Employment Relations (Allowing Higher Earners to Contract Out of Personal Grievance Provisions) Amendment Bill

Employment Relations (Allowing Higher Earners to Contract Out of Personal Grievance Provisions) Amendment Bill

Member’s Bill

225—1

Explanatory note

General policy statement

The personal grievance provisions in the Employment Relations Act 2000 are intended to protect workers from unjustifiable dismissal or disadvantage. This overrides any existing contracts agreed to by the parties.

This Bill amends the principal Act to allow employees with an annual gross salary over $150,000 to contract out of the personal grievance provisions. Under this Bill, if that option is taken, whatever the employee and the employer have agreed to in their employment contract stands. This removes the threat of personal grievance for the employer in exchange for agreed terms with the employee.

Clause by clause analysis

Clause 1 contains the Bill’s title.

Clause 2 states the commencement date.

Clause 3 provides that the Employment Relations Act 2000 (ERA) is the Act being amended.

Clause 4 amends section 102 of the ERA. The amendment makes it clear that the right to pursue a personal grievance is not available to a person whose individual employment agreement excludes the right.

Clause 5 inserts a new section 102A into the ERA. The new section provides for an individual employment agreement to exclude the application of Part 9 of the ERA, which deals with personal grievances, as long as specified conditions are observed.

Scott Simpson

Employment Relations (Allowing Higher Earners to Contract Out of Personal Grievance Provisions) Amendment Bill

Member’s Bill

225—1

The Parliament of New Zealand enacts as follows:

1 Title

This Act is the Employment Relations (Allowing Higher Earners to Contract Out of Personal Grievance Provisions) Amendment Act 2016.

2 Commencement

This Act comes into force on the day after the date on which it receives the Royal assent.

3 Principal Act

This Act amends the Employment Relations Act 2000 (the principal Act).

4 Section 102 amended (Employee may pursue personal grievance under this Act)

In section 102, insert as subsection (2):

(2)

Subsection (1) does not apply to an employee who is a party to an individual employment agreement containing a term included under section 102A(2) and (3).

5 New section 102A inserted (Higher earners may contract out of this Part)

After section 102, insert:

102A Higher earners may contract out of this Part

(1)

This section applies when—

(a)

a person (employee) is negotiating with another person (employer) to make an individual employment agreement; and

(b)

the individual employment agreement provides for an annual gross salary greater than $150,000.

(2)

The employee and the employer may agree to include a term in the agreement excluding the application of this Part.

(3)

The term is void unless—

(a)

the agreement containing the term is in writing; and

(b)

the employee and the employer have signed the agreement; and

(c)

the employee had independent legal advice before signing the agreement; and

(d)

the lawyer who gave the advice explained the effect and implications of the term before the employee signed the agreement; and

(e)

the lawyer witnessed the employee’s signature; and

(f)

the lawyer certified that the lawyer complied with paragraphs (d) and (e).

(4)

Subsection (3) does not limit or affect any enactment or rule of law or of equity that makes an individual employment agreement void, voidable, or unenforceable on any other ground.