The tell tale signs of bullyingat work

Exclusive EMA news, advice, learning and networking
Issue 25 + April + 2006
Save 3% of your tax
The tell tale signs of bullying at work
■ Youth rates are still good
■ Managing interruptions
■
Your company car for branding
What it takes to become a
Best Place to Work?
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is published for:
EMA Northern
159 Khyber Pass Rd, Grafton,
Private Bag 92066 Auckland
Ph: 09 367 0900 or 0800 800 362
Email: [email protected] Website: www.ema.co.nz
Chief Executive
Alasdair Thompson
Advocacy Manager
Bruce Goldsworthy
Manager, Employment Advice
Our cover shot this month features
Simon Gibson from Industrial Research Ltd’s
spin-off company, HTS-110 Ltd, loading high
temperature superconducting (HTS) wire as
part of an insulation coating process.
This process of enhancing HTS wire for
particular applications was developed jointly by
IRL with New Zealand companies Whitehall
Technical Services and Scott Technology using
materials discovered by IRL that conduct power
with no electrical resistance or power loss.
The wire is then wound as coils for HTS
magnets, electric motors or generators. It can
also be used for manufacturing HTS electricity
transmission cable, short lengths of which are being
prototyped around the world.
In New York’s Long Island IRL’s wire is being
run through existing tunnels and conduits to boost
power supply by between three to five times for the
same cable dimension. Streets don’t need to be ripped
up, and power loss is also reduced.
David Lowe
Manager EMA Learning
George Gerard
02
Sustainable
economy - Where is it?
FINANCE
03
Productivity figures!
04
TECHNOLOGY
Youth
rates are needed
Waikato
Alan Fursdon
07 839 0806
Bay of Plenty
Kim Stretton
Paul Winter asks
WORKING
&NET
your
Taxman lyrics
07 577 9665
EMA central
24
08
Pacific Labour conference
12
Save 3% on your terminal tax!
24
FINANCE
Learn
what it takes to become a Best Place to Work
04
Taming the workplace bully
09
FINANCE
Tax
penalty regime relaxed
10
When is an employee not a contractor?
06 759 4006
13
Kiwisaver: Nuts & bolts
Manawatu/Wanganui
14
Enforcing mediated settlements
PO Box 1087 Wellington Ph: 04 473 7224
Fax: 04 473 4501
Email: [email protected]
Website: www.emacentral.org.nz
Chief Executive
Paul Winter
Manager Training & OH&S
Tony Ward
Hawke’s Bay
06 843 3419
Taranaki
06 350 1825
NET WORKING
TECHNOLOGY
NET WORKING
TECHNOLOGY
FINANCE
Nelson
03 548 4528
17
Canning
the spam
NET WORKING
Gilbert Peterson 09 367 0916
18
TECHNOLOGY your interruptions at work
Managing
Published by
20
The company car as branding device
21
Beefing up IT makes for fresher food
Editor
TPL Publishing Services
Project Manager
04
20
Sheila Marshall 09 529 3007
Advertising Sales
Colin Gestro 09 419 6723
[email protected]
ISSN No. 1176-4953
Our Vision. Your Success
PAG E By Paul Winter, Chief Executive, EMA Central
Sustainable economy, yeah right!
We are likely to find we
have diverted too much of the
Government surpluses into
short term ‘what’s in it for me’
redistribution programmes, leaving
little for a really bold review that
would raise the attractiveness of
investing in our productive business
base.
Government says it wants foreign
direct investment but on its terms.
The evidence is growing in the vital
It has so far proved unwilling to
signs of our economy that our focus has
match, or better the trend to reduce
been weighted towards consumption
business taxes which would keep our
and the enjoyment of our life-style
taxes on foreign investor profits truly
today, not enough towards building the
competitive internationally.
productive capacity needed to ensure
Investing in New Zealand’s
we will keep on having a prosperous
productive capacity as a small
and sustainable economy in the years
economy a long way from key
ahead.
markets is itself a major challenge.
The evidence for this
Uncompetitive tax rates just
is the dramatic slow down
add to the challenge. So come
in the economy, which
on Government, be bold in
‘Investing in New Zealand’s
is out of sync with the
action not just words.
momentum of the major
While voters and
productive capacity a long way
world economies.
Government ultimately
from key markets is a major
Historically our
determine the policy
economy has dipped
priorities, our entrepreneurs
challenge. Uncompetitive tax
when those of our trading
and businesses must work
partners slowed, which
within the existing policy
rates just add to the challenge.’
caused our domestic
framework.
economy to slow and
What can be done to
sometimes go into
maximise opportunities? For a
recession.This time the
start we should believe in our
slow down comes at the end of a
The business sector is responsible
potential. The recent Commonwealth
domestic frenzy from a housing boom
ultimately for making it happen. But it Games showed up the determination
(some would say bubble) and the
needs a supportive policy environment of Australian competitors compared
wealth effects of fast rising land prices
from Government. Neither business or to Kiwis.
on our rising demand for imports.
government is doing their bit well.
The Australians, and other foreign
While it lasted, the euphoria of
Where we need urgent action is
competitors set more aggressive
feeling wealthy has been wonderful
leadership, in establishing a policy
goals, and play longer and harder for
for immediate beneficiaries, but it's
environment attractive for New
success in business than we do. We
really a diversion from building broader Zealand and foreign investors alike to
seem too willing to ease back after
infrastructure and productive capacity.
grow our productive capacity.
attaining the boat, bach and BMW.
Now it is starting to dawn on many
One small flame of hope flickers
We also seem too willing to
Kiwis that by far the most important
in the form of the review of business take short term profits by selling
engine of our economy is the tradable
taxation currently underway. But
our productive assets to overseas
sector. Our producers and traders have
the chances of this being fanned
investors, then grizzle when they
to deliver the long term economic
into a raging investment fire in our
take the IP off shore or lift their
growth we need for a more prosperous tradable sector are rather unlikely if
performance to a higher level, to take
standard of living. But at the moment
the Government focus remains on
more profits again offshore.
our producers are far from robust
balancing short term income and
We need to get on and compete
enough to earn the foreign exchange
expenditure.
far more aggressively!
It is never easy getting the balance
right between a focus on long term
goals and making the most of today’s
tactical opportunities.The same is
true for our personal lives, for the
enterprises that power our economy
and the 40 per cent of the nation’s
GDP that Government directs.
PAGE we need to buy all the things a country
of four million people can’t sensibly
make for themselves.
Twenty years on from the economic
reforms in the mid 1980s, New
Zealand still has too narrow a base in its
tradable sector to support the levels of
consumption we have been indulging
in. Our continuing balance of payment
deficits are the evidence for this, as our
housing and other spending are funded
through mammoth kiwi-bond issues.
The international business
competitiveness of the tradable sector
needs to be substantially increased
before we can entertain such profligacy
as of late.To do this we need to achieve
a commensurate increase in investment
in quality business opportunities for
growing exports and import substitutes.
EMA Business Plus Magazine - Exclusive EMA news, advice, learning and networking
By Alasdair Thompson, Chief Executive, EMA Northern
Productivity figures highlight complacency
Government complacency is evident
in the productivity figures released last
month.Though New Zealand’s productivity from 1988 to 2005 was measured
to be slightly ahead of Australia’s, the
figures do not take into account the 40
per cent of the economy controlled by
Government spending.
While the Government has reaped the
benefits of the reforms in the mid to
late 1980’s it has not added much to
them to keep the good times rolling.
The agenda over the past five years
has been to redistribute the modest
wealth created substantially by good
weather and world prices for our main
exports.
The legislative programme has
been full of new regulations and
more compliance for business, not on
building a sound foundation for future
sustainable growth.
To fill this gap in Government policy,
EMA has its own prescription for
business to keep employment high and
lift our standard of living with just two
items.They are:
n Drop the company tax rate to
encourage business to retain earnings
and invest more of their profits in
skills development, training and new
technology.This would increase
the value added to our goods and
services.
n G
overnment to invest far more in
developing highly skilled people.
Both would achieve higher labour
outputs without more hours worked.
Remember, globalisation has
increased the demand world-wide for
higher skills while slashing demand for
lower skilled people who can’t hope to
compete with low labour cost imports
from China and India.Yet, 25 per cent
of our students leave school with no
qualifications. Cutting this figure in half
alonewould realise huge productivity
gains.
The Government needs to
encourage businesses to invest, and,
itself, to invest much more in ideas,
intellect, innovation, infrastructure,
initiative and immigration since these
are the potent forces required to keep
our productivity and standards of living
rising.
Export Year 2007 plans needed now
The recent negative GDP growth
result, coupled with the ballooning
current account deficit, demands that
Government show strong leadership.
The responsibility for maintaining
the New Zealand economy is about
to fall weightily on our exporters’
shoulders, and exporters need to know
Government is on their side and will
accelerate measures to assist their
effectiveness. For instance, exporters
need to know right away. what plans are
being made for Export Year 2007. Next
All together now...
George Harrison, The Beatles - Taxman
One, two, three, four...
Hrmm!
One, two, (one, two, three, four!)
Let me tell you how it will be;
There’s one for you, nineteen for me.
‘Cause I’m the taxman,
Yeah, I’m the taxman.
Should five per cent appear too small,
Be thankful I don’t take it all.
‘Cause I’m the taxman,
Yeah, I’m the taxman.
year will be too late to gear up to meet
the combined challenges of negative
economic growth and our extreme
indebtedness.
We want to see trade missions led
by Economic Development Minister
Trevor Mallard.
Finance Minister Cullen should
accelerate the introduction of the tax
changes to be recommended by Peter
Dunne’s tax review and electricity
supply needs to be secured, and
transport infrastructure built faster.
Delay on Transpower decision petty
The Electricity Commission decided
the fate of Transpower’s proposed 400
high voltage link across the Waikato
on March 29 but said it wouldn’t tell
anyone what it was until April 27!
The respective responsibilities of the
Electricity Commission, the Commerce
Commission and Transpower are
hopelessly confused.
Time is not on our side.To avoid
brown-outs, or worse, in Auckland in
the next two to three years, a robust
power transmission system into the
city is essential. Otherwise the price
of power in the north will not remain
comparable with elsewhere in the
country at times of peak demand.
The Minister of Energy will be held
responsible for any shortfall in power
supply because the commission is
directly accountable to the Minister, not
Parliament, for rulings of this sort.
( If can't remember the tune, go to http://lyrics007.ringtone-logo-game.com and download it on your cellphone)
(if you drive a car, car;) - I’ll tax the street;
(if you try to sit, sit;) - I’ll tax your seat;
(if you get too cold, cold;) - I’ll tax the
heat;
(if you take a walk, walk;) - I’ll tax your
feet.
Taxman!
‘Cause I’m the taxman,
Yeah, I’m the taxman.
Don’t ask me what I want it for, (ah-ah,
mister Wilson)
If you don’t want to pay some more. (ah-
ah, mister heath)
‘Cause I’m the taxman,
Yeah, I’m the taxman.
Now my advice for those who die,
(taxman)
Declare the pennies on your eyes.
(taxman)
‘Cause I’m the taxman,
Yeah, I’m the taxman.
And you’re working for no one but me.
Taxman!
Our Vision. Your Success
PAG E By Charlotte Stephens, HR Consultant, EMA Central
Taming the workplace bully
Bullies. The very word can strike
fear into the hearts of employees and
employers alike.
Bullying is fast-becoming the latest
buzzword, and it can have serious
implications for workplaces, including
low morale, high turnover and increased
stress claims.
One statistic puts work related stress
illnesses directly attributable to bullying
at approximately 30 to 50 per cent of
cases (Olsen, 2005).
Bullying can be between colleagues,
or from a manager to an employee or
an employee to a manager.
Bullying defined
There are various research definitions
regarding bullying. One such definition
(Olsen, 2005) defines bullying as
comprising:
n Unwanted behaviour
n Unwarranted or unnecessary
behaviour within legitimate
boundaries of the job
n Repeated – pattern of behaviour,
and
n Behaviour that has a detrimental
effect on the recipient causing harm
While there is no statutory definition
of bullying, in Evans v Gen-I Limited,
the Authority defined bullying as:
“Bullying may be seen as something
that someone repeatedly does or
says to gain power and dominance
over another, including any action
or implied action, such as threats
intended to cause fear and distress.
The behaviour has to be repeated on
more than one occasion and there
must be evidence that those involved
intended or felt fear.”
Similarly, in McGowan v Nutype
Accessories Limited, the Employment
Court described the verbal abuse
suffered by the employee as “persistent
offensive and bullying. It unsettled Mr
McGowan to the point that he could
no longer bear to be at work.”
PAGE In upholding Mr McGowan’s
claim, the Employment Court said
“Bullying can be insidious but in
this case it occurred under the noses
of management. It rendered Mr
McGowan powerless through constant
humiliation.’
Whether bullying has occurred will
depend on the circumstances in which
the behaviour has taken place, making
the need for careful consideration,
and possibly a formal investigation,
important.
Prevalence in New Zealand
How widespread is bullying in
New Zealand workplaces? Quality
organizational research using sound
methodology on the topic is difficult
to find. Research from employers’
perspectives has proved elusive.
However several self-report surveys
have been done in attempts to measure
workplace bullying from an employee
perspective.
One such survey conducted by
FINSEC found approximately 40 per
cent of staff reported they had been
bullied, with nearly half of those experiencing the bullying behaviour on a
weekly basis (Olsen, 2005).
The difficulty with employee
surveys is that they are based on selfreports, meaning that the results reflect
perceptions of bullying rather than an
objective assessment
of the problem
following investigation. Like sexual
harassment, there
is an element
of subjectivity
inherent in
definitions of
bullying behaviour.
What one person
perceives as
bullying, another
perceives as either
inappropriate
behaviour or
simply normal
behaviour.
EMA Business Plus Magazine - Exclusive EMA news, advice, learning and networking
In Evans v Gen-I Limited1 the
Authority noted that “a vulnerable
person may perceive criticism of his or
her work as bullying, regardless of how
the criticism is couched.” It is unclear
how many of the behaviours described
in the surveys, then, could truly be
considered bullying.
Managing complaints of bullying
It is important to take any
complaints of bullying seriously.
Employers have a duty to provide a
safe working environment, to take
reasonable care not to cause psychological or physical injury, and to
systematically identify and control
hazards, including behaviour, to
minimize the risk of harm in the
workplace.
Many genuine complaints require
action to be taken. A recent Sydney
Morning Herald (16/03/2006) report
of an extreme case of bullying in the
workplace found the complainant had
suffered racial taunts, and extremely
poor working conditions over his
four years of employment. So severe
was the bullying over this timeframe
that he was awarded a massive $1.9
million. He had suffered a nervous
breakdown and was unlikely to be
able to work again.
The most recent case in New
Zealand was Williams v The Warehouse
Limited. Allegations of bullying
through a lack of respect, treating staff
in a derogatory manner, denigrating
them in public, stand-over tactics, and
in an intimidatory manner, together
with threats of record-keeping, were
raised. The complainants had already
resigned.
The Employment Relations
Authority concluded the behaviour
described amounted to serious
misconduct and the dismissal that
resulted justified both substantively and procedurally. The former
employee is appealing the decision to
the Employment Court.
In contrast some complaints of
bullying are frivolous or even false. In
my experience of advising employers
on bullying, most allegations arose
during genuine performance
management or disciplinary processes.
Or, bullying was raised as part of a
personal grievance claim without it
being raised previously. All employers
took these allegations seriously and
attempted to obtain specific details
for further investigation. Not one
employee provided any.
What should an employer do to tame
bullies in the workplace?
nT
ake all complaints of bullying
seriously. Some may require a
formal investigation; others can be
dealt with on an informal basis.
n Where allegations are vague, request
further specific details from the
employee
n Assess the seriousness – is there
medical evidence of harm?
n Make sure that both the
complainant and the alleged bully
are treated fairly and in accordance
with the principles of natural justice
during any investigation.
n Ensure that acceptable and
unacceptable behaviour in the
workplace are clearly defined. Model
acceptable behaviour yourself, and
enforce your standards.
n I mplement a bullying and
harassment policy that includes
a complaints process with the
consequences for the alleged
bully if the complaint is upheld.
Consequences for making false or
frivolous complaints should also be
included.
n Ensure your recruitment and
selection process is designed to
screen out potential bullies.
Remember to seek advice from
EMA specific to your situation in order
to manage bullying allegations.
References:
Evans v Gen-I Limited, unreported, D
King, 29 August 2005, AA333/05.
McGowan v Nutype Accessories Limited,
[2003], 1 ERNZ 120.
Olsen, H. (2005). Workplace Bullying and
Harassment: A Toolbox for Managers and
Supervisors. Auckland, NZ: CCH New
Zealand Limited.
Williams v The Warehouse Limited,
unreported, D King, 23 December 2005,
AA498/05.
“Did you hear the one about the government that
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date, no matter what the law change is.
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pay change, call Comacc today on 0800 800 729 or visit
comacc.co.nz for more information on the pending changes.
Comm EMA_April.indd 1
20/03/2006 1:20:28 p.m.
Our Vision. Your Success
PAG E With David Lowe, Employment Services
Manager for EMA (Northern).
Abolition of youth rates would hurt young
job seekers
A 16 year old and 32 year old are
applying for the same job, both to be
paid at the same rate. It takes no
brain surgeon to figure out the 16 year
old has no show.
Abolishing youth rates will hurt the
very people the promoters of the law
currently before Parliament’s Select
Committee are trying to help – the
teenagers themselves. Teenagers already
find it hard to get their first job. Their
unemployment rate is 12 per cent
against a national average of just under
four per cent. Abolishing youth rates
will make the situation a whole lot
worse.
(Submissions on the Minimum Wage
(Abolition of Age Discrimination)
Amendment Bill close on April 21st.)
Twice in the last month I have been
served by a teenager in a fast food
outlet texting on their phone hidden
below the counter while at the same
time serving me. Or I should say, trying
to serve me because my order just
wasn’t as important as the text.
Not all teenagers are like this, but
hiring a teenager can carry some risk.
It is hard and expensive for employers
to deal with employment problems so
they are often reluctant to take a chance
on someone unless there is an incentive
to do so.
Some teenagers in the workforce are
very productive and valuable and most
employers who employ them recognize
their value in their pay packets.The
few who don’t can’t complain when
the young person they rely on, ups and
leaves.
Those who support the abolition of
youth rates point out the arbitrary age
at which a youth becomes an adult for
pay purposes, which is 18. It is arbitrary,
but it is still the best idea anyone has
been able to come up with for many
years and is a distraction from the real
debate.
The minimum wage is just that,
the minimum. Most employers pay
more the minimum; youth rates are no
exception. The adult minimum wage
is $10.25 but the average rate paid by
employers is over $20 an hour.
Teenagers need for employers to
have an incentive to hire them ahead
of an older person. Take away that
incentive and teenage unemployment
will skyrocket. After school jobs, which
many parents rely on to supplement
home income, will dwindle.
I don’t even need to point out why
hiring a teenager is riskier than hiring
an older person. Every parent knows
why. That’s really the point.
EMA has written to the leaders of
several political parties along these lines
to make sure they are aware of the
issues underlying the youth rates debate.
The letters urge the parties to
ensure the Bill to abolish youth rates
does not proceed. We suggested the
Case example
A hair salon owner has borrowed
to get her business open and has to
make $2000 a week before any profit
becomes available. To make $2000 the
owner needs an average 50 clients
a week/10 clients a day. The owner
has a 16 year old school leaver who
wants to be a hair dresser, helping
out and the plan is for her to become
an apprentice. The 16 year old is paid
youth rates.
Under this Bill the 16 year old would
lose her job. The salon just cannot
afford to keep her. Putting up the cost
of a hair cut is not an option when
establishing a customer base. The 16
year old will find her lucky break to get
her dream job is about to end.
A one-size-fits-all piece of legislation
may provide a settlement for a few
collective agreement disputes but it
will hurt a lot of teenagers and a lot of
small businesses along the way.
politicians put themselves in the shoes
of a small business, and the teenager
who works in it, because the stories of
those in favour of the Bill are about big
companies and big unions, ¬¬but the
vast majority of teenage workers are
employed in small businesses and this
legislation will hurt these teenagers and
the small businesses they are working
in most.
Code developed to align people skills
A software system designed to align
networks of people and organisations
for maximum performance is being
marketed in the USA by New Zealand
company Vortex.
Vortex director Nick Gerritsen says
Vortex™ grew out of research on the
relationship between an organisation’s
purpose, values, culture and financial
performance in the S&P 500. The group
developed an algorithm to describe the
PAGE ability of firms with a strong culture to
out-perform their peers.
The HR and performance-related
system is used by several New Zealand
and Australian organisations, including
Fulton Hogan, one of our largest
construction and civil engineering
companies.
“As an engineering company, we like
to put numbers on those things we
want to track and work on. We’ve
EMA Business Plus Magazine - Exclusive EMA news, advice, learning and networking
chosen Vortex to help us manage the
people elements of our business,” said
Alex Adams, Fulton Hogan’s Executive
Manager.
Go to: http://vortexdna.com/u_profile/
Research - © Metawealth Limited,
2005, The Enhanced Performance of
Firms with Whole-Systems Cultures,
by Martin Burley, Head of Research,
MetaWealth Limited.
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vary from products depicted. Information correct as at 13 March 2006. For full terms and conditions visit www.hp.co.nz/promotions/smartoffers/terms.asp. HPI3170REMA.
Pacific labour market
conference to explore seasonal work
An upcoming conference in Wellington
on “The Future of the Pacific Labour
Market” will focus on the temporary
movement of people from the Pacific
Islands to New Zealand for seasonal
work.
The issue is increasingly high profile as
New Zealand industries, particularly in
the horticulture and viticulture sectors,
face real difficulties securing a reliable
workforce in the peak seasons.
On the other hand, labour surpluses
in Pacific Island countries are growing
bringing mounting pressure from
Pacific leaders for New Zealand to
open its doors to temporary workers.
Both sides could benefit.
The conference organised by the
Pacific Cooperation Foundation*
will be on June 29-30 at Te Papa in
Wellington. Both policy and practical
issues will be reviewed against the
backdrop of the economic development
of New Zealand and the Pacific.
Guest speakers will include
representatives of the World Bank and
the Commonwealth and Pacific Islands
Forum secretariats. Local employers
and industry associations,
government departments, unions,
regional governments, academics
and media will also attend.
The Pacific Cooperation
Foundation hopes the
conference will promote
solutions to the temporary
labour movement issue and
bring about a win-win for New
Zealand industry and Pacific
Islanders in need of employment.
Subscribers to EMA Business+ are
invited to participate.
* The Pacific Cooperation Foundation (PCF)
is a public/private sector trust dedicated to
making useful and productive connections
between New Zealanders and Pacific
people. For more details visit the PCF
website - www.pcf.org.nz.
7ELLDOWHATEVERWECAN
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PAGE EMA Business Plus Magazine - Exclusive EMA news, advice, learning and networking
EMA's
TAX TIPS
Shortfall penalty relaxation welcomed
The Government has acknowledged
that since the 2003 amendment of the
unacceptable interpretation penalty
provision, there has been an economic
disincentive for taxpayers to disclose
errors to Inland Revenue voluntarily.
To address this, a legislative
amendment has just been introduced
that recognises even with the best
of intentions, errors can occur and
responsible taxpayers should not be
unduly penalised for them.
For tax positions taken on or
after 1 April 2003, the section that
imposed a shortfall penalty for an
“unacceptable interpretation” was
amended, and penalties were able to
be imposed on an “unacceptable tax
position”.
Officials said the reason for the
2003 amendment was that some
taxpayers were deliberately choosing
not to interpret the legislation
in respect of tax on large value
transactions so as to avoid the
potential imposition of the penalty.
However, as a result of the 2003
amendment, certain IR officials have
argued that the shortfall penalty for
an unacceptable tax position can
now apply to almost all situations
where a taxpayer has a tax shortfall
exceeding the threshold (a tax
shortfall greater than $20,000 and
the lesser of either 1% of the total
tax figure or $250,000). This was
done on the basis that the majority
of errors made by taxpayers will fail
the test of being “as likely as not”
correct.
A supplementary order paper
to the Bill has been introduced
providing the Commissioner with
the power to not impose a shortfall
penalty for taking an unacceptable
tax position in certain circumstances. There is also provision
for shortfall penalties imposed in
respect of taking an unacceptable
tax position in earlier years to be
remitted.
Three main criteria need to be
satisfied for the new provision to
apply, including the fact the shortfall
must arise from a ‘clear mistake
or simple oversight’, and that it
is ‘appropriate’ that no penalty is
imposed. The application of the
criteria is somewhat uncertain.
In the media release
accompanying the supplementary
order paper, the Revenue Minister
stated he hoped this was a short
term measure to reduce the
harshness of the penalty regime and
that, in the longer term, he would
like to devise legislative solutions to
more fully address taxpayer concerns
about penalties.
Ernst & Young tax director Geof
Nightingale says it’s a very welcome
measure, particularly the ability to
apply to have a review of previous
unacceptable tax position penalties.
However, Geof says the
Government and officials have taken
too long to react to the issue, which
is unfortunate as the New Zealand
system relies heavily on taxpayer
goodwill. Most tax is collected by
voluntary taxpayer compliance and
this issue has been damaging to the
spirit of voluntary compliance. He
says taxpayers will await a longerterm solution with interest.
If you have had a penalty imposed for
taking an unacceptable tax position
since 1 April 2003, contact EMA
Adviceline 09 367 0909 or 0800 800 362 in
the first intance, or Ernst & Young or your
usual adviser at the earliest opportunity
as any request for remission must be
made in writing before 1 October 2006.
Our Vision. Your Success
PAG E TPL5132
By Magdalene Phythian,
Employment Relations Consultant with EMA Northern
Who is an employee?
Paul Smith was an ex chef with one of
Auckland’s top restaurants. Due to a
downturn in tourist numbers two years
ago he was made redundant. With his
redundancy money Paul decided to go
into a small business and he bought into
a franchise selling coffee.
The business took off and Paul patted
himself on the back for his entrepreneurial skills. But as time went by he
found he wanted to stop working long
hours and to spend more time with his
new baby.
He tossed up between hiring
someone or taking on a contractor.
The thought of all the legislative
requirements of hiring someone was
appalling: 3 weeks annual holidays
(4 weeks from 1/4/07); sick leave;
bereavement leave; ACC premiums…
Worst of all was the thought of a
personal grievance. Paul simply did not
have the time to familiarize himself
with the tricky requirements of the
Holidays Act, and the Employment
Relations Act.
On the other hand, his good mate
John had indicated his interest in being
an independent contractor working
for him that way on the weekends and
some public holidays. John expected to
do a roaring trade and give Paul a break
as well. It was all win-win.
John took on the assignment as
a gentleman’s agreement - no paper
work. It went well for a year then things
began to sour. John felt he had all the
unsocial hours, and working on public
holidays lost its charm.
John failed to file his IRD returns
and before long, they were after him.
He did not have the cash to pay his tax.
In a moment of desperation, John told
PAGE 10
IRD he was not in business for himself
but working for Paul Smith who was
responsible for making the PAYE
deductions. IRD came knocking and
Paul was dumbfounded. Had not John
agreed to be a contractor?
Paul took advice from his
employment relations consultant who
pointed out that IRD first needed
to prove John was an employee
before claiming PAYE was payable as
contractors are required by law to file
their own tax returns.
To do this the IRD would have to
take the matter to the employment
relations authority or the employment
court. If they did, four tests would be
applied to determine whether John was
an employee, or a contractor.
The tests are the:
(a) The Intention of the parties
(b) The Control test
(c) Fundamental test
(d) The Integration test
The fact there was no written
contract makes no difference since
Section 6 of the Employment Relations
Act 2000 defines an employee as anyone
who works for hire or reward under a
contract of service.The intention of
a contract of service is not restricted
to whether or not there is a written
agreement for it.
Previously the classic test was the
extent that a person was subject to
the control of his/her employee;
the greater the degree of control, the
more likely the relationship was one
of employee rather than contractor.
However, this is no longer determinative.
In Cunningham v TNT Express
Worldwide the Court of Appeal declared
Mr Cunningham to be a contractor
despite the high degree of control
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exercised over his work.The degree of
control was simply necessary for the
efficient running of the business.
The fundamental test answers the
question of “Is the person in business on
his/her own account?” In the Bryson
v Three Foot Six of the Lord of Rings
trilogy the Employment Court and
Court of Appeal found that Mr Bryson
was not in business for himself. He had
no separate legal entity such as a trust,
company or even as a sole trader. He
took no risk and was paid for hours
worked, not results. He was even paid
for downtime but despite this filled in
an IR 3 form.
When a person is an integral part
of the business he or she is more than
likely to be an employee. Mr Bryson
was an essential part of the miniature
unit of Three Work Six and operated as
part of a team.
So where did Paul Smith go wrong?
1. He failed to appreciate the
importance of coming to grips
with basic employment legislative
requirements.These are part of the
skills and expertise required of a
business person.
2. A written contract at the outset
would have saved him anguish and
expense. In this case, Paul could
have a contract for service (for
people in business for themselves
i.e. contractors) drawn up for John’s
signature. An individual employment
agreement is for employees only.
3. He would have asked John to seek
advice regarding his status as an
independent contractor. After all, they
were mates.
4.There was poor communication
between the two parties. Issues could
have been sorted out at an early stage.
Business
failure need not
be fatal ...
If you are in business - alone, in partnership or
as part of a company, your personal assets could
be at risk. For example, if your business was
unable to pay creditors, assets, such as your
family home, could be sold to satisfy business
claims. Even if your company has limited
liability, as a director of the company, you could
be personally liable under The Companies Act
or other laws such as Health and Safety and
Resource Management.
Take the case of Craig Mercer. Craig set up his
business when his product was new to the
market and demand was growing. Over several
years the company expanded and continued to
show healthy growth.The future certainly
looked rosy.
Unpredictably, the economy started to shift
and a series of interest rate changes followed.
The effect of these changes over an extended
period eventually had a serious impact on Craig’s
cash flow and his creditors went from knocking,
to banging at the door. Despite his best efforts,
Craig couldn’t turn the company around and
after 8 years he closed down.
Fortunately, all was not lost. Many years prior,
Craig had taken some advice and set up a
family trust. His personal assets: family home,
beach cottage and some investments were in
the trust and could not be touched to pay
business creditors. Throughout his ordeal,
financial and emotional, Craig had some
peace of mind knowing his personal assets
were secure.
Trusts are a tried and tested way of protecting
assets but, they must be well structured and
well managed. Set up with the right flexibility,
a trust can ensure you and your family continue
to enjoy the benefits you have worked hard
to provide.
For a complimentary consultation
to discuss your options or review your
existing plans, contact
Andrew Doidge on 0800 87 87 82
Save 3% on April 7 terminal tax
Businesses have the opportunity to
reduce their IRD interest cost on 7 April
2006 terminal tax payments using a Tax
Payment Intermediary.
The difference between the interest
Inland Revenue levies on business
underpayments, and what it pays on
overpayments (currently 13.08% vs
5.71%) has long been a sore point.
But in March 2003 the Government
passed legislation to enable taxpayers to
reduce the cost of IRD interest.
While keeping the headline interest
rates unchanged, taxpayers could
benefit by buying and selling under or
overpayments of provisional tax and
thus arbitrage the difference in Inland
Revenue interest rates.
As Inland Revenue does not want
to be involved in managing transactions
between taxpayers, the law requires
taxpayers to use an IRD registered
PAGE 12
Tax Payment Intermediary. To date,
Tax Management New Zealand
(TMNZ) is the only registered
intermediary (look under Tax
Pooling on the IRD website
(www.ird.govt.nz/provisional-tax/
provisionaltax-index.html) The service
uses Guardian Trust to handle all funds.
The first trade was three years ago.
Corporate clients include Fonterra, Air
New Zealand and NZ Post.
A business with say, $30,000 terminal
tax and $5464 use-of-money interest to
pay on 7 April 2006 could use the tax
payment intermediary system to reduce
the interest cost to $4184, thereby
saving $1280.
Any late payment penalties are
eliminated as IRD recognises deposits
made up to the due date.
SME clients range across all sectors
including high-growth ventures,
retailers, manufacturers, and property
companies.The system works like this
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If this notice is too late for you to benefit this year,
keep it in mind for 2007. In any case business
owners should discuss the system with their
accountant. Most major accountancy practices
and tax agents are registered with the system.
Accountants can make Tax Purchase requests for
their clients online through the Tax Management
website (www.taxmanagement.co.nz)
for SMEs:
1. An accountant with a client that has
7 April 2006 terminal tax can request
a Tax Purchase on line from TMNZ.
2. The request is confirmed by email
to the client who deposits the tax
amount with the TMNZ interest to
a designated Guardian Trust bank
account.
3. Guardian Trust then instructs Inland
Revenue to transfer the tax to
the clients account at the original
payment dates thus eliminating the
IRD interest.The saving for the
client is the IRD interest eliminated
less the TMNZ interest cost.
If a large corporate over estimates its
tax to pay it can ask Tax Management
to sell the overpaid tax to earn more
interest.
by Jo Doolan, Tax Director, Erst & Young
KiwiSaver takes centre stage
KiwiSaver, heralded as the saviour for taxpayers’ retirement
savings, is having its moment centre stage. For the few
who have an interest in saving for retirement, the debate is
robust with views fixated at each end of the spectrum.
The detail of how KiwiSaver will work is now contained
in 120 pages of legislation with 40 pages of explanatory
foreword and endless other documents to explain what it
all means, all available on the Treasury website.
Key elements are the proposals include:
n New employees are automatically enrolled if you are
aged between 18 and 65 but you can opt out within 2
to 6 weeks of starting a job.
n Others (including those who do not work or are self
employed) can opt in.
n The Government makes a start-up contribution of
$1000 and will contribute towards fees
n You can choose your own risk profile, conservative or
balanced growth.
n Deductions are made at 4% of your gross unless you
elect to go to 8% .
n After the first 12 months contribution holidays can be
taken for up to five years.
n Savings are generally locked in until you are eligible to
receive NZ super.
n Exceptions include first home purchases, financial
hardship and emigration.
n After three years of membership the Government will
provide a first home buyer subsidiary of $1000 per year
of savings up to a maximum of $5000.
n The scheme is portable so it goes with you if you
change jobs.
Dr Cullen and his team richly deserve the praise they
are getting for the scheme’s design.
My personal two big buts are: The lack of tax incentives
and the fact that it’s not compulsory. The Government
must have decided making the scheme compulsory was a
political nightmare.
Some fear KiwiSaver will incite anarchy and street
riots as union members demand employers contribute
to the fund. In 1986 Australia introduced its employerfunded super contribution scheme as a trade off for wage
increases.
In my view some form of tax break on contributions
to the retirement savings is appropriate. While acknowledging there is no historical evidence to say this is
necessary, or that it changes behaviour, it might make
people more inclined to consider saving for retirement.
By 2030 it is anticipated there will be two workers for
every retiree. Along with predictions like this, declining
birth rates and increased life expectancy clearly red flag a
potential problem in funding future retirees.
A means test on receiving Government-funded
superannuation may therefore be necessary in future, along
with raising the age limits. Giving current taxpayers a tax
break on saving to self fund their retirement now would
be some form of compensation for what they are unlikely
to receive in the future.
If it does work then, given the savings funds are taxable,
consideration could be given to moving to an exempt
taxed, and taxed method. In other words if contributions
are made from pre tax income, the funds would be taxed,
with the retirement pension taxed. Without this we stand
to continue the cycle of burdening the next generation of
taxpayers.
KiwiSaver is a great proposal with two areas ripe
for improvement – include tax breaks and make it
compulsory.
The views expressed here are Jo Doolan's are her own and do
not necessarily represent those of Ernst & Young. Email joanna.
[email protected]
Our Vision. Your Success
PAG E 13
By Richard Searle,
Senior Solicitor, EMA Legal, Wellington
Mediated settlements: enforcement
and appeals
Settlements whether reached privately or through mediation usually state that they are
in “full and final settlement of all matters”. This is not always true, and finding this out
can come as an unpleasant surprise to the uninformed.
What can employers do to reduce the likelihood of subsequent claims?
Where a settlement is reached
between the parties to an
employment relationship problem at
mediation, a Department of Labour
mediator normally countersigns the
terms of agreement.
Even if a settlement is reached
without the assistance of Mediation
Services, it is advisable to have a
mediator countersign the settlement.
This brings it within s 149
Employment Relations Act 2000
(ER Act).
Section 149 is refreshingly clear:
When signed by a mediator, the
terms of settlement are final and
binding on the signatory parties and
except for enforcement purposes,
cannot be challenged.
Before countersigning the terms
of settlement, the mediator must
explain to the parties the full and
final nature of the settlement, and
the fact it cannot be subsequently
appealed or reviewed. They
must also be satisfied the parties
understand these consequences.
Enforcement
The only provision in the
Employment Relations Act
for an appeal or review of a s
149 settlement is an action for
enforcement in the event that one
of the parties doesn’t comply with
the terms of settlement.
In other words, if an employer
wants to reduce the likelihood of
subsequent litigation, they need to
ensure that they themselves comply
with the terms of settlement.
If a settlement is reached and
countersigned by a mediator, it can
be enforced against the party in
default by applying to the Authority
for a compliance or enforcement
order. The Authority may also
impose a penalty for breach of
settlement. If a compliance order
is then breached, the Employment
Court has a range of penalties at
its disposal, ranging from fines to
imprisonment.
Settlements under s 149 are
accorded special status; they can
be enforced on production of the
document signed by the mediator
with no further proof required.
In contrast, agreements reached
privately between parties without
being countersigned by a mediator
cannot be automatically enforced by
the Authority.
However, in appropriate circumstances the Authority can decide to
Footnotes:
ER Act, s 149(3)(a).
ER Act, s 149(3)(b).
ER Act, s 149(2)(a).
ER Act, s 150(4).
Wheeler v 24 Hour Auto Electrical Ltd (ERA, Wellington
WA95/02, 27 September 2002, G Wood (member)).
Kerr v Associated Aviation (Wellington) Ltd (EC, Wellington
WC17/05, 17 August 2005, Judge Shaw).
PAGE 14
enforce an agreement that was not
reached under s 149.
In Wheeler v 24 Hour Auto
Electrical Ltd, for example, the
Authority decided to enforce a
settlement agreement that had not
been executed by a mediator. The
Authority considered there had
been a meeting of minds that the
personal grievance claim would go
no further and it would be contrary
to good faith and equity and good
conscience to hold otherwise.
Bad mouthing clauses
It is common for a settlement to
include a clause that the parties “will
not speak ill of each other” meaning
they will not bad mouth each other.
Given the ill-defined nature of
the clause it is unsurprising that a
number of cases have been taken
claiming a breach.
In Kerr v Associated Aviation
(Wellington) Ltd , for example, the
parties settled Mr Kerr’s claims in
a written document containing
a clause that the “terms and
circumstances” of settlement were
confidential and the parties would
“not speak ill of each other”.
Mr Kerr engaged a private
investigator to call the company
posing as a potential employer.
During one call the CEO said a
grievance had been settled and
he could not speak very well of
Mr Kerr. He indicated the parties
had previously been to Court
and described the outcome of the
hearing.
>
Marlow v Yorkshire NZ Ltd [2000] 1 ERNZ 206.
Gilman v Residual Health Management Unit (HC, Wellington
CP117/97, 2 December 1999, Ellis J).
Scrimgeour v The Wellesley Ltd (EC, Wellington WC22/05, 10
November 2005, Judge Couch).
Tobin v Stayinfront Inc (ERA, Auckland AA314/05, 18 August
2005, R Monaghan (member)).
Tobin v Stayinfront Inc (ERA, Auckland AA314A/05, 25 October
2005, R Monaghan (member)).
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The Court held that the company
had breached the confidentiality
clause by referring to the previous
court action, and describing the fact
of settlement, even though the CEO
had not disclosed the specific terms.
As the cumulative nature of
the CEO’s comments created an
unfavourable impression of Mr
Kerr, he had spoken ill of him.
However, the Court did not order
cancellation under the Contractual
Remedies Act 1979 as the statutory
requirements had not been made
out, and there was no award of
remedies. In any event, the breach
was hypothetical as the discussion
was not with a genuine employer.
Nevertheless, the case highlights
the importance of complying with
agreed terms. Before accepting
the standard wording that “neither
party will speak ill of the other”,
employers should carefully
consider whether they will be
able to comply with this in future.
Particular difficulties may arise
for employers asked to comment
on an incompetent or dishonest
former employee. There is also the
danger that repeated “no comments”
could be construed as creating an
unfavourable impression.
Mr Scrimgeour’s claim and payment
extinguished any further wage
claims.
The cost associated with
challenging a final settlement is
well illustrated by Tobin v Stayinfront
Inc. Mr Tobin claimed that an exit
package he had signed, that was
in full and final settlement of any
grievance he might have, amounted
to an unlawful contracting out of
the Employment Relations Act
under s 238. In its decision on
costs, the Authority dismissed an
argument that it was a test case,
stating that it was an issue “free from
doubt”. An award of $30,000 costs
was made in favour of the company
in a case heard entirely on the
papers.
A UK solution?
Employers wishing to avoid a
future challenge to their terms of
settlement could also consider UK
responses to these issues. In the
UK it is common practice for a
compromise agreement to list the
particular kinds of claim expressly
stated to be settled. This avoids any
future argument that they were not
in contemplation.
Clauses stating that a party has
no knowledge of any other matter
giving rise to a claim, and has not
brought any other proceedings in
any other jurisdiction, can also be
useful to employers. This approach
provides certainty against future
claims.
More New Zealand businesses use Ace
Payroll than any other computerised
wages program.
Visit our constantly updated website at www.acepay.co.nz
for employment law, legislative links, tax planning etc
or call toll free on 0800 223 729 for a free demonstration kit.
PAYROLL
PAYROLL
Neither full nor final?
Courts have taken the view that
full and final clauses cannot be
read literally. Instead, they should
be restricted to matters that were
covered by the settlement and
within the contemplation of the
parties involved.
Thus a full and final redundancy
settlement did not bar a common
law action for breach of implied
terms relating to a safe workplace
as that claim was not within the
contemplation of the parties at
the time of settlement (Marlow v
Yorkshire NZ Ltd ).
Equally a full and final settlement
did not prevent an employer joining
an employee as a third party to
proceedings arising out of the
employer’s vicarious liability for
the employee’s actions (Gilman v
Residual Health Management Unit).
Although the Courts have been
willing to examine the scope of
whether settlements are “full”,
thereby excluding new claims, they
have resisted attempts to reopen
“final” matters.
In Scrimgeour v The Wellesley Ltd
evidence about what was agreed
between the parties at mediation
was allowed before the Employment
Court as both parties consented.
Mr Scrimgeour had been paid $247
after mediation but claimed it was
an ex gratia payment and sought
additional lost wages. The company
claimed the amount had been
requested by Mr Scrimgeour in
settlement of his dispute. The Court
concluded it would have been
illogical for the employer to make
an ex gratia payment given it denied
liability. Instead, it held the payment
of $247 was the agreed settlement of
Our Vision. Your Success
PAG E 15
>
The EMAdvantage on your Southern
Cross Healthcare Plan
Your key to business growth
is happy, productive and
secure employees.
Introducing another reason for your staff to stand by you
Exclusive to EMA members, the EMAdvantage with Southern Cross offers
valuable and unique group schemes, that are simple with affordable
premiums. Many employees have little or no life insurance. In the event of
accidental injury or death, the burden of financial hardship falls on their
family. By making the EMAdvantage with Southern Cross available to your
staff, you provide them with low-cost insurance and your company with
happy secure employees.
Special benefits available to staff and their immediate family include:
‹ Accidental death at work benefit of $100,000.
‹ Accidental injury lump sum benefits up to $100,000.
A schedule of fifteen lump sum tax free cash
payments, for example of loss of limbs, sight,
speech and hearing.
‹ An additional funeral benefit paid of $5,000 on Death
by natural causes.
Please Please
fax to Penny
367 0920
or David
Lange
04 473 4501
FaxKing
to 09
P
enny
King
09 367
0920
Penny
I am interested in learning more about the Southern Cross EMAdvantage
Name:
Company Name:
Position/Title:
Currently
staff have healthcare cover with the Southern Cross Healthcare Plan
staff have no current healthcare cover with the Southern Cross Healthcare Plan.
Please contact me via: phone:
Email:
By Elizabeth Brown, Solicitor, EMA Legal based in Napier
Canning the spam
Formerly the word “spam” was
associated only with an all-American
canned luncheon meat. Then some
years later a Monty Python sketch
from the 1970’s gave marketers an
idea; they saw a parallel between
the repetitive and unwanted presence
of the meat product on the menu in
the Python sketch and the multitude
of unsolicited electronic junk mail
messages forced on us every day!
and cost effective way for many
organisations to keep in contact
with their clients or potential
clients.
But one of the purposes of the
anti-spam Bill is to put restrictions
on senders of messages, including
text, sound and visual images. So
how will it do this without compromising the technology’s advantages?
The Bill sets out to distinguish
between a commercial electronic
message (“CEM”) and a
promotional electronic message
(“PEM”).
Interestingly, the legislation does
not apply to spam sent by fax.
No one can deny the growth in
the volume of spam email we
receive these days. Some may be
lucky enough to have
expensive supersonic
technology that filters
The Bill sets out to
out large amounts of
it, while others are
distinguish between a
lumbered with the daily
task sorting the good
from the bad.
commercial electronic
Spam has become
the bane of an emailing
message (“CEM”) and a
generation, so much so
that an international
promotional electronic
movement has begun to
regulate this by-product
message (“PEM”).
of the internet.
New Zealand’s contribution is the Unsolicited
Electronic Messages Bill, now before
A CEM can apparently be
a select committee.
identified if its primary purpose
Submissions on the Bill closed
is marketing or promoting goods,
at the end of March, and the
services, land, an interest in
committee is due to report back to
land, or a business or investment
Parliament mid June.
opportunity.
Information Technology Minister
A PEM can be identified because
David Cunliffe indicated at the
it is not a CEM and its primary
Bill’s first reading that the degree
purpose is the promotion or
of public concern, and the growing
marketing of an organisation or its
cost of spam to our economy
aims and ideals.
made it time for specific anti-spam
Senders need to assess whether
legislation.
they are sending CEM’s or PEM’s. If
All good, but how would the
you send CEM’s the recipient must
legislation work in practice?
have consented to receiving them.
If you send PEM’s, and an unwilling
Are you a sender?
recipient opts out, then you must
Electronic messages are a convenient stop sending them messages.
Irrespective of whether the
message is a CEM or PEM, the
sender should include their contact
details on the message as well as a
functional ‘unsubscribe’ facility.
Are you a spam recipeint?
On the other side, recipients
can expressly consent to receive
electronic messages from a particular
organisation.
A recipient’s consent can also be
inferred from their conduct and their
relationship with the sending organisation.
As mentioned above a recipient
who no longer wishes to receive
the messages would have
the right to opt out or
unsubscribe.
Under the Bill, consent
is also deemed to have
been given if the recipient
publishes their electronic
address and does not include
a statement equivalent to the
“No circulars please” sign
people put on their letter
boxes. The message received
would have to be relevant to
the business, role, functions
or duties of the recipient in a
business or official capacity.
To avoid receiving
unsolicited emails (spam), recipients
can ensure their email disclaimer
includes a statement to the effect
that this addressee does not want to
receive unsolicited electronic messages
at this address.
Will it work?
It is important for New Zealand
to be up with international moves
in this area. But as the majority of
spam messages seem to originate
from far off lands like Bolivia or
Russia, it is difficult to see how
this new legislation will curb the
exponential increase of unwanted
emails we are bombarded with
everyday.
Our Vision. Your Success
PAG E 17
get a grip
hot tips for higher productivity
Who controls the interruptions?
You come into work bright and sharp,
the work at your desk beckons invitingly,
you can’t wait to get started, and then
the day turns to muck!
One thing after another claims your
attention; the rest of the world is clearly
in conspiracy against your productivity.
At the end of the day you collapse into
an untidy heap of exhausted humanity.
Yes? Try these strategies.
Turn off the phone or divert it
If you must have the phone answered
by a real person, divert it to a pager
service or another colleague while you
attend to important, high-concentration
tasks.
Schedule appointments with yourself
for the big tasks
There’s something about a written
appointment – it gives you more power
to say ‘No, I’m sorry, I can’t stop.’
Shut the door (if you’ve got one) or
make yourself unavailable
An hour (at least) of uninterrupted time
every day would transform the lives and
job satisfaction of most people.
E-mail
Turn off your message notifier. Schedule
two or three non-prime-time daily
slots for e-mail. A delay of a few hours
doesn’t matter - email shouldn’t be
used for time-sensitive matters. If we
go there first in the day we run the
serious danger of being swallowed up
by the addictive world of the Internet.
Suddenly the day has vanished and it
seems that all we’ve done is major in
minor things.
Skim
If you’ve been out of your office for any
time, skim your waiting mail quickly
for peace-of-mind but then get down
to the most important work. Unless it
really is the most important thing, don’t
let the new item steal your attention
until it’s the ‘right’ time.
If you’ve got an assistant or a PA, ask
them to sort incoming material into
priority piles so your ‘quick skim’ of
familiarisation is even quicker.
As with any technique, skimming has
benefit and danger. Benefit – you get
to your ‘real’ work with confidence,
knowing exactly what lurks and when
you need to do it. Downside - if you
always skim and rarely or belatedly
come back to complete it you’ll
soon have a Leaning Tower of ‘I’ll get
round to it later’ piles all over the desk.
Overwhelm becomes the dominant
sensation!
Chunk types of activity as well as
specific tasks
Chunking focuses the mind. Allocate
a piece of time to one task or activity
only. For me, now it’s writing, soon
it will be e-mails, then phone calls.
By Robyn Pearce
Many people dart like swallows from
one activity to another and then
wonder why nothing ever seems to get
completed.
Keep focus
When interruptions come in, decide
whether the interruption is of higher
importance than what you’re working
on. If not, put it on your daily list or
‘today’ action pile and keep going with
the present activity.
A clear desk
The space in which you work (for
many that’s around a computer) is
your potential interruption zone.
Keep it clear of distractions. Items
awaiting attention should be slightly
or completely behind you, out of eye
range. Otherwise, while you work the
stacks of ‘stuff ’ nearby wave invisible
hands, shouting almost audibly ‘Pick me,
pick me!’This is a huge and invisible
energy drain.
The interruptions never go away, but
we can control them.
Robyn Pearce frees up time and makes the
complex simple. You’ll find more of her timesaving tips at http://www.gettingagrip.com.
She’s an international keynote speaker,
author of multiple books on productivity and
time management issues, and the developer
of the GettingAGrip.com Productivity Training
System, now being licensed worldwide.
driving growth on tough terrain
Make sure you are a financial member of
EMA (Northern) on 30 June 2006 and you
could win a fantastic Nissan Murano.
For terms and conditions visit www.ema.co.nz
PAGE 18
EMA Business Plus Magazine - Exclusive EMA news, advice, learning and networking
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Our Vision. Your Success
PAG E 19
The company car: branding device
“We’re young cats and it’s a cool
car” – that’s how hip hop band
Black Eyed Peas justifies owning
that symbol of Californian excess,
the Hummer.
For much the same reason Flava,
the New Zealand hip hop brand of
Radio Network, chose a Hummer
to deck out as a branding machine.
“It fits the image,” says Radio
Network’s General Manager Talk
Programmes, Bill Francis.
The Auckland-based Radio
Network takes
care to match
its promotional
vehicles to brands.
When the Beetle
reappeared it was
just the sexy, up-todate image ZM was
looking for.
Talkback hosts
are equipped with
four wheel drive
station wagons to
project a slick, solid
but sharp image.
Protecting that
image is exemplified by the Radio
Network’s policy on vehicle use.
“Most of our promotional
vehicles are required to be parked
in our garage at night,” Bill Francis
says. We don’t want them parked
outside a pub at 1am.”
Similarly, office automation and
audio visual equipment supplier
Pitney Bowes demands that all its
drivers keep their cars polished, tidy
and maintained.
“Customers frequently travel
to demonstrations with our sales
representatives,” Technical Manager
Mansor Hakim says. “We are more
flexible on the standards maintained
by technicians and engineers who
carry a substantial amount of
equipment.”
Drivers are encouraged to report
PAGE 2 0
even minor bangs and scrapes while
spot checks are carried out to
encourage compliance.
“I do not like to see any damaged
cars on the road as they all carry
personalized plates that promote the
company,” Mr Hakim says.
Pitney Bowes’ policy also
determines vehicle allocation.
Executives get Nissan X-Trails while
sales representatives drive Nissan
Primeras. Mercedes Benz vans are
the workhorse for technicians.
More flexibility is allowed to
senior executives, though the
guiding rule is that engine size
should not exceed 2.5 litres.
Company policy also determines
the conditions for private use of
vehicles.
Transport operator The PBT
Group allows its company-car
drivers one tank of petrol at the
weekend at the company’s expense.
“When they are on holiday,
the fuel bill is their concern,”
says financial controller Rick
Groufsky.
Like many organisations, The
PBT Group has a written policy
which new employees sign
before taking the keys to their
company vehicle.
“It is a straightforward
document,” Mr Groufsky says.
Drivers are required to
comply with the law at all times.
EMA Business Plus Magazine - Exclusive EMA news, advice, learning and networking
The
policy
also makes
clear that
when
accident
insurance is invalidated by charges
relating to alcohol or drug abuse,
employment is terminated and the
company’s insurers instructed to
pursue the individual to recover
costs.
The PBT Group has only had to
take that step once in the last three
years and the low accident rate the
policy it has promoted has led to an
insurance premium
refund last year for
the group’s own
fleet of 70 vans, cars
and trucks.
Responsibility
for minor
misdemeanours is
also spelt out.
“There is no
reason for parking
or speeding
infringements
while on company
business. The ticket
goes to those who
incur them – with no exceptions,”
Mr Groufsky says.
There are further clear benefits
from a vehicle policy followed by
the boss as well as the sales rep.
Well maintained vehicles incur
no extra costs to bring them back
to acceptable condition at the
termination of a leasing agreement.
Reasons for a company vehicle policy
nP
romotes and protects company
image/brand
nD
efines business/private usage
nD
etermines vehicle allocation
nP
romotes safer driving
nM
aintains re-sale(terminal) value of
vehicles
Heller Tasty beefs up IT
Heller Tasty used to have separate
systems for accounting, sales records,
purchase orders and our weigh stations
- lots of software that just didn’t
communicate.
“Any data we did manage to source
was often a week old,” laments Heller
Tasty IT Manager, Trish Jenkins.
“When we did upload one lot of
data into another system, there were
significant delays so no real time
information was available.”
“The other main issue we wanted
to resolve was our lack of inventory
control. With no real-time data at our
fingertips, we had to conduct manual
weekly stock-takes encompassing up
to 250,000 kilos of produce – quite
an undertaking.
“The old system exposed us to
human error and increased the risk of
produce passing shelf expiry dates."
Heller Tasty’s managers were
frustrated they couldn’t easily extract
sales and production data for analysis.
The software did not allow for the
review of trends, or extraction of
reliable information.
“We needed a package developed
solely for us so we could log industry
standard information on the exact
weight of products sold, explained
Jenkins. “Many systems we looked at
didn’t let us capture this. We needed
the security of a future-proofed and
well supported system.”
Nick Harris, Heller Tasty
Managing Director, is equally
enthusiastic: “Having chosen a
Microsoft product, we feel like we
have hopped on board a 747 with
endless fuel”.
The previous manual system
absorbed nearly all of the accounts
receivable clerk’s 35 hour week,
with little time to contact debtors.
With the system’s fully integrated
electronic accounting system in
place, Heller Tasty hasve reduced the
accounts ledger considerably, closing
the loop on outstanding payments.
Currently, most data is managed
by Microsoft SQL Server 2000
providing market intelligence
reporting, trend mapping, margin
analysis and product review, but
Jenkins has other developments in his
sights.
We’re about to integrate Microsoft
Windows software into the scanning
guns and would like to make remote
working a reality for our sales team,”
she concluded.
Heller's Trish Jenkins
and Financial
Controller Michael
Wall - fresher food
background brief
From modest beginnings in 1985 trading
as Todd Heller Meats in Christchurch,
Heller Tasty has expanded to the point
where it employs more than 300 staff.
Heller Tasty can produce up to 240 tonnes
of products each week: 80 different types
of sausages and saveloys, along with
bacon, ham and deli goods.
The company’s disparate software system
and lack of inventory control risked
business expansion. By implementing
Microsoft Dynamics NAV (formerly
Microsoft Navision), Heller Tasty has
reduced stock wastage, cleared the
accounts ledger, improved cash flow
and can now use real time information to
realise the company’s potential.
Our Vision. Your Success
PAG E 21
Productivity puzzle? Where to find missing pieces
Finding ways to boost your workplace productivity can be fun
Productivity is often thought to be dry, boring, hard work
and above all ‘more work’.
Sometimes the temptation is to think about productivity
improvements as an ogre only concerned with getting
fewer people to run faster on a treadmill.
It simply doesn’t need to be like this. Productivity
programmes can even be fun and engaging for staff.
Proudfoot Consulting says sustainable productivity
is achieved when there is alignment between processes,
management operating systems and people’s behaviour.
“The training and development of people on revised
processes and newly installed management operating
systems is key to sustainable productivity improvements,” said
John Mullany, Proudfoot Project Manager.
The company emphasises transferring skills and knowledge
to staff. using various ‘tools’, one of the more innovative ones
being the ‘Proud Puzzle’ showcased recently in Auckland.
The Proud Puzzle communicates the importance of
key concepts connected to productivity including active
supervision, appropriate management operating systems,
PAGE 22
Proud Puzzle offers an engaging and often entertaining means for
organizations to achieve sustainable improvements in their productivity
- no excuse for your workplace not to get involved!
meeting effectiveness and lost time.
Its been used with CEOs, supervisors and staff of some of
New Zealand’s largest organisations to improve their productivity.
The puzzle sets participants the task of compiling a large
puzzle, firstly in sub-sections with the final assembly occurring
in one central location.
What appears at first to be simple turns out to be rather
complex.To meet the standard required, participating groups
have to work closely together.
Success on the first trial run of the puzzle is rarely achieved.
But once the barriers to meeting the required standards are
identified, groups determine what they should do differently
next time to succeed.
Time, cost, resource allocation, process improvement,
suitable skills allocation, work reallocation, supervision,
communication and motivation are amongst the issues
addressed.
Proudfoot have been using the puzzle for more than
40 years in various industry environments. Its power and
effectiveness are derived from the recognition that people
commit to learning when the goals and objectives they have
to achieve are considered realistic and important to them.
People want to be the origin of their own learning and
resist learning activities they believe are an attack on their
competence.
The puzzle interprets complex business issues in order to
accelerate their understanding, acceptance and action while
providing the necessary support for people to act differently
and for behavioural changes to stick.
The puzzle also teaches participants to identify areas where
behaviour slippage may occur and provides guidance and
training to avoid this.
Proudfoot has 20 years experience in New Zealand assisting
organisations with productivity initiatives to transform their
efficiency and profitability.
EMA Business Plus Magazine - Exclusive EMA news, advice, learning and networking
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How to create a great workplace
and retain staff!
Winners of the unlimited/JRA Best
Places to Work in New Zealand
Survey report a remarkable fact:
They have no trouble recruiting and
retaining staff.
This is amazing given the low
unemployment figures, global
competition for talent and tough
trading conditions out there.
The unlimited/JRA Best Places to
Work in New Zealand Survey is an
annual ranking of great workplaces as
measured by employees.
Since its inception six years ago,
participation in the survey has
risen from 7000 employees in 45
organisations to a staggering 23,400
employees in 197 organisations. This
clearly makes it the country’s largest
employee engagement study by far.
You may be asking yourself why
your organisation should enter.
To put it simply, it gives you the
information you need as a business
leader to improve the performance of
your people and your organisation.
Each year the unlimited/JRA
Best Places to Work Survey shows
that organisations rating as ‘great
workplaces’ outperform – often
dramatically – their competitors.
Research indicates that companies
with the best people management
practices can generate nearly twice as
much value to shareholders as their
average competitors, statistics hard to
ignore.
The unlimited/JRA Best Places
to Work Survey is a low-cost, highvalue employee survey. In addition
to finding out how your employees
view their workplace, many
companies also value the opportunity
to benchmark themselves against
other organisations.
Also, the kudos received from
being a winner or finalist is
PAGE 24
Outward Bound, overall winner of the unlimited/JRA Best Places to Work Survey 2005
Photograph courtesy of Robert Catto Photography
invaluable and can help to improve
staff retention and make it easier
to recruit new staff. After all,
doesn’t everyone want to work
in a nationally recognised great
workplace?
How do you find out what makes a
great workplace?
As a follow up to the survey, the
unlimited/JRA Best Places to Work
Seminar Series offers the opportunity
to hear first hand from winning
organisations. These one-day events
in Auckland and Wellington are based
on the leadership lessons that have
emerged over the past six years from
the survey.
The unlimited/JRA Best Places
to Work Seminar Series will allow
people leaders to meet key executives
from some of the winning companies
and learn from their success, discover
what makes a great place to work
from the survey itself, and hear from
some of New Zealand’s top people
leadership experts.
The survey has identified four key
characteristics of great workplaces
that will form the basis for the
seminars. Leaders from four of our
‘Top 25’ organisations will speak
EMA Business Plus Magazine - Exclusive EMA news, advice, learning and networking
on each of these topics, followed
by break-out sessions based on
the same four key characteristics.
These interactive sessions will give
attendees the opportunity to discuss
with a panel of three experts in very
practical terms how to develop these
characteristics in their own organisations.
The main focus of the seminars is
to ensure that when you leave you’ve
heard more than just an interesting
story.You’ll come away practical ideas
and strategies you can apply to your
own businesses.You’ll also have the
opportunity to mix with the ‘experts’
and get direct feedback on their own
problems and challenges.
If you’re a CEO, HR professional
or someone responsible for leading
a team of people, you can’t afford to
miss the opportunity of taking part
in the survey or attending a seminar.
To find out more information on the
survey or to pre-register for 2006, visit
www.bestplacestowork.co.nz.
Information and registration for the
seminar series can be found through
EMA online at www.ema.co.nz/
bestplacestowork.htm.
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