Employers need to balance growth with volatility from COVID-19

First published in The Profit. Written by Edward Bostock.

No doubt we are all spending a lot of time considering what sort of year 2021 will be. New Zealand has been very fortunate compared to the rest of the world, however, there are still plenty of challenges we are facing particularly for those in certain industries such as tourism and events, most recently highlighted by the cancellation of the Art Deco Festival due to the change in alert levels.

Confidence in the local economy appears strong although it is hard to predict if this will continue and how any changes will impact the workforce and its well-being. For example, businesses may be wishing to increase their workforce to cope with current workloads while trying to balance this with not being over-committed given the potential changes to alert levels throughout the year and the resulting impact on both the local and national economy.

While we are all navigating this together, we must also be aware and informed of the employment law changes the Government has signalled for the coming 12 months. The Government has made a commitment to focus on our workers and will look to introduce changes to better support them. These changes include:

  • a confirmed minimum wage increase effective on 1 April 2021 from $18.90 to $20.00 per hour.
  • proposed increase to sick leave entitlements from five to ten days every 12 months which looks likely to apply to both full and part time employees, but will not increase cumulatively.
  • making it easier for women to gain pay equity.
  • plans to strengthen and simplify the Holidays Act.
  • Te Rā o Matariki confirmed as a public holiday from 2022.

Employers must be conversant with the changes already confirmed, and those that are planned, and be ready to implement them while also navigating the uncertainty from COVID-19.

What is clear is that working arrangements have (and no doubt will continue) to change for some businesses. For example, in the professional services sector (such as lawyers and accountants) there is a greater focus on flexible working which includes working a different number of hours, e.g. part-time.

  • working within different time frames, e.g. starting and finishing early.
  • working remotely.
  • job-sharing.
  • purchasing additional annual leave.
  • taking additional unpaid annual leave.

These flexible working arrangements are known to have benefits for employees, such as:

  • the ability to meet family needs and responsibilities.
  • reducing the chance of burnout.
  • increased job satisfaction

Under part 6AA of the Employment Relations Act 2000, all employees have the right to request a variation of their working arrangements at any time. Employers have an obligation to respond to requests as soon as possible and not later than one month after receiving the employee’s request.

There is a limited but broad number of reasons employers can decline a request for a variation to working arrangements, such as an inability to recruit additional staff or to reorganise work.

Employers should consider a number of factors when an employee requests flexible working arrangements and it is important to ensure that transparent processes are put in place for the benefit of both the employer and the employee. Employers must also be aware that no matter when or where an employee works, ensuring their health and safety is a shared responsibility. For example, if an employee will be working remotely, they are responsible for organising a work area that is appropriately set up to ensure that they can work safely, and an employer may request an employee provide photos of their work location. An employer may also request a health and safety assessment of the workstation to ensure that the employer’s health and safety obligations are being met.

Businesses will no doubt continue to adapt to the ever-changing landscape presented by COVID-19 and those that choose to embrace flexible working for their employees may end up with a stronger and more committed workforce. That said, we suspect that there will be many twists and turns to come throughout 2021.