Jeremy Tauri: Contracts vital for workers

"You can be fined $20,000 for not having an employment agreement," a labour inspector from the Ministry of Business, Innovation and Employment (MBIE) told me recently, over a cup of coffee.

We were talking about employer compliance and how exposed some business owners leave themselves - $20,000 is a lot of money, especially since you can get expert assistance to draft an employment contract for about 1 per cent of that amount. There are even some free resources available.

That $20,000 fine takes the offence to the same level as driving causing injury or death. So employment agreements are something the Government wants us to take seriously. And at this time of year the issue becomes even more pressing.

There's usually an influx of migrant workers and seasonal contractors, many destined for orchards and farms. Some of them aren't up to speed with their employment rights and some businesses that hire people for only a short while don't bother to get all the paperwork in line.

MBIE is stepping up its monitoring and will hire more inspectors to make sure all employers meet the rules. It says it's interested in helping businesses understand their obligations, not just waving a big stick at them.

Inspectors may investigate individual complaints but their focus is on wider workplace activity and where there is evidence of repeated breaches of employment standards, the MBIE inspector told me.

They pay particular attention to agreements, wage records, and leave and time records.

The inspector told me casual agreements were particularly problematic. I expect this has something to do with how busy we're all getting. Growth means more work, so you might rely on casual staff more often.

A casual worker has no guaranteed work or income, and the work they do cannot be anticipated. This is sometimes confused with part-time employment so it's a good idea to review any casual contracts you have to ensure that's still the most appropriate type of contract for that worker.

This is for the business owner's protection as well. If a "casual" gets paid 8 per cent holiday pay and it turns out they actually qualify as a part-time employee, they may be able to recover additional paid holiday leave from you after 12 months.

If you're not sure about any aspect of your workers' contracts, ask for expert advice. That will mean no nasty surprises down the line.