Woodhouse Michael: Employment Standards Legislation Bill — First ReadingText is incorporated into the Bound VolumeWoodhouse Michael: Employment Standards Legislation Bill — First Reading[Sitting date: 08 September 2015. Volume:708;Page:6352. Text is incorporated into the Bound Volume.]Hon MICHAEL WOODHOUSE (Minister for Workplace Relations and Safety): I move That the Employment Standards Legislation Bill be now read a first time. I nominate the Transport and Industrial Relations Committee to consider the bill and at the appropriate time I intend to move that the committee report to the House by 12 February 2016.This bill addresses a number of issues in the employment relations system. It includes measures to modernise the parental leave scheme improve levels of compliance with minimum employment standards and prohibit practices that undermine the mutuality of obligations in the employment relationship such as the zero-hour contract. Taken together these measures will promote fairer and more productive workplaces by providing enhanced protections and benefits to both employees and employers.The bill before us today is an omnibus bill in five parts. Part 1 makes substantial amendments to the Parental Leave and Employment Protection Act. These measures broaden the eligibility requirements of the parental leave scheme to better reflect current work and family arrangements and to provide more flexibility to increase choice and support labour market attachment. They complement Budget 2014 legislation that extended the period of paid parental leave to 16 weeks from 1 April this year and then to 18 weeks from 1 April next year.Currently eligibility for the entitlements in the scheme depends on being in continuous employment with the same employer for a certain period of time immediately prior to the child’s birth or adoption—6 months to be eligible for the paid leave entitlement and 12 months to be eligible for the extended unpaid leave entitlement. This leaves a number of hard-working employees unable to access the scheme—for example employees who have recently changed jobs casual or seasonal workers or employees with more than one employer. In addition only biological and formal adoptive parents are eligible ruling out some people who still have permanent responsibility for the care of the child.There is also no flexibility in how the leave is taken. If an individual goes back to work at any time during their paid or unpaid leave even if just for a few hours then the remainder of their leave entitlement is forfeited. The amendments to the legislation address these issues by extending eligibility for the scheme to employees in a wider range of working arrangements such as those that I have mentioned already and employees in a wider range of primary-care arrangements such as permanent guardianship Home for Life carers and whāngai arrangements. They also permit employees who have been with their employer for more than 6 months but less than 12 to take 6 months’ unpaid leave.The amendments in the bill also increase flexibility in the scheme in relation to how leave can be taken. The introduction of keeping-in-touch days will allow employees to work up to 40 hours during the period of paid leave. They will also be able to take their unpaid leave flexibly by mutual agreement with the employer. So for example if there was a period in which they were going to have extra support—perhaps they have parents staying who can help out—they could return to work by arrangement but then continue the unpaid leave afterwards.Today I also announced that the Government would extend paid parental leave to parents of preterm babies. Earlier this year I agreed to work with ACT leader David Seymour to review the support provided in situations of multiple births disability and preterm births. Assistance is already available to parents of multiple-birth children and to parents of children with disabilities. However I have had fruitful discussions with Mr Seymour and have accepted that for parents of preterm babies there is an opportunity to provide more assistance. As a result the Government will make changes to the Employment Standards Legislation Bill to extend paid parental leave to eligible employees and self-employed parents of preterm babies.Under the changes eligible parents of preterm babies will be entitled to a longer period of parental leave payments than the standard 18 weeks if the baby is born prior to 37 weeks of gestation. They will receive additional weekly payments for each week the baby was born prior to the 37-week gestation period. For example a mother who gives birth at 28 weeks would receive nine additional weekly payments making it a total of 27 weeks of payment. Contrary to media reports today that the example meant that the maximum number of weeks would be 27 this is not the case. Minimum viable gestation could be just 24 weeks meaning 31 weeks of paid parental leave would be available in that situation. I want to thank Mr Seymour for his contribution in helping make our paid parental leave framework more modern flexible and practical.The next main purpose of the bill is to address compliance with minimum employment standards. Non-compliance not only disadvantages the workers it directly affects but also the wider New Zealand economy through for example anti-competitive behaviour. The bill includes a number of measures to strengthen enforcement of employment standards. These primarily amend the Employment Relations Act through Part 2 of the bill though associated amendments are made to the minimum entitlement legislation in Parts 3 to 5. Broad new accountability provisions mean that persons other than the employer will no longer be able to avoid sanctions if they are knowingly and intentionally involved in committing breaches of employment standards.Other measures in the bill include requiring that in all circumstances employers have a record of the hours their employees work each day in a pay period and the pay received for those hours; overturning the statutory obligation on the Employment Relations Authority and Employment Court to send employment standards cases to mediation; and introducing an infringement regime in relation to the obligation on employers to keep records and where relevant individual employment agreements in relation to each of their employees.These measures are complemented by the Budget 2015 announcement of increased funding for the employment system. Among other things this funding will improve the provision of information to employers and employees on their rights and obligations and will provide for an additional nine labour inspectors—eight of these in Auckland—bringing the total number once appointments have been made to 53. Taking into account the six additional inspectors that were appointed in Christchurch in 2014 this is an increase in the inspector numbers of 40 percent over the last 2 years.Finally the bill includes measures to address what have become known as zero-hour contracts and other practices that undermine the mutuality of obligation in the employment relationship. These are found in Parts 2 and 5 of the bill. Although businesses need flexibility to be able to adapt to fluctuating demands it is also important that employees have enough certainty to plan financially and in their personal lives. However some practices have developed where there are not mutual and reciprocal obligations. Zero-hour contracts as distinct from casual working arrangements require employees to be available for work without a guarantee of work or any compensation for that time.To address this the bill requires that where parties to an agreement commit to a set amount of hours those hours are stated in the employment agreement. Employers and employees do not need to agree to an amount of hours. However the bill ensures that employees cannot be required to be available for work beyond what is agreed without either being paid compensation or being able to decline work on a case by case basis without fear of negative consequences. Similarly an employer will not be able to cancel a shift at short notice without the payment of compensation as agreed in the employment agreement or prevent an employee from taking up secondary employment unless there is a genuine reason based on reasonable grounds.Finally in response to the situation in which employers were making deductions from employees’ wages to compensate for loss or damage caused by third parties the bill also amends the Wages Protection Act to prohibit unreasonable wage deductions. This bill makes the employment framework fairer for employees and better for businesses and I commend it to the House.