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Notifications of privacy breaches increases significantly

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Check systems are in place

Notifications for a privacy breach have increased nearly four-fold since the new Privacy Act 2019 came into force on 1 December 2020. In the period 1 December 2020 to 30 November 2021, 750 privacy breach notifications were received by the Office of the Privacy Commissioner (OPC). One-third of those cases met the threshold for serious harm.

The new legislation makes it mandatory to notify the OPC of privacy breaches that have caused, or have the potential to cause, serious harm to people.

Failure to report a serious breach can result in a Compliance Notice being issued, public notification of the breach and/or a fine of up to $10,000.

Privacy breaches can cause real harm to people. In the serious breach category in the above 12-month period, 36% of serious breaches involved emotional harm, 14% reputational harm and 13% identity theft. Other harms were classified as financial harm, threats of harm and so on.

Take great care with personal information

Human error causes the majority of reported serious breaches. Human error includes accidental disclosure of sensitive personal information, data entry errors, confidentiality breaches, redaction errors, postal and courier error.

Email error accounts for over a quarter of all reported serious privacy breaches. The OPC recommends any organisation should have good systems and processes for electronic communications. Emailers should:

  • Use the BCC option when sending to multiple recipients
  • Double-check attachments are correct, and
  • Have a send delay.

Senders should always check their email draft very carefully when including any sort of personal information. It is also useful to ask a colleague to do a fresh-pair-of-eyes review of any draft email that includes personal information.

Privacy breaches occur in the public and private sectors, as well as in not-for-profits; all three sectors store some form of personal information such as health care and social assistance data.

To read more about privacy breaches in the first 12 months of the new legislation, go here.

NotifyUs

If you want to either report a serious privacy breach or are unsure if your potential breach meets the threshold for notifying the OPC, use  the anonymous self-assessment tool, NotifyUs, to help you decide.

 

 

DISCLAIMER: All the information published in Fineprint is true and accurate to the best of the authors’ knowledge. It should not be a substitute for legal advice. No liability is assumed by the authors or publisher for losses suffered by any person or organisation relying directly or indirectly on this newsletter. Views expressed are those of individual authors, and do not necessarily reflect the view of Edmonds Judd. Articles appearing in Rural eSpeaking may be reproduced with prior approval from the editor and credit given to the source.
Copyright, NZ LAW Limited, 2022.     Editor: Adrienne Olsen.       E-mail: [email protected].       Ph: 029 286 3650

Postscript

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New holidays legislation

The complexities of calculating holiday pay and other leave provisions under the current Holidays Act 2003 should be a thing of the past when new legislation is expected to be introduced to Parliament mid-year.

A government-appointed taskforce has made recommendations to simplify provisions and to provide a commonsense application in the workplace. It is proposed, for example, to allow employees to take annual leave on a pro rata basis during their first year of employment rather than having to wait a full year before being entitled to paid annual leave.

The advent of this new legislation will, we hope, bring much relief to not only employees but also payroll staff who have had to grapple with the anomalies of the current Act. +

Minimum wage increased from 1 April

In February, the government announced that from 1 April 2022 the minimum wage would rise to $21.20/per hour.

It also announced that the starting-out and training minimum wage rate would increase from $16.00 to $16.96/hour from 1 April.

All employers should ensure their records are up-to-date and that they are paying their employees the correct hourly rate. +

 

 

DISCLAIMER: All the information published in Fineprint is true and accurate to the best of the authors’ knowledge. It should not be a substitute for legal advice. No liability is assumed by the authors or publisher for losses suffered by any person or organisation relying directly or indirectly on this newsletter. Views expressed are those of individual authors, and do not necessarily reflect the view of Edmonds Judd. Articles appearing in Rural eSpeaking may be reproduced with prior approval from the editor and credit given to the source.
Copyright, NZ LAW Limited, 2022.     Editor: Adrienne Olsen.       E-mail: [email protected].       Ph: 029 286 3650

Contractors

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A veritable minefield of employment law

From a legal perspective, hiring contractors has always been tricky. The onus of correctly identifying who is an employee versus a contractor, and ensuring legal compliance, remains an employer’s responsibility. The financial consequences of misidentification can be significant for a business owner.

With the rise of the ‘gig economy’, employers are increasingly relying on contractors to fulfil essential roles, so correctly identifying these people’s employment status is more important than ever. The Employment Relations Authority has been very clear that it does not matter that a ‘contractor agreement’ is in place, if the individual behaves like an employee, their employer is responsible for ensuring compliance with the Employment Relations Act 2000 and will be penalised if they fail to do so.

We explore the key features to differentiate between contractors and employees, and what changes may lie ahead for those who fall into the grey area in between.

Defining a contractor

A contractor is a self-employed person who is engaged to provide services privately under contract law and issues invoices for those services. As such, the Employment Relations Act 2000 and all associated entitlements do not apply to the relationship. Key identifying features of a contractor are:

  • They have their own business and are responsible for all their own taxes and associated expenses such as ACC levies
  • They are considered to have an equal bargaining position to the business they are contracting with (in contrast to the power imbalance between an employer/employee)
  • The relationship may not be exclusive
  • They will ordinarily have an element of control or discretion over their daily tasks and work, and
  • Under normal circumstances they are freely able to accept or decline work.

Who is an employee?

Anyone who is not clearly a contractor should be considered an employee until determined otherwise. Red flags should be raised to treat an individual as an employee if there is little discretion on daily tasks, an exclusivity of relationship or they do not complete all their own financial accounting and reporting.

If they are an employee, you will need to assess if they are casual, part-time or full-time and are provided with the appropriate employment agreement and entitlements.

Consequences of getting it wrong

Misidentifying your employee as a contractor can give rise to a personal grievance (PG). The outcome of that PG could result in your employee being entitled to backdated entitlements such as annual leave and sick leave all the way through to the beginning of the relationship. There may also be other financial penalties imposed by the Employment Relations Authority.

Introducing the ‘dependent contractor’

A grey area arises when a person clearly runs their own business but works exclusively for one company or depends heavily on one contract for an income, and has very little discretion in daily tasks.

An example of this is a courier driver who owns their own vehicle, runs their own accounts, is free to contract with third parties and take on additional duties. For the majority of the time, however, they work for one company, are dependent on one income source and have very little control over the day-to-day activities as this is dictated by that company.

The government has consulted on a proposal to introduce legislation designed to protect this type of vulnerable worker. A new category under employment law is proposed called the ‘dependent contractor’ that is designed to protect and enhance the entitlements of this type of contractor such as a courier or rideshare driver. These contractors’ protections would be extended into parts of employment law which means a dependent contractor may be entitled to certain benefits such as sick leave.

These proposals have not been finalised and further consultation is expected this year. If this proposal is enacted, employers will need to be proactive in promptly reviewing and reclassifying (if necessary) their workforce to ensure all dependent contractors are given their new protections and entitlements.

Classify your employees

Ensuring your employees are correctly classified as contractors or employees is essential. Roles such as marketing, social media management, IT support, website management and virtual assistants are all examples of valid contractors who, under the right engagement circumstances, could be considered employees or, if the new proposal becomes law, a dependent contractor.

If you have concerns about correctly classifying an existing contractor or you are a contractor but believe you are probably an employee, please feel free to discuss this with us.

 

 

DISCLAIMER: All the information published in Rural eSpeaking is true and accurate to the best of the authors’ knowledge. It should not be a substitute for legal advice. No liability is assumed by the authors or publisher for losses suffered by any person or organisation relying directly or indirectly on this newsletter. Views expressed are those of individual authors, and do not necessarily reflect the view of Edmonds Judd. Articles appearing in Rural eSpeaking may be reproduced with prior approval from the editor and credit given to the source.
Copyright, NZ LAW Limited, 2021.     Editor: Adrienne Olsen.       E-mail: [email protected].       Ph: 029 286 3650

Grounding your jet-setters

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The Covid dilemma of annual leave and holidaying offshore

Since Covid appeared in New Zealand in early 2020, employers have navigated a variety of complex matters relating to vaccinations, vaccine passes, alert systems and workforce management.

In this third year of the pandemic, many employers now face difficult decisions around annual leave and international travel ambitions of their valuable staff.

Can employers legitimately deny leave if their staff disclose an intention to travel internationally? What happens when employees are stranded overseas?

As with many employment law areas, responses will depend on the individual circumstances, but we look at some of the general principles that will govern these scenarios.

Disclosure is optional

While most employees freely disclose their leave plans, they are not legally required to tell you what they will be doing in their personal time — including how they take annual leave. As an employer, you may only request additional information relevant to the good faith assessment of the leave request, ensuring that it is not ‘unnecessarily unfair to your employee in the circumstances or unreasonably intrusive on your employee’s personal affairs’[1]. Quizzing employees about their plans could be considered a breach of the Privacy Act 2020 and employer good faith.

Approving/denying leave

You must consider ‘in good faith’ every leave request submitted by your employees. This means you may only reject the leave request on objectively reasonable grounds.

Reasonable grounds to reject leave may apply if your employee:

  • Is required to be present in your workplace during their proposed leave due to prior commitments or key business dates
  • Is required to be present immediately after, or shortly after, their proposed leave and that quarantine or self-isolation may jeopardise that availability, or
  • On their return to New Zealand they may present a significant health and safety risk to themselves or your workplace.

It is anticipated that the majority of leave that is reasonably denied will be due to essential staff shortages and a requirement to be physically present either during the leave period requested or shortly after. It is important to remember, however, that your employees must be allowed to take annual leave within 12 months of their entitlement arising, so perpetual rejection of leave is not permitted.

An argument that a returned employee could present a health and safety risk is unlikely to be considered ‘reasonable’ given that the government is already enforcing stringent public protection measures such as quarantine, self- isolation and ‘trans-Tasman bubble’ pauses. This could change, however, if the government relaxes protection measures and increased responsibility falls on employers to provide a safe workplace.

Someone stranded!

What happens when you have granted annual leave and your employee is stranded overseas or in MIQ? When can you terminate their employment and move on?

Again, the principle of acting in good faith will be the prevailing principle and each situation will be unique.

Some of the most relevant factors to consider are:

  • How long is your employee stranded? If it’s only an additional two to four weeks for MIQ, it’s likely you will have to make do until their return. The appropriate time frame before termination will vary, but in almost all circumstances it would be months before termination was considered a reasonable response.
  • Can your employee work remotely in some capacity? If so, you should support them to work in this way. Dismissing an employee who can work remotely (even if it’s less desirable than in person) would likely be valid grounds for a personal grievance claim.
  • Can your business take alternative measures such as hiring casual or fixed-term contractors? If so, it is likely the role will need to remain open for a much longer time frame before terminating your employee.

During the time your employee is stranded overseas, you must continue to communicate proactively with them and consult with them on how to best rectify the situation. If you have a Covid policy (which is now recommended  for all businesses), this should be followed.

If, after considering all relevant information, it is unlikely that your staff member can return in an acceptable time frame, you may be able to terminate their employment in accordance with their employment agreement.

Employers must ensure their staff have appropriate opportunities to rest and enjoy their accrued entitlements and, generally, this leads to a healthier and more engaged workforce. However, business disruptions can and do happen. Ensuring your Covid policy is up-to-date and undertaking good consultation with employees can lay the foundation to manage whatever circumstances arise.

If you have any difficult annual leave conversations ahead and would like additional support, please contact us.

[1] Privacy Act 2020 Principle.

 

 

DISCLAIMER: All the information published in Rural eSpeaking is true and accurate to the best of the authors’ knowledge. It should not be a substitute for legal advice. No liability is assumed by the authors or publisher for losses suffered by any person or organisation relying directly or indirectly on this newsletter. Views expressed are those of individual authors, and do not necessarily reflect the view of Edmonds Judd. Articles appearing in Rural eSpeaking may be reproduced with prior approval from the editor and credit given to the source.
Copyright, NZ LAW Limited, 2021.     Editor: Adrienne Olsen.       E-mail: [email protected].       Ph: 029 286 3650

Lockdown rent relief – are there remedies?

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For many of us the recent lockdown brought a sense of déjà vu. Once again, a number of us were back juggling Zoom calls while supervising school work from the confines of our own homes. The landlords and tenants amongst us were again grappling with the issue of how the lockdown affects lease obligations.

Businesses which were not deemed ‘essential’ were prohibited from accessing their premises during Alert Level 4, and for some of you this meant your business could not earn any income during that period or revenue was severely reduced.

Is rent relief available?

The first place to look for rent relief options is in your lease itself. The most common form of commercial lease is the Auckland District Law Society (ADLS) lease. If you’ve entered into an ADLS lease in or after 2012 it is likely to contain clause 27.5 which deals with situations where tenants are unable to gain access due to an ‘emergency’.

Although this clause was originally introduced as a result of the Christchurch earthquakes and tenants being unable to enter undamaged premises which were in the locked down ‘red zone’, the term ‘emergency’ includes epidemics such as Covid. Clause 27.5 states that if a tenant is unable to gain access to their premises in an emergency ‘to fully conduct the tenant’s business’ due to a restriction on occupation by a competent authority then a ‘fair proportion of the rent and outgoings shall cease to be payable’ during the period they are unable to access their premises.

What is a ‘fair proportion’?

Eighteen months after the first Covid lockdown, there is still no guidance from the courts as to what a ‘fair proportion’ is as disputes between landlords and tenants have either been resolved through agreement or by arbitration. While fairness is ultimately in the eye of the beholder, the following factors should be considered:

  • Fairness to both parties: Both the landlord’s and tenant’s situations should be taken into account in determining the extent to which a reduction is ‘fair’. While the income of most tenants will be impacted by a lockdown, many landlords will also have mortgages and other outgoings and rely on the rent to meet those obligations.
  • Nature of a tenant’s business: Businesses will be affected differently by the lockdown. At one end of the scale there are ‘essential businesses’ such as supermarkets which may continue to fully operate from their premises.

At the other end of the scale, cafés and restaurants will not be able to operate at all. Also in the mix are professional services businesses such as law and accounting firms where staff may be able to continue to work from home but have access to the server situated on the premises. Many businesses will have important items stored at their premises so will continue to gain some benefit from the premises during their lockdown. The proportion of the rent reduction is likely to be affected by the benefit the business gains from the premises.

Rent relief period?

Clause 27.5 applies to situations where a tenant is not allowed to access their premises due to an emergency ‘to fully conduct the tenant’s business’. If a tenant can access the premises, but still can’t fully operate, they may claim an abatement of a ‘fair proportion’ of the rent and outgoings for as long as they cannot access the premises to fully conduct their business due to the emergency.

The clause is not intended to deal with situations where a tenant’s turnover has been affected by a market downturn which is not related to access to premises.

Resolving rental issues

We recommend that landlords and tenants attempt to negotiate an acceptable outcome for both parties in good faith. If an agreement cannot be reached it is likely that the lease will require the dispute to be resolved by mediation, and then arbitration if mediation is not successful.

It is in the interests of both parties that tenants survive this difficult period and that they maintain a good relationship.

Lease does not provide for rent relief?

An early November 2021 amendment to the Property Law Act 2007 effectively inserts a new clause similar to clause 27.5 into those commercial leases which do not currently have a rent relief clause. The deemed clause took effect (retrospectively) from 28 September 2021 and only applies in relation to epidemics. The new law does not define ‘fair proportion’, so there will still be a need for negotiation, then possibly arbitration.

The legal doctrine of ‘frustration’ also provides a potential legal argument in favour of tenants.

It is important that any agreement on rent relief is properly documented. We will be happy to assist you with this, and help you with any negotiations with either your landlord or tenant during these Covid times.

 

DISCLAIMER: All the information published in Fineprint is true and accurate to the best of the authors’ knowledge. It should not be a substitute for legal advice. No liability is assumed by the authors or publisher for losses suffered by any person or organisation relying directly or indirectly on this newsletter. Views expressed are those of individual authors, and do not necessarily reflect the view of Edmonds Judd. Articles appearing in Fineprint may be reproduced with prior approval from the editor and credit given to the source.
Copyright, NZ LAW Limited, 2021.     Editor: Adrienne Olsen.       E-mail: [email protected].       Ph: 029 286 3650

Working from home

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Tax status of allowances

Most, if not all, employers and employees will now be familiar with the once illusive and distant concept of working from home (WFH). Since Covid reached our shores, flexible working practices have evolved with more employees now preferring to work remotely in any alert level, either on a full-time or part-time basis.

WFH brings unique challenges that are otherwise not encountered in an office environment. One commonly-faced situation by both employers and employees is the blurred line around work and home life. This is more than just a decrease in the ability to switch off from work; it also relates to work use of a household’s power, internet and phone.

Both employers and employees should be aware of the tax implications of such costs of WFH. Employees cannot personally claim a tax deduction for costs incurred in carrying out their employment duties, such as WFH costs. If employers wish to contribute to their employee’s WFH expenses and compensate them accordingly, in some circumstances that compensation will be taxable income for the employee; in some circumstances, it will be tax-exempt. Inland Revenue has provided a simplified way for employers to determine whether, and to what extent, such a payment is taxable or not; it recently extended this method for the period from 1 October 2021 to 31 March 2023.

Inland Revenue has a great deal of information about WFH; to read this go here 

If you have specific enquiries about WFH tax obligations, do contact your accountant. Employers may also want to draft a WFH policy that outlines their expectations about this new way of working; we can help you with that.

 

DISCLAIMER: All the information published in Fineprint is true and accurate to the best of the authors’ knowledge. It should not be a substitute for legal advice. No liability is assumed by the authors or publisher for losses suffered by any person or organisation relying directly or indirectly on this newsletter. Views expressed are those of individual authors, and do not necessarily reflect the view of Edmonds Judd. Articles appearing in Fineprint may be reproduced with prior approval from the editor and credit given to the source.
Copyright, NZ LAW Limited, 2021.     Editor: Adrienne Olsen.       E-mail: [email protected].       Ph: 029 286 3650

Digital Boost – a tool for small business

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Since the launch of government-funded Digital Boost in late 2020, more than 40,000 small businesses have signed up. Digital Boost is a joint initiative between the Ministry of Business, Innovation and Employment (MBIE) and the private sector. Its purpose is to get small businesses to not only acknowledge, but also to use, the benefits that come from digital tools and technologies.

Adding to its existing toolbox, Digital Boost recently launched a new Digital Boost Live app. MBIE says that it wanted to make Digital Boost content more accessible to people who work more from their mobile phones and to give businesses up-to-date digital information “in the palms of their hands”.

Features include:

  • More than 500 short three-to-five minute learning videos including how to use digital marketing to increase sales
  • Podcasts with business owners
  • Hundreds of downloadable learning summaries
  • Case studies featuring Kiwi small business owners, and
  • Live Q&A sessions.

Digital Boost Live is available free at the App Store or Google Play. For more about Digital Boost go here

 

DISCLAIMER: All the information published in Fineprint is true and accurate to the best of the authors’ knowledge. It should not be a substitute for legal advice. No liability is assumed by the authors or publisher for losses suffered by any person or organisation relying directly or indirectly on this newsletter. Views expressed are those of individual authors, and do not necessarily reflect the view of Edmonds Judd. Articles appearing in Fineprint may be reproduced with prior approval from the editor and credit given to the source.
Copyright, NZ LAW Limited, 2021.     Editor: Adrienne Olsen.       E-mail: [email protected].       Ph: 029 286 3650

Having a puff at work

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Vaping now treated the same as tobacco smoking

New Zealand laws have finally caught up with vaping (also called e-cigarettes) that have, for some time, enjoyed freedom from the country’s strict tobacco regulation.

Since 11 November 2020, however, all vaping products and behaviours must now be treated the same as for tobacco products and smokers. All businesses and employers should be aware of the changes to SmokeFree legislation; for retailers of any vaping-related products these changes are especially important.

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Legal documents signed during lockdown

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Best to sign again after lockdown to avoid later complications

During the Covid lockdown, special rules applied to the signing of some legal documents. Obviously it was, and is, not possible to have your signature witnessed by someone outside your bubble in Levels 3 and 4. So the law allowed signing over audio-visual link (AVL) and other similar arrangements. While these documents will remain valid in the future, it may be wise to have wills and enduring powers of attorney (EPAs) signed out of lockdown to avoid any time-consuming queries later on.

Many legal documents need to be signed in a particular way or before a particular person. For example, some documents such as affidavits must be signed in front of a JP or lawyer. As this was, and is, not possible during lockdown, special rules were put in place to enable people to sign documents such as wills, EPAs, affidavits and so on.

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