As previously announced by the government the adult minimum wage will increase, from $18.90 to $20.00 per hour on 1 April 2021.
The starting-out and training minimum wage rates will also increase on 1 April 2021, from $15.12 to $16.00 per hour.
As an employer, you need to ensure your payroll systems and processes are updated.
If you’re looking for information about about law changes, setting up a business, places to get help and so much more then you should check out www.business.govt.nz/news
This is a government run site that highlights all the information business owners need.
We recommend subscribing to the regular e-newsletter.
Financial support for businesses to pay people in situations where they cannot work from home and need to stay at home while waiting for a COVID-19 test result.
What is it?
The Payment is a one-off amount of $350 for each eligible worker (full or part time) that is unable to work from home while they are staying home waiting for Covid-19 test results.
Who is it for?
Criteria
Test must have been taken on or after 9 February 2021. The payment can be applied for up to 8 weeks after the test, but not retrospectively if the test was taken before 9 February 2021.
Payment cannot be paid for workers who:
Business can’t apply if receiving other Covid -19 wage subsidy or leave support scheme payment for the same worker.
Applications
Application must be completed by the business, not the worker. The self-employed or contractors can apply directly.
Payment can be applied for once in a 30 day period (for each eligible worker)
Apply online using MSD online form https://www.workandincome.govt.nz/covid-19/short-term-absence-payment/how-to-apply.html#null
Well it certainly has been an interesting week and a half as we all get used to working and living differently during the Covid-19 lockdown.
It seems that every day the government is providing more clarification as to things we can do day-to-day and, most importantly for you, how you can use the wage subsidy. There have been many conflicting pieces of advice from employment lawyers and employment relations businesses. As we have digested these varying pieces of interpretation we have taken a ‘use it responsibly and fairly’ attitude.
On Friday Minister Grant Robertson clarified that if a wage subsidy received for a part time employee is more than they would usually get paid then the balance can be used towards paying other employees. The key thing is it MUST be used to pay staff wages.
We have had many queries from clients who are sole traders, partners in partnerships, and contractors as to whether they can get the wages subsidy. The answer is yes, provided you meet the necessary criteria.
Contact Anna at anna@savage.co.nz if you need help filling in the application
You may be asked to prove you have applied the wage subsidy correctly and we will need to account for any subsidy you have received when we prepare your annual accounts at the end of the year so it is important you keep a record of how you spend the money the government gives you for wages.
We have prepared a very simple spreadsheet that will help you keep track of the money you receive and pay out.
If we prepare your payroll for you we will do this for you and can send you updated figures on a regular basis so you know how much you have left to use for wages. If you want a copy of the spreadsheet just email neil@savage.co.nz and he will send it to you
At the end of the year please email it back to us with your annual accounts information.
If you are an employer it is important to note the minimum wage rate increased effective from 1st April. Even during the current difficult trading conditions this is the minimum you must pay all of your staff
The rate increases from $17.70 to $18.90 per hour.
If Sari normally contacts you prior to provisional tax payments she will still do so as many businesses may need to estimate their provisional tax down due to low trading / no trading in March and doubt about debtor payments.
As usual we will be sending out tax notices to you during April for 7th May payment.
If you have any queries contact Sari – sari@savage.co.nz 021-548-489
If you are using Xero or MYOB on-line and would like us to get started on your 2020 annual accounts please sign client questionnaires that were previously emailed to you in March, and send them to Sari.
Your bank may need these if you are looking for further support from them during these difficult times. We have two senior accountants as well as Sari working remotely from home who can work on these during the Covid-19 lockdown.
Remember, we are here to help you if you need some advice or assistance, just email or phone us, but most importantly please be safe and stay home so we can all get back to a level of normalcy as soon as possible.
| Callaghan Innovation’s R&D Student ‘Experience’ Grants are now open to help you to access fresh skills and talent to drive innovation in your business. R&D Student ‘Experience’ grants support students and recent graduates, by funding businesses to engage a student in a R&D activity, giving them the work and technical experience, and in exchange a business will receive new talent, capabilities & fresh thinking to assist you with your R&D endeavours. Key Things to Know: Businesses receive $8,460 (excl. GST) to cover 400 hours of a student’s time to work in your business (equivalent of 10 weeks work); It’s a great way for a business to bring in a student to add some focus, expertise or blue sky thinking to a R&D project; Applications for the 2019 student ‘experience’ grant are open between 1 May 2019 – 31 August 2019; The student must be an Undergrad, Masters or Phd student (note,a student is still eligible if they have recently graduated and their final semester is within 6 months of your application); The student’s main area of study must be Science, Technology, Engineering, Design, or Business; You can apply now, and then recruit the student later; and The student can come on-board any time after an application is approved and their work (within the business) must be completed by 31 March 2020. This year the process is more flexible and faster, and applications are assessed as they are submitted for a faster outcome (approx. 2/3 weeks approval time). Applications are open for the next 4 months so you can secure the talent you need earlier in the year and before students break for summer. We recommend that you apply now so you can access and recruit the best talent from around NZ. |
| Next steps: For more information on the R&D Experience Grant and to find out if your business is eligible, please contact Mark Maguire on mark.maguire@nelsontasman.nz. We will assist and guide you through the process, as well as approving your application, so please contact us now. As the region’s economic development agency, one of our core roles is to connect our clever businesses and people with opportunities to grow and innovate. The Regional Business Partner (RBP) Network is designed to make it easier for NZ businesses to access early-stage support to innovate and grow. This national network is made up of 14 ‘Regional Business Partners’ and is supported by New Zealand Trade and Enterprise (NZTE) and Callaghan Innovation – the government’s business innovation agency. The Nelson Regional Development Agency is the ‘Regional Business Partner’ for the top of the south. We provide information, advice, funding and connections to local businesses seeking support for their growth journey. |
A recent personal grievance case between Philipa Johnson and the National Business Review (NBR) resulted in a win for the employee, which actually ended in a financial loss for her when all was said and done. The Employment Relations Authority determined the employee was unjustifiably dismissed. However, the sting in the tail for the employee was that her legal costs were 10 times higher than the compensation she received.
As an employer, it can at times feel like the cards are stacked against you when dealing with a personal grievance. Frequently the better business decision can be to reach a settlement to resolve a dispute even when you have done nothing wrong. From a point of principle this may not feel particularly comfortable.
However, despite best intentions an agreement might not be reached, or you may decide the principle is more important. As a client goes through the decision process to determine which strategy to adopt, we take you through the risks of each pathway and the potential costs of both winning and losing a grievance in the Employment Relations Authority.
At the same time we analyse the risk for the employee and likely value of any compensation award, and this helps inform the decision on how much to consider offering to reach a settlement if this is the preferred option. There are times the employee is either too greedy or poorly advised and their expectations of a settlement amount are unrealistic.
Affecting the level of the award Johnson received was the Authority’s determination that she breached her employment agreement when she took and distributed confidential information from the employer when she left their employment.
Johnson was awarded $1,666.67 in lost wages and $8,000 in compensation for the unjustified dismissal. She had claimed $50,000. However, she was ordered to pay a $9,000 penalty for breaching her Employment Agreement, of which $6,750 was to be paid to the NBR and the balance to the Authority. Johnson paid a staggering $96,000 in legal fees.
The winning party ordinarily is awarded $4,500 in costs for a one day hearing in the Authority. With this in mind, even without the penalty awarded against her, Johnson was always going to be on the losing side financially, as she claimed $50,000. This case demonstrates how principle can override common sense, and some people cannot be negotiated with.
Recently WorkSafe announced that it will ‘typically only investigate bullying and harassment claims where there is diagnosis of serious mental harm’.
This significantly limits the complaints they will investigate. Although the clear acknowledgement of this is new, it is consistent with WorkSafe’s actions to date.
WorkSafe has never prosecuted anyone for bullying, despite receiving over 100 complaints of bullying in the past 4 years. Of those complaints, only 9 were investigated. WorkSafe receives over 10,000 notifications a year, and they only have the resources to investigate the most serious incidents, primarily those that result in serious physical harm.
Radio NZ recently reported on allegations of bullying at the Bay of Plenty DHBs’ Tauranga Hospital. Two Hospital staff, who were at times suicidal after feeling bullied at the DHB, had their cases turned down for investigation by WorkSafe. This demonstrates just how serious the harm must be before WorkSafe will investigate.
This does not mean employer’s are off the hook. The path to seeking some form of recompense is frequently taken by raising a personal grievance.
A recent case, FGH v RST, was heard in the Employment Court. The employee was being performance managed, and during that process accused her manager of bullying her. The organisation chose not to investigate the complaint, concluding the employee was simply resistant to being performance managed. The Court criticised this approach, concluding that although the behaviour complained of was ultimately found not to be bullying, the employer had an obligation to investigate the concerns raised rather than dismiss it out of hand.
Bullying investigations are often complex, particularly as bullying behaviour is frequently underhand and out of sight of witnesses. Getting the basics right is a good start.
All of the information you gather has to be provided to the alleged bully. Only in extreme circumstances can information be anonymous. Case law consistently rules a person is entitled to know who is making allegations against them. The alleged bully then needs to be provided adequate time to consider the information before responding to it, and they are entitled to have a support person or representative with them.
Other issues include having one person’s word against the other and no witnesses, witnesses unwilling to provide statements out of fear, imbalances of power between a complainant and the accused, seemingly small incidents that separately are minor but collectively paint a different picture.
Bullying is a health and safety issue, and irrespective of the lack of action WorkSafe is likely to take, if you don’t take action it can adversely affect attendance, productivity, culture, employee retention, and ultimately result in a personal grievance.
If you have any issues at your workplace that concern you, please talk to one of our trained consultants for advice before embarking on an investigation process. We offer 10 minute free advice for any new enquiry.
Below is the first in our series of one liners we use in response to challenging behaviours. We hope they come in handy for your own work situations. If you have any of your own that work please email them in and we can include them.
Passive Aggressive Colleagues
We have a passive aggressive person on our team who constantly moans to his colleagues but won’t say anything to me. The team want him to stop. What can they say to him?
Next time he corners them in the tea room and he his being negative about the latest thing, get his colleague to say : “That sounds really important to you, let’s go and tell the manager.”
Crying
What do I say to the employee who always cries when I raise something with them. Firstly accept crying as being okay, not something to be intimidated by. Acknowledge they are upset, but don’t be put off from discussing what you intended, or hearing what they have to say. A response to tears can be as simple as passing over some tissues and saying: “I can see this is upsetting for you, I will give you a couple of minutes.” Just sit there. Say nothing. It is more likely than not they will start talking again. The key is to not allow the tears to bring the discussion to an end. It may temporarily put it on hold, but always come back to it.
Blaming
Next time someone simply blames others e.g. says, ‘but I couldn’t do it because John did/didn’t do that thing’, respond with “I’m interested in what you could do differently next time so that we still get the necessary outcome”. For example: Ted hasn’t completed the report he was supposed to do for you. It was John’s fault (according to Ted) because he didn’t get the information to Ted to complete the report. What could have been done differently? Ted could have chased John for the information, communicated to John a timeline, told you before the report was due that there was possibly a delay, or completed other parts of the report while he waited for the other information. All things Ted could have done. Place the responsibility back on to Ted. i.e. the person who blames others.
There will be significant implications for many employers following a recent Employment Court Case. If your employees attend training, meetings, work functions or travel for work purposes you may need to reconsider how you pay them.
The case involved the Smiths City Group. Every morning prior to opening, the sales manager at each of their 29 locations holds a 15 minute morning meeting to discuss issues and talk about sales promotions and targets. The employees were not paid for their attendance.
In January 2016 a Labour Inspector issued an improvement notice to Smiths City that required the organisation to undertake an audit to identify where wages had been paid below the statutory minimum. The audit was for all employees who attended the 15-minute morning meeting who was on, or close to, the minimum wage rate and it applied across all 29 stores. The audit had to cover all current and previous employees for the last six years. The company was to calculate the arrears of pay below the minimum wage and reimburse those arrears accordingly.
Smiths City objected to the improvement notice claiming the 15 minute meeting was not work. In addition, Smith City was claiming the commissions and bonuses paid to employees ensured they were paid above the minimum wage even when the hourly base rate was at the minimum wage and the 15 minute meeting was deemed to be work. The matter went to the Employment Relations Authority and the Authority agreed with Smith City, rescinding the notice. The Labour Inspector appealed, and the case was heard by a full bench of the Employment Court.
The Employment Court looked at the Idea Services case (known as the Sleepover case) as the basis for determining whether the 15-minute meeting was “work” for the purposes of the Minimum Wages Act.
Smiths City argued that the employees were not compelled to attend the meetings, that the meetings didn’t put a significant degree of constraint on the employees, and there was no responsibility on the sales staff during the meetings, and they argued that the meetings were not critical to the business.
The Employment Court found that staff were required to attend the meetings, and that while there were different expectations of behaviour in the meetings compared to when they were in the store, that it did not alter the fact that their personal freedom during those 15 minutes was constrained by the employer.
The Court rejected Smiths City’s claim that there was no responsibility on the employee during the meetings, but rather like a training course, the employees were expected to sit, listen and learn the information being presented by the Sales Manager so they could apply it during the day.
The Court also rejected Smiths City’s claim that both the employer and the employee benefited from attending the morning meeting, by earning higher commissions.
Accordingly, the Court found that the sales employees who attended the morning meetings were working during those 15 minutes.
That left the Court to consider whether Smiths City had breached the Minimum Wage Act. Smiths City contended that when the sales commission was taken into account, all of their sales staff earned more than the minimum wage. The method of payment was justified by the company because wages, and commission, were earned over the whole pay period which it considered to be the correct interval for the calculation of minimum wage.
The Court accepted that the commission does form part of wages, but said it didn’t satisfy s 6 of the Minimum Wage Act. The Court found that commission and incentive payments were not earned for attendance at the meetings and were not connected to hourly rates of pay generally. They were achieved against targets specified by the company. The commission payments were deemed to be additional income earned over and above the contractual hourly rate, and not a substitution for it.
The Court stated that Smiths City’s method of calculation did not satisfy the Minimum Wage Act. The Court reinstated the Labour Inspector’s Improvement Notice. This means Smith City will be required to backpay, for a six year period, any hourly paid employee who attended the morning meetings.
If you have concerns about how your remuneration is structured and whether you are inadvertently failing to meet minimum wage requirements, please contact our team.
We have seen an increased occurrence of employees resigning and then raising a PG, stating that their resignation was constructive dismissal and unjustified. In many instances they haven’t previously raised their concerns with their employer or the issues raised appeared minor with the employer believing each was addressed at the time as no further concern was raised by the employee. However, post-resignation, the employee might list all of the minor issues trying to prove that a trend existed. They may even claim an illness that they believe resulted from issues in their employment.
It is reassuring to see the Employment Relations Authority reject a recent claim of constructive and unjustified dismissal by Kathryn Gifkins that she was forced to resign from her position at Marinoto Rest Home in Taranaki.
The claim followed two incidents; one regarding a false accusation of Gifkins dragging a resident and the other about her being stalked by a dementia patient. Gifkins claimed her manager did nothing about either incident and so felt she had no option but to resign i.e. her resignation was constructive dismissal and was unjustified.
Gifkins was employed as a healthcare assistant at Marinoto Rest Home in July 2016. Two issues arose, shortly after she started which she said were of “significant concern for her”.
She soon realised that she was expected to dispense medication to patients which was something she felt uncomfortable doing in case she made a mistake and also felt it was a a registered nurse duty.
Her manager, Barbara Kay, said Gifkins did not convey her concerns about making a mistake and commented that Gifkins was “very competent” at providing medication and had no concerns about her confidence.
The Authority was satisfied the dispensing of blister pack medications was a reasonable activity for Gifkin’s position.
The second issue Gifkins had was with a dementia patient who became “infatuated” with her.
The patient told her he wanted to marry her and proposed to her. He continuously sought her out, giving gifts, making phone calls to her home and following her to the car park.
Despite complaining to Kay about feeling harassed, she said her concerns were never addressed.
However, Kay argued she told Gifkins she did not have to go to the area of the rest home where the patient was living, she did not have to care for him or communicate with him.
Gifkins said it was difficult to distance herself from him due to the size of the rest home.
The Authority member said it was clear Gifkins received unwanted attention from the resident, but she could not apportion blame to the rest home as options were given to her by management to reduce the interaction.
In May 2017, Gifkins resigned. This followed an incident which Gifkins described as “the final straw”.
Gifkins claimed that earlier that day Kay falsely accused her of dragging a patient when she and another carer were trying to lift a patient off the floor into a chair.
Gifkins claimed Kay yelled “Are you dragging him or lifting him?”. Kay admitted she said those words, but denied she yelled them, or directed them solely at Gifkins.
Gifkins said she was unhappy with the way she had been treated and felt distressed that Kay had not listened to her or been responsive.
The Authority member noted that Kay’s manner, along with the words used at the time of the incident, may have been “insensitive and unhelpful in the moment” and added “I accept, however, that Ms Gifkins was unhappy and resentful as a consequence, but I am not at all persuaded that the interaction could be regarded as a breach of Ms Gifkins’ employment, let alone one that could be fairly characterised as dismissive or repudiatory conduct that would make it reasonably forseeable Ms Gifkins would resign, an employer is under no contractual obligation to behave sensitively towards its employees.”
A constructive dismissal occurs where an employee resigns from employment but really the resignation was forced or initiated by the action(s) of the employer.
The Authority assessed whether a substantial risk of resignation was reasonably foreseeable and found that it was not in this case.