Publish date: 03/04/2019

A raft of significant changes for employers and employees came into effect on April 1st.

The adult minimum wage increased from $16.50 to $17.70 per hour, and the starting-out and training wage has gone up from $13.20 to $14.16 per hour.

Mike Johnson of Essential HR in Christchurch says that any employee who works a 40-hour week on an annual salary of less than $36,816 will need to have their salary increased to comply with the new minimum wage.

Those employees on a slightly higher salary than this will also need to be considered, he says.

“You [the employer] will need to consider the impact on those employees paid only slightly more than $36,816 because additional unpaid hours may likewise break the minimum wage legislation.”

Phyllis Gardyne of HR consultancy JOYN says business owners need to ensure their payroll, legal and HR staff are aware of the new rates so they can make the necessary amendments.

“We recommend that companies have their payroll person run a report listing everyone earning under the new rates and ensure their rates are increased if needed,” she says. “If you have missed the date, you will need to backpay.”

April 1st also saw the introduction of rights for employees under the Domestic Violence Victims’ Protection Act. Employees affected by domestic violence are now entitled to up to 10 days paid domestic violence leave per year as well as short term (up to two months’) flexible working allowances due to a domestic violence situation. The new entitlements apply to anyone directly affected or anyone supporting a child who has suffered from domestic violence.

Phyllis says there are a number of things employers should do to prepare for these new leave entitlements.

“Firstly, we recommend that employers add a clause to all employment agreements along the lines of ‘Domestic Violence Leave: The provisions of the Domestic Violence Victims’ Protection Bill shall apply’. Employers also need to ensure that staff are advised of their entitlements under the Act, and managers or those completing leave requests are aware of the new entitlements.”

She adds that there are new financial penalties for businesses who do not comply with the new legislation.

In addition to the above recommendations, Mike says employers need to consider the new inclusion that victims of domestic violence have the right to ‘not be treated adversely in the workplace because you might have experienced domestic violence’.

“You should make available some information to help staff get help where and when they need it,” he says.

“MBIE points out that as an employer you have a duty of good faith towards your employees and this must be managed accordingly. Given the hugely sensitive nature of domestic violence, your attitude should essentially be one of ‘how can I help?’”.

An information document on Rights for Employees Affected by Domestic Violence outlines the new entitlements and can be found here.

Changes were also made to KiwiSaver from April 1st. Two additional contribution rates of 6% and 10% have been added on top of the current contribution rate options of 3%, 4% and 8% of an employees pay. This change is designed to offer KiwiSaver contributors more flexibility.

In addition, KiwiSaver ‘contribution holidays’ have been renamed ‘savings suspensions’ while many KiwiSaver scheme providers have renamed the ‘Member Tax Credits’ initiative ‘Government Contributions’ after a survey revealed many people didn’t know about the credit and were missing out on government contributions to their KiwiSaver account as a result.

The KiwiSaver changes are outlined in full on the Kiwi Wealth website

JOYN have released a list of employment legislation that employers should be aware of in 2019, which you can read here.