Glossary

Record Keeping

Under the Employment Relations Act 2000 and the Holidays Act 2003, all employers are required to keep wage and time, holiday and leave records. Records can be stored electronically (i.e. on a computer, hard drive or the cloud) or on paper.

Record keeping is a legal requirement, as it shows the employer is compliant with employment law and correctly giving all employees the minimum employment entitlements.

If an employer does not keep accurate records, they can face a penalty of up to $50,000 or more.

Recruitment

The process of finding and hiring new staff to fill an open job position.

At each stage of the recruitment process—from posting job vacancies to screening candidates and hiring the new workers—employers must be compliant with employment law. This means an employer cannot discriminate against potential employees based on their gender, race, age, marital status, physical or mental ability, pregnancy, cultural background, religion or political opinion.

Employers must be careful with their choice of words when advertising job vacancies and asking questions at job interviews. Even if a potential employee is not hired, they can still submit a claim to the Human Rights Commission.

Redundancy

Ending the employment relationship because a certain kind of work is no longer required, or there is no more work available in the company. Before making an employee redundant, employers must show they have explored all other possible avenues to keep the worker employed. The employer must also go through a thorough consultation process with the employee about the proposed redundancy.

Employers are required to give notice of redundancy to employees in accordance with the employment agreement. If there is no clause in the agreement, the notice must be given within a reasonable timeframe.

Just like other forms of dismissal, redundant employees are entitled to unused annual leave, salary and other entitlements in their final pay.

Remuneration

Any form of compensation or pay in exchange for employment. The term refers to monetary rewards like hourly wage, salary and commission, but also other benefits such as annual leave, holidays, cash incentives, work insurance and a company car, to name a few.

How an employee is rewarded for their service depends on the industry, the current job market and the nature of the work itself. Employers should think carefully about the kind of cash and non-cash incentives they can afford to offer, and how it will affect the business when tax time comes around.

Repeated Misconduct

Consistent behaviour from an employee that falls out of line of the standards and expectations of the company. Repeated misconduct can occur in different aspects of the job. For example, showing up late for work, disrupting other employees, unauthorised absences from work and intentionally performing below the company standards.

For an act of misconduct to be deemed as repeated misconduct, the employee must have been given a fair chance to improve their behaviour. Employers must follow the proper disciplinary process before dismissing an employee to avoid the risk of an unfair dismissal claim.

Resignation

When an employee decides to terminate the employment relationship and clearly communicates their intention by giving the employer a notice of resignation.

How much notice an employee must give depends on the terms of their employment agreement. If a departing employee does not give the minimum notice period—in accordance with the terms of their employment agreement—the employer can withhold money from the departing employee’s final pay.

It is important for an employer to find out why the departing employee is leaving and if there are deeper problems in the company that should be addressed. This is vital if the departing employee plans on filing a personal grievance claim against the company in the near future.

Rest and Meal Breaks

All employees are entitled to rest and meal breaks or reasonable compensation if they do not get a break.

There are no specific rules for when or how long a rest and meal break can be. But the length and timing of each break should be reasonable in accordance with the length of the working day. Both the employer and employee can negotiate the terms of rest and meal breaks into the employment agreement.

Employers can only restrict rest and meal breaks on certain conditions. This means the restriction must be for a good reason (i.e. it is necessary based on the nature of the work) and the employee must agree to the condition in writing or verbally.

Restraint of Trade

A clause in an employment agreement that helps protect the commercial viability of a business by placing restrictions on what a former employee can or cannot do after they stop working for that employer.

The two most common restraint of trade clauses are non-competition and non-solicitation.

1. Non-competition: Prevents a former employee from working for a competitor in a field or industry similar to their former employer’s business.
2. Non-solicitation: Allows an employee to work for a competitor in a similar field or industry, but they cannot contact the former employer’s clients to talk about the new business they work for.

The terms of a restraint of trade clause must be reasonable in order to be enforced.

Retirement

The act of permanently leaving the workforce, often due to the employee’s age. In New Zealand there is no longer a default retirement age because people in their later years are staying healthier and productive for longer.

It is illegal for an employer to discriminate against an employee based on their age and force them to retire. However, there are some exceptions to this rule, for example, if the retirement age is set in a specific legislation, or if the employee signed an employment agreement before 1 April 1992 at a time where it was allowed to specify a retirement age.

These days employers are helping aged workers phase into retirement by slowly reducing their workload and providing flexible working arrangements.