Tougher Employment Standards
25 August 2015The Employment Standards Legislation Bill introduced to Parliament on 13 August 2015 promotes fairer and more productive workplaces by providing enhanced protections and benefits for both employers and employees.
Specifically it:
- Extends parental leave and payment to more employees and increases the flexibility of the Parental Leave Act.
- Provides for stronger and more effective enforcement of employment standards through amendments to the Employment Relations Act, Minimum Wage Act, Holidays Act and Wages Protection Act.
- Prohibits certain practices in employment such as “zero hours” contracts through amendments to the Employment Relations Act and Wages Protection Act.
Key measures include:
- The ability for the Employment Court to impose significantly higher penalties for breaches.
- Extending accountability to persons other than the employer who are knowingly and intentionally involved in breaches of employment standards.
- Enhancing the powers of labour inspectors to request information and share it with other agencies.
- An infringement notice regime for breaches of an employer’s obligations in relation to record keeping and individual employment agreements.
Parental Leave Changes
Parental Leave Changes
From 1 April 2016 paid parental leave will be extended to 18 weeks (currently 16 weeks) and:
- Parental leave payments will be extended to non-standard employees (such as employees who are casual, seasonal or have more than one employer) and those who have recently changed jobs.
- Parental leave entitlements will be extended to carers other than biological or formal adoptive parents.
- Employees who have been with their employer for more than 6 months (and who have worked an average of 10 hours per week in that period) will be able to take a standard 26 weeks leave period (inclusive of the 18 weeks paid leave).
- Enabling employees to take one or more periods of extended leave by mutual agreement (within the 26 weeks period for those with 6 months service and within the 52 weeks period for those with more than 12 months service).
- Enabling employees to keep in touch with their work by being able to work for up to 40 hours during their paid leave period by mutual agreement (but not within the first 28 days after birth or adoption).
- Employees may resign and retain their paid leave entitlement (currently the payment only continues where the employee is dismissed or made redundant, has a miscarriage or is no longer caring for the child, or the employee or the child dies.
Restrictions on Certain Practices
Restrictions on Certain Practices
- Hours of Work - The agreed hours of work must be included in the employment agreement.
- “Zero Hours” Contracts – Unless there is a compensatory provision in the employment agreement, any availability provision is unenforceable if there is no obligation on the employer to make work available but the employee must remain available to accept any work the employer makes available. The employee and the employer may agree that the employee’s remuneration includes a provision to cover such compensatory measures. Note also that the employee may not be treated adversely by refusing to perform work under an availability provision.
- Cancellation of Shifts - The agreement must also specify the minimum period of notice to cancel any work commitment (“shift”) and the compensation payable if the shift is cancelled without the required notice. The period of notice must be “reasonable”. If the shift is cancelled without the requisite notice, the employee is entitled to be paid what he/she would have been earned had the shift been worked, or the remainder of the shift if the shift had already started when the instruction to cease work was given.
- Secondary Employment - Any provision in an employment agreement restricting an employee from working for another employer is unenforceable unless there is a genuine reason, based on reasonable grounds and the reason is stated in the employment agreement. Reasonable grounds include protection of commercially sensitive information, IP and reputation or preventing a real conflict of interest. One imagines health and safety would be a reasonable ground if in total the employee is working very long hours.
- Pay deductions – Any pay deductions an employer is entitled to make must not be “unreasonable”.
Enforcement
Enforcement
Labour Inspectors will have greater powers to issue infringement notices. Infringement fees will be from $1,000 to a maximum of $20,000 over a three month period depending on the nature of the infringement. They will also have greater powers to share information with other agencies.
The Court will be able to impose:
- A Banning Order if the Court is satisfied the person has persistently breached or persistently been involved in the breach of one or more employment standards. The order may be imposed for a period of up to 10 years, during which time the person may not enter into an employment agreement as an employer, be an officer of an employer, or be involved in the recruitment or employment of employees.
- Fines of up to $50,000 for individuals or the greater of $100,000 or 3 times the amount of financial gain made from the breach. Note that insurance against such penalties will be unlawful.
- Compensation orders to the employee.
Employers will be required to maintain records sufficient to demonstrate compliance with the legislated minimum entitlements.
For a copy of the full Bill see: