Let's Talk Law: No more 90-day trial for big firms

Workplace Relations Minister Iain Lees-Galloway introduced the Employment Relations Amendment Act 2018 into Parliament.

Brittany Smith-Frank

On entering into Government in October 2017, the Labour-led coalition made it clear there would be changes to New Zealand's employment law.

Two weeks ago the Government passed the Employment Relations Amendment Act 2018, bringing into force the first phase of these reforms.

The majority of reforms will be coming into force in two stages — straight away and May 2019.

The changes in the later stage will, in our opinion, have the biggest impact on employers and staff.

From May 2019, businesses that have 20 or more employees will no longer be able to include a 90-day trial period in their employment agreements.

So for most employers, their "get-out-of-jail-free card" will be taken away, and employees will be able to raise personal grievances as a result of being unjustifiably dismissed at any time during their employment.

This is significant — employers need to be conscious of the number of staff they have when hiring any new employee, and it is also now more important than ever that employees seek advice if they suspect they have been dismissed without a fair process or for a good reason. From a legal perspective, it is interesting to note that, in determining the legality of a trial period, the number of staff will be counted when the agreement was entered into, not when the employee was dismissed.

Employees' rights to set rest and meal breaks will also be restored from May 2019. At present, employees are simply entitled to "reasonable breaks".

The new law sets out the number and duration of breaks which employees are entitled to in relation to how many hours they have worked.

For example, staff working 9am to 5pm must be given two 10-minute paid rest breaks and one 30-minute unpaid meal break.

For many, this change will be familiar and is simply a roll back to the pre-2015 position. In fact, in our experience, most employers didn't realise the law had changed to begin with.

The reforms which are of immediate effect relate to union representatives and remedies for personal grievances.

From now on, union representatives must be given reasonable access to enter a workplace (where there is a collective agreement) and, in most circumstances, union representatives will no longer require employers' consent to be present on site. Further, reinstatement will now be the primary remedy for employees who request it. Up until now, where an employee has been unjustifiably dismissed, the Employment Relations Authority has favoured awarding compensation rather than reinstating them to their job.

Now, unless it is impracticable to do so, the authority will be focused on ordering the employer to reinstate that employee to their original position. Neither the length of time passed, nor the fact the employee's position has since been filled will have relevance in making that determination.

In addition to these changes, there are other amendments to union activities and vulnerable workers. You may need to seek advice on these changes should you be affected.

We anticipate these are only the first in a number of changes to employment laws the Government intends to make. It is important that employers are up to date with changes and make amendments to employment agreements.

Brittany Smith-Frank is a solicitor at Treadwell Gordon.