Summer days drifting away

We like to slow down in the hot months, to relax and take it easy – but we can’t let our businesses do the same.
Experience tells us that the lead up to Christmas is one of the busiest times for employment lawyers. Think you can duck out and do your last minute Christmas shopping or head home early and do that Christmas baking you were planning – not a chance.
Between clients deciding they want projects completed prior to the end of the year – and making sure that they are paying employee entitlements correctly over the holiday period – there is a lot of work to be done before the holiday period commences. On the bright side, you really feel like you have earned a holiday by the time it rolls around! However, it is a reminder that although the Christmas and New Year holidays are a traditional period of time off for many employees, it is also a particularly busy time for many employers. Think of the Boxing Day sales, and smaller towns which rely on an influx of visitors over the Christmas period to sustain their existence throughout the year.
So, once you’ve made your list of what you want Santa to bring, the following is what ought to go on your ‘to do list’ in preparation for the holiday period?
• A very important thing is to make sure you are paying your employees the correct annual leave entitlements over the holiday period. Employees with accrued leave are entitled to be paid annual holidays at a rate that is based on the greater of the employee’s ordinary weekly pay at the beginning of the annual holiday, or the employee’s average weekly earnings for the 12 months prior to the end of the last pay period before the annual holiday.
• Is your organisation closing down? If so, employees can be required to take annual holidays and may be required to discontinue work, even if the employee has not yet accrued an entitlement to annual holidays, i.e., the employee has been working for less than 12 months. Although the parties can negotiate about taking annual holidays in advance, the most important thing is that employees are given not less than 14 days’ notice of any closedown period and any requirement to take annual holidays.
• Ask yourself – does the organisation need extra staff over the holiday period? If so, for how long and on what basis? A casual employee is an employee who works on an ‘as and when required basis’. If there is work available, the employer can offer it to them, and they are free to accept or decline. If there is no work available, there is no obligation to offer or provide work. If your organisation is not sure of its exact work requirements in the lead-up to Christmas, but wants flexibility to call in extra staff on short notice, a roster of casual staff may be just what the doctor (or, in this case, the elves) ordered. By comparison, if you know that you need additional staff to complete a particular project or for a particular period of time, this is more likely to be a genuine fixed term employment situation, and employees should be employed pursuant to a fixed term employment agreement.
• If you are engaging extra staff, have they signed employment agreements prior to commencing work? Are they familiar with the company’s rules, policies and procedures and do they know what is expected? The best way to avoid issues during an employment relationship is to make sure both parties are clear from the outset about what is expected. It is easy to overlook in the Christmas rush and when ‘tis the season to be jolly – but if issues arise when the employment comes to an end in January – it is then you will value your investment in December.
• For many owner/operators, Christmas is a rare time to possibly let another staff member step up and take the reins (not the reindeer!) for a while. Again, preparation is the key. Make sure any temporary managers in charge know how to deal with issues such as disciplinary issues or performance concerns or that they know who to call.
The recession has made for tough times for many businesses in 2009/2010 and many will be looking forward to a well-earned break over the Christmas period. Although you need to cross your fingers weather wise, because that’s out of your control, something that is within your control is ensuring that your business survives by turning your mind to some of the issues set out above. And of course, the added benefit is that you can tell Santa, when you’re making that wish list, that you have been very, very good and you have all your employment law matters in hand. That guarantees a good gift!
Jennifer Mills and Bridget Smith
www.minterellison.co.nz