Keep employment agreements and policies up-to-date
Over the past 18 months, we have seen significant changes to employees’ hours of work, rates of remuneration and the expansion of flexible working arrangements as businesses have adapted to the Covid economy.
With most sectors of our economy recovering, and despite some occasional changes in alert levels, both employers and employees should ensure that any agreed post-Covid terms of employment or changes to the workplace are accurately recorded in their employment documentation.
Changes to hours of work and remuneration
In 2020, a significant proportion of businesses reduced their employees’ hours of work and rates of remuneration in response to the economic impact of Covid and claimed the government wage subsidy.
While many employees have returned to their previous hours and rates of pay, there is still a significant number who have not. It is important that employees’ rates of pay and hours of work are formally recorded; this will help avoid uncertainty and clarify how long the new hours/pay are intended to stay in place. The best way to achieve this is to prepare a variation letter for them to sign and return. This sets out an employee’s new hours of work and/or remuneration. They should of course seek independent legal advice.
Working from home
Covid has been extremely disruptive to our traditional ideas of what it means to be ‘at work’ and has been a catalyst for many businesses to introduce, or expand, flexibility for their employees. The introduction of working from home means that your employee’s home should also be recorded as a place of work in their employment agreement. This re-classification, however, raises some other issues that should be worked through.
Health and safety is important. For home-based workers who can perform their roles remotely, the main issue is whether their home is adequately set up to be a place of work. For example, are their desk, chair and computer screens ergonomically correct? If not, you should consider whether your business is prepared to subsidise or cover the cost of purchasing this furniture.
We recommend you consider whether the health and safety provisions in your employment agreements are fit for purpose in light of your employees’ homes being treated as a place of work.
Another issue is working from home expenses, such as internet and phone usage. You may wish to consider whether a weekly/fortnightly allowance is appropriate to subsidise employees’ expenses when working from home. Tax consequences will also need to be taken into account.
You will also want to ensure that sensitive business information remains confidential despite being in your employee’s home, and to ensure you have policies in place to address these issues.
What ‘flexible working’ looks like for a particular workplace is a major consideration. While many employees appreciate the flexibility that comes with working from home, you must take into account how allowing a large proportion of staff to work that way impacts your workplace culture and cohesion.
We recommend employers consider introducing flexible working policies in consultation with their staff in order to identify how often their employees can work from home and the rules and expectations around how they will stay connected while they are out of the office.
With travel bubbles open (and sometimes closing) with Australia and the Cook Islands, both employees and employers must be mindful of the possibility of employees being unable to return from overseas trips due to unanticipated Covid outbreaks.
Employers should develop overseas travel policies, in consultation with staff, to establish the process for authorising or declining an overseas travel request. If overseas travel is allowed, employers should consider whether their employees should take their work computer with them (if they are capable of working remotely) so there would be minimal business disruption if they are unable to return for some time.
Covid has thrown a spanner in the works in the way we carry out our day-to-day business. It has, however, given us all an opportunity to work in different ways. It is important to ensure your employment documentation reflects your workplace’s new normal.
A better-than-expected economic recovery after the scourges of Covid has enabled the government to propose significant investment in health and welfare, housing (particularly for Māori), infrastructure to rebuild from the impact of the pandemic and to continue to make this country safe from the virus. Continue reading
Your employee doesn’t want a Covid vaccination?
While many Kiwis are queuing up and eagerly awaiting their Covid vaccinations, not everyone is willing to take ‘the jab’. Recent headlines of sacked border staff who refused their Covid vaccinations have highlighted the difficulty many employers will face in deciding if their staff can reasonably be required to be vaccinated.
Check your passport is current
With a travel bubble opening with Australia, do check that your passport is still valid before making a reservation.
The Department of Internal Affairs says around 300,000 people currently hold expired passports.
As well as being the best regarded form of identity for AML and other requirements, it would be a pity to have your travel delayed if, at the last minute, you discover your passport has expired. To apply for a new passport go here.
Leave and pay entitlements during Covid response and recovery
Over the past 14 months or so, employers and employees have had to work together during national and regional lockdowns, working from home as a requirement and/or choice and many other employment-related situations. Employment law obligations do not cease during these periods and employers must ensure they are acting in good faith towards their employees, while also trying to navigate these complex and rapidly changing situations.
Covid has thrown up some uncertainties for employers when calculating their employees’ entitlements when they are unable to work from home, self-isolating, unable to travel (where necessary) and so on. The wage subsidy regime was introduced in 2020 to cover a portion of employees’ wages during the first nationwide lockdown and has been reintroduced periodically as needed. In addition, the Covid-19 Leave Support Scheme provides support for employees who cannot work from home or need to self-isolate. To find out more about the Scheme go here.
This is a complex area of employment law and it’s important to get it right. For more information, go here.
If you would like more guidance on ensuring you are paying everyone correctly, please get in touch, we are happy to help.
A reminder about major changes to tenancy laws
This year heralds some significant changes to tenancy laws:
Changes from 11 February 2021: Several changes to the Residential Tenancies Act 1986 took effect on this date. These include an increase to either the 63 or 90 days’ notice period for termination of a periodic tenancy and an increase in the level of awards the Tenancy Tribunal can make from $50,000 to $100,000.
There are further changes that take effect from 1 July and 21 August 2021; and from 1 July 2023 and 1 July 2024.
To read more about this go here.
Covid relief key expiry dates for businesses in 2021
In 2020, the government introduced a raft of legislation to provide temporary relief for businesses struggling to navigate the effects of the Covid pandemic. Some relief measures, such as the safe harbour for company directors, have already expired, while others will expire this year unless they are renewed. The key expiry dates for 2021 that you should be aware of are:
- 26 March: Landlords and tenants of commercial premises who could not agree on rental arrangements during the 2020 lockdown period have until this date to access the government’s subsidised arbitration or mediation service to resolve the dispute.
- 31 March: Measures allowing companies, incorporated societies and other entities to hold meetings online and make temporary exceptions to their rules.
- 15 May: Provisions allowing for electronic signatures when signing security agreements that contain powers of attorney.
- 22 September: The requirement for landlords to give 30 working days’ notice instead of 10 working days’ notice to end a commercial lease where the tenant fails to pay rent.
- 31 October: The cut-off date for businesses to enter into the government’s business debt hibernation scheme has been extended until 31 October 2021.
The scheme allows businesses to have a month of protection from most creditors enforcing their debts, and a further six months’ protection if their creditors agree.
Allowing for Covid-related settlement delays
When New Zealand headed into Covid Level 4 in March, real estate transactions stalled because of difficulties completing essential elements of settlement, such as the legal paperwork, giving of vacant possession and the inability of moving companies to access the property. In response, a number of buyers and sellers adjusted their agreements to delay settlement until alert levels decreased.
How many schemes are you eligible under?
Since the pandemic arrived on our shores, the government has made available multiple types of financial relief; more than one may be available to your business. Although applications under the popular Wage Subsidy Scheme ended on 1 September 2020, other options are still available for support if you need it.
Apprentice Support Programme
If your business has an apprentice who is actually training, you may be eligible to receive $1,000/month for first year apprentices and $500/month for second year apprentices. This payment is for a maximum of 20 months from August 2020 to March 2022. Visit here at Work and Income Te Hiranga Tangata to apply.
For all overseas purchasers
It seems as though the Overseas Investment Office (OIO) has been under constant evolution over the last two years. In June, the OIO enacted a change that now requires all overseas purchasers of New Zealand business assets to submit a notification to the OIO before the transaction takes place — regardless of the asset value. This submission will allow the OIO to monitor and prevent New Zealand asset ownership being unnecessarily diluted due to stressed sales caused by unprecedented economic pressures from Covid.
Which transactions does this apply to?
Previously, ‘overseas persons’ who purchased New Zealand business assets valued under $100 million (excluding land), did not have to apply for OIO consent. Under the ‘Emergency Notification’ requirement, however, the OIO must be notified by every overseas person before purchasing any New Zealand business assets — even if the transaction holds minimal value. This includes an increase of shareholding in a business in which the overseas person already holds an interest. The requirement to submit a notification does not extend to purchases that require the consent of the OIO, as the office will already be aware, and have the opportunity to reject, those transactions.
Remote working: the new normal
As a result of the Covid lockdown, many employees were required to work remotely, and some are continuing this arrangement.
Working remotely comes with some important considerations, particularly in terms of health and safety. If you are an employer, you should be:
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.