What a year it has been! Employers and employees have been taken into new territory. While it is generally considered that New Zealand has had an excellent health response to Covid-19, businesses have had to grapple with many issues from staff working from home where possible, reducing staff hours and rates of pay, what process to follow where redundancies were inevitable and wage and leave subsidies. While there have been business closures, it is generally considered that New Zealand businesses are now doing better than had been forecasted.

Some employers are still dealing with the legal fallout from the pandemic response, including personal grievances for unjustified dismissals and unjustified disadvantages and arrears of wages claims.

In returning to a new normality, you may have missed some important employment law changes that came into force this year and what is anticipated in the coming year.

The year that was

There are two main changes that may affect employers.

Triangular employment

From June this year, the law now allows employees in triangular employment situations to include a third party to a personal grievance they may have with their employer.

Employees can still raise a personal grievance with their traditional employer where they have grounds to do so. With the changes, an employee can now apply to the Employment Relations Authority to add a third party to the personal grievance if the third party has caused or contributed to the problem.

Common situations where triangular employment happens include where an employee is employed by an employment agency and is sent on work assignments to another organisation (labour hire or temping arrangements). Another situation would include where an employee is on a secondment from their employer to a host organisation. Another possible situation is where a third party provides significant funding to the employer with significant contractual control.

In these cases it may be the behaviour or action of the third party that has contributed to the problem, rather than the employer. Clearly this could include situations where the third party has abruptly terminated the arrangement and the employee is left without work. It may also include bullying or discrimination by the third party. In these situations, both the third party and the employer could potentially be responsible for providing remedies to the employee.

Privacy

From December, if there is a privacy breach, the law now imposes mandatory reporting of breaches where the breach causes or risks causing serious harm. Employers usually hold a lot of personal information regarding employees (or ex-employees). Employers should consider their policy on providing references and ensure permission is given to disclose that personal information as a breach may cause serious harm to a job seeker. If there is a breach, failure to report a breach would be an offence that could result in a fine of up to $10,000.

There is also a new offence of misleading an agency to obtain access to someone else’s personal information (eg. a prospective employer trying to obtain information from the old employer). A further new offence relates to destroying a document containing personal information knowing that a request has been made. 

What is coming up next year

There are a number of proposed changes that may affect employers.

Minimum wage

In preparing wage budgets, the minimum wage will almost certainly go up to $20.00 an hour next year.

Sick leave

Minimum sick leave entitlements will almost certainly go up to 10 days each year, although the maximum number of sick days an employee may accumulate will remain at 20 days.

Fair Pay Agreements

Fair Pay Agreements are perhaps the most contentious of the likely changes coming up. They are agreements that are between unions and employers and set minimum terms and conditions of employment for all employees in an entire industry or occupation. Rolling out Fair Pay Agreements are likely to proceed slowly at first, but are likely to ramp up when “test cases” have been established.

Protections for “dependent contractors”

Dependent contractors are workers who are effectively under the control of an employer. They do not receive the legal protections that are provided to employees by law. They may operate their own business and may use their own equipment, but they may depend on one firm for most of their income and/or may have little control over their daily work.

The new Labour government has said that it will extend collective bargaining and other basic employment rights to dependent contractors including requiring written contracts and introducing a duty of good faith for dealings between the contracting parties.

Empty office space in Wellington buildings suggests that many workers are still working from home, and to a lesser extent that some will have lost their jobs.

What are the additional health risks that workers face when they work at home and what additional steps should employers take to protect them?

While the situation is more extreme in the United States some of the problems still exist here. The emergence of “invisible burnout” has been mentioned. One problem can be the border between work and home life being blurred when working from home.

Thomas Bishop of Iowa told the Wall Street Journal about the effect of balancing work at home with caring for his elderly father. He said people often overestimate how much they can do. Even if you are good at time management, he says, it is important to balance your life by scheduling in relaxation time.

Balancing childcare responsibilities with work is another obvious difficulty. A director at Eventbrite says work burnout is insidious it is not just like a red light that comes on. It is something that very slowly starts to happen and can catch people by surprise.

On the positive side there are suggestions on what people can do. The Eventbrite director now leads sessions for employees on how to recognise burnout.

He gives them a forum to voice their feelings and talks to them about getting advice from mental health specialists.

The chief executive at Hewlett-Packard Enterprise in the US encourages managers to call staff to check on their well-being. “You have got to make an effort – do not assume an email is enough because it is not personable”.

Making sure your staff are being heard and providing them with backup if needed is important. Other examples include people being able to work reduced hours with little change in pay and conditions. Providing workers with access to child-care facilities is another option. Having a way of stopping people from being glued to their laptops may be important as well.

Monitoring peoples’ work, especially where they are working after hours, is something that managers could do. Expanding access to counselling and mental health services should be considered. Perhaps even digital counselling apps might be helpful.

Employers should also take an interest in the workstations and work arrangements that their workers have when they work from home.

Long before Covid-19 arrived in New Zealand the Australian retail chain Bras N Things opened seven stores in this country. A country manager was appointed. She entered the role with great optimism but this faded quickly with her concern with her workload. She routinely worked more than 60 hours a week and eventually her doctor diagnosed her with "burnout". He advised her to take sick leave which he did.

The manager informed her employer in writing of her detailed concerns about workload and her belief that it was the cause of her health problems. She returned to work part-time but found her workload remained excessive. She now also claimed she was being bullied by her managers.

Returning to work made matters worse and Bras N Things did not take all reasonable steps to ensure she did not suffer further harm. Eventually she resigned after 16 months.

The doctor took the view she was suffering from a relapse of burnout and depression. As often happens, Bras N Things said the workload was not excessive and that she received adequate support.

Bras N Things said it had concerns about the performance of the New Zealand operation and the way the manager had been managing it. It said these matters were brought to her attention in a proper manner and there was no bullying or unreasonable treatment.

The manager raised a personal grievance and the case went to a hearing. She had two claims that are relevant for our purposes. The first claim was for the harm to her health before she took the initial period of sick leave and wrote to the company drawing the problems to its attention.

She claimed that the company failed to provide a safe system of work. Her second claim was that she was constructively dismissed.

Although overwork caused the initial breakdown in the manager’s health, it was not reasonably foreseeable that this would occur to management and she received no remedy for that.

The position changed completely once she wrote the letter notifying management of the problems she was suffering from. Her ill-health following her return to work and her resignation were brought about by the unreasonable demands on her and the resignation was foreseeable. There was a constructive dismissal. She received $20,000 compensation and some minimal lost earnings.

The lesson of that case is how important it is for employees to notify their employers in writing of any workload stress or burnout problems that their employment is causing, whether they work at home or in the office. Keep the employer informed in detail regularly and in writing. That is the golden rule.

Recent media coverage of suicides amongst senior doctors due, at least in part, to burnout provides a further sobering reminder of how important it is to address burnout early.

We all know how lucky we are in New Zealand to be relatively Covid-free.

Overseas examples arise from a much bleaker health environment. But despite that there have been significant changes in the way people work in New Zealand. It is extremely important that both employers and employees communicate regularly with each other with a view to minimising damage to workers’ health.

Regular, preferably in-person, meetings and discussions with employees is the best way of ensuring staff feel valued and of ensuring risks to their health are kept to a minimum. We have a very different working environment that we are all learning to live with.

Industrial negotiations in Australia seem to be tough, rough and lengthy. Perhaps they give us a taste of things to come in New Zealand over the next two or three years.

Unions will want to make the most of the Government’s promised industrial legislation, including fair pay agreements. Hopefully Kiwis resolve things in a friendlier manner than the negotiations between BP and its workers at a refinery in Kwinana, Western Australia.

BP and the union were engaged in a long-running dispute for a new industrial agreement at Kwinana. The employer wanted major changes to existing conditions. Arguments about the old agreement restricting productivity, efficiency and flexibility were put forward by the company. The dispute dragged on.

Scott Tracey and his wife Rhyanna Tracey decided to help the union cause. They prepared a video entitled Hitler parody and EA negotiations.

The video was prepared using a website called Caption Generator. The website contains a small collection of video clips with non-English dialogue and allows the user to add subtitles to create an alternative story or theme for the video.

The most popular video clip was one from the German language movie Downfall. The clip showed Adolf Hitler in his bunker in Berlin as he realised that the complete defeat of Germany could not be avoided and Berlin would soon fall.

There were thousands of these parody videos based on this movie by the time the Tracey’s created theirs. People use these video clips in a way that can be said to have become a meme.

Meme was coined by biologist Richard Dawkins. It is a cultural concept or behaviour which is passed from one individual to another by imitation and communication.

The subtitles added to the Traceys’ version clip parodied the bargaining for the new agreement in the Kwinana refinery. Hitler is assigned to the role of an unnamed BP manager in charge of the bargaining strategy.

He is informed that the employees have voted overwhelmingly to reject BP’s proposed enterprise agreement. He falls into a rage about the failure of the company’s bargaining strategy. He is angry about the continued resistance of the employees.

The Traceys’ video appeared as one of thousands on the caption generator website. It was very hard to find there. However, in late 2018 Scott Tracey posted a link to the video on a Facebook group, the members of which were all employees of BP at the refinery. Tracey showed the video to some BP employees working with him.

Management learnt of the existence of the video and commenced an investigation. Tracey was required to attend a formal investigation meeting at which he admitted he had shared the video. He was stood down the following day.

The company claimed that Tracey shared and distributed material which was highly offensive and inappropriate and that various BP policies had been breached.

Ultimately Tracey was dismissed in early 2019. The dismissal was effective immediately but with 4 weeks’ pay in lieu of notice.

Management felt they had been likened to Hitler and took strong exception to that. Tracey probably thought it was part of the cut and thrust of negotiations. The Australian Fair Work Commission was divided on the issue.

On appeal, the superior tribunal rejected the view that the video likened BP management to Nazis or Hitler. The video is not stating management were behaving or conducting themselves comparably to the Nazis in terms of humanity and criminality.

It drew a comparison for satirical purposes between Hitler’s situation in his final days and the position of that BP had reached in the enterprise bargaining process. The company was facing defeat according to the video clip.

The superior tribunal said that the position is even clearer when one considers the development and use of the Downfall clip as a meme. The clip has been used thousands of times in an entirely imitated way to give a satirical description of contemporary situations. This has the result of culturally dissociating it from the import of the historical events portrayed in the film. Anyone with knowledge of the meme could not seriously consider that the use of the clip was to make some point involving the atrocities of Hitler or the Nazis.

The superior tribunal acknowledged the reality of what was happening. It said that there was no doubt the clip would be understood by the reasonable viewer as satirising BP’s conduct during the bargaining process. That by itself did not make it offensive or appropriate.

The Appeal Tribunal said the industrial circumstances at the refinery at the time followed heated and protracted bargaining between the company and the union. It was entirely understandable that persons in opposing camps might engage in criticism of the other party’s position and conduct.

It would be unrealistic to expect a dispute of this nature to continue to its conclusion without any form of criticism and reproach being expressed, at least privately.

The appeal tribunal drew a distinction between criticising a party’s position as opposed to criticising personally the individuals. So the appeal tribunal found the dismissal was unfair. Tracey was restored to his previous position with no loss of pay.

If the case had occurred in New Zealand, the outcome would probably have gone the same way, especially given New Zealand law gives some added protections to those engaging in union activities.

The recent controversy surrounding the isolated Christian community of Gloriavale has sparked a number of investigations regarding concerns of exploitation, unsafe working practices and oppression. It includes claims that members are being forced to work up to 20 hours per day for little or no pay.

It appears that Gloriavale runs a number of commercial enterprises such as dairy and deer farms where members work with a view to making a profit for their community. Members receive some level of reward for their services in the form of accommodation and food.

In comparison to employees, volunteers hold a relatively tenuous legal position. Employees enjoy basic employment rights and legislative protection in relation to the work they do, including minimum annual and sick leave entitlements and the ability to pursue personal grievances. Volunteers are not afforded the same statutory entitlements and protections, although they may devote considerable time, effort and skills to the organisations or causes they work for. Volunteers are not an homogenous group. They may, but need not, operate under an agreement, receive some form of payment, and perform services on a regular or ad hoc basis. They may devote years to one cause or engage in one-off acts of kindness.

The law

Under the Employment Relations Act, an employee is any person of any age employed by an employer to do any work for hire or reward under a contract of service but it excludes a volunteer who:

• does not expect to be rewarded for work to be performed as a volunteer; and
• receives no reward for work performed as a volunteer.

In deciding whether a person is an employee the Employment Relations Authority must determine the real nature of the relationship between the parties. The Authority must consider all relevant matters, including any matters that indicate the intention of the persons, but it does not to treat as a determining matter any statement by the persons that describes the nature of their relationship.

Reward

 What constitutes a “reward” is not defined in the Act. It is arguable that it includes non-monetary recognition of services provided. This was the approach adopted in The Salad Bowl case where the Court considered that the worker who completed a three hour work trial was not a volunteer because she had expected to be rewarded (by way of monetary payment) for the trial period, and was in fact rewarded by receiving a free salad at the end of the day.

In another case, a worker at a campsite who received free accommodation and access to facilities, and payment of an allowance was also held to be an employee. The employee both expected and had received reward for his services. The Court distinguished the arrangement from a volunteering arrangement that is performed out of a sense of duty to the community or a commitment to a particular cause. The Court listed the features of such volunteering arrangements as including the organisation not being engaged in commerce (at least for a capital gain-making enterprise) and that the enterprise would not be sustainable but for the commitment of such volunteers. The Court noted that there is often no difference in the work undertaken by a volunteer or an employee. The critical difference is the expectation of reward being received.

Conversely, in another case, the worker was considered a volunteer even though he was rewarded. The worker was appointed to the position of Registrar for the NZ Dance and Dancesport Council, a non-profit administrative organisation representing professional and amateur dancers. There was a job description which had reference to an expense allowance being provided as determined by the Council annually. Even though the worker received this allowance, the Court considered that he was a volunteer. Motivation was relevant in that case with the Court finding the volunteer “took on the role because he, like many others, wished to make a positive contribution to the dance community.”

Are Gloriavale workers volunteers

 Are Gloriavale workers volunteers as has been claimed? The answer is unclear. Gloriavale does run commercial enterprises and its members receive some level of reward with the provision of food and accommodation. It is unclear if the members expect or receive any reward other than that provided.

If they truly are volunteers, then they are excluded from many of the employment protections we have in New Zealand.