A well-written employment agreement helps the employee and employer to know what is expected from them. Photo / 123rf
A well-written employment agreement helps the employee and employer to know what is expected from them. Photo / 123rf
OPINION
Several times a week I receive a call from a harried employer who has had the best intentions for their team, but now find themselves looking down the barrel of an unexpected personal grievance from a once highly valued employee.
The thing all these employers have in common? Lackof communication, preparation, policies and paperwork.
Unfortunately, as a potential global recession advances, personal grievance claims will become more frequent. Money is tight – for employees and employers.
Unhappy employees will be looking to make sure they've got all they can out of an unsatisfactory employment situation, and frazzled business owners are less likely to prioritise employment processes – to their cost, ultimately.
Whilst this front-end advice is often ignored and put in the too-hard basket, here is what Northland employers need to address – today, before it's too late.
1. Employment agreements – A well-written employment agreement helps the employee and employer to know what is expected from them and what they're entitled to. This means misunderstandings are less likely to happen, and if a problem does come up then the employee and employer can turn to the employment agreement to clarify things.
David Grindle
As a matter of law, all employment agreements must cover a range of things such as the agreed hours the employee will work and their start and finish times.
It's recently become a requirement to record an availability clause that sets out the number of extra hours a week an employer may request an employee to work on top of their normal hours.
These kinds of development in employment law need to be captured in employment agreements or workplace policies.
2. Workplace policies – like all relationships, an employment relationship evolves over time and the expectations of the parties change with it. Workplace policies are important documents because they help create the culture of the workplace by setting out the employer's expectations and how the various entitlements in the employment agreements work.
At the heart of all the frustrated queries we receive is the need to have clear and detailed understanding of what each party expects of the other. We all want to know where we stand and what the rules of the game are. Without those things we feel insecure and less involved.
Investing time and resources in ensuring employees know what is expected of them pays dividends for both parties.
Collectively, an employment agreement and a workplace policy should spell out the expectation each party has of the other. For example, the question of an employee's availability to work overtime shouldn't be left to chance.
A good employer will have had that conversation with its employee before the need arises and they will document the outcome. There is no wrong answer to the question "how much overtime do you want to work?" but there is valid criticism if the question has never been asked.
In the past few years, business owners have had to swallow increased expenses across their businesses.
Employment costs have followed the same upward trajectory, including extra statutory holidays, the cost of maintaining relationships during the Covid pandemic, domestic violence leave and demands on employers to increase wages to match the cost of living pressure.
Potentially, there might be more costs on the horizon in the form of redundancies and the Government's proposed employment protection scheme, which would have employers being required to pay money into a fund to underwrite payments to employees affected by job loss.
We will cover the employment protection scheme in a subsequent column but lastly, a word on redundancy provisions and protocols.
In this world nothing is new and everything goes full circle.
History tells us periods of high employment are often followed by periods of lower employment and while we hope for the best, we need to make plans to accommodate the worst. In New Zealand, unlike Australia, it is not compulsory to pay compensation to an employee impacted by a workplace redundancy.
It is, however, compulsory to have information in the employee's employment agreement dealing with what would happen in response to a redundancy event, the notice period that would be provided and what, if any, compensation is on offer and how is it calculated.
Correctly managing redundancies is complicated and the employer needs to follow a procedurally correct and fair process.
We strongly recommend that any employer faced with a potential redundancy situation seek legal advice well in advance of the potential event, and that you obtain a blueprint that applies the law and outlines the steps required for you to successfully navigate this complex area.
David Grindle is the director in charge of the employment law team at WRMK Lawyers. He has practised in this area of the law for 17 years
