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Starting Employment

How to start employment well and kick off your relationship with the employee

What are employee rights and my employer responsibilities?

As an employer, it's important to know the basic requirements for every employee. This includes:

 

  • A written employment contract: Have a written contract for each employee that outlines the terms of their employment (see more information below)

  • Minimum wage: Pay at least the minimum wage for all hours worked (see more information below)

  • Payment method: Make payments in cash unless another method (like direct credit) is agreed between both you and the employee.

 

See more information here. Employees are also entitled to specific leave and break times (detailed below). It is important to keep records to show you are being compliant with the law. This can also help you avoid misunderstandings and protect you if problems come up. You can find more about this here.

What is acting in 'good faith'?

Building a strong relationship with your employees starts with acting in ‘good faith’. Good faith holds up the relationship you have with your employees. This is especially important when dealing with tough situations, like performance issues or misconduct.

 

Here are three key principles to keep in mind:

 

  1. Honesty: Don't mislead or deceive. Always be upfront and truthful

  2. Communication: Be responsive and keep communication open

  3. Transparency: Before making a decision which is relevant to an employee, provide them with all the information they need to understand the situation and give them a good chance to share their thoughts.

 

Under the law, all parties in an employment relationship must:

  • deal with each other in good faith, 

  • have good reason for their actions, and

  • follow a fair process. 

More information on good reason and fair process can be found here and here.

 

If an employer is found to have breached 'good faith', they could face significant financial penalties. For more details on acting in good faith, see here.

What are employment agreements (contracts)?

Every employee must have a written employment agreement (sometimes referred to as a ‘contract’), which makes it clear what is expected from them. 

 

There are two types of employment agreements:

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Individual employment agreement (IEA) 

  • This is between you (the employer) and an individual staff member

  • The details of the contract only apply to that specific employee

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Independant or Subcontractor agreement 

  • A self-employed individual or business hired by a head (main) contractor to perform specific tasks on a larger project

  • The terms are agreed between you (the employer) and the self-employed individual or business.

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Drug and Alcohol Testing

If you have a reasonable belief that employees could be under the influence of something or not sober at work, or that testing is needed to manage risks to health and safety, it is important to consider clauses around drug and alcohol testing. You can find more information on testing here. 

 

Employment Agreement Templates

Templates to build employment agreements can be found at;

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  • Business.govt.nz linked here - A free employment agreement builder to create a tailored employment agreement. This is not specific to the food and fibre sector. 

  • ​Independent / Subcontractor Agreements here

 

Job Descriptions

Job descriptions are also helpful tools so both you and the employee understand the expectations of the role. 

 

You can find skills to include which are relevant to your roles on job seeker websites such as;

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You can find PDF templates for job descriptions at;

  • Careers NZ - For a generic job description template

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There is also mandatory paperwork that must be completed for each new hire, such as IR330 tax declaration and Kiwisaver forms. See Attracting the Right Individuals for more information. 

 

Trials and probationary periods ​

As an employer, you may want to use a trial or probationary period to know for sure if an employee can effectively complete the job. This must be written into the employment contract and agreed to by the employee. For more information on 90 day trial periods, see here.

What are different types of workers?

It is important to understand whether a worker is an employee or a contractor.

 

Employee: Someone hired to do work for wages or a salary under an employment agreement. 

Contractor: Someone hired to perform services under a ‘contract for services’. 

 

To determine whether your workers are contractors or employees you can find legal test guidance here (intention test, control vs independence test, integration test, and fundamental / economic reality test) which can help decide whether someone is an employee or contractor. 

 

Knowing whether a person is a contractor or an employee is vital to ensure they are on the right contract. If you hire someone as a contractor when they should be an employee, you might end up paying extra costs like unpaid tax, unpaid minimum wages, unpaid kiwisaver and unpaid leave entitlements.

 

While there are a range of factors that can determine whether someone is an employee or a contractor, we have considered some of these in the scenarios below. If you are unsure if someone is an employee or a contractor, you should seek legal advice on this. 

 

Click here to work out if you should have a contractor vs employee

Types of Employees

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There are three types of employees:

 

  1. Permanent (full-time or part-time) employees: Ongoing employment at a workplace

  2. Fixed-term (full-time or part-time) employees: Ongoing employment which ends on a specified date or event

  3. Sub Contractor: Type of fixed term employee where work finishes at the end of the project see here

 

For more detailed information on each employee type see here. However, you can use this quick table to gain a quick understanding of how they differ.

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There are also other types of workers with different requirements that need to be met, such as: 

 

  • Apprentices and trainees: For workers learning on the job and growing the skills they need to succeed. See more information here. 

  • Volunteers and studentships: For unpaid roles who are not employees and therefore not covered by employment law. See more information here. 

  • Triangular employment situations: Where three parties are involved in an employment arrangement. See more information here.

Employment Linked to Visas (and Accredited Schemes)

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There are visas available to migrant workers. Some of these require employers to be accredited through government immigration schemes. These may include additional obligations and working conditions from the employer beyond the minimum requirements. For more information, see here. 

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Tip!

 

You should always check if a potential worker has the right to live and work in Aotearoa New Zealand prior to hiring them.

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