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New Zealand’s Farming Industry Under the Microscope

Published October 27, 2016 (last updated December 2, 2020) -

Labour Inspectors from the Ministry of Business Innovation and Employment have warned farmers that breaches in employment obligations could have a serious financial impact on their business as they launch a nationwide campaign across the industry, targeting employment agreements and employee time records. To date, employment breaches are totaling 21 across 14 farms in the Waikato region alone.

In most recent news, Taranaki dairy farmer, Allan Marx, has been ordered to pay at least $87,000 for serious breaches relating to not meeting minimum wage standards and public holiday requirements. While this figure was the result of $64,000 in payment arrears, an additional $23,000 was the penalty imposed by the Employment Relations Authority (ERA).

In addition to these payment breaches, Mr Marx failed to maintain legitimate employment records such as hours worked or employment agreements. To exasperate his situation even further, Mr Marx has also been accused of bullying two employees into signing an agreement that settled their claim at an amount well below their entitled figure.

Seemingly, Mr Marx has been in breach of his employment obligation on multiple occasion. Back in 2014 when Inspectorates first visited the farm, illegal employment agreements were discovered where two lots of couples were placed on joint employment agreements and were paid well below the minimum wage, at a minimum of $50,000 between them. In addition, they were not paid correct public holiday entitlements and offered $50 as compensation instead.

This case perfectly idealises how getting it wrong, or purposely avoiding your employment obligations results.

It is important to understand that each and every employee must be presented with detailed and accurate individual employment agreements from the outset. The only exception is if your employee is part of a union, meaning they will fall under a collective agreement. Individual employment agreements must detail the following:

  • the name of both the employee and employer
  • work to be carried out and agreed hours of work
  • agreed salary or wage and how it will be paid (this figure must be equal to or greater than the minimum standard)
  • how to manage personal grievances within the workplace (you must include a clause whereby these grievances need to be raised within 90 days)
  • public holiday pay of at least time and a half
  • trial or probationary periods
  • the type of employment ie full-time, part-time etc

Other items such as breaks, holidays, notice periods and redundancy can be included, however, are not mandatory. As an Employer, make sure you understand the entitlements associated with differing employment types as they can vary.

Under employment law, employers are also required to keep detailed, complete and accurate records of wages, hours worked, leave taken and any other details relating to working conditions. Unless it is outlined in the individual employment agreements, there is no regulation associated with the provision of payslips, but providing them can be seen as best practice.

If you have concerns associated with understanding your employment obligations in line with employment law, Employsure can assist. As the leading workplace relation specialist, our team can provide advice, assistance and documentation to help you meet your requirements. Call us today on 0800 568 012.

About Employsure

Employsure is one of New Zealand’s largest workplace relations advisers to small and medium businesses, with over 5,500 clients. We take the complexity out of workplace legislation to help small business employers protect their business and their people.

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