Welcome to our second Employment Bytes of the year, which to be frank, because employment law developments have been light in recent times, doesn’t contain a huge amount to catch-up on since our January update. This makes the coming weeks an excellent time to ensure you are across the changes that have taken effect, and to prepare for later in the year, when bigger law changes are anticipated.
Minimum Wage Increase
First cab off the rank: is your business compliant with the new minimum wage rate?
From 1 April 2024, the minimum pay rate has moved from $22.70 per hour to $23.15 per hour.
The 2% increase in the minimum wage, implemented by the new coalition government, marks a departure from the larger adjustments seen in recent years. This shift reflects the government's acknowledgment of New Zealand's current economic state, now officially classified as a recession by government economists.
Additionally, the Starting Out/Training minimum wage has increased from $18.16 to $18.52 per hour.
Employers,take heed, now would be an Ideal time, if you haven't already, to check the details around the new minimum wage rates in your business. You must ensure that the minimum wage rate applies to both wage and salaried staff, unless both parties agree to a higher rate in the employment agreement.
Your payroll systems and employment records will also need to reflect the minimum wage changes.
Living Wage Increase (www.livingwage.co.nz)
In early April, the 2024/25 New Zealand Living Wage rate was released. From 1 September 2024, the Living Wage rate will increase from $26.00 per hour to $27.80 per hour. A 6.9% or $1.80 increase to current.
This means that from 1 September 2024, employees and regular contractors of accredited Living Wage Employers will earn at least $4.65 per hour more than the minimum wage.
The New Zealand Living Wage rate was introduced in 2013 and is calculated and annually updated by the Family Centre Social Policy Research Unit.
There's a difference between an employer who pays a living wage and an accredited Living Wage Employer. Paying the Living Wage is voluntary, however employers can go through an accreditation process so they can use the trademarked Living Wage Employer logo and call themselves a 'Living Wage Employer'.
Immigration changes
On 7 April 2024, significant changes were announced to the Accredited Employer Work Visa (AEWV) scheme. These are effective immediately, and for those employers who use this scheme, are a must read.
A summary of what’s new:
- For roles that fall into the ANZSCO level 4 and 5, employers will need to engage with Work and Income before approval to bring in migrants will be granted.
- Introduction of an English language requirement for migrants applying for low skilled ANZSCO level 4 and 5 roles.
- A minimum skills and work experience threshold for most AEWV roles.
- Reduction of the maximum continuous stay for most ANZSCO level 4 and 5 roles from 5 years to 3 years.
- The franchisee accreditation category will be disestablished and these businesses will need to apply to bring in workers from overseas through the standard, high-volume, or triangular employment accreditation.
In summary, the requirements employers must meet to hire migrants on the AEWV have changed. If this is your business, it is important (as always) that you meet your obligations. There’s plenty of detailed information on the Immigration NZ website.
A recent ruling on racial harassment
In February, the Human Rights Review Tribunal ordered that an employer pay $10,000 in damages to an employee who had been racially harassed in breach of section 63 of the Human Rights Act 1993 (HRA). Section 63 of the HRA makes it unlawful to subject any person to racial harassment in employment and certain other areas.
The plaintiff had been employed as a racehorse trainer since 2010 and continued to work for the defendant’s company until his redundancy in 2020. During his employment, the plaintiff was made fun of for his Indian accent, was told off for speaking Hindi with colleagues, and was made to listen to belittling remarks about Indians in general.
The defendant denied racial harassment, although he admitted to engaging in “group banter” where he made joking comments regarding Indians. He also argued that Indian employees were asked to speak English at work due to “safety reasons”. This was refuted by the plaintiff, who cited multiple occasions where the defendant used abusive language to reprimand him for speaking Hindi.
Employer’s responsibilities
The key takeaway from this ruling is a reminder to employers: group banter or attempts at humour may be considered bullying or discrimination, even if not stated directly towards a particular employee. Further it doesn’t matter whether it is intended that comments cause offence, as the question is simply whether the employee suffered hurt or offence.
Employers, having appropriate discrimination and harassment policies in place is hugely important, as is the need for employees to receive regular training on the kinds of behaviour considered unacceptable in the workplace. The onus is on the employer to ensure that no lines of acceptable behaviour are crossed.
Health and safety updates expected
We expect some upcoming reform on health and safety laws, although the specifics on this are light. As a part of setting out her reform agenda, The Minister for Workplace Relations and Safety questioned whether the almost 10-year-old Health and Safety at Work Act is fit for purpose given many businesses reported to her that they did not understand what their obligations actually are.
Public consultation will be sought to determine how risk and costs should be allocated under the regime, what’s working and what should change going forward. Watch this space.
That’s all for this April update. We will be keeping a close eye on developments—the next few months could possibly be a time of big changes, depending on government priorities. We will share relevant updates as they come in.
If you’ve questions about the content of this article, or general employment law or people-related queries, please don’t hesitate to get in touch with our friendly HR team. You can always reach us on +64 9 300 7224 or email hello@thepeopleplace.co.nz