MAY 2019 OTAGO SOUTHLAND EMPLOYERS’ ASSOCIATION MAGAZINE

5 / ’19

Personal grievances – making the most of your best offer

PAGE 2

Planning the brand pays off

PAGE 8

Turning your passion into a business

PAGE 12

Combining business with a zero waste emission

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CHIEF EXECUTIVE

CONTENTS

Chief Executive updateThere’s plenty of good news in our autumn issue as we hear from members who are passionate about their purpose, products and services.

HW Richardson safeguards the health and safety of employees across NZ and Australia. Its clear their passion is health & safety, including personal well-being. This year they have launched a new health and wellbeing programme HEART, which stands for healthy, energetic, alert, rested and taking time.

The story of Misha’s Vineyard in Central Otago highlights the importance of including export strategy in your business plan before starting your business. Their tips, which include testing your brand across proposed export markets and protecting your brand by trademarking, make for an interesting read.

Annemarie Hope-Cross vouches for the benefits of a Business Mentor in an article about the start-up and development of her photographic business. You don’t need to be an artist like her to relate to the challenges she faced.

Workplace First Aid Founder Phil Hudson has converted his passion about first aid training into a nationwide business. Aside from demonstrating the very

real benefits of first aid and other emergency training, his story is both interesting and inspirational.

The University of Otago is celebrating its 150th anniversary this year with a diverse calendar of events. We wanted to acknowledge the significant role the University has played, and continues to play in our region’s prosperity and growth.

The importance of constructive workplace culture on perforamnce and productitivity can’t be underestimated. Wastebusters is a great news story about a business making a positive social and environmental impact by building a positive workplace culture.

Staying in the sustainable space, Abbie Reynolds from the Sustainable Business Council talks about the Better Futures Report, which proves consumers want to make sustainable choices.

Southern businesses are also fantastic examples of the Buy New Zealand Made programme, part of BusinessNZ. They profile three businesses who have benefited from this programme,

now into its fourth decade. The announcement by

Austrian energy company OMV of an oil and gas drilling programme off the coast of Otago-Southland will no doubt galvanise opinion about the merits of mining carbon-based energy sources in our waters. But before deciding if you’re for or against prospecting, it is worth considering what’s at stake for New Zealanders and the southern region in particular.

Like businesses across our region who are breathing a collective sigh of relief, we too are pleased with the Government’s decision not to implement a capital gains tax. With this news businesses can look to the future without the concern of an additional tax burden. The about-turn on this issue highlights the importance of our collective advocacy on these and other issues – and we’ll continue to speak up.

We’ve recently provided submissions to the Government on the vocational education reforms and a new approach to employer-assisted work visas and regional workforce planning.

The vocational education reforms propose to create a centralised NZ Institute of Skills and Technology by merging all Institutions of Technology and Polytechnics, including the Otago Polytechnic and SIT, into a single organisation. Plans also include replacing Industry Training Organisations. These proposed changes would have significant effect on business and I encourage all members to read our submission, and the BusinessNZ submission, which can be found in the member-only part of our website.

As always any feedback is appreciated.

With a long history of supporting employers across Otago and Southland, we are here to help you succeedEMPLOYMENT LAW

Performance and disciplinary issues

Individual and collective employment agreements

Personal grievances

Restructuring and redundancy

Holidays and leave

Incapacity and ACC

Employment consultancy

HEALTH AND SAFETY

Tailoring health and safety systems

Hazard and risk management

Audits

Employee participation schemes

Drug testing

Advocacy

Training

Wellness programmes

Mentoring system implementation

REPRESENTATION

Founding member of BusinessNZ, New Zealand’s largest business advocacy group. As one of the four regional employers groups we are a voice for Otago and Southland business at a national level. Members are automatically a

VIRGINIA NICHOLLSCEO

Otago Southland Employers’ Association

virginia@osea.org.nz

OUR SISTER ORGANISATIONS:

member of BusinessNZ with access to:• ExportNZ• ManufacturingNZ• Sustainable Business Council• BusinessNZ Energy Council• Buy NZ Made• Affiliated Industries Group

TRAINING

Business development

Customer service and sales

Employment and human resources

Health and safety

Management and leadership

Personal and skill development

Computer training

Workplace literacy and numeracy

REGIONAL BUSINESS PARTNER NETWORK

We are part of the Otago RBP network which helps businesses innovate and grow by making it easier to access a wide range of business support services. These include business mentoring, NZTE capability vouchers and Callaghan Innovation.

EVENTS

Member briefings

Networking

Special interest speakers

Forums

DUNEDIN OFFICE 16 McBride St, South Dunedin, PO Box 473, Dunedin 9054 INVERCARGILL OFFICE 64 Arena Ave, Invercargill, 9840

Tollfree: 0508 656 757 Email: info@osea.org.nz osea.org.nz

CEO Update 1Making the most of your best offer 2HWR Heart launches 6Why diversity and inclusion are important for our social and economic future 7Planning the brand pays off 8Business mentorship “gold” for Central Otago photographer 10Turning your passion ınto a business 12Combining business with a zero waste mission 14Consumers want to make sustainable choices 16NZ Made shines in the south 17University of Otago - daring to be wise for 150 years 18 Great South Basin drilling good news for Otago and Southland 20 Recent Cases 22

UPDATE MAY 2019 1

The OSEA Update magazine is published in May and October each year. We welcome any feedback, and topical issues you would like us to feature.

2 UPDATE MAY 2019

Making the most of your best offer

LEGAL

UPDATE MAY 2019 3

Even the best employer may face a personal grievance at some point in their business life. The breakdown of an employment relationship can be unpleasant, time consuming and costly. Unfamiliarity with processes and the institutions involved can also lead to a general sense of unease and increase the concern over the length of time and commitment involved to work through the problem. The associated expense may not just be financial but personally and professionally as well.

LEGAL

LEGAL

notice that should the employee decline the amount offered and then proceed with their case and should the amount awarded be at least as much as the sum offered to settle the employer will seek full costs against the employee. In this way a Calderbank letter may incentivise an employee to settle before the Authority becomes involved.

The courts have said that costs follow the event. A successful party whether

4 UPDATE MAY 2019 UPDATE MAY 2019 5

employee or employer will always be able to apply for their costs once a decision or outcome is made. How much is awarded is at the discretion of the Court or Authority. Costs have their own case law and the most notable being the principles set out in PBO Ltd v Da Cruz [2005] 1 ERNZ 808.

Principles for settling costs awards found in Da Cruz include: discretion, equity and good conscience, reasonableness, modesty, and that costs are not to be used as a punishment or as an expression of disapproval of the unsuccessful party’s conduct although conduct which increased costs unnecessarily can be taken into account in inflating or reducing an award.

A recent case heard by the Employment Relations Authority provides guidance on how to draft a Calderbank letter to ensure the employer’s best offer is put to effective use. The case also demonstrates the cost of not getting it right.

Last November the Authority heard the personal grievance of Ms Adams who claimed she had been unjustifiably dismissed by a Paper Plus shop in Christchurch. Following the investigation meeting Member Appleton determined Ms Adams had not been unjustifiably dismissed and at the conclusion of the determination included the standard paragraph giving parties 14 days to agree how costs would to be dealt with and including if no agreement is reached the respondent employer was to serve and lodge a memorandum seeking a

contribution towards their costs. Then having heard what the employee applicant had to say in reply the member would decide who was to bear the cost of bringing matter to the Authority.

No agreement on costs was reached and on 19 March this year Member Appleton decided.

The starting point for deciding costs is the generally accepted tenets that costs follow the event and costs lie where they fall. As explained this means whoever wins can seek to have their costs paid. At the Authority level costs are determined on the basis of $4,500.00 for each day the hearing with legal fees are over and above that.

Having been successful the employer believed they should also have their full legal fees paid by the employee. Their legal fees were put at $17,336.71, plus GST. A Calderbank letter was claimed to exist in support of the cost application.

Unfortunately, Member Appleton said the Calderbank letter relied on was “very brief”. It was marked only as “without prejudice save as to costs” and only set out the following offer to the employee:

1. We have instructions to offer in full and final settlement the sum of $4,500.00 pursuant to section 123 of the Employment Relations Act.

2. This offer will remain open for acceptance until 5pm on Tuesday 24 April 2018, at which time if not accepted, it will lapse.

ONCE AN INITIAL assessment of the employee’s claims has been undertaken a plan can be formulated to respond to the problem. Key to this is a cost benefit risk analysis and important questions need to be asked and honestly answered including: how strong is the employer’s position, what is the likelihood of success if the matter proceeds to the Employment Relations Authority? And crucially how much will it take to defend the matter going forward?

The process to locate the answers to those and other questions is often fraught and contrary to good advice may lead an employer to take a principled stance against settling the grievance, when good business acumen would suggest otherwise. A reasonable settlement offer could see the matter resolve, however if the settlement isn’t accepted by the employee the problem may cost more to both parties before the Authority hears the case and issues a final determination.

Far from being a sign of weakness or admission of liability an offer to settle can be a strategic tool that, when handled properly can pay dividends well down the road.

Calderbank Letter

A Calderbank letter is an off the record without prejudice offer to resolve the employment problem. It is made “save as to costs”, meaning that for the time at least costs are not captured by the offer. It is unlike other off the record offers as it has teeth. While the amount offered will hinge on the facts of the situation the Calderbank letter should also explain what the consequence for an employee may be if they reject the sum set out in the letter.

The letter can be an effective tool if it alerts the employee to the fact that rejection of the

offer may lead the employer to seek full costs going forward. In some ways the Calderbank can be viewed as a bet placed by the respondent party that the employee won’t be able to sustain the level of award sought and that they will not take the risk of pursuing the matter any further if they know they might have to pay the employer costs. An employee may still win their PG but if the amount they are awarded is less than what they were offered to settle then the costs aspect comes back into play.

How it works is this; after careful consideration of all the issues, claims, evidence and facts an employer may decide there is some risk for

them if the employee takes their personal grievance all the way to the Employment Relations Authority. Awards are going up all the time and the media seem always interested in reporting a matter especially involving a large award against an employer.

The Calderbank letter contains the employer’s best offer. It also provides written

At paragraphs 12 to 14 of the determination Member Appleton said:

The problem I have in assessing whether it was reasonable for Ms Adams to have rejected the Calderbank letter is that it does not give any reasons for the level of settlement sum being offered. It may be that there were background discussions against which the Calderbank letter should be examined, but these have not been made known to the Authority; and

Therefore, all that I know is that a settlement offer of $4,500 was made which had to be accepted by Ms Adams within 26.5 hours (having been sent by email to (the employee’s lawyer) on 23 April at 2.35pm). No mention is made of how Ms Adams’ costs were to be dealt with, and no mention is made why the sum of $4,500 was deemed by the respondent to be a reasonable offer. Whilst brevity is often commendable, it is not always appropriate in a Calderbank offer.

I am therefore unable to conclude that Ms Adams was unreasonable in rejecting the Calderbank offer. I therefore decline to take it into account in fixing costs.

As a result the employer was only awarded the daily tariff of $4,500.00 and their lawyer’s travel costs of $364.43. Whether

the employer would have been awarded the full amount sought had an appropriate Calderbank letter been drafted is another question in its own right and beyond the scope of this article. In any event the difference between what was sought and the award made is significant.

The upshot is this:

A Calderbank letter can incentivise an employee to agree to settle early in the process and perhaps even before mediation. To be successful the Calderbank letter must be in writing, the amount offered should be reasonable and set out the consequences if the offer is rejected. The employee must be made aware the employer will seek full costs if the offer is rejected and they proceed with their claim. Considering the potential effect the employee must also gave a reasonable period of time to review the offer before its expiration date. As the costs sought in Adams v Paper Plus demonstrates the expense of resolving a PG can be high and when properly handled a Calderbank letter will bring that to everyone’s attention early on when parties are contemplating potential outcomes.

DAVID BROWNESENIOR SOLICITOR

Otago Southland Employers’ Association

david@osea.org.nz

Many of the countries from which we have welcomed migrants are now aging, and depopulating regions of Europe are already competing with us for migrants.

It should also be remembered that migrants grow old too – over 30 per cent of today’s older New Zealanders were once migrants.

Our people shortage is critical now because of the opportunities that are opening for New Zealand business.

The successful completion of the giant Pacific trade deal CPTPP and the likely completion of an EU-New Zealand trade deal mean 46 more markets will soon be open to enhanced trade with New Zealand businesses.

So, while our markets are expanding our working population is reducing. And like many other countries, we are competing for skills.

But we are competing for more than just skills – we are competing for our values.

We are competing for the future leaders of our communities, our economy and our society.

We need to ensure that our political thinking more clearly acknowledges that we are an immigrant nation at our core, that we truly value diversity, that we are inclusive and will celebrate and support new New Zealanders as we all grow our economy and standard of living, contributing to our communities and our future.

AS AN ORGANISATION, we invest heavily in trucks and equipment to ensure we lead the way within our industries. But the truth is, our staff are our most valuable asset and taking care of our own personal wellbeing, is fundamental to taking care of ourselves and others in the workplace. If we don’t look after our own physical and mental health – what chance is there, that we will be serious in our efforts to keep each other safe?

Just as we need our trucks to be well serviced, well presented and safe to operate, having our people alert, well rested and healthy in mind and body, is even more fundamental to a safe working environment.

Over the past couple of years, we have been looking for ways to further improve our awareness and performance in workplace safety. While we have always had

With nearly 2,500 staff, working in six sectors across Australia and New Zealand, ensuring the Health and Safety of our employees is a primary priority of the HW Richardson Group.

6 UPDATE MAY 2019 UPDATE MAY 2019 7

HWR Heart launches

Why diversity and inclusion are important for our social and economic future

an extremely robust health and safety strategy, in the past it had focussed on the ‘safety’ side of the health and safety equation. We had undertaken several ‘health’ initiatives – annual flu shots, medical check-ups etc – which had been done in piecemeal approach and didn’t really connect with our wider safety objectives. We were looking for something that would offer our staff more. More for their physical, emotional and mental wellbeing.

At the start of March, HWR launched our health and wellbeing programme HEART – which stands for Healthy, Energetic, Alert, Rested and Taking Time. While the programme is primarily focussed on wellbeing – this in itself, can mean many different things to different people. Over the course of our lives, the focus on what is important to us, as an individual, changes. Whether that be a focus on having a healthy heart, or an emotionally happy heart or a joyous, full heart, the programme offers solutions and advice to staff on how they can start to live their fullest lives.

The online programme, which can be accessed via the website or by downloading the App, is based around 10 key Healthy Habits

BUSINESS NZ

KIRK HOPE CHIEF EXECUTIVE

BusinessNZ

businessnz.org.nz

THE TRAGEDY IN Christchurch has highlighted many things about New Zealanders. Our response in the wake of this horrific tragedy demonstrated our capacity for tolerance, inclusiveness and compassion, and our Prime Minister has been lauded internationally for the depth of her response to these events.

It is in light of this response - and the generally unified strength of societal compassion that was demonstrated and deeply felt - that we also need to address some uncomfortable truths in order to continue our commitment to these values.

One of the challenges we must face is for our politicians to stop treating the topic of immigration and immigrants as politics. Many of those killed and injured

were immigrant New Zealanders and we need to respect their memory, and for this reason our political discourse around immigration must change.

It is a truth that New Zealanders are immigrants or the descendants of immigrants, and we are ethnically diverse. The last census showed New Zealanders belonging to more than 200 different ethnic groups.

It is also true that the demographics for New Zealanders born in New Zealand tell a story of aging and regional depopulation. Much important work has been done by Dr Paul Spoonley on the changing face of New Zealand society and here are some of the realities that we face:

We will soon have more people aged over 65 than under 15 years of age. Auckland and

New Zealand will be dependent on immigration for skills. Two out of every five New Zealanders will live in Auckland, nearly a third of them Asian.

The labour market needs to grow by 1.5 percent to support moderate economic growth of 2.5 percent, but actual labour market growth tends to be under 1 percent. Workforce exits are increasing, while workforce entry levels are modest and declining.

Our people shortage is getting worse. In regional New Zealand for every 100 workers there are 52 dependents, but in about a decade, many regions may have 80 dependents for every 100 workers.

Immigration contributes to population and economic growth, provides an expanded talent pool, helps us understand overseas markets, and contributes to the diversity and vitality of New Zealand communities.

Skilled migrants can help fill the gaps arising as large numbers of skilled professionals enter retirement.

But that doesn’t come without challenges. The number of migrants required to offset structural ageing is large, while competition for them is growing. In the 58 ‘more developed’ countries from which most skilled migrants come, the population aged 0-64 is projected to be around 41 million smaller in 2031 than in 2011.

MEMBER NEWS

which have stood the test of time and are simple to follow. Through Heart, participants learn that small steps taken frequently across the 10 Healthy Habits, can add up to big results over time.

Heart is also available to friends and family members of HWR employees. We’re acutely aware that when staff have support around, both at work and at home, they are more likely to be successful in creating and maintaining new habits.

Already we have seen some great results. More than 25% of our workforce signed up to the

programme within the first 20 days of it going live. 100% of all friends and family members who have been invited to join the programme have registered and more than 45,000 pieces of content have been consumed over this period – showing that not only are our staff are engaging with the information, they’re coming back for more and more.

As an organisation this is great to see and proof that for HWR Health and Safety really is a focus on the emotional, physical and mental wellbeing of our staff.

Brent Esler - HWR

add a fourth market, Canada, you account for 82% of exports. Currently, we don’t export to any of those countries! We have found our niche in Asia and it’s working well.”

Planning the brand pays off

COMING FROM SUCH A corporate background, the owners of Misha’s Vineyard have taken a slightly different approach to creating their award-winning venture. “Our plan to export was intrinsic to our business plan,” says Misha. And it’s paying off.

“Misha’s Vineyard came about because we’d spent almost two decades in high level corporate IT roles, mainly in Singapore, and we just really needed to get something more out of life!

“So after coming back to NZ in late 1999, we knew that meant we

had to build our own company. “We were overwhelmed with

the quality of the Pinot Noir being produced, and after talking to Andy’s cousin who had a vineyard in Bannockburn, Central Otago, we realised a vineyard would be the perfect option.”

A two-year search for the perfect piece of land ensued, during which they started writing a business plan. Although most (grape) farmers don’t do that, the couple believe you need a business and marketing plan first, so you know what you’re looking for.

The ideal location turned out to be 57 hectares on Bendigo Station – a high country merino station infested with rabbits

and rocks. In 2004, with a mantra of “no-

compromise” they set to work clearing the land

and planting the vineyard.

“We had a detailed marketing plan and knew we would be export-led – especially in Asia, so we could take advantage of our knowledge and connections. We had done extensive research on our brand in our planned export markets, and on launching in late 2009, announced 4 distributors – in New Zealand, Singapore, Hong Kong and Japan,” says Misha.

“Although the distributors had only tasted one pre-release vintage, they were very familiar with our brand story and our quest to produce an ultra-premium product. We based ourselves in Singapore for the first year to work closely with our Asian distributors. Then in 2010 we moved to New Zealand and started operating from here.”

Over the next few years the couple grew their export markets to over 20, including a couple in Europe, as well as the US and Canada. However, it’s now around 14 markets, as they refine their distribution footprint to markets that are big enough, convenient to service and profitable.

“It’s a long and expensive process to find distribution,” says Misha. “We put a lot into trying to find distribution in markets that were not on our target list but where New Zealand exports were strong – like the USA, UK, Australia and Canada.

“According to New Zealand Winegrowers, 75% of New Zealand wine is exported to these three markets, and if you

8 UPDATE MAY 2019 UPDATE MAY 2019 9

EXPORT NZ

CATHERINE BEARDEXECUTIVE DIRECTOR

ExportNZ

exportnz.org.nz

Top tips for exporters

1.

2.

Include exporting in your business plan prior to starting your business. It’s important for many reasons. We tested brand names to ensure we had a brand that would work across various markets. Then we secured our brand name with trademarks across all markets. This part is essential to avoid any issues in potential export markets down the track – like Montana had to change to Brancott Estate once it started exporting to the USA.

The market is always more powerful than the businesses seeking to enter that market. To do business successfully in Asia requires a business structure, partnerships, relationships and business practices aligned to the market. Spending time in a market talking to as many people as possible is the only way to really start to understand the business and social culture.

Include exporting in your business plan prior to starting your business

Test your brand across your proposed export markets

Trademark your brand in your export markets

If you want to operate successfully in Asia you will need a to spend time in the market, have a business structure, partnerships, relationships and business practices aligned to the market

Taking over 18 years of high-flying business experience gained from Singapore and New Zealand, and adding it to their passion for Pinot, has proved to be a recipe for success for Misha and Andy Wilkinson.

Andy and Misha Wilkinson - Mishas Vineyard

CARRYING ON THE family tradition, Annemarie studied Photography after leaving high school and then worked in several commercial photographic studios, but eventually became a fulltime ambulance officer.

Annemarie was always keen to reignite her love of photographic art, but the opportunity never eventuated until she moved to

Alexandra in 2008 and came across some brochures her father had given her years earlier, from the place where photography had been invented in the 1830s.

Annemarie herself travelled to that place, Lacock, England, in 2011 for workshops which, she says, led to her “lightbulb moment”.

“The workshops changed how I viewed my photography as an artist and I decided I wanted to do this all day, every day for the rest of my life,” she says.

Annemarie’s dream was to become self-employed, making a living from photographic art. She was already exhibiting and selling works through a gallery in old Cromwell, but was struggling to grow her business.

“I honestly didn’t know anything about business, but I had a feeling that if I talked to

a business person, that might change.”

So she contacted Business Mentors New Zealand and John Rigby from OSEA linked her up with mentor Brian Weaver. It was the beginning of a partnership of nearly four years which she describes as “precious”.

“I didn’t know what to expect and it will be different for everybody, but for me, Brian is absolute gold.”

“He’s always there in the background. I might not talk to him for a while but then something will pop up and he’s there for me.”

Brian, meanwhile, has watched Annemarie grow.

He says to begin with she didn’t really appreciate how “potentially interesting” her art was.

“Her art is terrific but the back story to its creation, how it’s made and the nature of the historical process she is using, also needed to be heard.”

But to tell her story, Annemarie had to move out of her comfort zone and sell herself by talking to her customers, gallery owners and people at markets.

“It didn’t come naturally to her, but I tried to make her aware that no one else could do it for her,” Brian says. “Her art is her passion and her ability with the process is unique.“

Brian says she was surprised at how interested people were.

“It was a learning process for her to become more confident in interactions with people. The fact that she is getting recognition now is in large part due to the fact she is growing in confidence.“

Sometimes, he says, people just need a bit of confidence to take that first step.

“My experience in mentoring is that people actually know what they should be doing, but they want to hear it from someone else. They need to know they’re on the right path and making the right calls.”

Annemarie had been working alongside Brian for a year and was edging closer to fulfilling her dream of becoming fully self-employed when she found out she had breast cancer.

She had reduced her work hours so she could focus on her passion and was learning to think bigger.

Her diagnosis meant they had

Business mentorship “gold” for Central Otago photographerPhotography is in Annemarie Hope-Cross’s blood; her father and grandfather were both photography professionals; some of her earliest memories are of watching them at work together in her grandfather’s darkroom.

10 UPDATE MAY 2019 UPDATE MAY 2019 11

The Regional Business Partnership helps businesses innovate and grow by making it easier to access a wide range of business support services:

Business Mentors New Zealand is a not-for-profit organization dedicated to supporting the success and growth of small businesses through the knowledge and experience of experienced mentors.

businessmentors.org.nz

Callaghan Innovation helps businesses succeed through a wide range of services designed to make the path from research and development to market success easier, faster and less risky.

callaghaninnovation.govt.nz

New Zealand Trade & Enterprise is the Government’s international business development agency whose purpose is to help New Zealand businesses grow bigger, better and faster in international markets. NZTE also support the Capability Development vouchers.

nzte.govt.nz

Our Growth Advisers:

John RigbyOtago Southland Employers’ Association. 027 478 5121john.rigby@osea.org.nz

Ross GreyEnterprise Dunedin (DCC)027 432 5469ross.grey@dcc.govt.nz

Cara BradleyThe Otago Chamber of Commerce03 479 0181cara@otagochamber.co.nz

Tara DruceThe Otago Chamber of Commerce021 21 66543business@otagochamber.co.nz

Otago Southland Employers’ Association

Enterprise Dunedin (DCC)

The Otago Chamber of Commerce

In partnership with Business Mentors New Zealand, OSEA links skilled, experienced volunteer mentors with Small and Medium Business Enterprises, start-ups and community organisations needing support to grow.

Our mentors are accomplished business experts with strong links to their communities and a passion for helping others to succeed. They offer advice, support and an independent perspective, guiding mentees to realise their potential.

For more information on getting business mentor support or becoming a mentor, visit osea.org.nz/mentoring or call us on 0508 656 757.

BUSINESS MENTORS

Interested in getting a Business Mentor or in passing on your knowledge and experience as a Business Mentor?

to “park” things, but ironically there has been a positive spinoff to her cancer journey: during treatment, she found time to research what other photographers were doing, how they sold their work and generally understand the competition.

Annemarie credits Brian with her newfound business savvy.

“Brian has focused on my marketing and how important it is to have a range of products. For example, I have my ‘bread and butter’ photographs, and my creative photographs, which I will sell less of, but at a premium price.”

And having Brian help craft a statement to explain her business enabled Annemarie to realise that where she has come from is part of the story of her work.

“That has helped me understand the value of a story. I’ve now changed my whole pitch.”

Photographer Annemarie Hope-Cross

12 UPDATE MAY 2019 UPDATE MAY 2019 13

MEMBER NEWS

Turning your passion ınto a business

Dunedin’s Workplace First Aid founder and owner, Phil Hudson, “First Aid Phil” is passionate about first aid training, and the difference it can make to everyday lives.

PHIL HAS BEEN providing first aid training in his own business, for the past 15 years, he puts his success down to teaching in a practical, common sense way and no power point presentations.

When Phil read Michael Gerber’s classic The E Myth Revisited recently, he discovered he had been doing everything Gerber advises in setting up and running a business.

When you talk with Phil Hudson you realise he is more a ‘follow your passion’ than a

‘follow the text books’ kind of guy. So instead of chasing academic credentials, he trained as a scuba diving instructor, qualifying as the world’s youngest on the day he turned 18, the minimum age for doing so.

Later, while working for a Dunedin dive shop, he found himself teaching more first aid than diving courses, despite having added to his diving knowledge and expertise with several specialist qualifications. While he loved diving, he discovered a passion for training people in how to save lives using first aid.

One day Phil had a eureka moment in the most mundane of situations. He was approached in a supermarket aisle by a tearful woman, who said that the first aid skills he’d taught her had saved the life of a family member. He suddenly understood that what he was doing was unique.

A person who thrives on helping people, Phil began to look

more closely at why his training technique was so successful. The incident in the supermarket turned out to be more than a one-off. It happened regularly – and still does.

He decided to set up on his own business and took a part-time job as a lifeguard at Moana Pool while developing his side-hustle – teaching first aid courses.

Realising he didn’t know enough about business, when offered a role at Surf Lifesaving Otago as regional manager, he grabbed it with both hands. Over the next five years he learned the politics of business, about tax obligations and all business-related tasks, how to write funding applications, process GST and take board minutes.

He kept teaching first aid courses – in the evening and at weekends – even using his annual leave to get his lifesaving message in front of more people (thanks to the support of his wife Tracy, who keeps the family running.). He networked hard with business owners and schools, and was part of the water rescue squad, progressing into teaching people how to escape from helicopters if they needed to ditch into the water. His scuba diving, first aid and lifeguarding background led him to be asked to instruct the Helicopter Underwater Escape Training (HUET) course, the content of which he naturally rewrote and improved.

Phil has continued to teach this course for a decade and is

the only qualified instructor in Otago and Southland. Recently, his training resulted in the survival of three crewmembers whose helicopter ditched into the sea off the Auckland Islands. Sir Richard Hayes, the chief pilot of the helicopter’s owner, Southern Lakes Helicopters, said afterward it was rare for people to survive such crashes.

Their odds, however, improve if they have undergone HUET training and Phil Hudson believes the incident clearly demonstrates the importance of all helicopter crews undergoing such training for marine flying.

In April 2004 – exactly 15 years ago – Phil officially set up Workplace First Aid and in 2016 he won the Future Business Leader section of the Westpac Otago Chamber of Commerce Business Awards. He says, “I wasn’t even looking to enter. I just wanted the judges’ independent feedback on my business plan so I could improve my business model.”

Workplace First Aid is now recognised as a Private Training Establishment (PTE) with NZQA, a feat that took Phil many years

www.wpfirstaid.co.nz

and countless hours of writing documents to achieve. But the company might have remained just a small Dunedin business if it hadn’t been for another chance encounter.

While waiting to pick up his children from school one day, Phil ambled over to the only other father also waiting and discovered he was the exact person needed to help take the company to the next level. One of Phil’s most pressing problems was the time eaten up by repetitive tasks. He needed to automate his business’s processes if it was to grow. Nigel Hulls has been instrumental in helping him achieve that by designing and building a fully automated system that allows the business to run itself. Now, what would have taken Phil an entire day is completed in two minutes. Plus, he can monitor performance indicators remotely.

Central to Workplace First Aid’s success in the market has been finding the right team members – Phil doesn’t regard them as staff. Currently there are eight, but he is constantly looking for new people who embody the same caring and sharing philosophies that he himself demonstrates. Particularly, he is keen to find regional managers who can shake up first aid training in other parts of the country.

Since its launch, Workplace First Aid has leapt from success to success and is on track to become fully nationwide inside the next two years. Then, Phil Hudson says, look out Australia!

14 UPDATE MAY 2019 UPDATE MAY 2019 15

MEMBER NEWS

Combining business with a zero waste mission

A NEW THREE-YEAR programme is underway to grow social enterprise known as The Impact Initiative, the social enterprise sector development programme is being delivered by the Ākina Foundation and the Department of Internal Affairs, with support from the Community Enterprise Network Trust (CENT). One of the programme’s tasks is to trial the development of regional

hubs, which will connect social enterprises and provide support for new social entrepreneurs. Wastebusters is excited to be part of the development of a Central Otago/Queenstown Lakes regional hub. It will promote a local social enterprise ecosystem to nurture and connect social enterprise in our area.

Wastebusters has been a social enterprise since we were set up by our local community

to start recycling in Wanaka and the Upper Clutha back in 2000. We employ 50 people at our two reuse and recycling sites, one in Wanaka and one in Alexandra. We’re a limited liability company, with a board of directors and an annual turn-over of $2.6 million. Like any business we have to be efficient enough to survive in a competitive world.

Like all social enterprise, we have an environmental/social mission, and ours is to lead the way to zero waste. We invest our surplus in making our community more resourceful, and in bringing zero waste closer to reality by changing systems and attitudes.

Sorting through recycled materials and donated belongings by hand is not glamorous work, but having a shared mission makes our staff more resilient. Every day staff have to sort through discarded objects and pull out anything which can’t be resold or recycled, from frilly undies to broken toys. The upside is coming across incredibly generous donations

It’s a growth time for social enterprise, as people recognise the power of combining a business model with social or environmental impact.

like an 18th Century painting or as-new Canon SLR camera.

It’s hard physical work, and can be a bit discouraging when you’re dealing with discarded items all day, so a focus in recent years has been strengthening our staff culture. After rewriting our values in plain English, we began hiring to our values, with a positive impact on our workplace culture. Connecting with the bigger picture “why” makes it easier for staff to deal with repetitive tasks and difficult situations. It’s also improved our customer service and interactions with customers. One of our goals is for all our staff to be able to tell the story of zero waste and all Wastebusters projects, which is still a work in progress.

Our wider community is also influenced by Wastebuster’s zero waste mission. A former Board chair told me about a world cruise he and his wife were embarking on with another couple. Their female friend went to Thailand to order new outfits for the cruise. His wife went to Wastebusters. Many Wanaka people are proud to say their new outfit came from Wastebusters because they understand the environmental benefit of reusing stuff.

Over time, we’ve seen attitudes shift around waste. The harm done by discarded plastics in the ocean has galvanised people to change their behaviours The closure of China’s recycling markets is motivating businesses to choose packaging with viable recycling solutions. Plastics 1 and 2, for example, can be recycled onshore, so all parts of the recycling chain can talk to each other from packaging designers to recyclers.

Many “out there” things that Wastebusters used to say are now mainstream. There’s still a long way to go, but we’re excited to see the impact that more social enterprises can have in moving towards a fair society and a circular economy.

of New Zealanders are concerned about plastic waste

“If items are wrapped in single use plastic I won’t buy it. If the plastic can be recycled I will buy it.”

Consumers want to make sustainable choices

SUSTAINABLE BUSINESS

ABBIE REYNOLDSEXECUTIVE DIRECTOR

Sustainable Business Council

sbc.org.nz

THE LATEST Colmar Brunton research into consumer perspectives on social and environmental issues shows that consumers are increasingly committed to sustainable lifestyles. The Better Futures report, released in February, is based on a survey of 1,000 New Zealanders, on a wide range of environmental and social issues.

The number one concern was plastics in the environment, with 72% of respondents concerned. Pollution of lakes, rivers, and seas, is still high at 64%, and for the first time in the 10 years of research, more than half of respondents expressed a high level of concern about climate change.

When 4 in 10 say they are highly committed to a sustainable lifestyle, and 5 in 10 somewhat committed, this represents a real shift among New Zealanders, which will have a flow-on effect on their purchasing behaviour.

And this commitment goes beyond just ditching plastic bags. Kiwis are increasingly choosing to repair or maintain items to avoid buying new stuff (61%), and disposing of clothing / household items through online community groups (59%). However, only 25% would buy second-hand rather than new, to avoid buying new stuff.

Respondents said they were using alternative transport for

short journeys, which means shopping locally, and buying ethically manufactured goods that reduce their impact on the environment. Vegetarianism and veganism are also on the rise, with 10% of New Zealanders now going mostly or completely meat-free, up from 7% last year.

But an even higher proportion than ever before, 83%, find the information that businesses give them confusing.

So how can businesses respond to these concerns and build your relationships with your customers? First of all, make it simple for them to make sustainable choices. Your customers have busy lives and make dozens of decisions every day. They don’t have time to evaluate technical information about sustainability, so you can help by making them feel comfortable that they can trust what you are offering.

Consider using recognised standards for your products and business footprint such as Enviro-Choice, Fair Trade

16 UPDATE MAY 2019 UPDATE MAY 2019 17

Plastics in supermarkets, climate strikes in schools, and beach clean-ups on the weekend – the public conversations about sustainability issues are louder and more frequent than ever before. These conversations are happening in your communities, your cafés and at your checkouts. So what can businesses do about it?

and Enviro-Mark. Make sure that your business behaviour is consistent with customer concerns. Are you minimising waste as much as possible? Introducing reusable items rather than disposable ones? Talk to your suppliers about their sustainable choices, and use your purchasing power to choose the ones that offer the best options.

Understand your business’s impact on the environment and society. Are you taking steps to mitigate any negative impact? Is there room to make a positive difference with your activities?

Beyond taking the obvious steps, the best way to align your business with your customer needs is to talk to them. It’s not rocket science, but having a real conversation, and listening to what they have to say, is the best way to find enduring solutions. If your business represents values that are meaningful to your customers, that will create deeper loyalty and cement your place in their community.

And if the opportunity to build stronger bonds with your customers doesn’t feel like the catalyst to get going, consider that 90% of New Zealanders said they would stop buying products or services from those businesses that behaved unethically or irresponsibly.

The report is available from www.colmarbrunton.co.nz/news/better-futures-report

ABBIE REYNOLDS is executive director of the Sustainable Business Council, a division of BusinessNZ.

BUY NZ MADE

NZ Made shines in the south

A FLYING VISIT to Invercargill uncovers inventive businesses creating outstanding products, including Robax Products, Morrifield Greehouses and Southern Cross Produce.

Jennings says the unique and honest-to-goodness qualities of their offerings set them apart from their competition.

Like many other southern businesses, the three companies

take part in the Buy NZ Made campaign, using the ‘kiwi in a triangle’ on their branding to show the provenance of their unique products.

Robax Products is the maker of the famous Robax slat beds – sturdy, stylish beds created from locally milled southern timber.

Robax Products creates the iconic slat beds that are sold direct throughout New Zealand

and through retailers like the Bunk House and Beds ‘R’ Us. The beds have been a favourite in New Zealand households for 40 years.

Their ingenious design allows for different configurations according to need – differing bed sizes and bunk and trundler arrangements, all made from beautifully shaped and treated wood grown in the south. The Robax factory in Invercargill is home base for this growing business that gives many New Zealanders a great sleep every night.

Morrifield Greenhouses is another Invercargill manufacturing firm that has tallied up thousands of happy customers over 40 years or more.

The Morrifield factory in Invercargill produces the ingenious tunnelhouses that have replaced the traditional glasshouse in commercial market gardens and residential back yards all over New Zealand and the Pacific. The tunnelhouses with their distinctive round metal frame and tough polythene sheet construction are uniquely

suited to New Zealand’s growing conditions, withstanding wind, salt and high UV light to create optimal growing conditions for premium vegetables, fruit and flowers.

Sold direct to customers or through leading outlets for garden supplies, the Morrifield tunnelhouses can be supplied in different lengths and sizes suitable for large market gardens, home gardens, or small townhouses. The family business that created the tunnelhouse design is still operating from Invercargill, with the new generation of the family continuing to evolve and update this original Kiwi classic.

Southern Cross Produce are the people behind the ‘So Sweet’ brand of root vegetables grown in Southland and happily consumed throughout New Zealand.

‘So Sweet’ carrots and parsnips gain their legendary sweetness from Southland’s ideal root crop growing conditions – deep soil, long summer daylight hours and frosty cold winters. Southern Cross Produce manage a large vegetable growing operation and operate from their ultra-modern packaging and distribution centre in Invercargill, the headquarters of a traceability programme that guarantees the quality of all produce grown for market.

The growers of outstanding vegetables, Southern Cross Produce are a great example of New Zealand-produced quality.

Buy New Zealand Made director Ryan Jennings says companies like Robax, Morrifield and Southern Cross Produce are trailblazers in creative, authentic Kiwi business.

“They demonstrate the best of New Zealand-made.”

Southern businesses are fantastic examples of New Zealand-made: that’s the view of Buy NZ Made leader Ryan Jennings.

www.buynz.org.nz

UPDATE MAY 2019 1918 UPDATE MAY 2019

University of Otago - daring to be wise for 150 years

IN 1869, the University was created by a group of determined settlers who believed education and learning would help build a just and prosperous community.

They chose as their motto sapere aude – dare to be wise, which has remained a central challenge to generations of students and staff, inspiring them to question the norms and break new ground.

Today 21,000 students study programmes across the four Divisions of Health Sciences, Humanities, Sciences and Commerce, and across its campuses in Dunedin, Invercargill, Christchurch, Wellington and Auckland.

Otago consistently ranks first for key Government indicators measuring educational performance of students at New Zealand universities and, in the last seven years, six of

the national Tertiary Teaching Excellence Supreme Award winners have been from Otago.

Dr Alison Clarke, author of the recently launched history “Otago, 150 Years of New Zealand’s First University” describes the University as “a place of many contrasts – at once amazingly innovative and entrepreneurial, and also, at times, very conservative. Mostly it’s a place made up of talented people and always has been.”

Reflecting the importance of the connection between the University and the City of Dunedin, celebrations began in February with a community picnic on the Clocktower Lawn. The official celebrations were held during Queen’s Birthday weekend, but events continue throughout the year, finishing up with the University College 50th reunion in November.

Celebrating its 150th anniversary this year, the University of Otago, New Zealand’s first university, has a diverse calendar of events, talks, concerts and festivals planned for its special year.

For more information on the 150th and the events visit: otago.ac.nz/150 and for alumni who wish to update their details and receive information about events and alumni news, please visit: otago.ac.nz/alumni

UNIVERSITY OF OTAGO

A Winter Symposium series which will be held across the country from June to August.

An Anniversary Gold Ball will be held at the Dunedin Town Hall on 10 August.

The University hosts the UNESCO Play Festival from 13-20 September, showcasing new plays from various UNESCO Cities of Literature and elsewhere in New Zealand.

The Heritage Festival hosted by Otago at the end of September will be a chance to celebrate the architectural heritage of the University. The festival runs alongside the Australasian Victorian Studies Association conference “1869”.

In early October, the Otago University Rowing Club is hosting a three-day International Universities Rowing Regatta, including crews from Russia, Japan, China and Canada. OURC will also be celebrating its 90thanniversary and will host an alumni reunion.

The 50th Reunion of University College will be held on November 22-24.

From now until November, 150th University of Otago Exhibition will be on display at the Otago Museum.

Events from June to August include:

UPDATE MAY 2019 21

OMV

20 UPDATE MAY 2019

Great South Basin drilling good news for Otago and Southland

BUT BEFORE deciding if you’re for or against the prospecting it’s worth considering what’s at stake for New Zealanders – and the southern region in particular.

OMV plans to drill up to three exploration wells and up to seven follow-up ‘appraisal’ wells in the seafloor of Great South Basin, southeast of Dunedin (but will only proceed with the ‘appraisal’ wells if the exploration well findings are favourable).

These plans follow initial exploratory work that was conducted under permits granted before the Crown Minerals (Petroleum) Amendment Bill was passed in November 2018, legislation which ruled out issuing any new offshore permits.

OMV’s plans are possible because they are covered by pre-existing permits which the Government has said it will honour - although they are subject to an application to the Environmental Protection Authority regarding proposed marine discharge.

Of course the fact OMV has announced this next phase suggests their initial work has indicated the potential for commercially viable hydrocarbon

reserves. But the process of realising that prospect is a lengthy, complicated and very expensive one, with no certainty of outcome.

And the clock is running out: because OMV must relinquish their permit if they have not drilled by July 2021.

In the era of heightened climate change awareness the idea of mining for hydrocarbons may seem an anaethma. Indeed nearly everyone agrees we need to move away from fossil fuels.

But we also need alternative cost-competitive energies to move to – and in sufficient quantity to fuel our homes, our lives and our economy. That future is still some way off.

There’s no way we can remove fossil fuels from our economy in the immediate future – it’s going to take some time. Responsible hydrocarbon extraction and cleaner-burning hydrocarbon technologies have an important role to play as we move towards a net zero carbon future.

Many New Zealanders may not be aware that our proven gas reserves are modest, with production volumes forecast to diminish from 2021 onwards.

Given that our chances of finding alternative gas supplies rest on activities like OMV’s, we should be supporting its activity.

Should the prospect in the Great Southern Basin prove viable, it would help New Zealand in its quest for cleaner fuels and energy self-sufficiency at affordable levels. The more energy we produce here, the less we have to import – at considerable environmental cost, and potentially from sources with far lower environmental standards than OMV’s.

OMV’s mining activities also offer significant economic benefits in terms of employment

– hundreds of jobs are likely to arise in relation to their work – as well as significant contribution to the country’s GDP. It pays taxes and royalties here. In short, it represents significant investment in the local and

regional economy. But what of the potential

down-sides of its activity? The application currently before the EPA will no doubt provide greater transparency around potential environmental impacts of OMV’s exploration drilling. But what we know now is that the physical impact of a well on the seafloor has been likened to that of a large ship’s mooring. Further, significant progress in drilling, well capping and spill-containment technology in recent years greatly alleviates concerns about potential damage from spills and leaks.

Austrian-based OMV is a responsible corporate citizen with an excellent environmental record and its operations comply with New Zealand’s stringent environmental and health & safety regulations. It consults extensively with community stakeholders and iwi, and supports community and environmental initiatives.

Nearly all New Zealanders want to lower emissions, but it’s critical we do so in a planned and managed way to ensure our economy and our living standards do not suffer, while being mindful of our environmental responsibilities. South Island-based hydrocarbon prospects like OMV’s offer exciting possibilities which could enable us to do that, while delivering real benefits to our region.

The announcement by Austrian energy company OMV of an oil and gas drilling programme off the coast of Otago/Southland will no doubt galvanise opinion about the merits of mining carbon-based energy sources in our waters.

“The more energy we produce here, the less we have to import...”

VIRGINIA NICHOLLSCEO

Otago Southland Employers’ Association

virginia@osea.org.nz

RECENT CASES

EMPLOYMENT RELATIONS AUTHORITY:

Employer sought repayment and reimbursement from employee

JPB Painting Contractors 2006 Limited (“JPB”) was a painting business and employed Mr Paul on an individual employment agreement. JPB sought repayment from Mr Paul for the overpayment of his wages and sought to recover costs associated with his failure to return property owned by JPB and his failure to provide adequate notice. Mr Paul denied owing the sums that were sought by JPB.

JPB said that Mr Paul fell ill and requested to receive holiday pay in advance which JPB paid to him. Mr Paul then resigned without notice and did not return to work. JPB said it was left short staffed and this jeopardised an ongoing contract with one of its clients resulting in a loss of productivity. JPB initially sought $4,500 in compensation for damages. This claim was ultimately withdrawn by JPB, after the Authority pointed out the numerous difficulties it would face. JPB would have been required to prove contractual breach. There was nothing further than the required notice period in Mr Paul’s employment agreement to which such a breach claim could attach. The Authority also stated that JPB would have been unlikely to meet the requirement of accurately quantifying the damage suffered. The Authority also considered various Court decisions that suggested an employer should not hold an employee responsible for risks that the business should shoulder, such as ensuring adequate staffing.

The remaining claims related to the overpayment of wages and reimbursement for company property that was not returned. JPB claimed it made an overpayment of $726.87 to Mr Paul, as annual leave in advance. Mr Paul’s employment agreement stated that on termination the employee had a duty to repay any loans. The advance of his holiday

pay was treated as a loan. This amount was not disputed, and Mr Paul confirmed that this was paid to him as annual leave in advance.

JPB claimed $238.60 as the value of the property that Mr Paul failed to return at the end of his employment, as required by his employment agreement. Mr Paul accepted that he disposed of the property but said he was unaware that he would be held accountable for failing to return it. The requirement for returning the property was a contractual obligation in his employment agreement.

Finally, JPB claimed two weeks wages which it justified by referring to the employment agreement. The relevant clause stated that “either party must provide 2 weeks’ notice of termination, failure to do so would result in two weeks forfeiture of salary”. The Authority held that is was now established that such clauses were not enforceable, where they would constitute a penalty for inadequate notice.

The Authority concluded that JPB successfully established some of its claims. Mr Paul was ordered to pay JPB $726.87 as repayment of wages and $238.60 as reimbursement for property he failed to return upon his resignation.

JPB Painting Contractors 2006 Limited v Mr Paul [[2019] NZERA 184; 28/03/2019; M Loftus]

Employee’s claim dismissed for being frivolous and vexatious

Ms Milne applied to the Authority to investigate alleged problems with her former employer, Air New Zealand Limited (“Air New Zealand”). Ms Milne’s application described the employment relationship problem as “the separation from family and my home country and financial hardship due to the terms and conditions of employment from 1972 to 2006”.

Ms Milne was employed by Air New Zealand in October 1972 and her employment ended in 2004 on

the grounds of medical incapacity. She was medically certified to be permanently unfit to fly and no suitable alternatives were available for her with Air New Zealand.

Ms Milne had made numerous applications to the Authority and the Employment Court where she had been unsuccessful multiple times in raising a successful grievance or question of law. On two occasions the Authority declined to reopen previous investigations. It was noted in 2014, that Ms Milne had not paid costs orders made by the Court and the Authority.

The Authority considered Ms Milne’s application which was on the same grounds used in her most recent unsuccessful application. Air New Zealand was not required to lodge a statement in reply. Ms Milne was given the opportunity to provide written submissions.

Ms Milne submitted there was new or different evidence that was not considered or not available at earlier investigations and determinations. Ms Milne provided documents from 1971 and 1972 regarding her employment with Air New Zealand including some correspondence which had been sent to her father’s address. She also included medical records dating back to 1973, 1974 and 1979.

The evidence did not make clear how this related to her claim of unjustified action on grounds of

“separation from family and… home country” and “financial hardship”. The Authority considered an application made by Ms Milne in relation to her dismissal for medical incapacity however, the medical records from the 1970s were not considered as the Authority held they were unlikely to have made any difference to the outcome.

The Authority considered that even if Ms Milne’s concerns about separation from family and financial hardship could have amounted to a personal grievance, there was no evidence that this was raised within the required 90day period from the end of employment. The Authority held that even if this had been raised there was nothing to indicate it was pursued within the three year period.

The Authority determined that any claim made by Ms Milne for a personal grievance fell outside

the six year statutory limitation period for commencing action for such breaches. The Authority also considered that even if Ms Milne was successful in raising her claim within the statutory period, there was no real prospect of success. Air New Zealand had not acted unlawfully when she accepted a job and was required to move to New Zealand.

Given Ms Milne’s previous failed applications on the same points, the Authority dismissed her application without further investigation for being frivolous and vexatious.

Milne v Air New Zealand Limited [[2019] NZERA 178; 27/03/2019; R Arthur]

Employer agreed to make payment in lieu of notice but then failed to pay

Mr Stone was employed by Aura FX (NZ) Limited (“Aura”) as a full-time senior trader. Mr Stone resigned on 12 October 2016 giving three months’ notice of resignation. Subsequently, the parties exchanged emails and engaged in discussions about Mr Stone’s resignation and the period of notice. Mr Stone claimed that Aura agreed to pay him three months’ salary in lieu of notice. Aura failed to pay Mr Stone as agreed and only paid him one months’ salary in lieu of notice.

Aura failed to comply with the Authority’s directions regarding the filing of documents and failed to attend the investigation meeting without good cause. Mr Stone sought payment of the balance, totalling $16,666.60, as well as holiday pay of $5,407.17 and statutory holidays. Mr Stone also sought interest on these payments.

The statement in reply filed by Aura claimed that Mr Stone abandoned his position. It claimed that he was therefore not entitled to the payments he was seeking. There was no evidence put forward by Aura in support of its claim. Various other claims were made by Aura in its statement in reply. These claims were not made out in the evidence

UPDATE MAY 2019 2322 UPDATE MAY 2019

available to the Authority and were accordingly dismissed.

Mr Stone would often work from home and it was by agreement that he submitted two daily reports to the director. On 4 October 2016, the director’s employment ended and thereafter, Mr Stone reported to Mr Martin, the business development manager. During this time Mr Stone worked entirely from home as it was the school holidays and that was part of his working agreement.

On 12 October 2016, Mr Stone received a notification from Bloomberg that his account was to be transferred to another person. Bloomberg is a global provider of financial news and information. This meant that the main tool used by Mr Stone to perform his work for Aura would no longer be available to him. Mr Stone immediately sent an email to Mr Martin questioning this. Mr Martin responded that he wished to meet with him to discuss the matter and that he wished to discuss his absenteeism from work in the last three weeks.

On 26 October 2016, Mr Stone’s representative, Mr Lance, sent a letter to Aura with reference to Mr Stone’s concerns about the way in which he had been treated. Mr Lance stated that in light of this treatment, Mr Stone was of the view that he had no option but to resign, giving three months’ notice.

On 31 October 2016, Mr Lance received a response from Aura claiming that Mr Stone had abandoned his employment. The letter went on to state that Aura accepted Mr Stone’s resignation but only on the basis of a short period of one month’s notice. The letter stated that if this was not acceptable, Aura would continue its “employment investigation”. Mr Lance responded stating that the notice period was three months and that Mr Stone would not accept payment of anything less.

On 30 November 2016, an email was sent to Mr Lance accepting Mr Stone’s resignation and agreeing to pay him three months’ salary. Aura only paid Mr Stone one months’ salary.

Aura was ordered to pay Mr Stone $16,666.60 for the remaining two month notice period, $6,740.50 in holiday pay and $769.23 for

statutory holidays. The Authority also ordered Aura to pay 5 per cent interest on all of the above payments to Mr Stone.

Stone v Aura FX (NZ) Limited [[2019] NZERA 189; 1/04/2019; A Fitzgibbon]

School boarding house manager claimed back pay for sleepovers

Ms Kidd was employed by the Epsom Girls Grammar School Board of Trustees (“the Board”) as a house manager between April 2012 and December 2014.

Epsom Girls Grammar is a state secondary school for girls with a roll of approximately 2,000 students. This includes approximately 140 boarders who live in Epsom House, a building located near the school premises.

During her time working as a house manager, Ms Kidd was required to work 40 hours per week between the hours of 6.30am and 10.30pm, as well as on call work overnight. Typically, the on call work involved five sleepover shifts per fortnight during which Ms Kidd would sleep in a room located a few steps away from one of the dormitories which was occupied by year 9 girls. Due to its proximity, Ms Kidd claimed that during the sleepovers, there could be disturbance from girls talking and using the bathroom.

Ms Kidd claimed that during the sleepovers she was unable to entertain friends or consume alcohol, and that if the night supervisor was unwell she would often then be solely responsible for the girls throughout the night.

Ms Kidd brought a claim before the Authority alleging that the work performed on these sleepovers was

“work” which was subject to the Minimum Wage Act 1983. Ms Kidd was remunerated by way of annual salary including a living allowance.

The Authority considered previous case law regarding sleepovers, including the Dickson case which considered the work of carers, and the Woodford House

case concerning sleepovers in a boarding school. The Authority summarised the three factors that are considered helpful in determining whether or not a sleepover constitutes “work”: (a) the constraints placed on the freedom the employee would otherwise have to do as she pleases; (b) the nature and extent of responsibilities placed on the employee; and (c) the benefit to the employer of having the employee perform the role.

The Board claimed that there was no benefit to it in having Ms Kidd work overnight, as there were night supervisors employed for that purpose. There was also a charge supervisor who could assist the night supervisor, for example, if girls needed to be taken to hospital or if there was an incident. The Board also claimed that Ms Kidd was “available to be engaged” rather than working the whole night.

The Authority found that Ms Kidd could not leave the Epsom House premises, could not consume alcohol, and in general was unable to enjoy the comforts and freedom she would exercise when living in her own home. She was required to be on call to attend any event or emergency. In practice, she dealt with few emergencies during the period. The Authority considered that the constraints placed on Ms Kidd were significant.

The Authority considered that the students in Epsom House were vulnerable as they were away from the care of their parents, and the school was entrusted with the students’ care and protection. If a night supervisor was unavailable, Ms Kidd would be responsible for their duties overnight. The Authority concluded that the degree of responsibility placed on Ms Kidd was significant.

Regarding the benefit to the Board in Ms Kidd performing her role, the Board had engaged night supervisors for the purpose of fulfilling a statutory requirement regarding hostel licenses. It was a requirement that someone was on hand to take responsibility overnight, should a student become unwell. The Authority found that having Ms Kidd sleep over was beneficial to the Board as it enabled the Board to fulfil parental

expectations and its statutory responsibility in respect of the students in its care.

The Authority directed the parties to prepare a spreadsheet analysis of the payments made to Ms Kidd across the period, to assess whether any payment in addition to the salary she received was payable.

Kidd v Epsom Girls Grammar School Board of Trustees [[2019] NZERA 183; 28/03/2019; E Robinson]

Mechanic started work before visa was approved

Mr Wate applied for a role as a mechanic at Talbot Agriculture Limited (“Talbot”). On the recommendation of his immigration advisor, Mr Wate undertook a work assessment at Talbot’s workshop in Temuka between 2 and 4 May 2016, residing with Talbot’s managing director, Mr Talbot, during this period.

The assessment was successful and on 6 May Mr Wate signed an employment agreement. The agreement contained a 90 day trial period clause, and stated that the employment would commence on approval of a work visa by Immigration New Zealand. From 10 May, while waiting for the visa to be granted, Mr Wate attended Talbot’s workshop daily. He stayed as a guest at Mr Talbot’s house, and would leave with Mr Talbot in the mornings and return in the evenings from the workshop.

The purpose for Mr Wate’s attendance at the workshop prior to his visa being approved, was for him to familiarise himself with the workplace and to shadow Mr Talbot or another employee. On occasion Mr Wate assisted with workshop tasks. Mr Wate was not paid for this, however he received a sum of $300 on 13 May, $500 on 29 June, and $300 on 19 July. Mr Talbot’s visa was approved on 15 June. Talbot’s solicitors claimed that the amounts paid were advances on his wages to tide him over until his IRD number was provided. Mr Wate claimed the amounts were gifts.

On 19 July Mr Wate was given a letter advising him of the termination of his employment on 31 July. The reason given for termination was dissatisfaction with Mr Wate’s skills. Mr Wate had expected the letter as a result of discussions with Mr Talbot over the previous days.

Mr Wate had raised a personal grievance and the Employment Relations Authority had found in his favour, ordering Talbot to pay him three months’ lost wages, $10,000 in compensation and $3,751.50 in unpaid wages. Talbot challenged this decision, maintaining that Mr Wate was dismissed pursuant to a valid trial period and that he was engaged as a volunteer prior to the trial period commencing.

The Court considered the status of Mr Wate’s unpaid assessment prior to his start date of 15 June. Mr Wate stated in evidence that he had “no issues” with Talbot’s characterisation of the first assessment period, between 2 and 4 May, as an unpaid appraisal. Mr Wate confirmed that he did not expect to be paid for this.

During the second “familiarisation” period between 10 May and 15 June, Talbot said the work performed by Mr Wate was not recorded in the company accounts and was not part of a bill to any customer. However, Mr Wate claimed he expected to be paid for this period, despite being aware he was lawfully unable to work. The Court found that a realistic explanation of the arrangement was that Mr Wate was performing work for reward. The Court held that the issue was not the lawfulness of the work, but whether Mr Wate actually worked as an employee during that time. He had performed work for the company, his tasks were integral aspects of the services provided by Talbot, he had a regular attendance pattern and the length of time he was engaged prior to becoming lawfully entitled to work, all pointed to Mr Wate having been an employee during this period.

Although the parties had agreed that the trial period would commence once Mr Wate’s visa was granted, the Court found that separately to this the parties had entered into a period of

Community Pharmacy Limited and Waiora Community Pharmacy Limited (“the Pharmacies”).

The Pharmacies were registered companies operated by the same three directors, none of which had any prior record of breaches of employment legislation or complaints to the Labour Inspectorate.

The Pharmacies shared “back office” support functions including human resources, accounting, payroll, IT and office support. Between April 2014 and April 2016, the Pharmacies employed approximately 90 people including pharmacy technicians and trainee pharmacy technicians.

Trainee pharmacy technicians were required to complete a set number of hours of study to achieve the Level 4 or 5 qualification, while also working for the pharmacy for a minimum of 20 hours per week. The Open Polytechnic course was delivered 100 per cent online.

The trainee pharmacy technicians employed by the Pharmacies agreed they would not be paid for time spent studying towards their qualifications which was described as “training hours”. The expectation was that trainees would use down time while present in the pharmacy to complete their training, often using the pharmacy’s computers and equipment.

A deduction of approximately 10 to 20 hours per week was made from the trainees’ full time pay to account for the training hours. Trainees were trusted to spend these hours studying or working on assignments and were not prevented from working if they wanted to, but no records were kept of the actual number of hours spent studying.

The Labour Inspector informed the Pharmacies that these practices did not meet the requirements of employment legislation, in particular that a blanket deduction for training hours brought the effective hourly rate below the minimum wage for 12 employees if the training hours are treated as hours worked; and that there was constant under-payment of holiday pay.

The Labour Inspector sought penalties in respect of 13 breaches of the Minimum Wage Act and one breach of the Holidays Act. All the affected employees were migrants.

employment beginning on 10 May, which meant that when Mr Wate commenced the trial period on 15 June he was already an employee of Talbot. Consequently, the trial period could not apply to him.

The Court found that Talbot had not acted as a fair and reasonable employer could in how it dismissed Mr Wate. Further, the Court received evidence that after Mr Wate was given notice of dismissal by Talbot, the company offered him a period of further employment as a casual employee. The Court found this undermined Talbot’s assertion that its concerns about Mr Wate’s performance were such that the company wanted to end the employment relationship.

The Court directed Mr Wate to be paid $10,000 in compensation for hurt and humiliation in accordance with the Authority’s determination, ahead of the parties undertaking calculations as to his overall remedies.

Talbot Agriculture Limited v Wate [[2019] NZEmpC 31; 22/03/2019; Judge Smith]

Consultant at a law firm challenges final written warning

Mr Palmer was a partner at Duncan Cotterill for around 20 years before he left in 2009. He was then re-engaged as a consultant from 2015 onwards. Mr Palmer alleged that he suffered an unjustified disadvantage because Duncan Cotterill issued him with a final written warning on 31 August 2017.

Mr Palmer was alleged to have inappropriately contacted a Duncan Cotterill staff member, Ms Z, over an extended period of time and it was this conduct which gave rise to the warning. On 18 May 2017 there was an informal conversation between Mr Palmer, the Chief Executive and the Chair of Duncan Cotterill. Some concerns regarding Mr Palmer’s behaviour were raised. The behaviour included allegations about long lunches, some implications that Mr

The Labour Inspectorate submitted that where employees are migrants an employer can be expected to exercise even greater care not to, even unintentionally, take advantage of their circumstances which may increase the inherent imbalance of power in the employment relationship.

It was also submitted that it was foreseeable that the trainees would

“lend a hand” in the Pharmacies, and without adequate monitoring by the Pharmacies, the trainees had thereby contributed to the profitability of the Pharmacies by working during training hours.

The Authority considered the nature and number of statutory breaches, and any aggravating and mitigating factors. Each breach incurred a maximum penalty of $20,000, to give a total starting point of $280,000. The Authority accepted that the Pharmacies did not have a deliberate intention of exploiting the employees in order to benefit their businesses. However, the Pharmacies could have utilised a better system of monitoring the trainees in order to avoid the situation. The Authority considered that the Pharmacies had been quick in resolving the breaches as soon as they were notified of them. Taking into account the need to deter others, the Authority concluded that a penalty of $92,500 was appropriate. This amount was then apportioned according to the number of employees at each pharmacy.

A Labour Inspector of the Ministry of Business, Innovation and Employment v Avondale Community Pharmacy Limited [[2019] NZERA 214; 11/04/2019; A Robinson]

Employee dismissed by text message

Mr Skomski claimed to be unjustifiably dismissed by Quite Handy Limited (“QHL”) and or Mr Lamberth, the sole director of QHL. Mr Lamberth argued that no employment relationship existed, and that Mr Skomski was engaged as a labour-only contractor.

Mr Skomski was engaged from 27 November 2017 until the end of this engagement on 20 June 2018.

Palmer was guilty of drink-driving, a suggestion of touching female staff and an allegation that he had a habit of taking out staff for coffee and lunches and that typically involved young female staff. No warning or direction was given to Mr Palmer in the meeting.

Over a 2-month period beginning on 10 May 2017 and concluding on 12 July 2017, Mr Palmer sent Ms Z, a junior staff member, a series of emails suggesting dates for coffee and subsequently, dinner. The complainant forwarded the emails to two colleagues saying that they made her feel “uncomfortable”, then provided the email trail to an HR Advisor for Duncan Cotterill in advance of her exit interview. At the interview, Ms Z outlined her concerns in more details, including asking the firm to respond to the matter in a serious way.

A letter was issued to Mr Palmer on 1 August 2017, raising the concerns. Following an investigation and a disciplinary process, Mr Palmer was issued with a final warning on 31 August 2017. Mr Lang who was one of the signatories to the final warning letter, gave evidence that he thought some of the language used by Mr Palmer was suggestive or contained sexual innuendo. The sheer repetitive nature of the email request was regarded as an exacerbating factor as was the power imbalance between Mr Palmer and the complainant. Moreover, the inability of Mr Palmer to grasp the seriousness of the situation appeared to have been a further motivating factor for Duncan Cotterill as Mr Palmer did not accept the suggestion of a power imbalance and labelled that as “political correctness”. The firm’s position was also that Mr Palmer’s response to the allegations was

“aggressive”. The Authority first examined

the letter sent on 1 August 2017. It clearly identified the nature of the complaint, the letter also referred to the firm’s bullying and harassment policy and a copy of the policy was attached for Mr Palmer’s information.

What seemed significant to the Authority about the policy was not

Mr Lamberth claimed Mr Skomski was able to pick and choose when and if he wanted work and he provided timesheets as proof. Mr Skomski argued these were invalid as he had never seen or filed timesheets. Mr Skomski provided a large number of text exchanges in relation to the requirement to be available for pickup to be taken to site. The Authority preferred Mr Skomski’s evidence and found he was not in control of determining his own work schedule.

QHL did not employ or engage anyone on a permanent basis and would only engage people when the workload required. Mr Skomski only worked on one project which the Authority found indicated more of an independent contractor relationship when considering the integration test.

QHL supplied Mr Skomski with the majority of the tools he needed. Mr Skomski did provide his own health and safety equipment but did not regard himself as a person in business on this own account. The Authority found the fundamental test indicated only slightly more in favour of an employment relationship as Mr Skomski was not in business for himself.

On numerous occasions Mr Skomski had requested an employment agreement, holiday pay, sick leave and statutory days. Mr Skomski claimed he was told he would be provided an agreement in time and was told annual holiday and sick leave would be provided to him when he met a certain length of service. Mr Skomski again requested holiday pay and said Mr Lamberth asked him for his CV and said he would sort this out for him. Mr Lamberth denied that he said he would be entitled to leave but accepted he asked for a CV but only for the purpose of giving Mr Skomski a pay increase. The Authority found Mr Skomski’s evidence more credible which suggested more of an employment relationship.

The Authority considered their findings on the control, integration, and fundamental tests along with the discussion of holiday pay and sick leave. The Authority found Mr Skomski was an employee of QHL.

The Authority then considered

that Duncan Cotterill relied on the policy in order to make its decision to issue a final written warning, but rather that a breach of the policy stood as an alternative ground for reaching the same conclusion that Duncan Cotterill did. If the firm had relied on the policy, then Duncan Cotterill could have relied on it to ground its decision to issue the final written warning.

The gravamen of the decision to issue to a final written warning was contained in the letter stating;

“We consider the content of the emails, and the repetitive nature of the invitation, to be entirely inappropriate and unacceptable. We consider your actions are all the more serious given that the email exchange inviting (Ms Z) for dinner was instigated by you only four days after the informal discussion… where you were asked to refrain from taking female colleagues out for drinks and lunch due to the perceptions this could create”

The Authority was satisfied that it was available to Duncan Cotterill to conclude that a final written warning needed to be issued to seek to modify Mr Palmer’s behaviour and to protect other staff. The decision was informed to some extent by the 18 May 2017 discussion which had no effect on Mr Palmer’s behaviour. So a fair and reasonable employer in Duncan Cotterill’s position could have concluded that a final written warning was an appropriate response to Mr Palmer’s identified behaviour.

Palmer v Cotterill [[2019] NZERA 174; 22/03/2019; J Crichton]

Trainee pharmacy technicians were not paid for “training hours”

A Labour Inspector sought penalties against seven pharmacies: Avondale Community Pharmacy Limited, Family Care 7 Day Pharmacy Limited, Mangere Community Pharmacy Limited, Otara Community Pharmacy Limited, Ratanui Community Pharmacy Limited, Takanini

whether Mr Skomski was unjustifiably dismissed.

On 19 June 2018, Mr Lamberth was due to pick up Mr Skomski at their prearranged time of 6am. Mr Lamberth was sick and alerted Mr Skomski to this at around 9.30am, stating he was “pulling the pin”. Mr Skomski sought confirmation he would be paid from 7am to 9.30am in accordance with their normal agreement but did not hear back.

On 20 June at 7.30am, Mr Skomski texted Mr Lamberth saying he had been ready to leave since 6am and again sought confirmation of payment. Mr Lamberth responded saying he was still sick and that Mr Skomski needed to find his own way to the site. Mr Skomski then made his unhappiness clear and raised the non-payment of holiday pay, statutory days and sick leave. He reminded Mr Lamberth it was unlawful to not have a written employment agreement and said he would “no longer be taken advantage of”. This came to an end when Mr Lamberth text saying

“were done find a new job” (sic).The Authority found the ending

of Mr Skomski’s employment through text was unjustified.

Mr Skomski was awarded a total of $4,800 in lost wages after a reduction of 40 per cent for contribution in the dismissal and the text altercation. QHL was also ordered to pay Mr Skomski wages in arrears for 19 and 20 June totalling $75, $1,800 for nine statutory days he had not been paid, and $2,247 in respect of the annual holiday owed to him.

Skomski v Lamberth & Anor [[2018] NZERA Wellington 105; 26/11/2018; T MacKinnon]

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