Talking Shop - advisory

Enquiries to Advisors, Roy Hanrahan or Kathy Owen, through the NZRA freephone 0800 472 472 or email advisor@retail.org.nz.

May 2012

Protect your EFTPOS terminals
Skimming scams involving retail store EFTPOS machines have recently made the news. Customers have fallen prey to fraudsters who swapped in tampered machines. See Paymark’s fraud protection guidelines for merchants at https://www.paymark.co.nz/fraud-protection.

Customer access
While you are thinking about how to best secure your EFTPOS terminals against fraud, take some time to also think about legitimate customers’ access to them.

We recently had a call from a consumer disgruntled at the increasing trend for one-piece terminals which are fixed to the counter. The caller pointed out that fixing the EFTPOS machine to the counter makes it difficult or impossible for a person in a wheelchair or using a walking frame to use the machine. She claimed she could not reach some of the machines and, with those she could reach, it was impossible to hide her pin number.

You probably already consider issues like physical access, aisle width, floor hazards and shelf access. If you are installing new terminals, or while you are considering how best to secure your EFTPOS terminals against fraud, we suggest look for solutions to best address both these issues.

Fair Trading Act
You may have seen an article on Stuff.co.nz in April reporting increased attention from the Commerce Commission on traders who may be breaching the Fair Trading Act (FTA). The article discusses the action by the Commission’s Low Level Inquiry Unit and gives examples of investigations and outcomes. Read the article at www.stuff.co.nz/business/industries/6744832/Traders-face-fresh-scrutiny.

In light of this, it is timely for us to remind you about the Act and for you to brush up on compliance.

The Fair Trading Act applies to all people in trade; you cannot contract out of the Act. The Ministry of Consumer Affairs administers the FTA and the Commerce Commission enforces it but anyone – consumers and businesses alike – can rely on and take their own legal action under the Act.

The Act prohibits people in trade from misleading or deceptive conduct in general and prohibits specific unfair trade practices. It provides for the disclosure of consumer information relating to the supply of goods and services and promotes product safety. It is important to note that to breach the Act you do not have to intend to mislead or deceive, it is whether your actions did or could mislead or deceive.

Prosecutions under the Fair Trading Act can result in fines against companies of up to $200,000 and against individuals of up to $60,000. You’ll find information on the Ministry of Consumer Affairs website www.consumeraffairs.govt.nz/for-business/compliance/fair-trading-act/fair-trading-act-about-the-act. For factsheets and to order the FTA resource, ‘DVD: An Evening with the Fair Trading Act’, or to watch it on YouTube, go to the Commerce Commission website www.comcom.govt.nz/fair-trading.

Consumer Law Reform Bill - update
We are scheduled to appear before the Commerce Select Committee on Thursday 10 May to speak to our submission on the Consumer Law Reform Bill. The Committee is required to report back to Parliament by 9 August 2012.

Dismissal for poor performance
Every so often the Employment Relations Authority and the Employment Court make a decision that sets the standard for future interpretations of some aspect of employment legislation. These benchmark decisions enable us to establish a sound process for dealing with these matters in the future. In the case of dismissal for poor performance the benchmark case often referred to is Trotter v Telecom. Judge Goddard made the following comments regarding the obligations of an employer when deciding to dismiss an employee for poor performance:

When the dismissal is to be for reasons of alleged unsatisfactory work performance, fairness and reasonableness require that the specific reasons for dissatisfaction are disclosed to the employee; a reasonably specific and measurable improvement demanded of him or her; and a reasonable period of time given for it to be established whether the employee is able to achieve that improvement, and at the end of that time a dispassionate consideration given to the question whether enough progress has been made to avert dismissal. This consideration should also take into account the previous good record of the employee who is entitled to have account taken of all that is going for the employee as well as all that has been built up against him or her. Even if the employee is unable to come up to the mark, consideration should be given to possibilities of redeployment in other operations. 

Just as in the case of alleged misconduct there must be a fair inquiry, so in the case of alleged non-performance there must be a fair trial of the employee’s work. This involves providing the employee openly (as opposed to secretly watching him as happened here) with measurable targets or goals which in turn implies that they must be articulated to the employee being monitored and that they must be such as can later be the subject of an objective decision on the question of whether they have been attained or not.

From this decision we can conclude that, before any dismissal for poor performance, the employer needs to show that the employee was made aware of the measures that would be used to establish the standard required, that the employee was given a reasonable time to achieve those standards, that the employee was aware that if they failed to reach the standards their employment was at risk, and that the assessment of the employee’s efforts would be carried out in a fair and reasonable manner.

If you have a serious concern about the performance of an employee we suggest that you call our advisory line to discuss the matter before you reach the point of dismissal so that the process and measures can be established early in the process. Alternatively you can obtain a copy of our circular Discipline and Dismissal from our website.

Queen’s Birthday public holiday
There are no public holidays in May but Queen’s Birthday, Monday 4 June, will occur before you receive your June issue of Talking Shop.

The usual public holiday rules apply. If you are unclear as to employee entitlements, call the advisors or see our Guide to the Holidays Act 2003.

April 2012

Wages Survey 2012
Here are the preliminary results of our 2012 wages survey; the full report will be sent to participants shortly. Other members will be able to purchase the report for $60 including GST.

Position	Average rate per hour 2012	Average rate per hour 2011	% Increase
Shop Manager who buys	$23.73	$22.31	6.4%
Manager who does not buy	$21.53	$20.86	3.2%
Department Manager	$21.53	$21.55	-0.1%
Assistant Manager (2I/C)	$18.72	$18.59	0.7%
Sales representative	$21.15	$21.06	0.4%
Worker in sole charge	$16.93	$16.68	1.5%
Senior sales - grade 3	$17.75	$17.31	2.5%
Intermediate sales - grade 2	$15.75	$15.14	4.0%
Sales - grade 1	$14.11	$13.62	3.6%
Junior (aged under 16)	$12.45	$12.03	3.5%
Warehouse deliveries/deliver	$16.45	$16.28	1.0%
Office admin - grade 3	$21.54	$21.14	1.9%
Office admin - grade 2	$17.84	$17.09	4.4%
Office admin - grade 1	$16.12	$15.95	1.1%
Mechanic - cycle or otherwise	$19.95	$19.50	2.3%
Food preparation	$15.02	$15.29	-1.8%
Hairdresser / beauty therapist	$18.27	$18.45	-1.0%

We received 948 responses to the survey, representing 2,013 stores, and a total of 37,400 employees.

‘Other North Island’ remains the location of the largest number of respondents with ‘Auckland’ the second largest and ‘Other South Island’ third. Christchurch shows the effects of the earthquakes by dropping significantly from 139 respondents last year to 110 this year.

The weighted average increase for all categories was 2.96%. This is very similar to the result last year that showed a weighted average increase of 2.7%. It is interesting that national wage rates increased by less than 2% for the last two years while retailers appear to have paid slightly more than this in each of the last few years.

The categories that showed the greatest increase were ‘Shop Manager who buys’ (6.4%) and ‘Intermediate Sales – grade 2’ (4.0%). Those categories where the average wage rate decreased were ‘Hairdresser/beauty therapist’ (-1.0%) and ‘Food preparation’ (-1.8%).

Final reminder - minimum wage increase

Changes to the minimum wage took effect on 1 April 2012.

• The minimum adult rate, applying to employees 16 years of age and over, is now $13.50 per hour.
• The ‘new entrant’ minimum wage is now $10.80 an hour and may apply to the first 200 hours or three months (whichever comes first) of employment (with any employer) of 16 -17 year olds. It will not apply to young people who are supervising or training others.
• The minimum training rate for employees on registered training agreements is now $10.80 an hour.

There remains no minimum rate for employees aged 15 years or under. For more information refer to our circular Minimum Wage Order 2012.

Final reminder – ESCT on KiwiSaver employer contributions

Employer superannuation contribution tax (ESCT) now applies to all employer contributions made to employees' superannuation funds, including KiwiSaver accounts. Employer contributions are to be taxed at the employee's marginal tax rate, which means employees will receive less employer contributions than they have received from you in the past.

For more information and detailed examples see www.ird.govt.nz/changes/employers/budget-employers.html.

Public holidays in April

Good Friday, Friday 6 April, Easter Monday, Monday 9 April and ANZAC Day, Wednesday 25 April 2012 are the public holidays this month.

The usual public holiday rules apply. If you are unclear as to employee entitlements, call the advisors or see our Guide to the Holidays Act 2003.

Trading restrictions in April 2012

Unless a shop is specifically exempted, it is an offence to open on:

•  Good Friday, Friday 6 April
•  Easter Sunday, Sunday 8 April
•  ANZAC Day, Wednesday 25 April 2012, before 1pm

Take particular care with Easter Sunday which, although a non-trading day, is not a public holiday. We covered this in detail last month; scroll down (online) to review.

Unless a shop is specifically exempted, it is an offence to open on a non-trading day. Offenders are liable to prosecution and a $1,000 fine. Members are welcome to phone the advisors for our information flyer on trading restrictions and holiday obligations specific to Easter 2012.

Robbery – staff safety guidelines

The Department of Labour’s publication, Guidelines for the Safety of Staff from the Threat of Robbery, has recently been updated and is available on our website. The risk of robbery is always present in retail and this guideline offers a comprehensive list of the threats and preventative actions an employer should consider to minimise the risk of injury to employees and customers.

Under the Health and Safety in Employment Act 1992 an employer is obliged to take all practicable steps to ensure the safety of themselves and others in the workplace. By using these guidelines and involving employees in examining the preventative measures contained in the guidelines, an employer will be able to demonstrate they have taken reasonable steps to deal with the issues.

Our circular, Retailers’ Guide to Health and Safety will assist you to implement a comprehensive health and safety programme including an assessment of other hazards in the workplace. Download this circular from the member only area of our website or phone the advisors for a copy.

Camera surveillance systems and the Privacy Act

A recent query from a member suggests it is time to revisit this issue. Following an incident of shoplifting, security photos were posted on facebook. Although this lead to the identification of the people responsible, public disclosure of the images will usually be a breach of the Privacy Act, as indeed was the preliminary finding in this particular case.

Businesses need to be aware of all legislation affecting their business. This includes the Privacy Act and if you use security cameras you’ll need to be especially careful with your systems and image use.

We suggest you make good use of the guidance produced by the office of the Privacy Commissioner. The publications explain how businesses and other organisations can use camera surveillance systems, commonly known as CCTV (closed circuit television), while still protecting privacy.

The full guide explains the relativity to the Privacy Act Principles, includes a checklist designed for small businesses and provides practical advice on:

• deciding whether CCTV is right for you
• planning the system
• selecting the appropriate technology and positioning cameras
• making people aware of the CCTV
• collecting, using and storing the images
• access to images
• continuing evaluation.

A smaller summary document, comprising a summary of the guidelines and the small business checklist, is also available.

A privacy breach occurs when there is unauthorised access to, collection, use or disclosure of personal information. Examples of all too common privacy breaches include loss, theft or accidental disclosure of personal information of customers, clients or employees, perhaps through the loss or theft of paperwork or a computer, or information mailed or emailed to the wrong person, or perhaps due to procedural failings.

Immediately a breach is discovered (or suspected) you must take steps to limit the breach and its effects. The guidelines will assist you through that process, including the question of breach notification, i.e. notifying individuals when their information has become available to an unauthorised party or parties.

In the current environment of social media it might be too easy to focus on spreading the word following a theft or shoplifting incident, whereas you should be considering your obligations under the Privacy Act.

On the topic of public disclosure of CCTV images, the full guide has this to say:

“It is often difficult to justify public disclosure of CCTV images. By ‘public disclosure’ we mean releasing information to the public at large (not to a single agency such as the Police or to an individual).

Public disclosure includes:

• publishing still CCTV images in a newspaper or in the window of your premises;
• uploading footage to the internet;
• circulating it widely to an email group; or
• placing images on a workplace notice board where non-staff members may see it.

Releasing CCTV footage to the public can have a serious impact on the privacy of the individuals in the footage. For example, once something is uploaded to the internet, it can be difficult if not impossible to remove that information. Even if the individual in the footage is in the wrong, it is better to contact the Police and seek their advice. If you publicly release footage you may breach the Privacy Act or interfere with Police investigations.

The Police may publicly release CCTV images to investigate a crime, or to help identify or locate a person who is in danger or who is a danger to others. If you think that your CCTV images need to be released publicly for whatever reason, go to the Police. The Police will have the appropriate information to decide whether releasing the footage is necessary.”

Both the full guide ‘Privacy and CCTV’ and the ‘Summary of guidelines’ are available for download for free from the website of the Privacy Commissioner at www.privacy.org.nz.

March 2012

Minimum wage rate increase 1 April 2012
The Government announced on 8 February that the statutory minimum wage rate will increase from 1 April 2012.

The adult rate, applying to employees 16 years of age and over, will increase from $13.00 to $13.50 per hour.

The new entrants’ minimum wage rate and the training rate for employees on registered training agreements are both set at 80% of the adult minimum wage and so will rise to $10.40 to $10.80 from 1 April 2012.

Remember the new entrants’ rate may be paid only for the first 200 hours or three months of a 16 or 17-year-old’s employment (anywhere) and will not apply to young people who are supervising or training others. There remains no minimum rate for employees aged 15 years or under.

For more information refer to our circular Minimum Wage Order 2012.

KiwiSaver changes 1 April 2012
From 1 April 2012 employer superannuation contribution tax (ESCT) will apply to all employer contributions made to employees' superannuation funds, including KiwiSaver accounts. Employer contributions will be taxed at the employee's marginal tax rate, which means employees will receive less employer contributions than they have received from you in the past.

If you use a payroll package you’ll need to ensure it is updated to correctly calculate ESCT. If you manually calculate your payroll you’ll need to be sure you understand what is required. For more information and detailed examples see www.ird.govt.nz/changes/employers/budget-employers.html.

You might want to make staff aware of this before it happens, to avoid anxious questions later.

There are further proposed changes to KiwiSaver next year (which will effectively restore net contribution levels). From 1 April 2013 both the minimum employee contribution rate and compulsory employer contributions rate will rise from 2% to 3%.

Public holidays in March
Taranaki Anniversary Day and Otago Anniversary Day, on Monday 12 March and Monday 26 March respectively, are the public holidays this month.

The usual public holiday rules apply. If you are unclear as to employee entitlements, call the advisors or see our Guide to the Holidays Act 2003.

Looking ahead to Easter 2012 public holidays & non-trading days
Good Friday, Easter Sunday and Easter Monday this year are observed on Friday 6 April, Sunday 8 April and Monday 9 April respectively.

Good Friday and Easter Monday are both public holidays, however Easter Sunday is not.

Good Friday and Easter Sunday are both non-trading days.

Unless a shop is specifically exempted, it is an offence to open on a non-trading day. Offenders are liable to prosecution and a $1,000 fine.

On non-trading days, shops such as dairies, service stations, souvenir shops, duty free stores, stores selling food ready to be eaten, bookstalls at public passenger transport terminals, pharmacies, shops at genuine exhibitions and shows may open. Other stores, (unless they hold a pre-existing exemption order) must be closed, with the single exception that garden centres may open on Easter Sunday. If you are required to be closed you may not offer any goods for sale or supply.

For Good Friday and Easter Monday the standard public holiday rules apply.

Remember that Easter Sunday is not a public holiday. If you cannot trade on Easter Sunday and your employment agreements do not deal with this, you will have to make arrangements with staff who would have normally worked on that day. Otherwise they will be entitled to their normal pay for that day.

You are able to have staff working, for example to do a stocktake or general reorganisation of stock (providing due process is followed with regard to the temporary change of duties), but the shop must remain closed. Any staff who do undertake this type of work for you on Easter Sunday will be due their ordinary pay rate.

Most stores instead arrange for all staff to have the day off. If the employment agreement allows changes of hours/days for temporary situations, this might include agreeing with the employee to swap a rostered day, or use an alternative holiday earned previously, or to take a day’s annual leave or leave without pay. You must agree any such changes in advance and should discuss this with affected employees at least two weeks before Easter.

If the employment agreement guarantees minimum hours, or does not provide for temporary changes, you are likely to have to pay for the day.

If the employment agreement deals with the issue, by saying that Easter Sunday will not be a working day if you are prevented from trading, you need only remind staff of the provision and invite any who still wish to be paid to apply for annual leave or an alternative holiday (if available).

If in doubt, members are welcome to phone the advisors on freephone 0800 472 472, or to download the NZRA circulars, Shop Opening Hours and Guide to the Holidays Act 2003.

Restraint of Trade clauses
A further case in the Auckland Employment Relations Authority (ERA) has clarified the reasonable length of a Restraint of Trade clause in an employment agreement. It is not uncommon to include a Restraint of Trade to prevent an employee who may have confidential information from joining another employer and using that confidential information to damage the previous employer.

A Branch Manager had a restraint provision in his employment agreement that prevented him from working in a competitor’s business for a period of six months. The ERA found that a six month restraint was too long as much of the confidentiality would have become stale after three months. The ERA accordingly replaced the period of the restraint with a three month period.

We don’t suggest you make any immediate changes to existing agreements but for new agreements think carefully about what information needs protecting and over what length of time that information would remain a risk. It may be that you can justify a six month restraint but be aware the ERA may overturn the clause if it believes it is too harsh.

Disciplinary meetings while ‘sick’
An employee was facing a disciplinary meeting when he became sick and was unable to attend a disciplinary hearing. The employer made several attempts to arrange the meeting but the employee claimed he was too sick.

However, the employee was seen several times a week at the local tavern which he later claimed was “part of his rehabilitation”. Eventually the employer dismissed him, which the employee claimed was unjustified. The ERA found the actions of the employer were reasonable and by attending the tavern the employee demonstrated that he was capable of attending a disciplinary meeting.

If you are faced with an employee who is genuinely sick and cannot attend a disciplinary meeting you are obliged to delay the meeting but, if you have concerns about the nature or extent of any such sickness, you can require a doctor to verify whether the nature of the problem prevents the employee from attending. An employee who refuses or unreasonably delays attending a disciplinary meeting may be dismissed in his absence, but call us before you make any decision.

What is a resignation?
We are regularly asked about the validity of a resignation: ‘Does it have to be in writing? Can resignation be cancelled by the employee? What if the employee does not give a date?’

A recent case clarifies one of these questions regarding a resignation by text message. The employee became angry at the promotion of a colleague and resigned by text. He later tried to claim unjustified dismissal on the basis that his text message resignation was not valid. The ERA decided that a resignation had only to be sufficiently clear for it to be valid, and in this case it was.

This begs the question, “What is sufficiently clear?” In our opinion a resignation should preferably be in writing and should indicate when it takes effect. However, you can require it to be in writing only if the employment agreement calls for this. If the agreement does not require written resignation, an oral resignation is valid if it is clear. In this case, we suggest you write a letter accepting the resignation and confirming the final day.

As regards the date the resignation applies, if an employee says, “I am leaving in April,” that is not a resignation. If, however, he says, “I am leaving on 6 April,” that is valid, in our opinion. Remember to ask for confirmation in writing or accept it in writing, depending on the terms of the employment agreement.

Wages survey 2012
Thank you to all members who participated in this year’s survey. Data entry is now complete and analysis is underway with results due out early April.

February 2012

Public holidays in February
Waitangi Day, Monday 6 February is the only public holiday this month.

Fixed term employment agreements
A fixed term employment agreement may be used when there are good business reasons for the employment duration to be fixed, rather than the employment to be considered permanent. A good business reason might be a project with a defined completion date, or a busy period for the business because of Christmas or Easter, or to cover for an employee who is overseas or on parental leave. You cannot use a fixed term agreement just in case the employee does not work out. Any fixed term employment based on a ‘just in case’ reason would be considered permanent employment.

The reason for a fixed term must be included in the agreement along with the finish date or a description of the circumstances upon which employment will end. For example, it may be possible to give the specific date that an employee returns from overseas, thus this is the date that employment will cease. In other circumstances you may not be able to fix the precise date but you can describe when the project or extra work will be completed. For example, the employment may cease “when the new computer system is installed and operating”.

It is suggested that in defining the circumstances that will trigger the end of the employment period, you indicate that no further work is envisaged at that point. As an example, your fixed term employment agreement may say, “This employment is to support the permanent sales team in the busy period leading up to Christmas, after which it is not envisaged that such support will be needed. The employment will therefore cease on 23 December 2011.”

A secondment to another position for a period of time is not considered to be a fixed term agreement. This is a temporary change to the terms of employment, usually provided for in the existing agreement, and will see the employee return to their original employment when the secondment is over.

Trial periods can be applied to fixed term employment in the same way as for permanent employment. The agreement will need to include the trial period clause, identify the duration and completion date of the trial and will, of course, need to be signed by the employee before they commence work.

You will need to be cautious about trying to end a fixed term agreement if for some reason the work is finished earlier than identified or you find you no longer need the employee. A fixed term agreement is an obligation on both parties and unless the agreement includes a provision for ending early, (such as early return to work after parental leave, or a redundancy provision) the employer may have to continue to provide work or pay the employee until the finish date in the agreement.

90-day trial period - reminder

We are still getting calls from members seeking to dismiss an employee on trial, only to discover the trial is not valid. Usually this is because they have failed to get the employee to sign the Employment Agreement before work commences.

Repeating the vitals of a valid trial:

• You cannot offer a trial to someone who has worked for you before or is already working for you.
• Agreement between the parties must be reached and the Employment Agreement signed before the employee starts work – not on or after the day they start work, earlier than their start date.
• The clause in the signed Employment Agreement must specify the duration of the trial including the date the trial finishes. It should refer to the relevant Section of the Act and should point out that the employee is prevented from pursuing a personal grievance on the grounds of unjustified dismissal. The trial clause in our standard Individual Employment Agreement meets these requirements.

Make it a habit to ensure all new employment agreements are signed before employment commences – not later than the day before they start. The agreement protects both parties. If you let an employee start work before documenting the agreed terms, not only is any trial invalid, but you open the door for them to challenge other terms which you believe had been agreed.

By law, an employer must hold a signed copy of each employee’s Employment Agreement. All the more reason to ensure one is signed before they start work.

90-Day trial period - recent case

A recent decision by the Employment Court has reinforced the importance of getting the employment agreement signed before the employee commences work in order for a 90-day trial to be effective.

In this case (AEC 152), the Employment Court found that the employee was able to bring a personal grievance for unjustified dismissal against his former employer, despite a written trial period provision in his signed Individual Employment Agreement.

The employee was offered employment by letter that made no mention of a trial period, and he accepted the offer of employment. On his first day the employee commenced work and was then presented with the Employment Agreement later that morning. Even though the employee signed the agreement at that time, and even though the agreement included a trial period provision, the Court held that the trial period clause was not valid because the employee was already employed at the time he signed the agreement.

The employee was dismissed by his employer on the strength of the trial period, however, this decision has now left the door open for the employee to take a personal grievance and challenge the dismissal.

Our advice in these cases is to make an offer of employment subject to acceptance of the terms in the Employment Agreement and confirm a starting date only when the signed agreement is returned.

2012 Retail Wages Survey

Our annual survey of the wages paid in the retail industry is under way. Each year we survey our members and prepare a full analysis of what is being paid to employees in various positions, locations, sectors and business sizes throughout New Zealand.

We need your help with this survey to ensure that it is accurate and truly represents the pay rates in the retail industry. You will receive the survey forms in early February and we urge you to take the time to complete and return the survey - hard copy or online.

Survey participants will receive a free copy of the analysis and report. Other members can purchase the report for $60 including GST.

Last year we had 1,010 responses, representing nearly 19,000 staff. The more members who respond, the more accurate and useful the results will be to you all.

You can take part in the survey online (shop.retail.org.nz/nzra_survey.htm) or use the survey pack that we have mailed to you.  If you have not received a survey pack by Friday 10 February please contact Roy Hanrahan or Kathy Owen on 0800 472 472. Please note the deadline for your response to this survey is Monday 20 February. Data received after 20 February will not be able to be included and will not entitle you to a copy of the results. Thank you in anticipation.

Layby Sales Act and the Fair Trading Act

A recent high profile case serves as a reminder about these two pieces of legislation. The Commerce Commission fined a Christmas hamper company $175,000 for misleading customers about their cancellation rights under the Layby Sales Act. The company also retrospectively refunded approximately 750 customers a total in excess of $141,000.

Under the Layby Sales Act customers have the right to cancel the sale any time up until the layby is paid in full. Upon cancellation, the retailer may deduct any loss or cost incurred by the cancellation. Any balance must be refunded to the customer.

Any attempt to mislead the customer about their cancellation rights under the Layby Sales Act is likely to breach the Fair Trading Act.

December 2011

Urgent advisory assistance during the Christmas / New Year break

The NZRA National Office will close at 3pm on Friday 23 December 2011 and will reopen at 8.30am on Wednesday 4 January 2012. Urgent advisory queries during that time – i.e. those that can’t wait until 4 January – may be directed to Roy Hanrahan on 027 438 7077 or Kathy Owen on 027 660 9603.

The NZRA Auckland office will close at midday on Friday 23 December 2011 and will reopen on Monday 9 January 2012.

The NZRA Christchurch office in the Westpac Business Hub will be unmanned from 2 December 2011 until 31 January 2012, inclusive. For most of this period Brian Finlayson, Southern Regional Manager, will be visiting members in the region and available on 0800 472 472, option 3, or mobile 027 475 0410. Brian will not be available after 23 December 2011 until his return on 16 January 2012.

Public holidays in December and January

December 2011 and January 2012 public holiday observance dates are:

• Monday 5 December, Westland Anniversary Day
• Sunday 25 December, Christmas Day – or the transfer day of Tuesday 27 December for those employees who don’t work on Sundays
• Monday 26 December, Boxing Day
• Sunday 1 January, New Year’s Day – or the transfer day of Tuesday 3 January for those employees who don’t work on Sundays
• Monday 2 January, Day after New Year’s Day holiday
• Monday 16 January, Southland Anniversary Day
• Monday 23 January, Wellington Anniversary Day
• Monday 30 January, Auckland & Nelson Anniversary Days

If you are unclear as to employee entitlements, call the advisors or see our circular, Guide to the Holidays Act 2003. For remaining questions on the transfer of the Christmas and New Year holidays, see our circular Christmas 2011 and New Year 2012.

The only non-trading day during this period is Christmas Day.

NZRA 2012 wallplanner error

Unfortunately our 2012 wallplanner carries a confusing error. If you have been following all our communications on the Christmas and New Year holidays and the transfer rules for the Sunday occurrences, you will have spotted the error yourself.

New Year’s Day, 1 January 2012, occurs on a Sunday. Staff who would normally otherwise work that day, will observe their New Year’s Day holiday on the Sunday. The transfer day, for staff who would not normally work on the Sunday, is Tuesday 3 January, not Monday as shown on the wallplanner note. Monday 2 January is already a holiday.

We apologise for this error. If you are at all confused, please call the advisors.

Alternative day reminder

An employee earns an alternative holiday by working on a public holiday that is also an ordinary working day for them. Remember the alternative day is a whole day off on pay, regardless of the hours actually worked on the public holiday.

Pay days and public holidays

If a public holiday is going to get in the way of a regular pay day you need to agree, in advance, on an alternative.

Discuss arrangements with staff in plenty of time. You may need to pay early. If you plan to pay late you will have to think again if this will create any budget problems for staff.

Shorter shift on a public holiday? Effect on pay

Often public holidays result in shorter than normal days, particularly in mall situations. Sometimes these have been preceded by longer shifts in the lead up to Christmas. Where an employee is to work a shorter (or longer) shift than normal, you need to discuss this change of hours with the employee in advance. A shorter shift on a public holiday can lead to pay disputes if you don’t address it properly.

A temporary change to the hours of work is typically a contractual matter between the parties and so depends on the terms and conditions contained in the employment agreement. If the agreement gives you the right to temporarily change the hours, or the employee agrees to the change, you need only pay the employee time and a half for the hours actually worked on the day. The employee will also be entitled to an alternative holiday to be taken later.

If you don’t discuss the reduced hours beforehand, there is a case to be made for the employee being entitled to time and a half for the hours actually worked plus ordinary time for the balance of the day they would otherwise ordinarily have worked, plus an alternative holiday. This is because you, as employer, have an obligation to provide the employee with the contracted work for that day. If you don’t, and it was through no fault of the employee that they were unable to work their full shift, then there may be an obligation for you to pay wages for the balance of the usual shift.

It is important to discuss the shorter day beforehand.

Public holiday surcharges

Typically only hospitality sector businesses lend themselves to public holiday surcharges. Even then, many businesses choose not to apply a surcharge, simply absorbing the extra wage costs as a cost of doing business and factoring it in across the year.

If you apply a surcharge on a public holiday you must clearly disclose this to customers before they commit to a purchase. Your notice of surcharge must be prominently displayed. We suggest a notice on the outside of your door and again at your counter.

If a customer isn’t told of a surcharge before they commit, you are likely to be in breach of the Fair Trading Act by insisting they pay it.

If you offer a reason for the surcharge, make sure it’s accurate. For example, if you give the public holiday as a reason for applying a surcharge, to avoid potentially misleading consumers, your surcharge should accurately reflect your extra costs of opening on a public holiday.

Retail Christmas security and loss prevention preparedness
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With Christmas trading looming it is time to consider your security and loss prevention readiness.

Members of the NZRA Retail Crime Prevention Group have offered the following pointers to minimise exposure to retail theft in the lead up to Christmas.

This article is a guide to completing a quick preparedness audit that not only deals with what you are expecting - increased customer counts and the cash they generate - but also with the unexpected. An extreme example of the unexpected occurred last Christmas Eve when an out of control car careered through into the shop floor. The right people were contacted and the store was ready for Boxing Day trading.

This security ‘walk’ begins outside the store and then through the building looking at areas such as POS area, product security, staff-only areas, access control, cash control, staff safety and emergency planning.

Environment

• Graffiti and untidy public areas and car parks will impact on your customers’ decision to shop with you.  Get any problems with these areas tidied up.
• Check your inwards goods controls and facilities. You’ll have larger stock volumes than normal and don’t want it sitting around in the car park.
• Crime, such as vehicles being broken into, needs to be reported to your local police. Together with the police put steps in place to deter or detect such offending.
• You may be working later than usual. Where are your staff parking, what is the outside lighting like?
• What’s your rubbish area like – tempting to rummagers or arsonists?

Building security

• Check that your doors, windows, grills, locks and alarms are in good working order. It’s better to deal with any small issues before they become major.
• Key security.  Who has what keys and what are the key identification numbers in case they need to be replaced?
• With extra stock on hand, check your stockroom security. Will your systems and accuracy be maintained with the extra volumes?
• If the unexpected happens e.g. doors won’t close, broken window etc, your best preparedness will be to know who to call for help. Prepare a callout list just in case.

Robbery risk and cash control

• With extra cash on site comes the extra risk of robbery – reduce the amount of cash held at your POS.
• Always use a safe to secure cash.
• Revisit your company’s Armed Robbery Safety Procedures.  If you don’t have any, take advice from your local police or visit https://www.police.govt.nz/safety/business-crime-prevention.html to access the police crime prevention advice for businesses.
• Consider having a security company uplift your banking. Never take business cash home.
• Carefully vet temporary staff and reinforce company rules.
• Revisit your opening and closing procedures. Be aware of what is happening in your environment. If you think something or someone is suspicious, act on those suspicions - take a second look.
• If you do fall victim to a robbery, don’t be a hero. Safety first. Remember robbers typically want just three things: control, money, escape.

Thieves

• Expect thieves to be ‘out and about’. Increased customers in-store can give thieves extra cover but also increases the number of eyes on them.

Some good advice to deter thieves is: 
- Be aware of customers and their behaviour
- Show customers you are alert to what is happening in your store
- Always acknowledge customers and practice excellent customer service
- Don’t stereotype; anyone can steal.

•  Ensure all staff understand what is expected of them in the event of theft. Conduct role plays with staff on dealing with suspicious customers.
•  If an incident does happen and the thief is uncooperative or aggressive, don’t give chase. The risk is too great. Observe from a safe distance to provide the police with information.

Fraud

Credit cards

• People using counterfeit or stolen credit cards will be more active over the busy period. Some indicators of these fraudsters could be:
  - The person not caring about price or warrantees 
  - Foreign cards
  - Asking you to swipe a chip card rather than insert it into the card reader
  - Trying multiple cards if one is declined
  - Using a card from a pocket rather than a wallet
  - Wearing disguises like hats, sunglasses.
• Ask for photo ID.
• Look closely at the card. Remember that if you phone for authorisation this does not guarantee payment. It will verify whether a card is genuine but not whether the owner is using it.
• If you accept card not present transactions, be extra vigilant with your checking. If in doubt, decline. The risk is yours. Talk to your bank about minimising the risk. Warning signs include:
  - Large one-off purchases
  - Multiple same items purchased
  - Requested delivery address differs from cardholder’s address
  - Rush or urgent delivery requested
  - Late request to change delivery address or notify delivery time
  - Overseas delivery
  - Country of delivery address differs to country of card issue.

Cheques

• Cheques are just a promise to pay.
• Blank cheques are relatively easy to steal. Ask for photo ID. Ask the customer to write their name and address on the back. Is it a local address? Does the bank Branch location match?
• If a cheque has already been signed ask the customer to sign another piece of paper and compare the signatures. Be particularly cautious of cheques payable to “cash”.
• Consider accepting cheques only if the bearer is listed in the white pages and they have supporting identification.
• Consider using a third party company for credit/cheque verification.
• For more information on cheques and credit card fraud visit https://www.police.govt.nz/safety/business-crime-prevention.html

Counterfeit notes

• There are always those who will attempt to pass fraudulent notes.  For information on what to look for in a genuine bank note visit www.rbnz.govt.nz/currency/money/polymer.pdf.

Returns and refunds

• Revisit your policies. Ensure all staff (including temporary staff) understand your policy and the law.
• Inspect all returns. You wouldn’t be the first retailer to refund an apparent unopened box only to find it contains phone books or counterfeit or substandard products.
• Be alert to ‘customers’ coming into the store with no product who then steal a product to match the receipt they have. Good customer acknowledgement can deter this type of fraud.

Staff safety

With late nights and the increase of dishonest or aggressive people visiting stores around this time, it is always good to remind staff to keep safe. Some advice is:

•  If they notice ‘suspicious’ people alert the management team.
•  When approaching these people, keep an extra distance. A good rule of thumb is two arms’ length, use barriers and position yourself so they can leave the store without pushing past you.
•  When leaving after dark have a torch, a mobile phone and a plan. If possible use a buddy system.

Take your ‘security walk’ now. Be prepared and enjoy a successful holiday trading period.

November 2011

Election Day – employees’ rights to time off to vote

Employers need to be aware of their legal obligations to staff working on Election Day, Saturday 26 November. Getting it wrong could cost you $1,000.

The Electoral Act 1993 provides employees working on polling day the right to time off to vote.

Polling booths are open from 9am to 7pm. If an employee has not had reasonable opportunity to vote before work on polling day, they are entitled to leave work at 3pm in order to vote. They are not required to return and they do not lose any pay. (There are special provisions for employees working in essential or emergency services and on board ships.)

You should make prior arrangements with employees working on Election Day. Where there is time, encourage them to vote before coming to work. Otherwise, or where there is not time before work, you might like to consider the following options:

•  Rearrange start times, giving staff reasonable opportunity to vote
•  Allow extended lunch breaks for voting
•  Schedule staff on rolling breaks (before 3pm is best)

Give special thought to situations where the employee works in other than their own electorate area. In such cases a special vote on the day may be an option.

Employers who fail to comply can be fined up to $1,000.

Public holiday in November

This year, Canterbury (Central and Northern) Anniversary Day is observed on Friday 11 November. Public holiday entitlements apply.

This is not the day shown on your NZRA wallplanner, which unfortunately lists the holiday as Monday 14 November. This is incorrect and we apologise for this error.

If you are unclear as to employee entitlements, call the advisors or see our circular, Guide to the Holidays Act 2003.

Gift vouchers

Are your gift vouchers ready for Christmas? A nicely presented gift voucher helps to suggest a stand-out store and can mean a great up-sell opportunity when the voucher is redeemed. Spend some time creating an attractive package which showcases your store and consider whether you want to include a presentation envelope.

Your terms and conditions must be clear. You need to show where and for what the gift voucher may be redeemed. If you sell goods and services, will the voucher be redeemable for both, or just for goods? You need to include the expiry date, otherwise it won’t expire. You might like to also include any rules regarding change and a caution about loss, although these are helpful rather than critical.

The rules of gift vouchers are:

• They represent goods (and/or services) to the face value of the voucher. You need not, therefore, give change if the customer chooses goods amounting to less than the voucher's value, unless the voucher says change will be given.
• Similarly, you need not refund them.
• A gift voucher should have an expiry date. A usual time period is anything from six to 12 months. If no expiry date is shown, the voucher will not expire.
• Generally a lost voucher is no different to a lost movie ticket; you don't have to replace it. The exception is where the voucher has been made out in a specific name and marked ‘not transferable’. In this case you would need to keep records allowing you to track the voucher, cancel it on notification of loss and issue a new one.
•  If your store changes ownership, the new owners will not be bound to honour vouchers issued by you unless they have purchased your liabilities or you have reached an agreement with them to do so.

Finally, do your gift voucher procedures invite fraud? Keep a list of vouchers issued and record redemption and cancellation of vouchers against your list.

Christmas holidays reminder

Remember Christmas Day and New Year’s Day this holiday season fall on Sundays and are subject to the transfer rules. Observation will be on Sunday or Tuesday depending on the employee’s work pattern.

If you haven’t already worked it out, contact the advisors or visit the members’ only section of the NZRA website to download our circular.

Being acquitted in Court does not make a dismissal unfair (WA 84/07)

An employee was dismissed for serious misconduct after he assaulted another employee. Subsequent criminal charges were laid by the police but the employee was acquitted of these charges. The employee raised a personal grievance for unfair dismissal.

The authority found the employer had conducted a full and fair investigation of the matter and decided that “on the balance of probabilities” the employee was guilty of serious misconduct and the employer had acted fairly.

The standard of proof in the Criminal Court is that the accused had committed the offence ‘beyond reasonable doubt’. This is different from the standard required under the Employment Relations Act which is that the accused ‘on the balance of probability’ had been guilty of serious misconduct. The claim of unjustified dismissal was dismissed.

A reminder about refunds and exchanges

In case any of you have missed our advice on refunds returns and exchanges, this reminder is to prepare you for the busy Christmas spend-up and the inevitable demand to exchange or refund on goods no longer wanted.

The Consumer Guarantees Act (CGA) requires the retailer to repair, replace or refund if the goods are faulty. However, if the goods are not faulty, but the customer has changed their mind, then you do not have to accept the goods back. A change of mind might be that the customer no longer wants the goods, or they don’t fit, or the colour does not match the carpet, or the grand piano will not fit through the cottage door; in any event the goods are not faulty and you do not have to respond.

You may choose to consider a credit note or a replacement, but under the CGA that decision is yours. If you advertise a refund or exchange policy you will need to comply with that. Remember, we have A4 sized signs for you to display at the point of sale that read, ‘Refund Policy. We do not have to provide a refund if you have changed your mind about a particular purchase, so please choose carefully. If the goods are faulty we will meet our obligations under the Consumer Guarantees Act to provide a remedy.’

Please contact our advisors if you need copies of these signs.