Essential Update - First update of 2024

Posted 10 January 2024 by Mike Johnson Case Law, Legislation, 90-day trial, 90-day trials, FPA's, Fair Pay Agreements, Personal Grievances, Letter of Expectiation;

First 2024 Essential Update

Wednesday 10th January 2024

In this update:

Important Legislative Updates – FPA’s repealed and 90-day Trial Periods now accessible to all
Court Cases – Grievances and Letters of Expectations

But, first and most important – Happy New Year to you all! We hope that you enjoyed a well-earned break with loved ones, thank you for your business over the last year (or longer) and here’s to an amazing 2024!

Also, for those who received our “Final Update for 2023” this morning… we are unsure how that happened and apologise for the confusion!

Important Legislative Updates:

Fair Pay Agreements

As of the 20^th December 2023, the new Government repealed the Fair Pay Agreements (FPA) Act. This will be great news for many of you as it will leave you in charge of your bargaining for employment agreements. You will be able to continue to ensure that you pay rates that are fair for both employee and employer.

Please note that rights and obligations under other employment legislation still apply. This means that Employees may use existing pathways and union representation to bargain with you for changes to their pay and other terms and conditions of employment.

90-Day Trial Period - Extended to ALL Employers

As of the 22^nd December 2023, s67A of the Employment Relations Act was amended to include all Employers and Employees working for them. The words “small-to-medium sized employer” were changed to “the employer” throughout the relevant parts of the Act which means that those businesses who have more than 20 Employees can now use a 90-day Trial period if they wish.

The rest of the clause (and related clauses) and the requirements for being able to use the trial period remain the same. To be able to use the trial period, the following must be complied with:

The trial period can only be used for Employees who have not ever been previously employed by the Employer (this includes any casual Employees);
The clause in the Employment must state:
- The specified period (not exceeding 90 days) that the Employee is to serve a trial period;
- That the trial period will start from the first day of work;
- That during the trial period, the Employer may dismiss the Employee;
- If the Employee is dismissed during this period, they are not entitled to bring a personal grievance against the Employer, or other legal proceedings, in relation to the dismissal.
For the trial period clause to be valid, the Employment Agreement must be signed by both parties before the Employee starts work of any kind.

This will be good news for any employer who has not been able to use this clause. If you wish to insert this clause into your IEA template, please get in touch so that we can update your Employment Agreements accordingly. There will be Employment Agreements in use that quote the previous legislation and refer to use of a 90-day trial period if they employ less than 20 employees – you may need to check this is not the case for you.

Court Case Rulings:

Personal Grievances (PGs)

I have had a number of clients recently question the validity of a Personal Grievance. What you need to know:

An employee has 90 days to raise a personal grievance (PG), from the date they first know of the event that gives rise to their grievance (12 months if it relates to a sexual harassment claim)
They must identify it is a PG
It must create the expectation of a response
It must be clear as to the substance of the grievance
But it can be verbal or in writing

If you are in any doubt at all, please contact us for advice.

Letters of Expectations

I know that we have advised many of you on issuing letters of expectations, generally to put a stake in the ground, where you don’t want to or cannot fairly issue a formal warning. There has been an interesting case where the imposition of expectations was challenged. What you need to know:

Imposing expectations that are not already in someone’s Employment Agreement, job description or policy, will be seen to disadvantage an employee
Before you add an expectation that is not already clearly evident, you should discuss it with the employee and get their agreement that it is reasonable

Essential HR are here to help. For ongoing help call us on – 03 3650532 (voice messages are automatically relayed to Mike), or you can contact Mike directly on 027 2808546 or mike@essentialhr.co.nz.

I’m happy for you to pass this on to others.

And if you need to conference call, we are all set up with Zoom.