Important employment matters
We would like to bring the following matters to your attention:
Fair Pay Agreements
The Government has announced its plan for FPAs with first agreements targeted for 2022 and likely to cover security workers. The NZSA will actively lobby on behalf of the security industry and coordinate industry representation.
Fair Pay Agreement system
In May 2021, the Government announced the design of the Fair Pay Agreement system. The design was informed by the Fair Pay Agreement Working Group and public consultation, as well as involvement from the New Zealand Council of Trade Unions and Business New Zealand.
A summary of the proposed Fair Pay Agreement system design is below:
Unions initiate the Fair Pay Agreement (FPA) process by meeting a representation threshold of support from 10% or 1000 workers in coverage, or a public interest test. If the coverage substantially expands during bargaining, the public interest or 10% representation test will need to be retested.
Th initiating union/s must decide which work they want covered. Parties can later agree to change the coverage. FPAs can be an occupational FPA or an industry FPA. If there is an overlap in coverage between the two FPAs, the second one only applies if the workers would be better off overall. Contractors are not currently included, but the government plans to begin work soon to incorporate contracts into the Fair Pay Agreements Act later. Penalties will be applied to employers who try to avoid FPA coverage by misclassifying employees as contractors.
Employers, unions, business representatives and government will each have a role in notification to reach as many affected parties as possible.
Unions will represent employees. Employers will choose representatives who meet specified requirements. The bargaining sides must use best endeavours to represent all those in coverage, including non-members, and to ensure Māori interests and views are effectively represented.
Scope of Agreements
All FPAs must include certain topics like base wage rates, ordinary hours, overtime and penalty rates. Some other topics must be discussed but don’t have to be agreed, like redundancy, leave and health and safety. Other employment terms can be included if the bargaining sides agree.
An FPA can allow for exemptions for businesses if they are in significant financial hardship. An FPA can set regional differences and other differential terms if they comply with the Human Rights Act and minimum employment entitlements. An FPA can set a preferential payment for union members up to a maximum value of their union membership fees.
Bargaining sides will be supported by training and a government-provided bargaining support person. The government will also contribute up to $50,000 per bargaining side, with additional funds if the side has low rates of membership of a union or industry group. Funding for this support is based on four FPAs per year. If more than four FPAs are initiated support may be rationed and prioritised. The New Zealand Council of Trade Unions and Business New Zealand will each be funded $250,000 per year to support their coordination roles in the FPA system.
Employees will receive direct updates from unions unless they opt out of communications. Employers must allow employees to attend two, two-hour paid meetings during FPA bargaining. Unions can visit workplaces on FPA business without needing the employer’s consent.
If bargaining parties encounter difficulties, mediation will help to resolve them. The Employment Relations Authority can also make recommendations. If bargaining parties reach a stalemate the Employment Relations Authority will set the FPA’s terms by determination.
The Employment Relations Authority will vet an agreed FPA to ensure the terms are lawful before it goes to a vote.
If bargaining parties reach an agreement, their proposed FPA will need support from a simple majority of both employee and employer voters to be ratified. Employers have one vote per employee in coverage, with slightly higher vote weighting for employers with fewer than 20 employees in coverage. If a first ratification vote fails, parties go back to bargaining. If a second vote fails the FPA goes to the Employment Relations Authority for determination.
Enactment and enforcement
Once finalised, MBIE will make secondary legislation to bring the FPA into force so it will apply to everyone within coverage. People within coverage can enforce their rights through the standard employment dispute resolution system. In addition, the Labour Inspectorate can enforce certain terms of the FPA.
For more information please see the MBIE website.
Introducing new accreditation and single work visa
The Government is introducing a new temporary work visa called the Accredited Employer Work VIsa (AEWV). The Accredited Employer Work Visa will be introduced on 1 November 2021 and will replace six of the existing temporary work visa categories.
Alongside the AEWV a new employer-led system will be introduced that will generally simplify the application process and make it easier for businesses and regions to fill genuine skills shortages when it is clear that there is no New Zealander available to do the job, or who can trained up for the role. Employers will need to be accredited before they can hire a migrant on an AEWV.
Better worker protection
The new 3-check system will help combat migrant exploitation by strengthening requirements on employers. The changes are also important for encouraging employers to focus on ways to train and upskill New Zealanders.
The system will:
- reduce New Zealand’s reliance on lower-paid temporary workers
- better address our productivity, skills and infrastructure challenges
- increase the skill levels of migrants
When to apply for accreditation
Employers only need to be accredited under the new system when they want to start hiring migrants on the new AEWV.
- Employers will be able to apply for accreditation from late September, ahead of the 1 November 2021 introduction date.
- Employers that are accredited under the current system will need to apply and meet the policy requirements of the new accreditation system.
- Employers don’t need to be accredited in the new system by 1 November 2021 if they do not plan to start hiring migrants on AEWV’s at this time.
Businesses employing migrants who hold a current Talent or Essential Skill Visa don’t need to become accredited until they want to hire someone on the new visa.
The following employer policies are closing to new and renewing applications on 30 June 2021:
- Accredited Employer (Talent – Accredited Employer)
- Labour Hire Accreditation (Essential Skills)
- Approval in Principle (Essential Skills), note: this does not include approval in principle for other policies including AIP for foreign crew of fishing vessels.
If employers want to be able to use these statuses up to 1 November 2021, they should apply by 30 June 2021 and consider the processing timeframes available on the INZ website. Employers that only want to hire migrants using the new AEWV should wait and apply under the new accreditation system.
For more information please see the Immigration New Zealand website.
Covid-19 vaccination and employment
Workplaces play a key role in supporting New Zealand’s vaccination campaign, and the rollout of Covid-19 vaccines will likely raise some important employment, workplace health and safety, and privacy questions.
How can my business support the Covid-19 vaccination campaign?
Employment New Zealand encourages all employers to make it easier for their employees to get vaccinated by removing any barriers, such as costs or disadvantage (for example, if travel or time off work is needed). You could:
- Allow your employees to get vaccinated during work hours, without having to use annual leave or losing pay.
- Make employees aware of information about vaccination available from the Ministry of Health or District Health Boards.
- Organise vaccination at your workplace, if asked by the Ministry of Health or a District Health Board.
Can I make my employees get vaccinated?
No. Employers can only require that certain roles are performed by employees who are vaccinated, if the work is covered by a Health Order, or if a risk assessment shows that there is high risk of getting and/or infecting others with Covid-19. There are very few types of work in New Zealand where this would apply.
Can I change my unvaccinated employees’ work arrangement or transfer them to other positions if vaccination is required for their job?
Before considering changes to roles or work, employers should consult with their employees (and their union if one is available), and agree if changes to their work arrangements are possible or desirable. This could include:
- hours of work
- change of duties (e.g. job content)
- transfer to other positions that no longer pose a high risk
Employers should also consider whether the tasks that require vaccination can be postponed. For example, if an employee can’t be vaccinated (e.g. pregnancy, certain medical conditions or existing medication regimes) then this might mean certain alternative arrangements can be agreed for the short term, with vaccination planned for a later date.
For more information please see the Employment New Zealand website.
From the NZSA team.