Mills & Reeve: HR Law Live

New restrictions on zero hour contracts in New Zealand

On 1 April 2016 a raft of new employment laws came into force in New Zealand. Several restrictions have been introduced effectively banning zero-hour contracts. These changes were introduced following union pressure and significant media coverage over the use of zero-hour contracts, particularly in the fast food industry.

Employers can no longer fail to guarantee hours of work but still require employees to make themselves available to work without compensating them. Casual employment arrangements, where the employee can choose whether to accept work offered by the employer, are not affected by these changes.

Now, only employment agreements which guarantee some hours of work may include an "availability provision" requiring the employee to be available for additional hours of work. An availability provision may only be included if the employer has genuine reasons based on reasonable grounds for including it and reasonable compensation is payable to the employee for making himself or herself available for work. Employees will not be required to work more than their guaranteed hours if their employment agreement does not include an availability provision that meets these requirements.

There is not yet any specific guidance on what level of compensation could be considered reasonable. While various factors must be considered when determining compensation, this issue will need to be tested before New Zealand's courts to provide more certainty.

It has been suggested that employers could still include an availability provision by only offering an employee one or two hours of work per week. However, an employer needs genuine reasons for justifying an availability provision. In most circumstances we consider it would be difficult to rationalise guaranteeing a nominal number of hours of work per week while still requiring an employee to be available to work significantly more hours.

Other measures have also been introduced to support these new restrictions on zero-hour contracts, including banning the cancellation of shifts without reasonable notice or reasonable compensation, and prohibiting unreasonable restrictions on employees' undertaking secondary employment.

See this briefing for more details on these changes.

Charlene Sell, Senior Associate

Wynn Williams

Wynn Williams and Mills & Reeve are both members of SCG Legal, a worldwide network of leading law firms.

Government releases new information on apprenticeship levy

The guidance on the operation of the apprenticeship levy published last month was considerably expanded last week. More information will be published in the run up to the implementation of the levy in April 2017.

The extra detail now available includes:

• A more detailed account of how the digital accounts will work;
• An explanation of the way group companies will be able to pool their contributions to the levy;
• Confirmation that employers will have up to 18 months to spend each credit to their digital accounts;
• Information about co-funding arrangements where the amount in the digital account is insufficient to pay the training provider;
• An explanation of how the transitional arrangements will work: existing funding arrangements will continue to apply to apprenticeships that have already started prior to April 2017;
• Employers who do not pay the levy will not have access to a digital account until at least 2018. More details on the proposed rate of government support for these employers will be published in June 2016.

Absence trigger point in staff handbook had contractual effect

The Court of Appeal has confirmed that a paragraph in a staff handbook, which defined the trigger point for invoking an absence management policy, had contractual effect. It did not matter that it was surrounded by other paragraphs which were not contractual, and was the gateway to a procedure which did not itself have contractual force.

The Department for Transport, as the appellant, was keen to establish that the trigger point – which was reached if an employee had short-term absences of more than 21 days in any 12 month period – was not contractual. That was because it wanted to change it so that the absence procedure could be invoked after fewer absences. The high court had already decided that another provision in the handbook (which permitted changes in certain circumstances) did not displace the general rule that an employer cannot vary a contractual term without the employee’s agreement.

Many employers will not have such complicated procedures for managing absence, but almost all have a staff handbook. This latest case underlines the need to be as clear as possible about which elements are contractual, and which are there to set out the employer’s policies procedures and can be freely changed because they are not legally binding. As this case illustrates, it is not always easy to distinguish between the two.

The way an employer categorises the relevant provision is not definitive, since the courts will look at the substance of the wording when deciding whether it is contractually binding. There are a number of factors which point towards the wording being contractual. These include:

• The importance of the provision to the employee: if it confers a significant benefit to the employee it is more likely to be contractual;
• Use of language which confers an entitlement on employees rather than referring to management discretion;
• Clear wording that stands on its own, rather than language that only makes sense in the context of the procedure as a whole.

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Countdown to introduction of apprenticeship levy begins

More information is emerging about the apprenticeship levy, which is due to take effect in April 2017. The best place to start is the recently published briefing paper from the House of Commons Library.

The key points can be summarised as follows:

• The levy will in effect be a 0.5% charge on the portion of an employer’s payroll which exceeds £3 million per year.
• The funding collected will be increased by a further 10% from the Government.
• Each employer (whether contributing to the levy or not) will have access to a digital account to obtain funding for training, assessment and certification of apprentices. Other costs (for example wages) will not be covered by this funding.
• Training must be delivered by approved providers.
• There will be a funding cap per apprentice, which will depend on the type of apprenticeship involved.
• A new independent body, the Institute for Apprenticeships, will advise the Secretary of State for Business, Innovation and Skills on the administration of funding raised by the levy. It will also have a role in designing new apprenticeship standards and maintaining the quality of existing standards.
• It seems that employers will be able to spend at least the amount of the levy they pay, plus the 10% Government top up, on their own apprenticeship programmes. Funds not used within a certain time limit (still to be decided) will be re-allocated.

The Government is planning to release more information, including an employers’ guide, in the next few months.

Warning for promoting religion in workplace not unlawful

The Employment Appeal Tribunal has upheld a decision of the employment tribunal about a Christian occupational therapist at an NHS Trust. She had been disciplined for failing to maintain “professional boundaries” when speaking to a junior member of staff who is a Muslim. She had repeatedly invited her to attend church services and on one occasion had prayed for her physical health while touching her.

The decision to impose a final written warning (reduced to a formal written warning after an internal appeal) followed an earlier informal warning. She had been told that she should not invite staff reporting to her to events associated with her personal beliefs, since they could feel under pressure to attend.

The EAT has said that the tribunal had been entitled to conclude that the claimant had not been disciplined for manifesting her religious beliefs (which would have been unlawful direct discrimination), but for crossing professional boundaries. This distinction is not easy to draw, but seems to have been the basis for all three decisions where religious discrimination claims by evangelical Christian workers have been dismissed by the EAT.

This latest appeal does not change the law, but serves to highlight the difficulties that can arise in this sensitive area. For more information about the steps employers can take to minimize the risk of such claims see our web briefing here, which explores the employment tribunal’s decision in this case in more detail.

Major shake-up of French Labour Code encounters opposition

The French Government has made some significant concessions to those opposing the El Khomri Bill, which aims to introduce “new freedoms and new protections for businesses and assets”. Named after the Employment Minister Myriam El Khomri, the Bill proposes wholesale liberalisation of the French Labour Code, including the insertion of a principles-based preamble.

Recent concessions include removing the proposed cap on compensation that can be awarded by the Labour Court for the French equivalent of unfair dismissal. Instead there will be an “indicative scale of damages” which will be set out in a future decree.

For more information please contact Albane Eglinger, Directeur Associé at FIDAL. A more detailed briefing about this and other recent employment law developments in France is available here.

Mills & Reeve LLP and France’s largest legal firm FIDAL work closely together on international matters and signed a memorandum of understanding in 2014.