Employment obligations

Canterbury businesses will face many issues following the earthquake - employers and employees alike.

There will be practical considerations which you will need to discuss with your staff. In terms of legal obligations in paying staff, you should look to your Employment Agreements.

The NZRA standard Individual Employment Agreement contains a force majeure clause which makes provision for situations where disaster prevents you from trading and releases you from the obligation of offering work. However, the threshold to invoke or uphold a force majeure clause is high and you should not look to act quickly to invoke this provision.

Whether your Agreements deal with the situation or not, you will need to take a practical approach and recognise that some flexibility is likely to be required. Essentially, you should be talking to your staff. Talk about what’s happening - or not happening - at work and about what their home/family situation is and needs are. If you don’t know when or if you’ll be trading again, tell them that and commit to keeping them in touch once you know more.

If staff are available to work but you are unable to offer it for a short period, then you should look to agree for them to take annual leave if they have it.

If you can trade as normal but your staff are unable to attend because of personal circumstances, you are not technically required to pay them but, again, you might agree to a period of annual leave.
If you cannot trade but are able to provide alternative, clean up work you will need to discuss this with available staff. They will probably be only too agreeable to undertaking this other work – provided it is safe.

Health and safety will be a major consideration. Obviously access to buildings will be available only where they have been assessed as safe. Comply with any safety notices issued and don’t put yourself, staff or public at risk. If there is any doubt, stay out.

Staff helping with clean up will need to be issued with appropriate protective gear.

If your building has been condemned and you will not trade again, or damaged so badly that it will be months before you can, then staff are likely to be redundant unless you have other premises available. In this situation the required notice period would be payable. A force majeure clause may remove the need for payment of notice if the business is unable to pay. Members should ring us to discuss if this is the situation.

If you are prevented from trading for some time there will also be questions regarding your lease. Again, check the lease document to see if this situation is dealt with. If not, you may like to ask your landlord about the possibility of a rent ‘holiday’.

Further advice is available on the Department of Labour website at http://dol.govt.nz/quake2010/.
NZRA members are welcome to phone the NZRA advisors on 0800 472 472.

PM releases initial earthquake assistance package (28 Feb 2011)
Prime Minister John Key today announced an initial support package for Christchurch businesses and workers affected by last week's major earthquake. The six week package is made up of two parts:
-  An Earthquake Support Subsidy to help employers keep paying wages
-  Earthquake Job Loss Cover to support employees whose employer believes their business is no longer viable.

"This package is a first step to help the people of Christchurch rebuild their lives and livelihoods. It is designed to get people through the next six weeks, as the Government considers what measures will be needed in the medium-term," Mr Key says. Click here to read the press release

Earthquake support package available immediately (28 Feb 2011)
The initial earthquake support package for employers and employees is available now and the first payments will be in bank accounts by Wednesday says Social Development Minister Paula Bennett. Click here for more information and how to apply