NZ employers are required to have signed employment agreements for their employees. Getting them signed is the key.
Most NZ employers are aware that it has been a requirement for some time to have signed employment agreements for their employees. But without any significant penalties it has been relatively easy to get by without them. 13 years on from the introduction of the Employment Relations Act this is a short-cut some employers still take.
Fewer employers seem aware that in 2011 a penalty was introduced that could result in a $20,000 fine if they cannot produce signed employment agreements for all employees, no matter when they started. But this is not surprising as the penalty had not been used until recently.
In the past 3 months an Indian Restaurant chain was fined $300,000 ($20,000 for each of its 15 restaurants), then 4 Marlborough vineyards were fined, all for failing to produce signed employment agreements when requested to do so by the Ministry of Business Innovation and Employment.
I am sure we can expect more fines, but there is absolutely no reason why any employer, of any size, anywhere in NZ should not have all their employees on signed agreements. It is such a simple process and has been made much easier by technology.
In the 13 years since the introduction of the Employment Relations Act the scale and pace of tech developments has been astounding and rapid. In amongst this development has come the creation of online signature technology, which was followed by legislation to accommodate electronic transactions, including signing documents online.
Both the technology and its supporting law have been around for some years. Yet over this time very little has been done to make use of this technology in the employment relationship.
Use of online signature technology speeds up the process at all stages, it makes things easier, it saves money and (I argue) is more secure and robust than the old-school paper based process.
- The employer reviews and signs the agreement online;
- It is auto-emailed to the employee with instructions;
- The employee reviews and signs the agreement online;
- It is auto-emailed to the employee as a pdf, with both signatures;
- It is auto-uploaded to the employer’s online account and stored inside the newly created file for that employee.
- Throughout the process alerts keep everything ticking along, such as: alerts if the employee refuses to sign or reminders to the employer as day one approaches.
This simple process is underpinned by security and technology that ensures the transaction steps are traceable and secure:
- All signatures are tagged with a security code, which is linked to the IP addresses of the respective parties and the time they signed the agreement.
- The employee can only access the document via a personalised link and by entering a unique code, sent to their personal email.
- Once complete, each page of the document is marked with a unique identifier creating a closed, un-editable “envelope” which defines the formal agreement reached between both parties.
Easy and secure. Employment is established on a solid foundation. All parties are clear on the terms and obligations and they’re ready for a productive, successful relationship.
Not to mention the immediate elimination of the risk of a $20,000 fine.
As a result of a partnership between MYHR and US software developer DocuSign, this technology is currently being actively used by 70 NZ employers, who collectively employ over 500 kiwis. It can be viewed and trialled at www.myhr.co.nz