Any agreed hours of work or an indication of the arrangements relating to the times the employee is to work must be in the employment agreement.
Employment agreements must fix the maximum number of hours to be worked by the employee at not more than 40 hours per week (not including overtime) unless the employer and employee agree otherwise. If the maximum number of hours (not including overtime) are less than 40, the employer and employee must try to fix the hours so they are worked on no more than five days of the week.
If an employee or employer wants to change the hours of work, both should agree to this in writing in the employment agreement.
Hours of work in an employment agreement might include that an employee also do additional work, as reasonably required by an employer, and should agree on any compensation for this overtime. Employers must make sure that employees are paid at least the minimum wage for all the time that they work; this rule applies equally to overtime as well as normal hours.
Employees must be paid for their work as agreed in their employment agreements and this can be no less than the applicable minimum wage rate.
There is no magic formula as to what is ‘work’. Work may include any activity where there are; constraints on the freedom of an employee, responsibilities placed on an employee, and / or there is a benefit to the employer. Generally, an activity will be work if it is “an integral part of the principal activity”.
Examples of activity considered to be ‘work’ include (but are not limited to) time spent in:
- after hours team meetings
- opening and closing businesses
- cleaning and tidying up
- on-the-job training
- product familiarisation.
Example: Payment for attending a meeting
Vinod just started as a sales assistant in a shop. Before his first shift, he had been told to attend a staff meeting each day to discuss current promotions and receive information about new products. Attending the meeting is not included in his employment agreement. This meeting would take 30 minutes before the start of business each day.
While these meetings might be quite informal there is an expectation that Vinod will attend the meetings and listen to what is said. Vinod has constraint placed on his free time, he has a responsibility placed on him because he is expected to listen to what is being said and there is clearly a benefit to the employer for his attendance at the meeting. This is work and Vinod must be paid for it.
The hours that are agreed to in an employment agreement are generally the only hours that an employee needs to be present at work. Many employees receive payment if their employer asks them to work more than their normal hours.
Whether this overtime is factored into the employee’s salary, or will be paid at the employee’s normal rate of pay (at least the minimum wage rate) or a higher rate of pay, the arrangement needs to be agreed to by the employer and the employee. This should be put into the employment agreement so that both parties are clear.
You can find a sample clause on overtime in the Employment Agreement Builder(external link). If the specific hours aren’t put into a written agreement (eg because they change so often that this isn’t practical), then an accurate and timely written record will need to be kept of exactly what hours the employee has worked.
If an employee has worked more than their normal hours and believes they haven’t been properly compensated for this, they should try to resolve this with their employer.
Employers and employees need to take all practicable steps to ensure the health and safety of themselves and others in the workplace, and this includes working safe hours of work and avoiding fatigue. For more information, view WorkSafe New Zealand's Managing shift work to minimise workplace fatigue (A guide for employers)(external link).
If employees have safety concerns about the hours they are required to work, they should discuss this with their employer, union or Worksafe New Zealand(external link).
If an employment agreement has the employee's hours of work, then an employer can’t change them without the employee's agreement. If the employment agreement says that an employer can change the hours of work, the employer still has to act fairly and reasonably before they do. If an employee thinks that the change to their hours is disadvantaging them and that the process the employer followed was unfair or there were no genuine reasons for changing the hours of work, an employee should first try to resolve the issue with their employer.
In some situations (such as genuine financial, commercial or economic problems, or genuine restructuring of the business), cutting back on an employee’s hours may be put forward as an alternative to redundancy. In these situations the employer must follow the usual process for organisational change, which includes giving the employee a fair opportunity to consider and respond to the proposed change.
An employment agreement can’t have an availability clause put in (ie working is conditional on the employer making work available to an employee and they’re required to be available to accept any work that the employer offers) unless:
- the employment agreement specifies agreed hours of work and includes guaranteed hours of work among those agreed hours, and the availability clause is in addition to those guaranteed hours of work, and
- the employer has genuine reasons based on reasonable grounds for including the availability clause and the number of hours of work specified, and
- the availability clause gives the employee reasonable compensation for making themselves available to work.
To decide whether there are genuine reasons based on reasonable grounds, an employer needs to think about such things as:
- whether they’re able to meet their business demands for the employee’s work successfully without an availability clause, and
- the number of hours that the employee needs to be available, and
- the proportion of these hours compared with their agreed hours of work.
To decide whether the compensation is reasonable, the employer must think about all relevant matters, including:
- the number of hours that the employee has to be available, and the proportion of these hours compared with their agreed hours of work, and
- the nature of any restrictions on the employee if there is an availability clause, and
- how much the employee gets paid for the work they are available for, and
- the employee’s salary (if that’s how they are paid). If they are paid by salary, then the employee and employer can agree that the employee’s salary includes compensation for being available for work under an availability clause in their employment agreement.
If an employment agreement doesn’t have a valid availability clause that provides reasonable compensation, then an employee can say “no” to work that isn’t part of any guaranteed hours in their employment agreement. An employer can’t disadvantage an employee if they turn down the work. This means that an employer can’t:
- refuse or not offer the same employment terms, work conditions, fringe benefits, and training, promotion and transfer opportunities, as other employees with more or less the same qualifications, experience and skills employed in the same or very similar circumstances, or
- dismiss or do anything to an employee that has a negative effect on the employment, job performance or job satisfaction, when other employees employed to do the same type of work aren’t treated the same.
Saying "no" to work scenario
Jenna has no guaranteed hours of work and said “no” to a shift because she couldn’t arrange childcare. Her employer then reduced the number of shifts she was offered, and gave her all the unpopular shifts because she said “no”. In this situation Jenna might want to make sure she has a copy of her previous shift history (her employer has to keep accurate records of employees’ time worked) before she said “no” as she could use this to show she was now being disadvantaged.
If an employee is a shift worker, their employer can’t cancel one or more of their shifts unless:
- the employment agreement has:
- a reasonable period of notice for cancellation, and
- reasonable compensation payable to the employee if the employer cancels a shift without giving reasonable notice, and
- the employer either gives the employee the above notice or pays the reasonable compensation above, and
- cancelling the shift doesn’t breach the employment agreement.
To determine whether or not the period of notice is reasonable, you must consider all the relevant factors, including-
- the nature of the employer’s business, including whether or not they could control or see the situation that led to the proposed cancellation, and
- the nature of the employee’s work, including the likely effect of the cancellation on the employee, and
- the nature of the employee’s employment arrangements, including whether there are agreed hours of work in the employee’s employment agreement and if so the number of guaranteed hours of work (if any) included among those agreed hours.
To determine how much is a reasonable amount to pay for shift cancellation, you must consider all the relevant factors, including:
- the shift cancellation notice period in the employment agreement and what the employee would have been paid if they had worked the shift, and
- if the type of work means the employee would have incurred costs preparing for the shift.
If the employment agreement doesn’t have a valid shift cancellation provision (with reasonable notice period and reasonable compensation for shift cancellation) and the employer cancels a shift anyway, then, because they can’t do this, the employer must pay the employee what they would have been paid if they had worked the shift.
Employers must also pay employees what they would have been paid if they had worked the shift if:
- the shift is cancelled but the employer doesn’t tell the employee until the start of the cancelled shift, or
- the rest of the shift is cancelled when the employee has already started the shift.
In this situation, the remuneration the employee gets when the shift is cancelled is included in their ordinary weekly pay and relevant daily pay.
If the employer doesn’t protect the employee's rights in relation to having to be available for work, or providing reasonable notice or reasonable compensation for shift cancellation, then the employee may be able to raise a personal grievance.
People under 16 years:
- must attend school, and their employment can’t stop or interfere with this
- can’t work between 10pm and 6am on any day
- can work during week days, before or after school, and/or between 6am and 10pm on the weekends and during school holidays.