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Key Legislation Updates

In New Zealand’s rapidly evolving workplace, staying informed about changes in employment practices is more crucial than ever for employers. Recent updates have introduced significant shifts in areas such as the Crimes (Theft by Employer) Amendment Bill, the 30-day union rule, and the Labour inspectorate compliance clampdown. This article outlines what these legislative updates mean for employers.

The Crimes (Theft by Employer) Amendment Bill

The Crimes (Theft by Employer) Amendment Bill has officially passed its third reading and is now law. This landmark legislation defines an employer’s intentional failure to pay any money owed to an employee as theft, ensuring stronger protections for employees across New Zealand.

Employers could be fined up to $5,000 and face one year in prison, and a company could be liable for a fine of $30,000.

The bill was introduced in 2023 by former Labour MP Ibrahim Omer, a refugee, who was a victim of wage theft. Statistics reflect that wage theft is most common in retail and hospitality roles and can often target vulnerable migrant workers.

30-day Union Rule being scrapped

The coalition government plans to scrap the 30-day union rule for employment agreements. This rule currently means that new employees are automatically signed up to the collective agreement when they start a new job. The change aims to give employees more freedom and reduce costs for employers.

Van Velden highlighted that the existing rule is convoluted and adds unnecessary costs, which negatively impacts workplace productivity. By removing this rule, employees and employers will have the flexibility to negotiate individual employment terms from the first day of employment.

Employers must still inform employees about their right to join a union. These changes will be part of the Employment Relations Amendment Bill, expected to pass by the end of 2025.

Labour Inspectorate in nationwide employer compliance clampdown

The Labour Inspectorate of Ministry of Business, Innovation and Employment (MBIE) has launched a nationwide compliance clampdown on employers. This initiative involves multiple operations across both the North and South Islands, targeting various sectors including retail, hospitality, construction, security, horticulture, viticulture, and dairy.

The compliance clampdown means that employers across New Zealand can expect increased scrutiny to ensure adherence to minimum employment standards. This initiative focuses on areas such as payment of the minimum wage, recordkeeping, holiday and leave pay, and the prevention of worker exploitation. Employers should be prepared for potential inspections and take proactive steps to ensure their practices are compliant, as enforcement actions may be taken against those found in violation.

Message for Employers

The Employment law space continues to change. Our team of specialists is ready to help with bespoke and practical advice and solutions on navigating the employment law landscape. Please do not hesitate to contact us if you need help.

Disclaimer: We remind you that while this article provides commentary on employment law, health and safety and immigration 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.