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The High Court has released a much-awaited decision, Stumpmaster Ltd v WorkSafe New Zealand [2018] NZHC 2020, confirming the approach sentencing courts should take when fixing fines under the current Health and Safety at Work Act 2015 (Act).

The general approach to sentencing under the Act largely remains the same as under previous law, but includes a greater range of orders that must be considered as follows:

Assess the amount of reparation;
Fix the amount of the fine by reference first to the guideline bands (table below) and then make adjustments for any aggravating and mitigating factors. When considering whether there are any aggravating and/or mitigating factors which may affect the sum of the fine, the court will also review discounts for reparation already paid, remorse, co-operation and a previous good record.;
Determine whether further orders are required, e.g an order for payment of WorkSafe’s costs, adverse publicity orders, or restoration, project, or training orders; and
Make an overall assessment of the proportionality and appropriateness of the total sentencing, including considering the defendant’s financial capacity, which can increase or decrease the fine.

Culpability	Band under HSEA 1992 (old legislation)	Band under 2015 Act (current legislation)
Low	Up to $50,000	Up to $250,000
Medium	$50,000 to $100,000	$250,000 to $600,000
High	$100,000 to $175,000	$600,000 to $1,000,000
Very High	$175,000 to $250,000	$1,000,000 plus

The increase in penalties under the new Act was intended to cause substantial uplifts in fine levels across all categories of offending, not just those of high culpability, and the cases decided show that this is occurring. The case has provided a definitive guide on the proper approach to sentencing under the Act giving certainty.

Interestingly, the Court discussed in Stumpmaster the fact that in Australia, where the Act was essentially copied from, fines have been significantly lower than now being awarded here. However, the Court did not consider this was relevant to the application of the law here.

What does this mean for you?
Employers across the board continue to step up their approach to health and safety, which is necessary to avoid the potential award of significant penalties. For advice on managing health and safety in your business, our team can help.

Disclaimer: We remind you that while this article provides commentary on employment law topics, it should not be used as a substitute for legal or professional advice for specific situations. Please seek guidance from your employment lawyer for any questions specific to your workplace.
August 2018

Last month, the Health and Safety at Work (Volunteer Associations) Amendment Bill (Bill) was introduced to Parliament.

The Bill recognises the important role volunteer associations play in New Zealand and acknowledges that most volunteer associations only employ a limited number of employees usually for very specific tasks (e.g. a sports club that engages someone to run the kitchen on club day).

If passed the Bill will exclude volunteer associations who employ individuals that do not work more than 100 hours per week from the definition of a person conducting a business or undertaking (PCBU).

A PCBU has a primary duty under the Health and Safety at Work Act 2015 (Act) to ensure the health and safety of its workers and others, so far as is reasonably practicable. Currently the Act excludes “volunteer associations” from the definition of PCBU. In summary, a volunteer association is defined as an organisation which does not have any employees and is made up of volunteers who work together for a community purpose.

As the law currently stands, when a volunteer association engages someone to carry out work, it is no longer excluded from the definition of a PCBU and inherits the same duties of non-volunteer associations under the Act. The volunteer workers would also inherit the same obligations as paid workers under the Act. Both volunteer workers and the PCBU could be prosecuted if they failed to meet their obligations under the Act.

PCBUs must ensure so far as is reasonable practicable that workers have:

A safe work environment free from risks to health and safety;
Safe equipment, structures and systems of work;
Safe storage, handling and use of plant, substances and structures;
Adequate and accessible welfare facilities;
Information, training, instruction or supervision to carry out work safely; and
Their health monitored.
What you need to know
If enacted into law, it would mean that more volunteer associations and volunteers will not be covered by the Act. Despite this, a volunteer association may still have an implied duty to take reasonable steps to maintain a safe workplace. An individual employed by the volunteer association could still potentially bring a claim on this basis against their employer.

We will keep you updated on the Bill’s progress through Parliament.

Disclaimer: We remind you that while this article provides commentary on employment law and health and safety topics, it should not be used as a substitute for legal or professional advice for specific situations. Please seek legal advice from your lawyer for any questions specific to your workplace.

August 2018

Join us at our next paid seminar on The Ever Changing Landscape of Disciplinaries, Investigations and Remedies

Workplace relations are more complex than ever for employers and Human Resource personnel to navigate. Employment lawyer Kate Ashcroft, Principal at Copeland Ashcroft Law will be presenting in Tauranga and Auckland on the legal developments in the areas of process and justification in a disciplinary context. Myriam Mitchell will be presenting in Hawke’s Bay

Kate & Myriam will discuss recent case decisions in the areas of:

Investigations, including external independent investigations.
Employees halting the process to seek interim injunctions.
Reliance on criminal charges when details are suppressed.
The content of a preliminary decision letter.
There has also been a clear shift in the space of remedies and claims driven by the Employment Court. Kate & Myriam will discuss remedies, awards and damages being sought by both employees and employers including:

Rising remedies for hurt and humiliation compensation under s 123(1)(c)(i).
Limitations on reductions that can be made for employee contributory conduct.
The effect of post dismissal conduct.
Legal cost awards/special damages being sought by the successful party.
Recent case decisions relating to breaches of record of settlements.
The presentation will be two hours. It is suitable for HR Managers, HR Advisors, Managers, Consultants or business owners with employees seeking to navigate through the minefield that is a disciplinary process and to mitigate the risks of personal grievance claims.

Venues

Tauranga: Tuesday 31 July 2018, 3.00-5.00pm – Crowe Horwath Offices, 57 Spring Street, Tauranga
Auckland: Monday 6 August 2018, 1.00-3.00pm – Crowe Horwath Offices, Level 29, 188 Quay Street, Auckland
Hawke’s Bay: Monday 6 August 2018, 3.00-5.00pm – Crowe Horwath Offices, Level 1, 211 Market Street South, Hastings

Cost
$150.00 plus GST

RSVP
Alice Tipoki-Lawton – admin@copelandashcroft.co.nz

The Vulnerable Children Act 2014 (VCA) was introduced to provide greater protection for children, requiring specified employers, who are funded by government, to conduct safety checks on workers who have regular contact with children as part of their role. You can read our article summarising the Act here.

The VCA classifies employees working with children into two different types: ‘core workers’ and ‘non-core workers’. Core workers are those employees who are either the only children’s worker present with, or someone who has primary responsibility for, or authority over, a child/children. Non-core workers are any other employee in the organisation whose role has contact with children and who doesn’t meet the criteria for core workers.

The VCA specified a staged approach to the requirement to conduct checks and initially these were only necessary for new employees. However, from 1 July 2018, all employers covered by the VCA must complete a safety check for all existing employees who are ‘core workers’, and three yearly thereafter.

Existing ‘non-core workers’ will be required to be safety checked from 1 July 2019 and three yearly thereafter.

The VCA also specifies when an employer can no longer employ a worker in relation to specific kinds of convictions, which means that some employers may be in the position of having to terminate employment where safety checks uncover these.

What does this mean for you?
If you are covered by the VCA, you need to ensure you’re complying with the new requirements. Our team can provide advice as to whether your organisation is covered, and what to do to comply. We can also provide assistance with drafting relevant policies which comply with the VCA, and with taking action against employees whose safety checks do not meet the requirements of the VCA.

If you have any questions, please contact us

April 2018

In a new case, significant penalties have been awarded against a construction company for breach of minimum employment standards. Labour Inspectorate resources have significantly increased recently, resulting in more of these kinds of investigations and claims in the Employment Relations Authority, and employers should be aware that all workplaces are vulnerable to this occurring.

The cases
Following a Labour Inspectorate investigation, Setia Construction, an Auckland construction company was penalised $19,000 by the Employment Relations Authority for failing to provide employees the minimum wage, holiday and termination pay, and not having compliant employment agreements.

It was fined $14,000 for 17 breaches of employment standards, with its sole director personally being fined $5000 for facilitating the breaches.

We have previously discussed the increasing penalties for breach of minimum employment standards, as well as the requirements for record keeping, here and here, and the Labour Inspectorate has sent a strong message that minimum rights must be met for all employees.

Message for Employers
It is crucial, especially given these increasing sums for penalties, that employers take minimum employment standards seriously and seek advice where a Labour Inspector raises issues. Please contact us if you are unsure about whether your current arrangements comply with the law.

May 2018

The Privacy Act 1993 (Act) establishes information privacy principles setting out how agencies may collect, store, use and disclose personal information. Employers are “agents” under the Act and must meet its requirements in dealing with employees’ “personal information”.

Parliament is considering a new Privacy Bill (Bill) which proposes to impose more substantive fines, greater power for the Privacy Commissioner (Commissioner) and a requirement to report any privacy breaches.

Summary of key changes
The key changes include:

mandatory reporting of privacy breaches, to the Commissioner and to affected individuals, if the breach risks causing, or has caused, harm;
the Commissioner will be able to issue enforceable compliance notices requiring agencies to comply with the Act;
further controls on cross border data flow, including requiring agencies to take reasonable steps to ensure that personal information disclosed overseas will be subject to acceptable privacy standards. This will apply, for example, where an agency holds data offshore, or discloses data to related entities based outside of New Zealand;
the introduction of offences under the Act for failure to comply with notification requirements, or a range of other obligations , including for example knowingly destroying documents containing personal information requested;
ability for Commissioner to decide whether access requests should be granted; strengthening the Commissioner’s information gathering power, with shorter timeframes for compliance and increased penalties for non-compliance.
What does this mean for employers?
We’ll keep you posted on the progression of the Bill in our InTouch newsletter.In the meantime, we recommend employers look at introducing a Privacy Policy (or reviewing their existing Policy).Breach of privacy is a growing avenue of claim for employees.If you’d like to discuss what privacy obligations your organisation has, please contact us.

May 2018

The short answer is, yes, as a recent Employment Court decision involving retail chain, Smiths City, has confirmed.

While the Minimum Wage Act 1983 (Act) does not include a definition of “work”, the Courts have provided guidance on the term in a string of recent cases. For example, the Court has held that employees who “sleep over” at work are working during the sleepover period, and we wrote about on call workers being held to be working here. The latest case involves Smiths City, a national retailer, and many other retailers have since been named as having the same unlawful practice.

Smiths City Case
Smiths City stores around the country held meetings each morning for 15 minutes before opening for business, over a period of 15 years. Attendance was expected, yet no wage or time records were kept and employees were not paid for attendance.

Smiths City said the meetings were unpaid as they were not compulsory and no disciplinary action was taken against staff for not attending. It also emphasised that their staff were entitled to flexible working hours, longer breaks and the ability to leave early when the store was quiet. However, the Court found many employees believed attendance at the meetings was compulsory, commenting that “there was an expectation to attend and the pressure placed on staff to do so, was direct and forceful”.

The Court held that the meetings were “work”, and accordingly that the sales staff who attended should have been paid at least the hourly minimum wage rate for their time at the meetings.

While Smiths City argued that it complied with the Act because of the way in which it calculated and paid commissions and incentives, the Court did not accept this because there was no opportunity to earn commission or incentive payments during the 15 minute meetings each morning. The Court commented that the commissions and incentive payments could therefore not be used to cover minimum wage entitlements.

Message for Employers
The upshot of these cases is that many employers need to look at their practices and payment of staff, to make sure they’re meeting minimum wage obligations with payment for all work done. Employers should consider if there could be any time employees have “worked” which have not been accounted for. Employment agreements, and in particular hours of work clauses, are likely to need revision if so.

If you are unsure about whether something could be considered “work” or if you have any questions regarding your obligations as an employer under the Act, our team of specialists can offer guidance.

May 2018

Join us at our next free seminar on employment risk management. New Zealand’s employment law landscape is becoming more complicated, and employers are kept on their toes managing the risks this creates, including personal grievances and other claims. During our June/July seminar series, with dates and venues around New Zealand, we will discuss the following:

Personal grievance claims costs rising
Current popular claims against employers:sexual harassment
volunteer workers
privacy breaches
minimum rights prosecutions
Practical risk management strategies, with tips to avoid common pitfalls
What to do if things go wrong
More information can be found at https://www.copelandashcroft.co.nz/training-events

Please register to secure your place as numbers are limited.

Stay

We are now in Rotorua at 1268 Arawa Street, Rotorua 3010.

For further information, or to make an appointment, please contact Renee Harley (07) 577 8663

A record of settlement (agreement) can be very useful tool to achieve finality in any claim, where agreement is reached. However, a recent Human Rights Review Tribunal (HRRT) decision to strike out a claim which related to an employment matter that had been fully and finally settled, demonstrates the relationship between privacy and employment law.

The decision highlights the need to take care when drafting and entering into an agreement in full and final settlement of any employment matter.

Case summary – Judge v Care Park NZ Ltd and Waikato Institute of Technology

Mr Judge brought proceedings under the Privacy Act 1993 (the Act) against his former employer Waikato Institute of Technology (Wintec) and Care Park New Zealand Limited (Care Park) who managed Wintec’s car parks.

Mr Judge complained to the Privacy Commissioner about personal information which Wintec had obtained from Care Park regarding outstanding parking notices, which was then used in a disciplinary process against him. He claimed that the information from Care Park had been obtained in breach of Privacy Principle 10 which restricts the use of personal information to that of the purpose for which it was.

Wintec dropped the disciplinary investigation process after the complaint was received, and attended mediation with Mr Judge, where an agreement was reached. The agreement discussed Mr Judge’s view that Wintec had breached his privacy and made unjustified allegations against him, and Wintec’s concerns as to his conduct and behaviour. Importantly, it outlined that the parties agreed to settle all matters arising from the employment relationship including the employment relationship problem and the termination of the employment relationship, including “any and all complaints” the employee had or may make against the employer “to any statutory body including the Privacy Commissioner”.

The HRRT struck out Mr Judge’s claims on the basis that the agreement clearly contemplated and covered resolution of the privacy complaint, and therefore could not be challenged or set aside.

What this means for you

The HRRT is hearing claims more frequently relating to privacy in respect of employment, and employers should be aware of employee privacy rights and uphold these in any process they undertake. Parties should also take care when entering into agreements that the resolution they achieve by doing this is what they want – whether that is full and final settlement, or to leave the door open for future claim should there be some reason to do this. If you would like assistance regarding any employment relationship or privacy problem, our team can help.

June 2018