How are we once again at this point where there is another u-turn on a big infrastructure project? Surely there must be accountability on these big projects? Before these projects get approval, there are numerous feasibility reports, consultant reports, reviews within the relevant Ministries, scrutiny in Ministers offices, and sign off by the Government.

There can be no doubt that New Zealanders deserve a better and safer solution for the important connection of the ferries on our state highway network. Both ferry companies operating the Cook Straight have had a year of cancellations due to engineering and mechanical issues. Some of the Interislander ferry woes have been particularly worrying.

In January this year the complete failure of the ferry Kaitaki’s engines caused it to drift dangerously close to rocks near Wellington harbour. According to the Transport Accident Investigation Commission’s report it was caused in part by KiwiRail's failure to replace safety-critical parts, which were years past their use-by dates.

In February the ferry Aratere lost power near the Tory Channel entrance, on its way to Picton.

In March the ferry Kaitaki was taken out of service after new engineering problems, this time with its gearbox. The repair took more than a month to rectify.

In August passengers were forced to spend the night on the ferry Kaitaki anchored out in Wellington Harbour after it turned back from its sailing due to steering issues.

Sailings of the ferry were also cancelled on the ferry Kaitaki in August after a bow door was damaged by a large wave during a crossing.

At the core of New Zealand’s Health and Safety at Work Act is the requirement that all duty holders, so far as reasonably practicable, eliminate risks to health and safety. Risks that cannot be eliminated must be minimised. A business has a primary duty of care to ensure, as far as reasonably practicable, the safety and health of its workers and that others are not put at risk by the work carried out as part of the business. It must further ensure that there is, amongst other matters, safe plant (such as a ship) and that there are safe systems of work (such as replacing safety critical parts by their used-by dates).

No doubt the replacement ferries that have been on order were a big part of the Interislander’s risk minimisation plan for the future. Within businesses, serious failures in health and safety are treated as issues that could amount to serious misconduct warranting dismissal. At governance level, oversight of those responsible for health and safety would (or should) also sit heavily on their shoulders.

However, the Interislander’s plans for the future proofing of our inter-island link have been thrown into disarray with the Government announcement last week that it would not contribute new funding to KiwiRail to address rising costs involved in upgrading the ferries and terminal infrastructure. It reportedly has quadrupled in cost since 2018 to about $3 billion overall - much greater than the original $775 million business case. 

Chief Executive of KiwiRail (owner of the Interislander), Peter Reidy, has defended his team's work and processes. Mr Reidy said the engineering project was "exceptionally complex". "We're talking about a seismic area of New Zealand; we're talking about having to lift the whole Wellington infrastructure a metre because of the flood modelling codes", "Once you start to look through all the design and the real costs of constructing, that's where the envelope obviously started to increase." 

Even to a layman, there is nothing new in Mr Reidy’s explanation. Yes, we know that this is an active seismic area; yes, we know that sea levels are expected to rise. No doubt numerous feasibility reports and consultant reports dealt with these issues (or should have). How does that justify a quadrupling of the cost at this stage of the project?

Trust and confidence is an essential part of the employment relationship. It may amount to serious misconduct warranting the termination of the employment relationship; it is more than mere inadvertence, oversight or negligence. Surely there is at least a case to answer here within the senior management team and at Board level?

KiwiRail chairperson, David McLean, has said that without the further funding from the Government they couldn’t proceed with the project and that an alternative long-term solution could take years to develop. “We sought a strong outcome for New Zealand through this project for a more resilient State Highway 1 across Cook Strait for exporters, domestic freight forwarders, tourism and domestic commuters.”

The Government is the majority shareholder Air New Zealand. Does it expect lesser safety standards of its’ national marine carrier than it does of its national air carrier? How would the public feel if they heard that Air New Zealand was failing to replace safety-critical parts which were years past their use-by dates.

Unfortunately for New Zealanders, and according to our Finance Minister, the best we can now expect for the Cook Straight connection is a reliable Toyota Corolla. Until then, the problematic Interislander service will continue to operate. Read more....

Employers and employees commonly enter into employment agreements that will take effect when the employee commences work at some later date. Once the agreement is made that person is intending to work and will have enforceable rights.

Particularly in certain occupations, offers of employment are often made on the basis that satisfactory pre-employment checks, such as Police checks, are received. A recent Employment Court decision highlights the importance of completing those pre-employment checks before employment commences.

Towards the end of 2020, Mr Edwards was looking for new employment opportunities. He had several meetings with Mr Justin Soong, who was the Chief Technology Officer for Laybuy. Mr Edwards was verbally offered employment with Laybuy by Mr Soong, who also advised him that there would be some pre-employment checks to go through.

Mr Edwards was then sent documents including a letter confirming the conditional offer of employment, a copy of an individual employment agreement already signed by Mr Soong, and a consent form for pre-employment checking (which included consent to a police criminal check).

In the letter, Laybuy advised that should it not be satisfied with the results of the checks, the offer could be withdrawn. The individual employment agreement did not contain any conditions regarding pre-employment checks.

Mr Edwards then had a conversation with the HR manager and told her of various matters that were likely to show up on his police criminal check. He said he had not advised the company of these matters sooner as he was not explicitly asked. The HR manager advised Mr Edwards that when the checks were received, the results from the police criminal check would be escalated within Laybuy for consideration.

The police criminal check came back. That check confirmed the matters Mr Edwards had mentioned to the HR manager. The next day, the HR manager called Mr Edwards and advised him that the offer of employment was withdrawn because of the outcome of the police criminal check.

A letter confirming the withdrawal of the offer was sent to Mr Edwards on 12 January 2021. Mr Edwards then emailed Laybuy advising that, as his contract required him to start at work the following Monday, he wanted to make it clear that he was not abandoning his employment and was awaiting further instruction on what to do on the morning of Monday 18 January 2021.

Laybuy further replied, saying that there was no employment relationship entered into between Mr Edwards and Laybuy and no requirement for him to attend the Laybuy office as the offer of employment had been withdrawn.

The Employment Relations Act includes an extended definition of “employee” to include “a person intending to work”. A person intending to work “means a person who has been offered, and accepted, work as an employee”. The Act does not define the words “offered” or “accepted”.

The Employment Relations Authority determined that as the offer of employment was conditional, and as the conditions attached to the offer were not fulfilled or waived by Laybuy, there was never a completed offer and acceptance. That meant that Mr Edwards was not a person intending to work and was not covered by the Act and could not bring a personal grievance claiming that he was unjustifiably dismissed.

On appeal to the Employment Court, Judge Holden took a different approach. She said the Act departs from a strictly contractual approach to employment, and its emphasis is on the relationship between the parties. Where parties have not yet begun to act on that relationship, the only thing tying them together is any understanding or agreement between them. If one or both of the parties do not intend to be bound by that understanding or agreement, it seems implausible to describe the situation as an “employment relationship”, giving rise to the rights included in the Act, including the right to bring a personal grievance.

The Judge concluded that the letter from Laybuy advised Mr Edwards that he would only be employed if it was satisfied with the results of the pre-employment checks. If it was not satisfied, then if Mr Edwards had not started work, the offer would not proceed – it would be withdrawn. Laybuy’s withdrawal of the offer made it clear that it did not intend to be bound to employ Mr Edwards even though Mr Edwards had accepted the employment agreement.

Unfortunately, some pre-employment checks (such as police checks) can take some time to come through. It is not uncommon for the person to start work before the business receives the check. This judgment makes it clear that if Mr Edwards had indeed started work, the employment relationship would have been established and he would be entitled to bring a personal grievance claim – a much harder scenario for Laybuy to extricate itself from. Read more....

The recently appointed Chief Executive, Janice Smith, of the South Wairarapa District Council might well be wondering if she has made the right decision in accepting her appointment.

SWDC mayor, Martin Connelly, said the council is pleased to have appointed Mrs Smith, who “has a proven track record of leading and managing in changing and challenging environments in senior management positions”. The mayor said he is confident Mrs Smith will be a good fit for the council and the South Wairarapa community.

Mrs Smith will be the most recent appointment in a fairly constant turnover of recent Chief Executives. There have been a growing number of council staff resignations, with a reported attrition rate of 22 percent and a rumoured settlement with the hasty departure of the previous Chief Executive.

Earlier this year two district councillors lodged a letter of complaint alleging that the mayor breached his duties under the council’s code of conduct by publicly criticising council employees with his comments in a newspaper article saying “the real issue here is that our officers did not start the annual plan process in good time”.

Councillors Martin Bosley and Alistair Plimmer​ said that it was in fact the mayor that was largely to blame for the rushed process as “almost four months were wasted in changing the committee structure” as directed by the mayor.

The councillors said that the Council had been repeatedly advised by senior staff of the risks such action would have on the annual planning process, but that concern was either overruled or ignored by the mayor. “By effectively now blaming the staff of causing the time pressures and subsequent effects, the mayor has sought to remove any blame from himself and his actions, in causing the very situation we have now found ourselves in.”

Somewhat unusually, an independent report was commissioned by senior management at the council for the Employers and Manufacturers Association to look into the issues outlined in the complaint. The Report conclude that the mayor had breached the council’s Code of Conduct and recommended that Mr Connelly publicly apologise to staff. The mayor has declined to do so.

More recently, all the district councillors took drastic action and held a unanimous vote of no confidence in the mayor last month.

The councillors have written an open letter to the mayor after the meeting, claiming the mayor had been dismissive towards some community members and absent from several important meetings. "We are writing to you collectively to express our concerns, voice our expectations, and provide advance consideration of potential actions should our expectations not be met," the councillors said.

As the mayor is elected by the district, the unanimous vote is largely symbolic. Nevertheless, the then Minister of Local Government said he was aware of the issues with the South Wairarapa District Council. He said the Department of Internal Affairs was the appropriate authority to provide support for the council at this stage and that “I have asked them to approach the council and talk to them”. He also said a no confidence vote in a mayor was unusual in New Zealand, but that the situation was not serious enough to warrant the dismissal of the council and the installation of a commissioner.

Local Government NZ has also been called in to advise on resolving the differences in the council. President Sam Broughton confirms that LGNZ is aware of the issues. "We are supporting South Wairarapa District Council to put effective governance structures in place to meet the community’s expectations.”

Mrs Smith, as Chief Executive, is the principal administrative officer of the district council and is appointed by the council. In business terms, the council is the governance body setting strategy and overseeing its implementation. The Chief Executive leads the management of the business, implementing the strategies to achieve the outcomes approved by the governance body. The council is the Chief Executive’s employer.

Typically, the Chief Executive works very closely with the mayor. Good faith and trust and confidence lie at the heart of the employment relationship. With the current divide between the mayor and the councillors, the new Chief Executive is going to have her work cut out just trying to get grips over whether she should follow instructions from the mayor or the councillors.

If Mrs Smith follows the mayor’s instructions she may find herself offside with the councillors and called to account by the majority. If she follows contrary instructions from the councillors, her working relationship with the mayor becomes untenable. If she follows neither faction, who will hold her to account?

Mrs Smith may indeed need to demonstrate all her skills in “leading and managing in changing and challenging environments”. While at present the situation has not become as publicised as the Gore District Council’s, it has the potential to do so. Read more....

Last weekend the Wairarapa Garden Tour was again held as a major fundraiser for the Pūkaha National Wildlife Centre, allowing the centre to continue its conservation work in its 940 hectare native forest reserve north of Masterton. Like a lot of fundraising events, it is supported by a dedicated team of volunteers who make the event work so successfully.

Tūao Aotearoa Volunteering New Zealand, reports that using information from Statistics New Zealand’s latest quarterly Labour Market Statistics that:

• Approximately 21.5% of New Zealanders undertake formal volunteer work. 
• The value of formal volunteering is estimated at $4 billion per annum.
• New Zealanders contribute a total of around 159 million hours of formal volunteer labour each year. 
• 11.8% of New Zealanders undertake informal volunteering work, contributing a further total of 7.8 million hours of volunteer labour per year to these figures. 

While this important work usually benefits society generally, it does have some challenges that need to be managed or the relationship between the “employer” and the “volunteer” can quickly become blurred.

The Employment Relations Act excludes a volunteer who does not expect to be rewarded and receives no reward for the work performed as a volunteer. “Reward” is a broad concept that can include intangible or non-monetary benefits. It has lead to some outcomes that at least one of the parties to the arrangement did not expect.

For example, in Hicks v Great Lake Aluminium and Glass Ltd, the “worker” was invited to the company’s Friday night food and drinks. When the company told him that he was no longer required this was enough to be considered a “reward” and enabled the “worker” to claim that he was entitled to wages and had been unjustifiably dismissed.

In The Salad Bowl Ltd v Thornley, Amberleigh Howe-Thornley was told at her interview that there was no reason why she would not be hired if she satisfactorily completed a three hour work trial. During the trial she was provided with a salad and this was considered to be sufficient to amount to a “reward”.

In another case, in Labour Inspector v Alpine Motor Inn and Café the “worker” was in New Zealand on a student visa which allowed her to work up to 20 hours a week. She applied for a housekeeper position. The employer intended to employ her full-time and could not do so while she was waiting for a work visa to arrive. In the meantime she was given accommodation and food and began to perform some work. The employer said that the “worker” was a volunteer who worked because she was bored. The Employment Relations Authority was not convinced and found that the food and lodging amounted to a “reward”.

If the parties want a volunteer relationship, it is important that they make it clear that the worker does not expect payment and does not receive payment. Otherwise, the worker may claim to be an employee. If the worker is successful in their claim they will be entitled to minimum entitlements; they will have to be paid minimum wage and cannot be dismissed unless it is justified.

Even if it is clear that the parties are in a volunteer relationship, the organisation should nevertheless be mindful that it may still have other “employer” type obligations to the volunteer. The Health and Safety at Work Act covers some volunteer workers, as does the Human Rights Act in respect of discrimination.

In the case of the Wairarapa Garden Tour volunteers, they receive a free t-shirt which identifies them as officially associated with the event. They are also given free access to the gardens on the tour. Such “freebies” could easily amount to a “reward” if the worker claimed that they expected to get rewarded for their work.

International Volunteer Day is an international event and is celebrated every year on 5 December. The purpose of the day is to recognize and support the spirit of volunteerism to help create a better future. It champions the impact volunteers have in communities, nationally and globally. 

Thankfully, it is rare that volunteers in genuine volunteer positions challenge the relationship. The unpaid work done by many New Zealander’s often goes unrecognised. A big shout out to our volunteers – they help make New Zealand a better place to be! Read more....