Staff: Legal rights and

Being a good employer means that you know and adhere to your legal rights and responsibilities. This has the added advantage of managing your risk and protecting yourself if an employment dispute occurs. There are a number of acts governing employment relations that must be observed. The most important of these during the recruitment process are the Employment Relations Act and the Human Rights Act.

Employment Relations Act 2000 

Any new or renegotiated employment agreements need to comply with the ERA's requirements. The main requirements are:

Dealing in "good faith": At the most basic level, good faith is about telling the truth and each party being able to have trust and confidence in the other. Good faith is not about always saying yes and it does not mean the two sides have to agree, but both parties should get a fair hearing.

Written employment agreements: All new employees must have a written employment agreement. This includes all casual staff employed on farms, such as relief milkers. All agreements are required to contain:

    • The name of the employer and employee
    • A description of the work to be performed
    • An indication of where the work is to be performed
    • An indication of the hours of work
    • Wages or salary to be paid
    • A plain language explanation of how employment problems will be resolved and the 90-day opportunity the employee for raising those grievances once they have become aware of the grievance.
  • For more information:  Fact Sheet: Employment agreements  View PDF (63kb)

Fixed term agreements: It is assumed that all agreements will run indefinitely unless there is a valid reason for them to be of a fixed term nature. Such reasons may be where a temporary worker is filling in for a permanent employee on leave or where work is seasonal, e.g. calving. In general, the dairy "season" of 1 June to 31 May is not justification for a fixed term agreement.

Opportunity to seek advice: Prior to employment, employees should be presented with a copy of the proposed agreement and allowed a fair and reasonable time to take the agreement away, study it and to seek advice. They should also be given the opportunity to negotiate the terms of the agreement. Indication are this should be a period of no less than three working days.

Human Rights Act 1993 

This Act makes it illegal to discriminate against people in hiring and firing or training and promotions based on race colour, national or ethnic origin, gender or sexual orientation, marital or family status, employment status, age, religious belief, political opinion or disability.

Other relevant Acts are briefly outlined below:

Minimum Wages Act 1983

Employees must be paid at least the minimum rate for every hour they work in a given week. If employees are provided with board or lodging, a deduction can be made to a point where the effective hourly rate is up to 15% for board or 5% for lodging below the minimum hourly rate.

Wages Protection Act 1983
Provides the employee the right to be paid in cash unless a written agreement is in place for another method of payment. The Act also limits the employer's ability to make deductions from workers pay unless written permission is provided.
Equal Pay Act 1972 Makes it illegal to pay different amounts when the only difference between employees is gender.
Parental Leave and Employment Protection Act 1987 Provides parental leave for parents and makes it illegal to discriminate on the grounds of pregnancy or taking of parental leave.
Holidays Act 2003
Sets out holiday entitlements for staff. These include four weeks annual leave, up to 11 public holidays, 5 days sick leave after six months service and bereavement leave for when an employee suffers bereavement.
Health and Safety in Employment Act 1992

Places duty on the employer to:

  1. Warn authorised visitors of hazards on the farm
  2. To provide and maintain a safe working environment for all employees, contractors and paying customers.
Tenancy Act 1986 
Where a farm owner or sharemilker provides housing for their staff they also have a dual role as landlord through a service tenancy and must comply with requirements of this act, including making sure the dwelling is of a liveable standard and meets the requirements of the Health and Safety Act.
Privacy Act 1993
Sets out the principles for the handling and management of personal information typically collected during employment, to avoid upsetting and damaging misuse.

The IRD has a wide-ranging interest in employment agreements, especially regarding how staff are paid. Some of the duties of an employer include:

  • Registration as an employer
  • Levying of PAYE, child support and student loan payments
  • Payment of Fringe Benefit Tax on any "perks" to employees
  • Charging staff a fair market rental for accommodation
  • Administration of Kiwisaver
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