As you read this newsletter, many of you will now be working under Alert Level 3 conditions and grappling with the logistics of having staff return to work.

While being able to restart the business will be a relief to business owners and managers, the current lockdown has yet again taught us a few lessons and challenged a few of our business practices. Based on the nature of the calls we received from clients over this lockdown, here are some key considerations for you to ponder…..

  • Wage Reduction Consultation

Lockdown 2020 was a new experience for us all where we largely walked into the unknown when it came to managing a changing landscape with our staff. Existing terms and conditions for staff did not adequately cover the changes needed to enable businesses to survive in a crisis situation.

Case Law from 2020 (see our last newsletter for specific details) has confirmed that we must have an agreement in writing with staff in order to temporarily reduce their wages prior to any reduction occurring. However, along with employers learning this fact, Unions, Employee Representatives, and employees, also discovered that refusing to accept an increase would result in the Employer having to continue to pay 100% of the usual weekly earnings.

 During this most recent lockdown, a number of clients implemented our recommended consultation document which enabled them not only to achieve an agreement around an immediate reduction in wages but also a more permanent solution. Our recommended approach focuses on obtaining agreement to a wage reduction strategy that will automatically apply in the event of future lockdowns, without the requirement for further consultation.

For those employers who adopted this process, this acceptance can now be read in association with the employee’s usual terms and conditions and will become binding and enforceable for future wage rate reduction situations.

As the latest Lockdown will likely not be our last, employers will need to be more proactive in having plans in place for future lockdowns that prevent the need to have to consult at the time.

If you wish to discuss how you might be able to get a robust agreement in place to prevent consultation in the event of future lockdowns, please feel free to contact us.

  • Working From Home

Many employees can remain as productive while working from home as they do when in the office. However, based on the calls received from employers over the last 10 days, it is evident that working from home is not successful for all staff.  

Employer’s reported staff who had “gone AWOL” and others expressed concerned that the levels of production had dropped to unacceptable standards.

If an employer is paying staff their full salary, or close to this (80%), they can still hold a reasonable expectation that the employee will make themselves available to complete all required work in a timely manner.

 While an employer may have to accept a degree of flexibility to enable an employee the ability to negotiate the intricacies of home life, the principle of “a fair day’s work for a fair days pay” should still apply.

Employers can therefore stipulate that:

  • employees are available at particular times each day (to either receive and respond to messages or attend on-line meetings)
  • a minimum number of work hours are to be completed each day or per week
  • a minimum turnaround time on activities

To enable the above outcomes to be achieved, it is reasonable for the employee to negotiate with the employer regarding commencing early, or working late, to meet the minimum work expectations based on their personal home environments and situations.

It however appears that few businesses have formal working from home policies in place with these being created “on the hoof”. With increased technology available to businesses, it is likely that we will see an increase in requests for working from home arrangements and therefore, before the next lockdown occurs, we suggest that it may now be the right time to get a formal Working from Home Policy in place.

If you would like to discuss your specific business situation or would like a copy of our Working From Home Policy Template feel free to contact us.


Complimentary Employment Agreement / Policy Review

We are still offering all clients the opportunity to have their employment agreements and/or employment policies reviewed free of charge. If you would like us to have a complimentary look over your documents please send us an email  – alexia@russelldrakeconsulting.co.nz

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