the 2018 Amendments to the Employment Relations Act 2000 (the Act).

Trial Period Changes

On and from 6 May 2019 employers with 20 or more employees will no longer be able to employ new employees on a Trial Period. This means that the 90-Day Trial Period will only be available to those employers with 19 or fewer employees.

If you have 20 more more employees, then you will need to remove Trial Period provisions from your employment agreements. However, these employers can still include a probationary period clauses in their employment agreements instead of trial period provisions.

It is important to understand that under a probationary period clause, if you dismiss an employee during the probationary period, you need to follow the full disciplinary process in order to effect that dismissal. The employee is entitled to bring a personal grievance if the dismissal is not for a just reason and/or the process followed to dismiss the employee is not carried out appropriately.

Rest and meal breaks

This change should not affect most employers who are already providing rest and meal breaks. However, if you currently provide flexible arrangements, the ability to continue with those has been removed from the Act.

On and from 6 May 2019 the Act prescribes each employee's entitlement to rest and meal breaks depending on how many hours the employee works on a given day.

Rest breaks are paid and of 10 minutes' duration, and meal breaks can be either paid or unpaid, though are generally treated as unpaid breaks. Meal breaks must be of at least 30 minutes' duration. There will be only limited exceptions to these requirements for employers engaged in national security matters and "essential services".

The new rest and meal breaks regime does not need to be set out in employment agreements. However, employers and employees can agree on the timing of an employee's prescribed rest and meal breaks (which may be within or outside the employment agreement). Any agreement that provides employees with less than their entitlements under the new regime will be unenforceable.

Employers can have Penalties awarded against them for breaching these new provisions, and employees can raise a personal grievance for unjustified disadvantage if they can show that they did not receive their rest and meal break entitlements.

As a defence for a personal grievance on these provisions, we strongly recommend that all employers clearly document their rest and meal break arrangements for each employee so that you can show that your employees have been provided with the opportunity to take breaks in accordance with the Act.

30-day rule reinstated

If you have a unionised workforce, then on and from 6 May 2019, the "30-day rule" will once again apply. This means that for the first 30 days of employment, a new employee who is not a union member but whose work is covered by a collective agreement must be employed on the same terms and conditions as the collective agreement. This means that for the first 30 days of their employment, their Individual Employment Agreement is deemed to be the same terms and conditions as the Collective Agreement that covers the work they will be doing.

The employer and employee may negotiated additional terms and conditions during this period so long as they are no less favourable than the collective agreement. This means that you will not be able to offer something different from what is in the Collective.

Employers in a unionised workplace will need to ensure that they have their letters of offer for new employees updated and ready to comply with the 30-day rule for any offers of employment made on and from 6 May 2019.

Information sharing requirements (unions and new employees)

Following on from the 30-day rule being re-instated, those employers with a unionised workplace will also be subject to new information sharing obligations in respect of new employees and unions concerning employees who are covered by the 30-day rule.

You will need to ensure that your recruitment and letter of offer process includes the provision of information for the new employee(s) about the union(s) in the workplace.

Information about the new employee to be shared with the union

Within 10 days of commencing employment, employers must provide a new employee with an MBIE-approved active choice form, which provides information about whether the employee intends to join a union. Unless the employee objects, this form must be completed and returned to the employer within the new employee's first 30 days of employment, after which the employer must provided the completed form to the union within 10 days.

At the time of preparing this Blog, MBIE had not yet released an approved active choice form.

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