It’s not uncommon for employers to need their staff to work extra hours from time to time. However care should be taken so that directions to work additional hours are compliant with the Employment Relations Act (the “Act”), and recorded correctly in the employment agreement. In short employers need to make sure that a correct “availability provision” is included in the employment agreement if the Act requires it in the circumstances.
You will recall that “zero hours contracts” were made illegal some time ago. These were agreements which required employees to be available for all work offered, without compensation for being available, and without any guaranteed hours of work. As an alternative to zero hours contracts availability provisions were introduced to allow some flexibility to request employees work additional hours, while also providing employees with increased protection.
Deciding on when an availability provision needs to be included in an employment agreement still manages to trip up employers. It’s important to understand when an availability provision is required, and if so what the clause should contain.
The key things to note are:
An availability provision needs to be included in an employment agreement if an employer can offer work at their discretion and the employee is required to perform that work if requested.
The employer must have genuine reasons based on reasonable grounds for including the availability provision.
An availability provision must set out:
a) what specific hours the employee is required to be available for work (in addition to the specified guaranteed hours of work); and
b) reasonable compensation for the hours that the employee must be available to accept work. Where the employee is on a salary it can be agreed in the employment agreement that the salary includes compensation (provided that this is reasonable in the circumstances).
When considering reasonable compensation the employer should take into account the number of hours the employee needs to be available, the proportion of those hours in relation to the employees guaranteed hours of work, any restrictions on the employee during the hours they need to be available and the employees pay under the employment agreement.
A deficient availability provision will not be enforceable, meaning that the employee will not be required to perform the additional hours of work.
If an employment agreement allows the employee to turn down an offer of work in addition to their guaranteed hours of work, an availability provision is not required.
At Pitt & Moore Lawyers our employment team can prepare and review Employment Agreements and Employment Policies, as well as review your current employment practices as part of an employment health check-up for your business.
What sets us apart is that each of our Employment Lawyers are also immigration experts. This means that we can advise on all employment issues affecting your business, including issues connected to hiring migrant workers.
If you would like advice on this topic or any other employment related issue please contact our Employment Team today.
Disclaimer: The information contained in this publication is of a general nature and is not intended as legal advice. It is important that you seek legal advice that is specific to your circumstances.