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Brief Counsel

New employment and holidays law passed

25 November 2010

​The amendments to the Employment Relations Act and Holidays Act were passed by Parliament yesterday and now only need the royal assent to become law, likely to be early next week.

This Brief Counsel summarises the key additional policy changes since our earlier publications.  

Union access

Employers are now required to respond to union access requests within one working day (previously this was two).  However consent is only presumed to be given if two days pass without a response from the employer (this has not changed).
Where access is refused, the employer must give written reasons by the end of the working day after the refusal (again, previously this was within two days).

Personal grievances 

The personal grievance provisions have been tweaked.  The original Bill stated that the Authority or Court could not determine a dismissal to be unjustified solely because the defects were minor or technical and probably did not result in the employee being treated unfairly.
In the Bill as passed, the references to “technical” and “probably” have been removed, so that dismissals will not be unjustified if the defects were minor and did not result in the employee being treated unfairly.

Employment agreements

The Bill provides that an intended agreement (of which the employer is obliged to retain a copy) must not be treated as the employee’s employment agreement if the employee has not signed the agreement or not agreed to any of the terms and conditions specified
This is likely to cause real issues as it is not uncommon for employees not to have signed agreements and for the courts in this situation to treat an unsigned agreement as setting the terms and conditions of that employment – a (usually practical) result which will now be unavailable.
The policy intention was to make it clear that an unsigned agreement cannot be the employment agreement where the employee has told the employer that he or she does not agree to it.  That is sensible, but it is not what the amendment actually says.  We had hoped that this issue would be ironed out when the Bill was considered by the whole House.

Holidays

The requirement that requests by employees for the payment of annual leave and requests to transfer a public holiday be “informed and voluntary” has been removed on the grounds that this could create much uncertainty.
The definition of discretionary payments under the Holidays Act has been tidied up.  Payments are not discretionary for Holidays Act purposes if they are required to be paid under the employment agreement, even though the employer may have a discretion about how much to pay, or payment is only required where the employee meets certain conditions.  In our view these changes are sensible and reflect current practice.

Application

Most of the amendments will come in to force on 1 April 2011.  The requirement for employers to retain copies of employment agreements will come in to force on1 July 2011. 
Please see, The 90 day trial period and New workplace rules, for more details about the new legislation and its effects.
Our thanks to Maddy Conway, Solicitor, for writing this Brief Counsel. For further information, please contact the lawyers featured.

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