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Business Update: 3 June 2004 - Issue 106

Thursday 3 June 2004 Issue 106


Rest home operator reps got a nasty shock at Parliament yesterday - while in select committee pointing out problems with the Employment Relations Law Reform Bill they were told the service workers’ union will lobby the Employment Minister to include residential care workers in the Bill’s ‘vulnerable’ workers list.

This would be expensive for the industry: any retirement home that was sold or outsourced its operations would have to transfer existing staff to the new owner or contractor on existing pay or pay redundancy. The pay and redundancy obligations will be an added expense for businesses employing food or cleaning workers who are already on the ‘vulnerable’ list. New categories of workers – like the residential care workers – can easily be added to the list on the say-so of the Minister. Contact


Keep an eye on sick leave this holiday weekend – some staff may attempt to misuse the new Holidays Act, which lets them get penal pay rates if they call in sick on a public holiday for which they were scheduled to work. Some firms reported high sick leave among staff scheduled to work during Easter and on ANZAC Day, increasing wage costs substantially.

The new Act’s definition of ‘relevant daily pay’ says you must pay what the employee would have received if he or she had worked. So it’s possible to throw a sickie and still get penal pay. The Act also says you don’t need a medical certificate for one day’s absence. Business NZ has drawn it and other problems with the Act to the Employment Minister and has offered help with improvements to the Act. But in the meantime some 7-day employers are vulnerable to misuse of the rules by some employees, and should be alert to unusual sickies this weekend. Contact


The Motor Trade Association outlined other problems with the employment Bill yesterday, saying it will prevent employers from treating staff consistently. In a dismissal situation, for example, the Bill requires the employer to


If you’ve ever run up against the Resource Management Act when seeking resource consents you may want to respond to the Environment Ministry’s review of the RMA. The review is looking at five areas of improvement - for a simple summary, check Improving the RMA in In Business where Business NZ recommends a changed definition for ‘environment’ - defining it more narrowly, so it no longer includes “social, aesthetic and cultural” factors on which many development projects have come to grief. The RMA review response form is on mfe. Contact: ‘balance the legitimate interests of employer and employee’ – but if two staff members are caught stealing, one having dependants and the other none, it seems the Bill could require the employer to deal more leniently with the first one than the second. Not being able to treat employees consistently will be a disadvantage to many employers, the MTA said. Contact justin.joseph@motortrade.


Industry associations and business organisations will be keen to see the details of the newly announced funding for polytechs and technical institutes to help them 'engage with business'. $21m over the next four years was announced in the Budget to assist these organisations to "transfer knowledge and technical expertise into industry". To access the fund they will need to agree ‘industry engagement plans’ with the Tertiary Education Commission. A summary of other skills-related Budget initiatives is on businessnzskills. Contact


The Clean Slate Act has received the royal assent but will not become law until a system’s been set up to allow for the concealment of offences, around the end of the year. Under the system people will be able to ring a Ministry of Justice privacy officer to ask about their criminal record. If no offence is recorded or a particular offence does not appear on the record, the inquirer will know that it has been concealed for employment enquiry purposes. The concealment will not apply to overseas travel. Contact


The strong appreciation in the currency against the US dollar since the end of 2002 has brought to an end the rapid growth in manufactured exports to the US since the mid 90’s. Over the last two years the only regions for which we have been able to record growth in manufactured exports were Australia (+6%), Europe (+5%) and the Pacific Islands (+1%). The biggest fall was to North Asia, with a 23% decline (-$762m) in exports between 2001 and 2003. Exports to Europe have grown steadily over the last 9 years, with the UK remaining the largest market in Europe, taking 43% of exports to the region. While wine remains a large export item to the UK, rapid growth is being recorded for electronic equipment and transport equipment. The UK is also an important market for clothing, electrical equipment and industrial machinery and equipment exporters.


Non-residential building consents in April were valued at $239m, 3% higher than in April 2003. Retail sector building consents continue to grow, reaching $516m in the year ended April, a 28% increase on the previous year. Strong growth has also been recorded for consents for office and administration buildings, up from $303m in the year to April to $460m in the last 12 months. The number of residential building consents in April declined again on a seasonally adjusted basis, falling by 5.5% in the latest month, following a 7.3% decline in March. The total number of residential building consents issued was still 11.3% higher than in April 2003 but the year-on-year growth has been declining. The total value of residential consents was just 8.5% higher than in April 2003. Four of the 16 regions recorded falls in the number of consents comparing April 2004 with April 2003 - Wellington (-54%), Tasman, Nelson and Southland.


Statistics NZ’s energy statistics for the March 2004 quarter show prices for commercial electricity users increased by 1.6% compared with the Dec 2003 quarter and were 8.1% higher compared with the March 2003 quarter. Seasonally adjusted electricity generation increased 2.6% in the March quarter compared with the Dec 2003 quarter. Hydro generation was 20.6% higher in the March 2004 quarter than in the March 2003 quarter. Thermal generation was 20% lower in the March 2004 quarter than the March 2003 quarter. Gas production was 25.7% lower in the year ended March 2004 than in the year ended March 2003.


Statistics NZ’s wholesale trade survey shows a 1.5% increase in the March 2004 quarter, following a 3.7% increase in the Dec 2003 quarter and a 0.5% increase in the Sept 2003 quarter. Machinery & equipment not elsewhere classified had the biggest increase (+$91m) for the quarter, followed by builders’ supplies (+$80m). These were partly offset by a decrease in seasonally adjusted sales of unprocessed primary product (-$41m) and petroleum product wholesaling (-$31m).


On Keep an eye on sick leave this weekend ‘In Business’ June 2004 ‘Spend now pay later’ Budget Budget 2004 – education & skills Budget 2004 – business summary Manufacturing expansion slows in April ANZ-Business NZ PMI for April 2004 Business planning forecast June 2004 quarter


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