Assignment 3 (50%) Status of employee, options and enforcement. (50 marks) You need to construct/have access to an employment agreement to complete this assignment. See the link below to help you do that. Go to the MBIE web site https://eab.business.govt.nz/employmentagreementbuilder/startscreen/ Learning outcome three (10%) Students will apply legal provisions to analyse the nature of the relationship between parties. 3. Interpret and apply the main legislative provisions and common law principles involved in the development of employment agreements and in offers of employment and variation to agreements Question 1: Contract “of” service and “for” services. (10 marks) Using the case study provided. answer the following. Case study for Questions 1 and 3 in assignment 3 For Bachelor of Applied Management Degree & NZ Diploma in Business 342.619 Industrial Relations & 342.613 Employment Relations Employment relationship problem Adnelg Retrop received the following text message from the sole director of Competent Worksites Company Limited, Pera Te Amo on February 2015 at 8.42pm. Ms Retrop said that the text message dismissed her from her cook/housekeeper role with Competent Worksites that she had held since 3 November 2014. The message provided: “ Most of the boys are moving out over the weekend and my wife and kids are moving in tomorrow so the boys are gunna sort themselves out one of them has their girlfriend moving in with them and didn’t want to be looked after they rather have away allowance so if you can drop key off at some stage tomorrow if my wife isn’t there just leave it under the mat”. PAYE was being taken out and as she was only part time and having a WINZ top up at that time it did not occur to her to check. It would be usual in the absence of a withholding tax exemption certificate with a provision of labour only contract for Competent Worksites to withhold tax deductions. That did not happen. Ms Retropdid not claim for any expenses such as driving to the supermarket for supplies. End of relationship On or about 24 February 2015 by email, Mrs Te Amo asked Ms Retropto state what she did for each block of hours she was claiming and to break it right down. She was also asked for information about the meals she had made for each night of the previous week and what she had planned for the week ahead. Mrs Te Amo advised that she needed that information by the following day. Ms Retrop provided a two page detailed email to Mrs Te Amo as instructed that same day, breaking down in some detail what she cooked and how she undertook the housework. In the email Ms Retro ppointed out that she had worked three hours on Waitangi Day morning and was only paid at the normal rate despite it being a public holiday and that she should have been paid out for time and a halfI further note that on the hours provided for the week to Mrs Te Amo in which Waitangi day fell Ms Retrop had claimed three hours at time and a half and the balance of the hours worked, 19.45 hours at the normal rate. Mr Te Amo did not respond to that issue or indeed to any of the matters in that email. I note that the amount deposited into Ms Porter’s bank account did not include additional time for working on Waitangi day. Mr Te Amo then advised Ms Retrop that he wished to meet with her at about 5pm on 27 February 2015. Although Ms Retrop waited at work for a period of time, Mr Te Amo did not come to the house. He explained to the Authority that he was tied up. Ms Retrop then received the text message that she says terminated her employment and Competent Worksites says ended the contracting relationship. Ms Te Amo sent two further text messages to Mr Te Amo that evening. He did not respond to them. The first asked whether she would be paid out two week in lieu of notice as per ERA laws and the second was to explain that she could not drop the key back until Monday as she was out of town. The following day Ms Retrop also requested all of her pay slips within ten working days and advised she would be contacting the Authority about her unjustified dismissal. Mr Te Amo responded on 2 March to say that there was no need to drop the key off as the locks have been changed and security, police and insurance advised. Mr Te Amo said that Competent Worksites had no further need for Ms Porter’s services because the contracts were going pear shaped and Mrs Te Amo was coming down and the boys were heading out of town. Ms Retrop did not accept that was the situation. She said that on 27 February she had had requests from crew members for self -saucing pudding and a roast for the following week that supported they had no idea they would not be there. She also said that after the relationship ended she drove by the house and the crew were still there. Was Ms Retrop a homeworker? Mr Richardson presented a carefully structured argument that Ms Retrop was a homeworker under s 5 of the Act and therefore an employee under s 6 of the Act . Control and integration I find that there was a level of control over Ms Porter. She was expected to prepare meals each weekday evening between 5pm and 7pm and that required her to attend work during that period. There was more flexibility I accept about when the housework was undertaken although as Ms Retrop said in her evidence it made sense to undertake that aspect of the role when the crew was not in the house. The hours within which Ms Retrop was expected to undertake her tasks were 20 hours per week. There was some slight variation to the hours each week but that was not significant. There was a list of duties which Ms Retrop undertook and the only time she deviated from these duties was when she would assist the crew with washing and drying their clothes. Ms Retrop did not provide any tools or equipment for undertaking the role. Ms Retrop was an integral part of the business as she was involved in feeding and attending to the cleaning and washing for Competent Worksites contractors when they were living away from home. Fundamental or economic reality test This test requires consideration as to whether Ms Retrop was effectively working on her own account. Ms Retrop did not pay tax and neither was it withheld by Competent Worksites. Ms Retrop was not registered for GST. I find that it is more likely that there was simply no discussion at all about tax. The evidence supports Ms Retrop regarded herself as an employee and she was not disabused of this by Competent Worksites. She did not claim for any expenses and took no financial risks. If Ms Retrop was required to buy food with her own money she asked for reimbursement. I do not find that the factors under the fundamental test that Ms Retrop was in business on her own account. There was no common intention in this case for a contracting relationship and there was nothing in writing was provided. The evidence supports that Ms Retrop thought she was an employee and made requests for an employment agreement and for time and a half for working on a public holiday. It is unfortunate that there was no discussion about these matters earlier. I do not need to return to the issue of whether Ms Retrop was a homeworker. For completeness the relationship did not have features of casual employment as Ms Retrop attended work every day for a set period. I will consider whether Ms Retrop was unjustifiably dismissed and whether she is owed money for unpaid wages, statutory days and holiday pay. Was Ms Retrop unjustifiably dismissed? Whether a dismissal was justifiable must be determined under s 103A of the Act which provides the test of justification. The Authority must, in determining whether a dismissal is justifiable, objectively determine whether the actions of Competent Worksites and how it acted were what a fair and reasonable employer could have done in all the circumstances at the time the dismissal or action occurred. The Authority must , in applying the test set out above, consider the four procedural factors set out in s 103A (3)(a) to (d) of the Act and any other factors it thinks appropriate. It must not determine a dismissal unjustifiable solely because of defects in the process if they were minor and did not result in the employee being treated unfairly. A fair and reasonable employer will also comply with the statutory obligations of good faith. Ms Retrop was dismissed without notice by a text message. The text message suggested that alternative arrangements had been made for undertaking her duties of cooking and housekeeping. The substantive reason for Ms Porter’s dismissal as set out in the text message was that the crew was going to look after themselves with an away allowance. Mr Te Amo in his evidence said that the crew left the house to work elsewhere although that is not altogether consistent with the contents of the text message which only refers to five of the crew moving out. Ms Retrop accepted that there could be changes that meant that she may not be employed until October 2015 but she said that she did not expect her employment to finish after four months, particularly when there was nothing apparent to her that that would be the case. Contribution Had Ms Retrop contributed to the situation that gave rise to her personal grievance? Lost Wages Ms Retrop said that after her dismissal she could not continue to afford to pay rent and after about two weeks she had to live in her car for about five weeks. She travelled out of town in search of work and obtained full time work on 1 May 2015 which paid more than she had received at Competent Worksites . Penalties Are penalties for breaches of good faith, not providing an employment agreement or a wage and time record to be paid? (a) What is the nature of the relationship between the parties? It is important to distinguish between “Contract of service (employee) versus contract for services (contractor.) why” (5 marks) (b) Determine the status of the contractual relationship between the parties in the case study by setting out and applying the “tests” used to determine the “real” nature of the relationship in this case. (5 marks) Learning outcome four (20%) 4. Students will critique and analyse the legal provisions applying to the creation of employment agreements. Question 2: Analyse and Critique an IEA & CEA. (20 marks) Required: Analyse and critique for legal compliance the Individual Employment Agreement (IEA) OR Collective Employment Agreement (CEA) that you have prepared prior to this assessment: (a) When engaging labour to do work there are options available to the employer (as an employee OR as a contractor. Outline the advantages and disadvantages in each of the above for the parties? ( 10 marks) (b) Using the (Individual Employment agreement (IEA) OR Collective Employment Agreement (CEA) you have prepared prior to this test (mentioned above). What are the provisions that “must” and “should” be contained that make up these agreements and describe the types of clauses found in the agreements (IEA & CEA) and state the origin of at least five “statutory” “incorporated” terms in the IEA and CEA provided. ( 10 marks) Learning outcome six (20%) Students will explain the legal provisions of and principles applying to the resolution of employment relationship problems covered by the Employment Relations Act 2000, and identify lawful, effective procedures that may be applied to manage a range of circumstances in which the termination of a contract of service may arise. . Apply the law relevant to the resolution of a conflict, issues or dispute arising from an industrial relationship Explain the functions and powers of state institutions established for the enforcement of employment agreements Using the case study provided answer the following. Case study for Questions 1 and 3 in assignment 3 For Bachelor of Applied Management Degree & NZ Diploma in Business 342.619 Industrial Relations & 342.613 Employment Relations Employment relationship problem Adnelg Retrop received the following text message from the sole director of Competent Worksites Company Limited, Pera Te Amo on February 2015 at 8.42pm. Ms Retrop said that the text message dismissed her from her cook/housekeeper role with Competent Worksites that she had held since 3 November 2014. The message provided: “ Most of the boys are moving out over the weekend and my wife and kids are moving in tomorrow so the boys are gunna sort themselves out one of them has their girlfriend moving in with them and didn’t want to be looked after they rather have away allowance so if you can drop key off at some stage tomorrow if my wife isn’t there just leave it under the mat”. PAYE was being taken out and as she was only part time and having a WINZ top up at that time it did not occur to her to check. It would be usual in the absence of a withholding tax exemption certificate with a provision of labour only contract for Competent Worksites to withhold tax deductions. That did not happen. Ms Retropdid not claim for any expenses such as driving to the supermarket for supplies. End of relationship On or about 24 February 2015 by email, Mrs Te Amo asked Ms Retropto state what she did for each block of hours she was claiming and to break it right down. She was also asked for information about the meals she had made for each night of the previous week and what she had planned for the week ahead. Mrs Te Amo advised that she needed that information by the following day. Ms Retrop provided a two page detailed email to Mrs Te Amo as instructed that same day, breaking down in some detail what she cooked and how she undertook the housework. In the email Ms Retro ppointed out that she had worked three hours on Waitangi Day morning and was only paid at the normal rate despite it being a public holiday and that she should have been paid out for time and a halfI further note that on the hours provided for the week to Mrs Te Amo in which Waitangi day fell Ms Retrop had claimed three hours at time and a half and the balance of the hours worked, 19.45 hours at the normal rate. Mr Te Amo did not respond to that issue or indeed to any of the matters in that email. I note that the amount deposited into Ms Porter’s bank account did not include additional time for working on Waitangi day. Mr Te Amo then advised Ms Retrop that he wished to meet with her at about 5pm on 27 February 2015. Although Ms Retrop waited at work for a period of time, Mr Te Amo did not come to the house. He explained to the Authority that he was tied up. Ms Retrop then received the text message that she says terminated her employment and Competent Worksites says ended the contracting relationship. Ms Te Amo sent two further text messages to Mr Te Amo that evening. He did not respond to them. The first asked whether she would be paid out two week in lieu of notice as per ERA laws and the second was to explain that she could not drop the key back until Monday as she was out of town. The following day Ms Retrop also requested all of her pay slips within ten working days and advised she would be contacting the Authority about her unjustified dismissal. Mr Te Amo responded on 2 March to say that there was no need to drop the key off as the locks have been changed and security, police and insurance advised. Mr Te Amo said that Competent Worksites had no further need for Ms Porter’s services because the contracts were going pear shaped and Mrs Te Amo was coming down and the boys were heading out of town. Ms Retrop did not accept that was the situation. She said that on 27 February she had had requests from crew members for self -saucing pudding and a roast for the following week that supported they had no idea they would not be there. She also said that after the relationship ended she drove by the house and the crew were still there. Was Ms Retrop a homeworker? Mr Richardson presented a carefully structured argument that Ms Retrop was a homeworker under s 5 of the Act and therefore an employee under s 6 of the Act . Control and integration I find that there was a level of control over Ms Porter. She was expected to prepare meals each weekday evening between 5pm and 7pm and that required her to attend work during that period. There was more flexibility I accept about when the housework was undertaken although as Ms Retrop said in her evidence it made sense to undertake that aspect of the role when the crew was not in the house. The hours within which Ms Retrop was expected to undertake her tasks were 20 hours per week. There was some slight variation to the hours each week but that was not significant. There was a list of duties which Ms Retrop undertook and the only time she deviated from these duties was when she would assist the crew with washing and drying their clothes. Ms Retrop did not provide any tools or equipment for undertaking the role. Ms Retrop was an integral part of the business as she was involved in feeding and attending to the cleaning and washing for Competent Worksites contractors when they were living away from home. Fundamental or economic reality test This test requires consideration as to whether Ms Retrop was effectively working on her own account. Ms Retrop did not pay tax and neither was it withheld by Competent Worksites. Ms Retrop was not registered for GST. I find that it is more likely that there was simply no discussion at all about tax. The evidence supports Ms Retrop regarded herself as an employee and she was not disabused of this by Competent Worksites. She did not claim for any expenses and took no financial risks. If Ms Retrop was required to buy food with her own money she asked for reimbursement. I do not find that the factors under the fundamental test that Ms Retrop was in business on her own account. There was no common intention in this case for a contracting relationship and there was nothing in writing was provided. The evidence supports that Ms Retrop thought she was an employee and made requests for an employment agreement and for time and a half for working on a public holiday. It is unfortunate that there was no discussion about these matters earlier. I do not need to return to the issue of whether Ms Retrop was a homeworker. For completeness the relationship did not have features of casual employment as Ms Retrop attended work every day for a set period. I will consider whether Ms Retrop was unjustifiably dismissed and whether she is owed money for unpaid wages, statutory days and holiday pay. Was Ms Retrop unjustifiably dismissed? Whether a dismissal was justifiable must be determined under s 103A of the Act which provides the test of justification. The Authority must, in determining whether a dismissal is justifiable, objectively determine whether the actions of Competent Worksites and how it acted were what a fair and reasonable employer could have done in all the circumstances at the time the dismissal or action occurred. The Authority must , in applying the test set out above, consider the four procedural factors set out in s 103A (3)(a) to (d) of the Act and any other factors it thinks appropriate. It must not determine a dismissal unjustifiable solely because of defects in the process if they were minor and did not result in the employee being treated unfairly. A fair and reasonable employer will also comply with the statutory obligations of good faith. Ms Retrop was dismissed without notice by a text message. The text message suggested that alternative arrangements had been made for undertaking her duties of cooking and housekeeping. The substantive reason for Ms Porter’s dismissal as set out in the text message was that the crew was going to look after themselves with an away allowance. Mr Te Amo in his evidence said that the crew left the house to work elsewhere although that is not altogether consistent with the contents of the text message which only refers to five of the crew moving out. Ms Retrop accepted that there could be changes that meant that she may not be employed until October 2015 but she said that she did not expect her employment to finish after four months, particularly when there was nothing apparent to her that that would be the case. Contribution Had Ms Retrop contributed to the situation that gave rise to her personal grievance? Lost Wages Ms Retrop said that after her dismissal she could not continue to afford to pay rent and after about two weeks she had to live in her car for about five weeks. She travelled out of town in search of work and obtained full time work on 1 May 2015 which paid more than she had received at Competent Worksites . Penalties Are penalties for breaches of good faith, not providing an employment agreement or a wage and time record to be paid? Question 3. Resolution of Employment Relations Problems (20 marks) (a) What are defined in the Act (The Employment Relations Act 2000) as “employment relations problems” and what “type” of employment relationship problem is central to this case? and what are the provisions that are contained in the Employment Relations Act 2000 (ERA 2000) that could be applied to the case study given? (10 marks) (b) How can the parties resolve the employment relations problem in the case? What are the options and what steps need to be taken (provided for in the Employment Relations Act 2000) for the employee to resolve this employment relationship problem (10 marks)