Big employment law changes arrive – Lexology

On 5 December 2018, the Employment Relations Amendment Act 2018 (the Act) was enacted. The changes take effect in three stages:

  1. The day after Royal assent (Received Royal assent on 11 December 2018),
  2. 6 May 2019, and
  3. Six months after the date of Royal assent.

Many of the amendments to the Employment Relations Act 2000 are familiar to employers as they reverse changes made by the National government over the previous nine years, particularly in the areas of unions and collective bargaining. Other changes include the restriction of 90-day trial periods to businesses with fewer than 20 employees and the reinstating of prescribed meal and rest breaks.

Key changes in effect from 12 December 2018:

  • Union representatives can now enter workplaces without consent for specified purposes in the Act. Entry without consent is allowed if (i) there is a collective agreement in place and the coverage clause covers the work done by employees in the workplace or (ii) if bargaining for a collective agreement has been initiated and the intended coverage would cover employees in the workplace.
  • Pay deductions can no longer be made for partial strikes, such as refusing to wear uniforms as part of low-level industrial action. Employers can still respond to partial strike action in other ways, including suspending employees without pay or initiating a lockout.
  • Businesses must now enter into bargaining for multi-employer collective agreements, if asked to do so by a union.
  • Where employees have been found to be unfairly dismissed, reinstatement will be the first course of action considered by the Employment Relations Authority if requested by an employee. The Authority is still required to assess whether reinstatement is practicable and reasonable for both parties.
  • Earlier bargaining initiation timeframes have been restored for unions in collective bargaining, enabling a union to initiate bargaining 20 days ahead of an employer.
  • New categories of employees may apply to receive the protections afforded to ‘vulnerable employees’ through an application process set out in the Act.

Key changes in effect on 6 May 2019:

  • Prescribed rest and meal breaks will be restored. The duration and number of rest and meal breaks will be determined by how many hours an employee works. 90-day-trial periods will be restricted to businesses with less than 20 employees. Businesses with 20 or more employees can still use probationary periods to assess the suitability of a new employee.
  • Employees in ‘vulnerable industries’ (for example cleaning) will be able to transfer to a new employer on the current terms and conditions in their employment agreement if their work is affected by restructuring, regardless of the size of their employer. The previous restriction to employers of 20 or more employees is removed.
  • The duty to agree a collective employment agreement will be restored unless there are genuine reasons not to. “Genuine reasons” is narrowly defined.
  • The 30-day rule will be restored. This means that for the first 30 days, new employees must be employed under terms consistent with the collective agreement, if one applies, unless more favourable terms are agreed between the employee and employer.
  • Pay rates must be included in collective agreements, along with an indication of how the rate of wages or salary payable to an employee bound by the agreement may increase during the term of the agreement.
  • Employers will need to provide new employees with an approved active choice form within the first ten days of employment and return forms to the applicable union.
  • Union delegates are entitled to reasonable paid time to represent employees. An employer will be able to deny the request if on reasonable grounds the activities would unreasonably disrupt the business or the performance of the employee’s duties.
  • Employers will need to pass on information about the role and functions of the union to prospective employees if requested by a union to do so. An employer has limited rights to refuse to comply. Unions must bear the costs if they want printed materials to be passed on.

Key changes in effect six months after the date of Royal assent:

  • Employees will have extended protections against discrimination on the basis of their union membership status, including union membership and involvement in union activities. The behavior of an employer can be considered discriminatory if it occurs within 18 months of employees participating in union activities.

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