Read our updated article following the Coalition Agreements here.
Employment relations policies, one of the traditional political footballs, have been a hot topic this election. With the preliminary results in, and coalition talks about to take place between the National, NZ First and ACT parties, changes are on the horizon in the employment sphere. We outline the main election promises that have been made and how they might impact on your obligations as an employer, below.
National
Trial periods
Currently, only employers with 19 employees or less can rely on a trial period. National and ACT have promised to reinstate the 90-day trial period for all employers. This would allow any employer with a compliant trial period in their employment agreement to dismiss an employee within the first 90 days of employment without giving a reason for the dismissal. The employee would be statutorily barred from raising a personal grievance for the dismissal.
Fair pay agreements
The outgoing Labour government had introduced fair pay agreement (FPA) legislation, which provided a mechanism for collective bargaining to be initiated across an entire industry or occupation. A FPA would bind all employers within that industry, or all employers that employ employees within that occupation. These have been unpopular with employers and employer advocacy groups.
National has fervently objected to the FPA system since it’s conception and has promised that it will be one of the first things to go if it is in power. No FPAs have been implemented yet (although collective bargaining has been initiated for several), so, their repeal should not mark a significant change to the industrial relations landscape.
Parental leave
National has also promised to make paid parental leave rules more flexible, allowing parents to take paid leave at such times and in such periods as they see fit, including at the same time.
ACT
In addition to supporting National’s FPA and trial period policies, ACT has promised to make drastic changes to the Employment Relations Authority (ERA). If elected, it said it would:
- Require all ERA decisions to be delivered within a month of the investigation meeting concluding;
- Remove eligibility for remedies if the employee’s behaviour is at fault; and
- Remove the ability for the ERA to unilaterally reinstate an employee.
ACT has argued that these changes will bring certainty for both parties, stop employers being penalised for minor procedural mistakes and make for healthier workplace relations.
Holidays Act
To assist with the financial impact of the new Matariki public holiday on small businesses, ACT has proposed removing 2 January as a public holiday. It has also proposed to simplify the calculation of annual leave entitlements by changing the units from weeks to days.
What it means for you
While there have been big changes promised, it is still early days. There is no telling what coalition arrangement will be reached, or what changes will be implemented, so we do not recommend overhauling your employment practices on the basis of these promises just yet.
Even if these changes come into force, they will not be a silver bullet; employment law obligations will continue to apply. As always, we recommend that you seek advice on how any legislative changes apply to the specifics of your business before relying on them. When there is more certainty around the changes, we recommend a review of your employment agreements, policies and procedures to ensure these are up to date.
For more information, or for specialist advice on any employment issues, please contact a member of our employment law team.
Disclaimer: The content of this article is general in nature and not intended as a substitute for specific professional advice on any matter and should not be relied upon for that purpose.
