It’s safe to say that 2023 hasn’t started quite as we had hoped. The fresh sense of optimism many of us started this year with has been met with devastating cyclones and flooding around much of the North Island, creating a fresh set of challenges for many individuals and business owners to overcome.
As these unexpected natural disasters add salt to the wounds of Kiwis battling a cost-of-living crisis and impending recession, Cyclone Gabrielle has raised new questions about an employer’s obligations during a natural disaster.
What Kiwi business owners need to know in the wake of Cyclone Gabrielle.
Under the Health and Safety at Work Act 2015 (HSWA), employers must take all reasonably practicable steps to ensure the health and safety of their workers while at work; that includes both physical and mental health.
In the wake of a natural disaster, a New Zealand business:
– Must only operate and direct workers to come to work if it is safe to do so
– Must allow employees to refuse to work if they believe they risk their health and safety by working
– Can request employee/s work from home, if they can do so safely
– Must pay all employees working from home their ordinary pay
– Must uphold health and safety obligations for an employee working from home (as their home becomes their workplace)
What about paying employees who can’t work during a natural disaster?
What an employee should be paid if they can’t work during a natural disaster depends on the following:
– The individual’s employment agreement: Employment agreements may have a ‘force majeure’ clause, which provides that an employee may be required to take annual holidays, leave without pay, work different hours, and/or modify their duties, to accommodate business interruption, from a natural disaster. If an employee is relying on a force majeure clause, consultation is required.
– Consultation: Regardless of any force majeure clause, if an employer wants to make changes to their business, they must consult about the proposed changes if they involve changes to an employee’s working arrangements. Even if consultation is difficult due to the circumstances, employee rights and employer obligations do not waiver.
– The Holidays Act: The Holidays Act allows an employer to direct an employee to take leave if agreement is not reached through consultation. In such a situation, 14 days’ notice is required.
– The decision maker:
- If an employee is ‘ready, willing, and able to work’ but can’t work due to the business being temporarily shut, the employee must continue to be paid as if they were working.
- If an employer directs an employee not to work (when they would otherwise be able to do so), the employee must continue to be paid as if they were working.
- If the workplace is operating and the employee wants to work but cannot get to work, and cannot work from home, the employer may not have to pay the employee. This is because the employee is responsible for ensuring they can work, including getting to the workplace.
Check your business insurance policies.
Many businesses are covered for natural disasters. If that includes yours, tell your employees about the WINZ Civil Defence payment, which provides income assistance for people in designated flood affected areas. This may be paid if a worker has lost income because they can’t get to work, their workplace is closed, they need to stay with family, or they are self-employed and can’t work. There is no income test for the benefit, and it can be applied for online.
In every crisis lies opportunity.
Natural disasters are likely to impact on the wellbeing of workers, so good communication and support are imperative. How an employer responds in times like these will be noticed and remembered for years to come. When handled well and with empathy, these testing times can be used to build tremendous loyalty between employers and employees.
The importance of controlling what you can.
The widespread impacts of expected events, like natural disasters, reinforce the importance of preparing for the things we can control. If you’re a Kiwi employer, 2023 is packed with dates for your diary when it comes to critical law changes that will directly impact your employees and your business.
Here are three of the most important employment law updates NZ employers need to plan for this year.
- Changes to the Minimum Wage
The adult minimum wage will be rising to $22.70 per hour in New Zealand from 1 April 2023. This is an increase of $1.50 per hour from the current hourly rate of $21.20. The training and starting-out minimum wages will both increase to $18.16 per hour, remaining at 80% of the adult minimum wage. This is a rise from the current minimum rate of $16.96 per hour.
For an employee who works 40 hours a week, the minimum wage rise to $22.70 per hour means they’ll earn an extra $60 each week before tax.
The Government plans to review the minimum wage rate again later this year.
- Changes to immigration policy
Immigration New Zealand (INZ) has announced changes for 2023 to ease the burden of labour shortages. These changes will directly impact New Zealand businesses. From 27 February 2023, the median wage will increase from $27.76 to $29.66 for an applicant of an Accredited Employer Work Visa (AEWV).
Any other visa categories with median wage related criteria will be updated.
The following sectors on the Wage Exception List will also be updated:
- Tourism and hospitality: Hourly rate will be $28.18 from April 2023.
- Construction and Infrastructure: Hourly rate will be $26.69 from 27 February 2023.
- Meat processing: Hourly rate will be $25.51 from 27 February 2023.
- Seafood processing (onshore): Hourly rate will be $25.51 from 27 February 2023.
- Seasonal Snow and adventure Tourism: Hourly rate will be $26.69 from 27 February 2023.
The following roles will be added to the Work to Residence Green List pathway from March 2023:
- Civil construction supervisors
- Gasfitters
- Drain layers
- Skilled crane operators
- Skilled civil machine operators
- Halal slaughterers
- Skilled motor mechanics
- Skilled telecommunications technicians
- All secondary school teachers (in addition to the specialisations already on the Green List)
- Primary school teachers
Auditors will also be added to the Straight to Residence Green List pathway from March 2023 (Registered nurses, midwives and medical doctors were added to this pathway in December 2022).
Changes to partner work visas have been deferred to April 2023.
It is likely INZ will release further amendments to address NZ’s labour shortages, including reviewing the Green List in June 2023.
- The introduction of Fair Pay Agreements
Fair Pay Agreements (FPA) were introduced on 1 December 2022 and while, to date, only four applications have been made, the proposed coverage for FPAs may be wide, so keep an eye on the applications to see if your organisation is impacted. If a business falls into an FPA’s coverage, it will have to comply with the FPAs minimum terms, whether it participated in bargaining or not. There is no opportunity for employers to opt out of an FPA, even if they are small or medium sized businesses.
Disclaimer: While this article provides commentary on employment law, health and safety and immigration topics, it should not be used as a substitute for professional advice for specific situations. Please seek professional advice for any questions specific to your workplace.
We can help keep you on the right side of the law.
If you need support preparing your organisation for impending law changes, we can help. Our initial chat is always free, and if you decide you’d like some independent, impartial, and up-to-date support, you can make use of our qualified HR expertise for as little as an hour, or as long as you’d like. It’s up to you.