Payroll – End of Year & Start of New Year

Employer monthly schedules and ir-files filed with IRD are based on the payment date of the pay run (not the pay period end date). After you have finalised the last pay for March and printed your end of year reports (make sure this includes leave liabilities/balances), go ahead and file your ir-file with IRD as usual.

The next step is to review and update your employees’ salary and wage information. Ensure all employees on minimum wage have their rates updated to the new minimum wage of $15.75. The new rate needs to be applied from 1 April. If 1 April falls in the middle of a pay period, you can either pay different rates by inserting an extra line with the different rate, or apply the new minimum rate for the whole pay period.

If you have contractors using the WT tax rates on schedular payments (including those hired by labour-hire firms), they are from 1 April able to choose their own tax rate, subject to minimums. New contractors, existing contractors (if they need to change tax rate or starting a new contract) and those opting in to the schedular payments rules need to complete the IR330C Tax Rate notification for Contractors form.

ACC levies, ACC threshold and student loan repayment threshold are automatically updated if you are using payroll software.

Want to read more?

Tax and Contractors

IRD Contractor Changes 

 

Migrant Worker Exploitation Cases Becoming More Prevalent

A migrant worker who was forced to pay her employer a premium to secure herself a job has been awarded $42,813 by the Employment Relations Authority.

Kapilaben Patel was employed as a chef by Curry Pot on Lincoln Ltd for three years from 2011 until mid- 2014.

The ERA found that Patel and her husband had made payments of around $15,000 in return for a job offer with Curry Pot Indian restaurant in Lincoln and assistance and support with a work visa and a residency application. Evidence showed that $5,000 was paid to the Curry Pot Indian restaurant four months before Patel started working there and 11 days before an employment agreement was signed and submitted to Immigration New Zealand.  Patel stated she also paid the directors of the restaurant cash payments.

Patel was awarded $31,413 for unpaid wages, working on public holidays and holiday pay from 2011 until 2014 plus $11,400 in reimbursement for the premium paid to secure her employment.

The company accepted there may be some statutory holiday pay owing to Mrs Patel but disputed all the other amounts claimed. They claimed she did not work all the hours claimed or that she paid them premiums.

“Advances may have been made from Mrs Patel to staff at Curry Pot but these, aside from one payment of $5,000 into the Curry Pot account, were personal in nature and not premium payments and they have nothing to do with Curry Pot” it said.

Minimum Wage Increase from 1 April

The Government have announced that the minimum wages will increase by 50 cents to $15.75 an hour from 1 April 2017.

Cafe Deducted Pay for Breaks Worker Was Never Allowed to Take

Natalie Cornelius was employed as a crew member in a café in Napier. She became concerned by her employer’s practice of deducting 30 minutes wages from her pay each day. This was allegedly to cover breaks which she is adamant she was never allowed to take.

Ms Cornelius tried to raise her concerns in writing and verbally however she says her employer inevitably reacted in a rude and belligerent manner and failed to address her concerns. Things got to a point where Ms Cornelius felt she had no choice but to resign.

Ms Cornelius subsequently raised a claim of unjustified dismissal, albeit constructively, by her employer, HPG Private Ltd (HPG). The claim was heard in the Employment Relations Authority in May 2016 where Authority Member Loftus agreed with Ms Cornelius that she had been constructively dismissed and awarded her the sum of $4,000 as compensation for hurt and humiliation.

In regards to the 30 minute deductions from Ms Cornelius’s pay each day for her breaks that she said were not taken, Member Loftus accepted Ms Cornelius’s calculations and awarded her $2,080. In all Ms Cornelius was awarded a total of nearly $12,000 for lost wages, inappropriate pay deductions, hurt and humiliation, plus costs.

Under recent changes to the Employment Relations Act, the duration and time of breaks is no longer strictly regulated. In the past, stringent rules governed how long rest and meal breaks had to be, and when they had to be given. For example, one 10-minute paid rest break during a work period of between 2 hours and 4 hours; one 10-minute paid rest break and one 30-minute meal break (unpaid unless agreed otherwise) during a work period of between 4 hours and 6 hours and so on. Now there are no specific rules for how long, or when, rest and meal breaks should be.

Employers and employees should bargain in good faith over the timing and length of breaks. All employers are required to provide employees with rest and meal breaks which give employees a reasonable chance during their work period to rest, refresh and take care of personal matters.

Under this legislation, some employers may be exempt from giving breaks. For example when employees agree to reasonable compensation in exchange for breaks, or where the employer cannot reasonably give the employee rest and meal breaks because the workplace environment or position make it impractical (for example, emergency medical staff, a sole charge customer service position, etc). However, the employer will always be required to compensate the employee if this situation arises. Compensation could be alternative time off equivalent to the missed break (i.e. finishing 15 minutes earlier but being paid until the end of the shift), or extra remuneration.

Could your Volunteer or Woofer be an Employee?

Did you know, that anyone working in return for food and accommodation is likely to be an employee? This means they are entitled to the same minimum employment rights as a paid employee and you need to register as an Employer, file Employer forms with IRD and pay PAYE, check they are allowed to work in New Zealand, keep time and wage records and enroll them in KiwiSaver if they are eligible. You need to make sure they receive minimum entitlement including that the value of what they are getting is not less than minimum wage, and pay sick leave and accrue holiday pay! If you do not deduct PAYE, you still need to calculate the amount of PAYE on the market value of accommodation etc provided and pay it to IRD.

This is not an exhaustive check list, please contact us if you need further information or have any queries.

Easter Trading Law Change

A recent change to the Shop Trading Hours Act 1990 now enables councils to decide whether shops in their district can open on Easter Sunday. The change is from Easter 2017, depending on each individual council. We will update you closer to the time with our councils’ local policies.

For employers who plan to open on Easter Sunday, this means you must tell staff of their right to refuse to work, eg by group email. This must be done:

  • between eight and four weeks before Easter Sunday, or
  • as soon as possible if new staff join your business less than four weeks before Easter Sunday.

For employees, the law change means they can:

  • refuse to work on Easter Sunday without giving a reason and without repercussions — but they must tell you they’re not going to work
  • raise a personal grievance against you if they believe they’ve been:
    • made to work Easter Sunday, or
    • treated badly for refusing to work Easter Sunday.

An employee who doesn’t intend to work Easter Sunday must tell you in writing within 14 days of receiving the right to refuse. This can be by letter or email.

The Power of Values in Driving Organisational Change

Most people instinctively understand the concept of values, after all we all have them, but most people tend to think of them as something that relates to a person and not an organisation. However, many successful businesses and organisations, across a range of sectors, are successfully using organisational values as a base to improve the culture in their organisation, drive improvements and deliver real benefits to their customers.

Organisational values represent the guiding principles for the way employees go about their jobs and interact with the customers of the organisation. They define non-negotiable behaviours and they underpin the organisation’s vision.

Placing organisational values at the heart of an organisation can deliver some powerful tools when addressing your organisation’s culture. For instance, organisation values can:

  • Provide a framework for how your employees (from the CEO down) treat one another at work
  • Provide a framework for how your employees treat your customers
  • Provide a framework for achieving your vision and increasing organisational effectiveness
  • Can help to create an environment that facilitates job satisfaction
  • Can help you identify employees who agree with your company’s vision and will fit with the culture
  • Can be used in marketing your organisation’s products or services

To be effective the organisational values cannot just be invented around the Board table or with the Senior Management Team. For this values led approach to be successful, four things are critical:

  • Employees and customers’ opinions about the organisation should form a crucial part in developing the values;
  • The values must be embedded from the top to the bottom
  • The values must be visible in every day work across the organisation
  • The values must be aligned to customer expectations

A brilliant example of an organisation using values to enhance its ability to improve the quality of delivery is the Waitemata DHB. It is referred to as the “Waitemata Experience” and is a values based culture change focused on achieving better outcomes and experiences for its patients. Cruicially the DHB realised was that they couldn’t improve patient outcomes without improving staff outcomes. They determined the DHB’s values by collaborating with their staff and their customers. Their organisational values are:

  • Everyone matters
  • Work with compassion
  • Feel connected
  • Better, best, brilliant

They then worked to develop 16 core standards that relate to the values and drive goals, decision making and behaviour within the DHB.  The DHB sought and analysed feedback from employees and patients and was surprised that the employees’ and the patients’ views didn’t always align on similar topics, for example, employees tended to believe that a good clinical outcome was the top priority for patients, but patients indicated that a good clinical outcome was expected. What the patient saw as a top priority was to be able to ask questions and to be listened to by the health professionals they were dealing with.  Patients also indicated that they wanted to feel welcomed and to feel that the place was a friendly one to visit. Whereas employees indicated that appreciation and recognition by their peers and managers was high on their list of needs.

The DHB has indicated that while the Waitemata Experience is still a work in progress the impact it has had on its employees and patients has been a significant and positive one.

If you are interested in improving the culture of your organisation or keen to explore what organisational values might be able to deliver for you, please contact us.

Are You Guilty of the Following?

Here are five of the most common slip ups employers have been making recently.

1. Not having your employee sign the employment agreement prior to starting is liable to result in problems including:

a. Any 90 day trial period clause would be void

b. Terms and conditions could be difficult to enforce and costly to negotiate after the fact.

c. Depending on how long it takes to get an agreement signed a precedent could be set that dictates what those terms and conditions will be

d. Not having an IEA is in breach of the Employment Relations Act

2. Not doing reference checks at all or not doing thorough reference checks on preferred candidates can lead to problem employees further down the track. If you do reference checks don’t be afraid to ask the hard questions such as ‘Were there any formal performance or disciplinary issues related to this candidate?’ or ‘Would you rehire them into the role they were doing before they left?’ ‘Was there ever any reason to question their integrity?’ Look closely at who their referees are; have they left out their last immediate manager? Why?

3. Not following process. Whether you are restructuring, performance managing or disciplining, there is a process that must be followed. There is a legal process and you may also have a documented internal process. It is important to comply with these to avoid any risk of a personal grievance.

4. Hasty decisions! Don’t make them. It is easy to make snap decisions or say things without thinking through the implications or seeking help first. Once you have communicated your decision or spoken certain words it is almost impossible to take them back or rectify the situation without some cost involved.

5. No Recognition. Failing to recognize good workers can cause employees to become disgruntled. Sometimes these are your best people that will walk and when they go you didn’t see it coming. Celebrate successes of teams or individuals and recognize a job well done. Success breeds success and is contagious. Conversely one disgruntled employee can poison those around them and quickly damage your culture.

 If you are unsure of the correct process when it comes to your employees, call us first. We offer 10 minutes free telephone advice for any new matter.

Chapman ER courses we can recommend

The Ultimate Team Leader

This workshop is our most popular and develops your team leaders and supervisors in areas that enable them to be better than average; they can become the ultimate team leader.

Date:  Wednesday 15 June 2016
Venue: Chapman Employment Relations, 56 Waimea Road, Nelson
Time: 9am – 12.30pm
Cost: $265 + GST (discounts apply for more than one delegate)
Enquiries: please email katrina@chapmaner.co.nz or call 03 545 0877

 

Successful People Management 

This series of 6 x 2hr sessions have been specially developed for people who want to learn the principles of effective and successful people management.  The series provides an opportunity for short but regular training, which can improve learning for busy leaders and managers.

In this series you will develop skills for effect communication, ways to manage difficult people, the disciplinary process as well as strategies to approach and prevent bullying in the workplace. There is also a 2hr session on Health & Safety to ensure you are meeting your minimum legal obligations in this area.

6 x 2hr Sessions, 2.30pm – 4.30pm at Chapman Employment Relations, 56 Waimea Road, Nelson

Session 1: August 10
Session 2: August 24
Session 3: September 7
Session 4: September 21
Session 5: October 12
Session 6: October 26

Cost: $795 + GST (early bird special – register before 1 June) Post early bird $845 + GST
Enquiries: please email katrina@chapmaner.co.nz or call 03 545 0877

 

Ways to Manage a Remote Workforce

If you operate a business that requires your employees or yourself to be mobile or work remotely from home, then you may be familiar with the unique challenges this can present.

With the advanced technology available; companies cutting back on expensive office space and overheads; employees demanding more flexible working arrangements and wasted hours spent sitting in traffic jams in some cities, the increase in mobile or remote workers has increased dramatically.

While some businesses are embracing this shift to more flexible working, others are more wary about what this would mean for productivity, accountability and overall staff performance. How do they reach employees in an emergency? How do they measure output? How much time is spent watching soap operas instead of working?

So to manage your employees remotely, accurately measure their performance and ensure they comply with company policies etc, here are some ways to create a good working employment relationship with your remote workers without compromising on productivity or profitability.

Firstly you need to measure what’s important. It is too difficult to manage something you can’t measure. GPS software allows managers to record, in real-time, vehicle activity details. This doesn’t mean you look over the driver’s shoulder every minute of the day but it does allow you to record important data like start and stop times, the number of jobs completed, idle time and maybe even speeding violations!

You will also need to really communicate well. This doesn’t mean stalking them every minute of the day but it does mean you need to find an easy way for you and your employees to communicate when necessary. Cell phones, CB radios, Smart Phones, Skype are all established and successful methods.

Next you will need to change your way of thinking to concentrate on outputs not activities. Flexible working changes the dynamics of management. You can no longer fixate on controlling what an employees’ day-to-day activities are. Instead step back and look at the big picture. What are the objectives that need to be achieved? Communicate the agreed objectives and leave them to work out how they can accomplish those goals. Have trust in them that they will use creativity and initiative to achieve the desired outcomes, or ask for help if they need it.

How much do you think you will you need to change especially if you’ve been used to a more hands-on management style, or been a ‘micro manager’? There is no doubt that some change will be required from you so be prepared for that and set the example for your employees.

Trust is going to be the most important aspect of this change. You need to give your staff the benefit of the doubt, extending trust until they show they’re undeserving of it. Reward the positive behaviour expected but ensure there are consequences for behaviour that doesn’t reach the standard required.

Finally, remember that technology will never replace you as a manager, but you can use it to complement your management of them. Make use of on-line meeting tools like Skype or instant chat to keep the communication lines open and contact with your employees easier than ever before. Web-based software for recording timesheets, sending and receiving e-mails, or monitoring staff location can be valuable tools to keep track of your employees if there is a requirement to do so.

So are you ready for your work force to work from Mars? It’s only an 18 month response time!