HOSPITALITY ASSOCIATION OF NEW ZEALAND
Submission by
Hospitality Association of New Zealand
to the
Transport and Industrial Relations Select
Committee
on the
Holidays Amendment Bill
17 September 2010
Hospitality Association of New Zealand
Level 2, Radio Network House, Corner Abel Smith and Taranaki Streets
PO Box 503, Wellington
Phone: 04 385 1369
Fax: 04 384 8044
www.hanz.org.nz
Holidays Amendment Bill
Members of the Select Committee
The Hospitality Association is a statutory body created by the Hotel Association of
New Zealand Act 1969. The Association has been restructured from the Hotel
Association to reflect the breadth of diverse operations in the sector including
restaurants, café bars, taverns, country hotels, motor inns, off-licensed premises and
large accommodation units. We believe the name “Hospitality Association” reflects
this diversity.
Through membership servicing of its 2,350 members throughout New Zealand the
Association is able to gauge the views and experiences of a wide variety of New
Zealand hospitality businesses including restaurants, café bars, hotels, taverns, offlicenses, casinos and a wide array of short and long term accommodation providers.
Our members employ some 11,610 full-time and 19,674 part time employees for a
total of around 30,000 people.
Membership of the Association is voluntary, is primarily funded by member
subscriptions and comprises predominantly small businesses. There is also a
perception that the Association, through its advocacy, speaks for and represents the
interests of the hospitality industry as a whole.
Service delivery to members is provided through a team of 8 Regional Managers
based at local branches around New Zealand supported by a service team in
Wellington. Service is delivered through personal visits and telephone contact with
members and includes advice to hospitality businesses on a wide variety of industry
and compliance issues including liquor licensing and employment.
The Association has considered the bill and makes appropriate comment on selected
aspects of the bill.
The Association would appreciate an opportunity to be heard before the Committee on
its submission.
Bruce H Robertson
Chief Executive
Hospitality Association of New Zealand
2
1.
Introduction and Overall Comments
1.1
The Association strongly supports the Bill.
1.2
The Association considers that the Bill will introduce a useful measure of
certainty and consolidation into the Holidays Act to make the Act work better in
the interests of both the parties to employment relationships.
1.3
The hospitality industry is a sector engaged in the important leisure and tourism
markets. Indeed employment in hospitality is characterised by work at times
when much of the rest of the workforce is not likely to be working including
especially public holidays.
Consequently, the Holidays Act is of immense
importance to hospitality employers and employees
1.4
Further, alongside a workforce increasingly characterised by more non
traditional working arrangements, the hospitality industry has always had a
disproportionately high proportion of part time and non traditional working
arrangements.
1.5
The Association therefore considers that holidays legislation ought to reflect
and be adaptable to these important developments.
In doing so holidays
legislation ought to be as clear, coherent and as flexible to all parties as
possible with individual employment arrangements the focus and not at the
expense of complex and prescriptive provisions.
1.6
The Association accordingly considers that holidays legislation, while providing
minimum employee entitlements, ought to provide a framework within which
parties to an employment agreement ought to be able to agree on
arrangements that both reflect business needs, workforce diversity and work
life balance and that these often diverse needs can align.
1.7
Despite the object of the Bill to make the Act easier to understand and apply
and reduce compliance costs the Association considers that areas where
compliance costs are imposed are not addressed. Specifically, these issues
are the additional prescribed payments for working on public holidays and
accumulation of alternative holidays that ought to be matters for negotiation
between the parties to an employment relationship rather than arbitrarily
prescribed by legislation.
3
1.8
The Association provides comment on selected aspects of the Bill as well as
suggests areas, while not covered in the Bill, that the Committee may like to
suggest as further measures in support of the Bill’s objects.
2.
Discussion
2.1
Paying out a Proportion of Annual Leave
2.1.1 The Association supports measures to enable employers and employees the
flexibility to negotiate to suit their particular circumstances. Many employees in
hospitality are often part time and don’t have either the need of desire for four
weeks off work and will be grateful for this ability. That request and consent is
required provides safeguards against misuse of the facility.
2.1.2 Similarly, we agree that the employer should be able to decline a request to pay
out a week of annual leave for cash if for example operationally the
arrangement cannot reasonably be accommodated or is challenging.
For
example, in the off season many hospitality employers rely on employees
taking their leave to smoothen their staff planning and forecasting and so the
requirement for employees to actually take their leave offers this facility.
2.2
Meaning of Relevant Daily Pay and Average Daily Pay
2.2.1
Changing the formula for calculating pay for public holidays and other leave
days will make compliance easier especially for smaller employers reduce
payroll administration costs and enable employees to better understand their
rights. The Association has long argued for greater flexibility and consistency
in calculating payment for public holidays and the flexibility that the Bill provides
for in respect of average daily pay will be welcomed.
2.2.2 However, we consider that pay for public holidays could be further simplified by
providing the ability for the parties to have the ability to negotiate all inclusive
pay rates inclusive of full compensation for working on public holidays rather
than the specific time and a half and alternative holiday requirements. An all
inclusive pay rate could still be specified as such in an employment agreement
and where issues in respect of minimum entitlements arise, the policy of good
faith dealing in employment relations and the Holidays Act apply as well as
recourse to the Labour Inspectorate and employment institutions to assist.
4
2.3
Transfer of public holidays
2.3.1 The Association supports the measure to enable employers and employees the
flexibility to negotiate to suit their particular circumstances and in doing so
better meet the objects of the Act. Indeed, the contemporary New Zealand
workforce is increasingly comprised of a wider variety of ethnic groups with
different days of national, religious or cultural significance to those referred to in
the Act.
2.3.2 The hospitality sector has a relatively high proportion of both employers and
employees of different ethnicities and nationalities and many hospitality
employers and employees alike would accordingly like the ability to transfer
observance of public holidays where they work to days of national, religious or
cultural significance to them. The Bill will therefore enable this to occur where
there is genuine agreement.
2.4
Proof of Sickness
2.4.1 The Association has no concerns with the proposal. Further, that the employer
must bear the cost of obtaining the proof suggests that the provision will only be
used in cases of repeated problem absences. The removal of the requirement
for an employer to have reasonable grounds to suspect that sick leave is not
genuine before the employer can request proof of sickness or injury is also
welcomed to better enable employers to address repeated problem absences.
2.5
Alternative holidays
2.5.1 The proposal to enable employers to direct the taking of alternative holidays if
agreement isn’t able to be reached aligns the taking of alternative days with the
criteria for taking annual leave and is welcomed and should increase flexibility.
2.5.2 We are however unsure how this aligns with section 58 of the current Act that
provides that an employer may direct the taking of an alternative holiday on 14
days notice only if 12 months have passed since the employee’s entitlement to
an alternative holiday arose. Accordingly, reading this section with the
proposed new section 57 we assume that the new section enables an employer
to direct the taking of alternative holidays on a reasonable basis within the
context of negotiations within 12 months of the employee’s entitlement to an
alternative holiday.
5
2.5.3 Additionally, the Association would support even more flexibility particularly the
ability for alternative holidays to be exchanged for payment earlier than once 12
months since the entitlement arose has elapsed as is currently the situation
under section 61 of the Act.
Indeed, the hospitality sector has high staff
turnover and often employees will prefer to exchange alternative holidays for
payment and will often not be employed by the same employer for 12 months to
enable cashing up.
2.5.4 Further, the Association considers that the requirement to provide employees
with alternative days ought to be commensurate with hours that the employee
actually works on a public holiday.
Although the proposals in respect of
Relevant Daily Pay under Clause 5 of the Bill will assist, we think that rather
than the requirement to pay employees for what they would’ve worked on the
alternative day irrespective of hours worked on the public holiday should accord
with hours worked on the public holiday. For example, where an employee
works say six hours on a public holiday at time and a half for the hours worked
we think that this is the maximum that an employee should receive as payment
for the alternative day. As we said above the easiest way to effect this is to
provide for the parties to have the ability to negotiate all inclusive pay rates
inclusive of full compensation for working on public holidays rather than the
specific time and a half requirements.
2.5.5 An all inclusive pay rate could still be specified in an employment agreement
and where issues in respect of minimum entitlements arise, the policy of good
faith dealing in employment relations and the Holidays Act apply as well as
recourse to the Labour Inspectorate and employment institutions to assist.
3.
Conclusion
3.1
The Association strongly supports the Bill.
3.2
The Bill’s proposals introduce a welcome consolidation into the Act to promote
better consistency of outcomes while retaining certainty of rights of the parties
to employment relationships. Rather than disadvantaging any party, the Bill
addresses identified impediments to optimal efficiency that should provide
better outcomes to employment decisions.
6
Recommendations
(a)
That the Bill proceed.
(b)
That consideration be given to extending the Bill’s provisions to enable the
parties to an employment agreement to be able to agree on all inclusive pay
rates inclusive of full compensation for working on public holidays rather than
the specific time and a half requirements.
7