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| Around the traps - Dec 09 |
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Reflections from Chris Rowe on dealing with employment and other problems. Chris Rowe, Director of Corporate Dynamics Ltd, is a Warkworth-based Employment Relations Advisor and Mediator I’ve been trying to get to writing this newsletter for several weeks, and it has finally come to the top of the pile. I do hope it reaches you before Christmas because it is intended to record some news and views to contemplate as you approach some (possibly) quiet times over the next few weeks. It is also to bring you my very best wishes for a wonderful end-of-year and new year, however you like to celebrate those. BUSY TIMES IN EMPLOYMENT As some of you are aware, I’ve had a very busy year, and I apologise for the fact that particularly over recent months I have been sometimes hard to find. Actually I’ve usually been in wall-to-wall meetings and mediations helping my valued clients deal with problems in the workplace. Thank you to those of you who have used my services during the year. In tough financial times, a range of employment issues arise: redundancy, poor performance (often resulting from personal/financial difficulties), conflict between colleagues, and (sadly) aggrieved employees who are looking for some extra money and try the personal grievance route. It is very important to deal with any personal grievance claim on its merits, and in good faith. Usually unscrupulous employees show their true colours along the way, and if you follow good practice and policy you can generally expect a fair result. There are currently quite lengthy delays securing mediation dates in the Labour Department, and I expect this will continue as backlogs increase. It’s always worthwhile to try to resolve matters early and between parties. Hot topics in my employment practice When I reflect on the mediations I have completed this year, and cases where I have advocated for employer or employee in Labour Department mediations, there are some regular issues:
The Employment Court saw it differently, concluding that the real nature of the employment relationship was essentially different from what was described in the employment agreement. Judge A A Couch said:”…It is important to understand what is meant by the terms “casual” and “ongoing” or “permanent”. ….. The distinction between casual employment and ongoing employment lies in the extent to which the parties will have mutual obligations between periods of work. If those obligations only exist during periods of work, the employment will be regarded as casual. If there are mutual obligations which continue between periods of work, there will be an ongoing relationship. The strongest indicator of ongoing employment will be that the employer has an obligation to offer the employee further work which may become available and that the employee has an obligation to carry out that work.” This case also concluded that an employment arrangement can vary over time, and sometimes the parties have implicitly agreed to vary the original agreement, so the variations are not documented. This often causes trouble later! Some learning from this case is that we all need to be alert, careful, and precise about the real nature of the employment relationship, and that if it changes significantly, we should ensure it is documented and signed off by both parties. Employee/Contractor The “real nature of the relationship” is also common terminology when considering whether a worker is an employee or contractor. It may seem straightforward, but the large number of cases which focus on this shows it is anything but straightforward. It is also potentially financially damaging to get it wrong, because employees have access to personal grievance remedies under the Employment Relations Act 2000. Often cases have to go through the ERA twice, first to determine whether the worker is an employee or a contractor, and then (if declared an employee) to deal with the substantive case. Because mediation is all but mandatory before cases get to the ERA, the process of reaching clarity about the employee/contractor issue can take ages and be very trying and costly. There are some industries (e.g. building, fishing, some trades) where it is current and standard practice for workers to be contractors. But this is not the only test, and before long there is going to be a test case in one of these industries which might change things abruptly. So give some thought to the real nature of the working relationship you have with your people, if you call them contractors. The ERA and courts will consider “all relevant matters” which indicate the intention of the parties to the relationship. These include: the written or oral terms of any contract; any divergences from those terms; features of control and integration including whether the person has been working on his or her own account; taxation arrangements; and industry practice. A test case might clarify the issue in your industry, but you would probably prefer not to incur the cost of reaching clarity! REDUNDANCY There’s a lot of it about, and I see no sign of it abating. 1. identify the risks 2. introduce policies 3. minimize use of personal PSDs in workplace 4. introduce software and/or hardware controls to restrict use of PSDs 5. actively monitor use of PSDs Bullying In some of the employment investigations I do, I am required to report on whether one or more employees has engaged in bullying behaviour. This can be either “horizontal” bullying which is bullying by one’s peers in the workplace, or “vertical” bullying, which is bullying of subordinate employees by those in the workplace hierarchy. I am guided by the case law on the subject, which is extensive. Workplace bullying has been defined as unwanted and unwarranted behaviour that a person finds offensive, intimidating or humiliating and is repeated so as to have a detrimental effect upon a person’s dignity, safety and wellbeing. The distinction between bullying and normal workplace banter or personality differences is often determined by the way the behaviour has been received by the employee being bullied. In Roberts v Japan Auto (NZ) Ltd [2003] 1ERNZ , the Court took into account the employee’s known fragile state of mind and the intensity of the remarks when it decided that the comparatively short period of the bullying was not an overriding factor. An employee has an obligation to bring any concerns about harassment or bullying to the attention of the employer. It is helpful to have a policy in your workplace manual which guides employees on this matter. Employers cannot be expected to know that bullying is occurring unless they are told. Employers then have an obligation to promptly have the matter investigated so that safety is maintained in the workplace. HOLIDAYS FOR SOME Speaking of safety, I wish you all a safe and peaceful holiday season, and look forward to renewed contact in 2010. I am taking an overdue break until 18 January 2010. If you have an urgent matter you need advice on in the interim, email will be the best way to contact me. Thanks! Cheers, Chris Rowe |