“Zero Hour Contracts’ are the Contracts signed between the employer and the employee in which the number of hours for an employee to be available are not defined. It has been an unfair practice against the employees and hence, New Zealand legislature has now made such contracts illegal, however, leaving a flexibility for an employer to add ‘availability clauses’ for such Contracts.
There have been discussions on the elimination of such zero hour contracts and a campaign of Unite Union was moved on the subject. The campaign got the momentum when it was raised in TV3’s Campbell live current affairs show in 2015. Also, the political parties in the Parliament were in support of this idea. Thereafter, a Bill was passed in March 2016 that completely eliminated the concept of zero hour contract and the employers are now required to mention the hours of work in all the employment contracts. However, some room has been given to the employer that he can add ‘availability clauses’ in the employment contracts.
What Flexibility Has Been Allowed to the Employers Post 2016 Bill?
The employers can add ‘availability clauses’ into the employment contract, however, the same is subject to a few conditions:
a. the employer has genuine reasons to include such clause in the contract.
b. the employee gets reasonably compensated;
c. and the employee already has guaranteed working hours.
For an employer to add such a clause, he must have genuine reasons and in order to ascertain what are those genuine reasons would be based on the following:
a. Whether it is possible for the employer to carry on his business without such availability clause;
b. The number of hours the employer requires the employee to be available; and
c. The number of hours which are mentioned as fixed hours.
In addition, for such clause to be added, the employer also needs to pay reasonable compensation to the employee for any extra hours he wants the employee to be available. There is a test for determining what constitutes reasonable compensation, however, the main factor to be taken into account would be the number of hours the employee is required to be available as against the guaranteed hours and the difference in the remuneration of guaranteed hours and additional hours.
Benefits to the Employees Post 2016 Bill
Since most of the employment contracts used to be zero hour contracts prior to them being banned in New Zealand. However, the 2016 Bill has provided the employees with the sense of comfort that they would not be required to work for the hours other than what are mentioned in the contract without any repercussions. Nonetheless, they would only be required to work for additional hours if there is an ‘availability clause’ in the Agreement and for that they would be getting reasonable compensations.
Why Appoint Fortune Manning?
In order to avoid any legal convictions, having a knowledge of your rights and the available defences is necessary. Therefore, we are here to safeguard the interests of our client. If you have any concerns pertaining to your employment contracts and your rights are being infringed, we are available to sort out the best possible solution for you.
For scheduling an appointment, please contact Toll free phone: 0800 436 529 or Phone:+64 9 915 2401.
