Business Buddy recommends employers get their HR in order

Business Buddy recommends employers get their HR in order

The workplace is full of whispers that the Ministry of Business Innovation and Employment (MBIE) is on route to audit employers in Auckland, especially those that may not be meeting the minimal requirements for staff.

The rumours are that companies where employees have made complaints or enquiries to MBIE will be top of the priority list to clean up poor employment practices.

At a recent SmartPayroll seminar the CEO, Chris Partridge, explained that 17 per cent of New Zealand’s employees are not receiving their minimum entitlements.

Kirsten Hawke, Business Buddy director, says the problems could be caused by errors employers inadvertently make or deliberate illegal employment practices.

Business Buddy recommends employers get their records in order, asap.

MBIE has an easy to read guideline that helps employers identify if they are doing everything correctly.

“Auckland has a large number of immigrant workers who are vulnerable to exploitation and it’s thought MBIE wants to address the problem,” says Mrs Hawke.

It’s believed MBIE also wants to put businesses on a level playing field because it is easier for companies to undercut the competition if they pay low wages.

The minimum wage will rise by 50 cents to $15.25 an hour from April 1, 2016. Employers need to be aware of their obligations.

Good practices start before the first day a new staff member arrives at their workplace, ensuring employees have signed employment contracts.

They also need to have had sufficient time to review the employment contracts and seek advice from an independent source.

If companies use contractors, they need to beware that they are genuinely contractors and not entitled to be employees.

SmartPayroll recommends companies take a cautious approach and if they are unsure – make the person an employee.

As well as ensuring pay rates are legal, employers also need to correctly pay annual leave, statutory holidays, sick leave, parental leave and other entitlements.

Over time, employment terms may change and employers need to remember to update employment contracts.

And, companies that say “they don’t do KiwiSaver” are not going to have any defence if MBIE comes knocking.

There are some exemptions to KiwiSaver but employees are entitled to join the retirement saving scheme.

To top all of this off – employers need to keep PAYE deduction records for at least seven years.

Penalties

There are financial penalties for not complying with employment laws, of up to $10,000 for individuals and $20,000 for companies. An employer may be fined or prosecuted for not complying with workplace health and safety laws. – Minimum employment rights and obligations, MBIE Kirsten Hawke, “suggests employers have a look at the new SmartPayroll HR.”

The cloud software helps companies build employment contracts, manage performance reviews and alerts management when licences, and certificate are up for renewal – plus much more.

If in doubt, Kirsten Hawke Owner and CEO of Business Buddy, suggest you to call your business advisor or contact the MBIE, they can steer you in the right direction.

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