New Employment laws – how will they affect your business?

It is important building and contracting companies keep up to speed with how the new Employment laws, introduced in April, might impact on their businesses, given the tougher sanctions for employers who fail to meet the new employment standards.

One of the key changes is the increase in minimum wage, which has gone up 50 cents an hour to $15.25 per hour, equating to $122 for an eight-hour day.

Any workers aged 16 years and over and not starting-out in work or training or are in the first year of an apprenticeship, are legally entitled to earn this rate.

The starting-out and training hourly minimum wage rates have also increased from $11.80 to $12.20 per hour, which is 80 percent of the minimum wage.

The new laws also target ‘zero hours’ contracts where an employee is effectively required to be on call all the time without any guarantee of hours and without being paid anything to recognise that demand. These practices have been deemed “unfair” in the new legislation, and have been prohibited since 1 April, along with the cancellation of shifts without reasonable notice or compensation, and unreasonable wage deductions.

Employers are now required to record details about agreed working hours in the employee’s employment agreement, so both are clear about their responsibilities to each other.

Parental leave has also been modernised.

Any employee who is a parent of a baby born after 1 April, or is taking primary care of a child under the age of six after this date may be entitled to up to 18 weeks parental leave payments.

Eligibility has also been expanded to include seasonal, casual and fixed-term workers who have worked for any 26 weeks of the 52 weeks prior to their baby being born.

Parental leave payments may also be available to primary carers who are not biological or adoptive parents, for example a grandparent who intends to take permanent responsibility for the care of their grandchild in place of the parents.

The new laws beef up the range of sanctions for employers that fail to meet their obligations in relation to employment standards, such as the minimum wage, holiday pay and record keeping.

New measures include increased penalties for serious breaches, clearer record keeping requirements, more ability for employees to seek penalties against employers and some changes to the way the Employment Relations Authority will deal with employment standards matters.

For more clarification about the changes for both employers and employees, visit employment.govt.nz

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