The earthquake caused a range of damage to businesses in the Canterbury region and it may take time for workplaces to be able to reopen. Employers and employees should be talking to each other about pragmatic solutions to help recovery. While generally wages are payable if the employee is able and willing to perform work and work is available, what this means in each individual circumstance is likely to differ.

Flexible Working Arrangements

An employer and employee should look to their employment agreement to see if there are options available during the recovery. It may be that alternatives such as working from home are available. Employees and employers may also agree to temporary arrangements that are additional to or different from their current employment agreement if they think this will be of benefit.

Sick and Annual Leave Entitlements

The Holidays Act provisions may be applicable also. An employee can take sick leave if they, their partner, or their dependents are injured or sick and the employee has sick leave available. An employer can also require an employee to take annual leave if the both of you cannot reach agreement as to when the leave will be taken and the employer gives the employee at least 14 days' notice. This only applies to annual leave that the employee is entitled to on each anniversary of the date they commenced employment. If an employee refuses to take annual leave on less than 14 days' notice an employer cannot require them to.

Unable to Continue Operating and Redundancy

It may be that the employer's business is unable to keep operating, closes permanently, and employment is terminated. In these circumstances, employers may need to consider making staff redundant. In that case, the procedures on consultation, good faith and other relevant matters in the Employment Relations Act apply along with other employment agreement obligations. It is important to get advice at this point including on any financial assistance that may be provided in the context of the earthquake damage.

Summary

In all situations, whether the business is likely to recover, or has to shut permanently, any changes to the employment agreement covering wage payments or redundancy need to be agreed to by both the employer and the employee before implementation.

There may be financial assistance that Work and Income can offer in hardship circumstances, including recently announced support for small businesses and their employees. Work and Income can be contacted on 0800 779 997.

This advice is given as a guide. Employees and employers are advised to seek their own advice depending upon the circumstances they face.

View information on health and safety and employment relations issues that employers and employees may be considering in the wake of the Christchurch earthquake. http://www.dol.govt.nz/quake2010/

WHK would like to send our best wishes to everyone that has been affected by the earthquake, our thoughts are with you. Thank you to the Department of Labour for this contribution.