Employment law changes coming – But will businesses be ready?

With every change of Government there are changes to employment law. A lot of the changes surround contract law pertaining to the specifics of people’s employment contracts, such as the 90 day employment legislation introduced a few years ago. However some of the more recent legislation passed has focussed on occupational safety and health, and employer responsibilities. With new legislation to be introduced this year, how ready are businesses for it?

A raft of concerns about employers in New Zealand being out to make a fast dollar, without regard for New Zealand employment law or the expectations of New Zealanders have come to the fore since 2010. In that year the sinking of a trawler whose senior crew were found to have abused the more junior crew and broken both New Zealand and international maritime law, cast a glaring spotlight on how Indonesians working in New Zealand get treated. Since then other concerns have been raised in the dairy and farming sectors about how Filipino’s get treated. As the Philippines, Indonesia and other S.E. Asian countries do not have strong labour laws their citizens are sometimes perceived as being able to be exploited by industry cowboys.

But these proposed law changes are going to go further than that. They will, among other things, affect:

  • How small-medium businesses maintain their statutory employment and financial records, with bigger penalties for non-compliance
  • The controversial Zero Hours contracts will be prohibited unless “reasonable compensation” is offered
  • Occupational Safety and Health (O.S.H.)laws regarding the handling of asbestos are going to change, with a new license required for those workers who are removing 10 square metres of more of material containing asbestos

So, now that we know roughly what the major changes are, how ready are businesses likely to be for it?

It is understood that compliance costs might increase as a result of the new legislation. However, when taken into account against the gains made by businesses by being more robust employers. Some in the dairy and farming sectors will think they are being hard done by because of the focus on their environmental impacts, but the cost of the world concluding New Zealand farmers are incompetent employers in a modern world would far outweigh the cost of complying.

Let us be honest, that there will always be a small percentage of employers – maybe 3-5% – who will absolutely steadfastly refuse to comply. Their reasoning will vary from one case to the next, but the changes coming mean the cost of non-compliance will be significantly bigger. Whether it is failure to keep full and accurate records, as per new Section 4B of the Employment Relations Act 2000 or not abiding by the new employment standards, measures include bigger pecuniary penalties, banning orders and a loss of insurance against pecuniary penalties.

This legislation has passed its first reading in Parliament. That means it can now be sent to a Select Committee for consideration before being returned to Parliament with amendments for a third and final reading. The Bill of Parliament can be read in its current state here.

1 thought on “Employment law changes coming – But will businesses be ready?

  1. FYI Rob, as a small business owner I have been bombarded with emails about new Health and safety legislation, from purveyors of compliance help services to official Government news. So I am left in no doubt what the new requirements are.


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