Edmonds Judd

Over the fence

Over the fence

Genuine reasons for fixed-term employment

Fixed-term employment agreements are a useful tool when, as an employer, you do not require a permanent employee but need an employee for a stated period of time, or until the conclusion of a specific project, or for a specified event.

The Employment Relations Act 2000 imposes specific requirements that must be complied with for a fixed-term employment agreement to be valid.

You must have ‘genuine reasons’ based on reasonable grounds for making the employment fixed-term.

You must advise your employee as to the reasons for the fixed-term provision, and record when or how their employment will end in a written employment agreement. If you don’t adequately record the reasons for a fixed-term, and when or how the employment will end, the fixed-term may not be valid, and you may be expected to treat your employee as a permanent staff member. This could open you up to a claim of unjustified dismissal.

Examples of ‘genuine reasons’ may be to cover another employee who is on an extended period of leave or your need for additional resources for a specific project. Employing someone who is on a work visa, or other type of immigration visa, is not a genuine reason for fixed-term employment because the expiry of a work visa is merely a circumstance of your employee. Your employee should be hired as a permanent employee with provisions included in their individual employment agreement about holding and retaining a valid work visa.

Read terms of trade!

Reading terms of trade for every new service provider and piece of technology can seem tedious. However, not reading and agreeing to the other side’s terms of trade before agreeing to trade can lead to problems for your wallet and your peace of mind. We set out a few examples of why it is important to carefully read terms of trade.

Limitations on liability are often included in terms of trade. Limitations may mean, for example, that a supplier who does not provide all the goods ordered, or if some of their goods are defective, will only be liable for the cost of the shortfall, not for the potential costs that might result from that shortfall. Some limitations will even cap liability at a fixed amount that may fall well short of the loss they cause.

Watch out for delivery terms. Terms of trade will often state whether time is, or is not, of the essence. This can either mean that a supplier is not bound to deliver goods by any certain date, regardless of the consequences, or that a purchaser need not pay for goods received before or after certain dates.

As vital as it is to read the terms of trade of any business you are dealing with, it is even more important to ensure that your business has its own terms of trade. There are many protections and conditions that are not legally available unless agreed to by the parties.

New Privacy Act will affect rural sector businesses

The new Privacy Act will come into force on 1 November 2020. Replacing the Privacy Act 1993, the new legislation reflects the needs of the digital age. The changes aim to promote and protect privacy and give confidence that your personal information is properly protected. This will affect all rural businesses and businesses across the board that collect, store and use personal information about their employees, clients and /or customers.

Key changes are:

  • Mandatory reporting of privacy breaches: where a privacy breach occurs causing, or posing a risk of harm, businesses will be required to inform the individual concerned of the breach, and report that breach to the Privacy Commissioner
  • Destroying information to avoid disclosure: if you request information from a business, that business cannot destroy the information to avoid disclosing it to you
  • Compliance notices: the Privacy Commissioner will be able to issue compliance notices to make businesses do something, or stop doing something, to comply with the amended privacy law, and
  • Information stored or processed by one agency on behalf of another: if you are a New Zealand business that uses an overseas service provider, it will be your responsibility to ensure that the overseas provider complies with our privacy laws. You should be asking any overseas providers, such as cloud software, what they are doing to meet New Zealand privacy laws. New offences will be created with increased fines.

Remember, if you hold private information you must ensure that you store it securely and that you dispose of it safely when you no longer require that information.