Employer’s obligations during alert level 4

While we are still awaiting further specifics on what Alert Level Three and Four will actually look like for New Zealand, below is some guidance that may be of assistance.

We will be in a position to provide you further advice over the coming days as more information comes to hand.

Essential businesses

The Government has stated that the following are considered ‘essential businesses’ (noting that this is an evolving list) and will remain open during Alert Level Four.

Sectors Entities providing essential services (including their supply chains)
Accommodation Accommodation services for essential workers and people who need to be isolated/quarantined
Border Customs New Zealand, Immigration New Zealand and the Ministry for Primary Industries
Building and construction Building and construction related to essential services, critical infrastructure, or immediately needed to maintain human health and safety at home/work
Courts, Tribunals and the justice system Courts of New Zealand and Tribunals and Critical Crown entities (eg Electoral Commission)
Education At level 3 only: Schools and educational facilities (e.g. ECE centres)
Fast-moving consumer goods Businesses involved in the supply, delivery, distribution and sale of food, beverage and other key consumer goods (but not takeaway shops)
Financial services Banks, insurers and other financial institutions
Health
  • Hospitals, primary care clinics, pharmacies, medical laboratories, care facilities
  • Ambulance services
  • Mortuary services
Local and national government
  • Any entity involved in COVID-19 response or that has civil defence/emergency management functions
  • Key public services
Primary industries, including food and beverage production and processing
  • Packaging, production and processing of food and beverage products
  • Food safety and verification, inspection or associated laboratory services, food safety and biosecurity functions
  • Veterinary and animal health/welfare services
Public safety and national security
  • Emergency services and intelligence services
  • Justice system
  • Public safety and national security roles
Science Any entity (including research organisations) involved in COVID-19 response, hazard monitoring, resilience, diagnostics for essential services
Social services Welfare and social services, including NGOs, which meet immediate needs (further guidance will be provided)
Transport and logistics
  • Transport services
  • New Zealand Post and courier services
  • Any small passenger service vehicle driver – including taxis and ride-share services
Utilities and communications, including supply chains Electricity, gas, water, waste, fuel, telecommunication services, internet providers and media

 

For the most up to date list of essential services visit: https://covid19.govt.nz/government-actions/covid-19-alert-level/

Employees who are working in essential services during this period should be paid as per usual.

Employee’s pay

While in lockdown do I need to pay my employees?

If your employees can work from home, and your business remain physically closed, then they should be paid their usual salary/wages.

If your employees cannot work from home, and your business remains physically closed, then there is no legal requirement to pay your employees, as they are ‘ready and willing’ to work, but they are not ‘able’ to work.

In an ideal world, and at the employer’s discretion, employees should be on paid special leave for the duration of Alert Level 4; however we recognise that this may not be possible for most employers.

Ultimately, any pay will need to be by way of consultation and agreement between the employer and the employee. You may wish to consider one or a combination of the following options:

  • Paid special leave
  • Sick leave (understanding the employee is not ‘sick’)
  • Annual leave
  • Alternative leave
  • Unpaid leave
  • Wage Subsidy Scheme.

The Government has now introduced the following changes to the wage subsidy scheme:

  • The previous $150,000 cap is being lifted, so that all employers can access the full payments to subsidise each of their employees’ salaries
  • New businesses (eg. that are less than a year old) and high growth firms (eg. firms that have had significant increase in revenue) are also eligible. They need to demonstrate the revenue loss assessment against a similar time period, for example a 30% loss of income, attributable to COVID-19, in March 2020 compared to January 2020
  • Self-employed people with variable monthly incomes are eligible if they can demonstrate the revenue loss assessment against the previous year’s monthly average (eg. 30% loss of income attributable to COVID-19 comparing March 2020 to the average monthly income in the period March 2019 to March 2020)
  • The scheme does cover registered charities, non-governmental organisations, incorporated societies and post-settlement governance entities.
    The same criteria will apply (including the 30% revenue reduction for businesses and the businesses must make their “best endeavours” to pay their employees 80% of their pre-COVID-19 income). The subsidy will still run for 12 weeks.

Redundancies and restructurings

We understand that some businesses have already commenced work to restructure their business. In light of today’s announcement employers may wish to:

  • Put the restructure on hold;
  • Continue with the restructure; or
  • Amend depending on your businesses circumstances.

We are able to advise on your options for restructuring your business in this every changing environment.

 

Workplace Law Team

Employment: Andrew Shaw, Fiona McMillan, Gwen DrewittMaria Green,  Hannah Martin, Joseph HarropHolly StruckmanAlex Beal, Giuliana PetronelliAna Fruean, Elise Wilson, Abby Shieh
Immigration: Mark Williams, Rachael Mason, Daniel Kruger, Nicky Robertson, Hetish Lochan, Julia Strickett, Rita WornerKen Huang, Mary Zhou, Mahafrin VariavaJosh TempletonSally Stone, Shi Sheng Cai (Shoosh)Sarah Kirkwood, Janeske Schutte, Sati RavichandirenLingbo Yu, Mengying Wang
ACC: Andrew Shaw
Health and Safety: Andrew ShawFiona McMillan

Contact

Andrew Shaw
Partner, Lane Neave

t +64 3 353 8014
m +64 29 244 9001
e andrew.shaw@laneneave.co.nz

Fiona McMillan
Partner, Lane Neave

t +64 9 300 6264
m +64 27 351 2000
e fiona.mcmillan@laneneave.co.nz

News and events

Visit our news and events section for more Workplace Law articles.

News and events