The Employment Standards Legislation Bill has passed its third reading in Parliament and will come into force on 1 April 2016. One of the numerous issues this includes is addressing the issue of "zero-hour contracts". This has come about to try and prevent the agreements between employer and employee that they have to be available to work when required, with no guarantee of any work being provided. There is often an exclusivity clause that prevents the employee working for others.

This is different to being casual employer where there is no obligation for you to offer work to your employees, or for your employees to accept it. Both parties are able to say no and there are no negative consequences. Read more from the Ministry of Business, Innovation & Employment below. If you require information specific to your circumstances, please contact our office to discuss.

 Addressing zero-hour contracts
The Employment Standards Legislation Bill includes a package of measures to prevent unfair employment practices in the New Zealand labour market, such as "zero-hour contracts".
The changes aim to retain flexibility where it is desired by both, employers and employees, but also increase certainty by ensuring that both parties are aware at the beginning of the working relationship of the mutual commitment that they have made.
The changes mean that where the employer and employee agree to hours of work, they will be required to state those hours of work in the employment agreement.

The changes also prohibit the following practices:
- employers requiring employees to be available to work for more than the agreed hours without having a genuine reasons based on reasonable grounds
- employers requiring employees to be available to work for more than the agreed hours without paying reasonable compensation for the number of hours the employee is required to be available
- employers cancelling a shift without the provision for reasonable notice or reasonable compensation
- employers putting unreasonable restrictions on secondary employment of employees
- employers making unreasonable deductions from employees' wages.

When hours are agreed, these must be stated in the employment agreement
Where the employer and employee agree to set hours of work, they will be required to state those hours in the employment agreement. This includes agreement on any or all of the following:
- the number of guaranteed hours of work,
- the start and finish times,
- the days of the week the employee will work
- any flexibility in the above.

What if there are no agreed hours?
The employer and the employee do not have to agree on hours, times or days, but when they do, anything that is agreed must be recorded in the agreement. This will ensure employers and employees are clear in their commitments to each other. In cases where no hours were agreed to, the employer must provide an indication of the arrangements relating to the employee's working times. This is consistent with the current law. Employees will be able to apply to the Employment Relations Authority for a penalty against their employer, if they agreed on hours, but have failed to record these in the employment agreement.

What about availability provisions?
Availability requirements and compensation rates will need to be agreed and stated in the employment agreement. An employer can not include an availability provision in the employment agreement, unless there are some guaranteed hours in the agreement. The employment agreement should also indicate the amount of availability the employer requests. Employers will also need to have a genuine reason based on reasonable grounds to require employees to be available above the agreed hours. Employers also need to have a genuine reason based on reasonable grounds for the number of hours of availability.

When considering whether there is a genuine reason based on reasonable grounds, employers must consider:
- Whether it is practicable for them to meet their business demands without using an availability provision
- How much availability they're requiring and the proportion of the availability to the number of agreed hours of work.