Human Resources Archives - BDS Chartered Accountants

The government has announced an increase to the minimum wage that will kick in from April 1. The adult minimum wage will rise by $0.45 an hour, taking it up to $23.15 an hour. This will mean additional costs for many businesses.

Workplace Relations and Safety Minister Brooke van Velden said that “a cautious approach to the minimum wage is required this year” giving “our lowest paid workers more money in their pockets, without hindering job growth or imposing unreasonable costs on businesses”.

If your business has minimum wage employees:
talk to your payroll people to ensure wage changes have been made
adjust your budgets for the year
consider the impact on the rest of your financial plans
check whether existing employment agreements provide for overtime or allowances. If they do, consider the impact of the wage increases.

Give us a call if you’re unsure how to plan for the minimum wage adjustment.

Everyone is talking about the artificial intelligence chatbot ChatGPT, a new tool that can do just about anything, from generating letter templates to answering questions.

ChatGPT is a fantastic free tool for any business. Here are some ways it can help you — and what you shouldn’t do with it.

DO

Use it to check your emails and letters: Ready to send an important email to a new client or business partner? Use ChatGPT to create a draft template and check your finished content for spelling errors. Ask the chatbot to edit your email and find any mistakes.

Use it as a research tool: ChatGPT is the most powerful artificial brain the world has ever seen, so use it to your advantage by asking it questions. The chatbot should be able to help you with research in any field — just remember to double-check information as it can get things wrong.

Use it for brainstorming: AI is great at coming up with ideas (though not all of them are good!). If you’re struggling for inspiration for a new business venture, product or service, ask ChatGPT to come up with some suggestions. It should help get the ideas flowing.

DON’T

Rely on it completely: ChatGPT is an amazing technology, but it’s not flaw-proof. The AI can still get confused and provide false information. Don’t rely blindly on information from ChatGPT for your client or staff emails. Fact-check everything.

Don’t plagiarise: Don’t lose your brand voice and personal touch by copying and pasting content from ChatGPT. Also, remember that your competitors will have access to the same tool.

Don’t share sensitive information: Concerns have already been raised about potential copyright issues and how ChatGPT uses information. You shouldn’t share sensitive business information, personal data or confidential information with the chatbot.

It’s always a good idea to give new technology a try. Experiment with ChatGPT to see if it can help your business.

Do you employ migrant workers? You need to be aware of the Worker Protection (Migrant and Other Employees) Act, which comes into force on January 6.

The law, which amends the Immigration Act 2009, Employment Relations Act 2000 and Companies Act, will introduce a tough penalty regime to deter the exploitation of migrant staff.

What you need to know

Under the law, employers must comply with requests from the Labour Inspectorate within 10 working days, including providing any employment-related documents.
Employers that fail to meet the 10-day deadline can be hit with an infringement notice, so be mindful of the changes.
The new law grants the High Court powers to disqualify a person from being a New Zealand company director if they are convicted of exploitation of unlawful employees and temporary workers under the Immigration Act.

If you employ migrant workers, be aware of the forthcoming changes and ensure your paperwork, including HR documentation, is easily accessible and in good order.

Give us a call if you think the new law could affect your business.

Studies show that diversity and inclusion in the workplace can lead to better business results. Here are five ways to enhance diversity in your organisation:

Cultivate an inclusive culture
Employees should be encouraged to share ideas without fear of judgement. Create an open environment that celebrates different perspectives and backgrounds.
Diverse recruitment strategies
Introduce diverse recruitment strategies and host career events targeted at under-represented communities. Embrace blind candidate screening to eliminate unconscious biases.
An inclusive leadership approach
Diverse leaders bring varied experiences and viewpoints to the table, inspiring employees and signalling a commitment to inclusivity.
Encourage employee resource groups
Employee resource groups (ERGs) are internal committees of workers with shared identities, often minority or under-represented groups. Support the formation of ERGs and consult them on key employment decisions.
Continuous education
Embrace ongoing diversity training for employees to raise awareness of unconscious biases, and encourage open conversations. A well-informed workplace should result in a more empathetic, understanding, and happier environment.

Pre-Covid, we never would’ve imagined working from home could be so welcomed and productive. The pandemic has pushed many companies to make the long-needed leap into the digital world, and as a result, remote working offers a lifestyle like never before.

Now, your team can ditch the commute, gain more flexibility for family life, and avoid the distraction of a busy workplace. The changes, however, have thrown up some fresh questions regarding accounting, culture, and connectivity.

Who pays home office expenses?

If staff are using their own telecommunications tools and/or usage plans for work purposes, even if they’re not required to work from home, you need to reimburse them. The tax-exempt amount of the reimbursement is calculated in proportion to how much of the usage is work-related.
If you provide staff with a work phone or device, it’s up to you to cover the usage costs
Say an employee needs personal home office furniture or equipment and pays for it themselves. You can choose to reimburse them by using:
1. the safe harbour option, where reimbursements of up to $400 can be treated as exempt income for furniture and other equipment. Find out more.
2. the reimbursement option, which requires you to identify the cost of the asset and work out whether it’s being used principally for employment or private purposes.

How do I know my staff are working effectively?

The swift move towards remote working has left many businesses without a culture to match the new work practices. Create policies that directly address new challenges posed by remote work to help your company culture carry over into the digital world and provide employees with much-needed guidance. Consider adopting regular informal one-on-one check-ins rather than time consuming annual performance reviews. You will enable your team to be more transparent about how they’re feeling, address any concerns, and stay on track to reach their goals.

How do we retain a feeling of team connectivity?

From virtual yoga to online clubs and cooking classes, 2022 will see more teams building their culture online. Friday drinks can be conducted via Zoom and group trivia sessions can create a feeling of fun and camaraderie.

While some staff will be enjoying the convenience and sense of freedom that comes from flexible working, be mindful others might be experiencing stress, feel overwhelmed, or isolated while navigating the new way of working.

A how to guide:

Getting the staff you need over the silly season during a global pandemic is tough. If you’ve tried Seek, Careers, and Trademe with no luck, maybe it’s time to think creatively. And remember, while our unemployment rate is low, there are always going to be part-time workers looking for more hours or full-timers looking for a change.

Here are six fresh ways to find new staff:

Ask friends and whanau. Advertise to your tribe first — whether it’s via social media, email, or newsletter. Your friends, family, and customer base are already engaged with your business so they might want to work with you or know someone who does.
Promote from within. Have you considered whether one
of your current staff members could fill the vacancy? Internal promotions are a great way to reward performance and create career paths that bolster employee engagement. Remember to go through the same recruitment process as you would with an external candidate to ensure they’re the right fit.
Use Student Job Search. Did you know there are more than 40,000 students nationwide looking for work? Most have finished their exams and are seeking temporary or permanent employment. Search Student Job Search.
Jump on social. Since most people use at least one social media platform, it makes sense to leverage these channels to attract and hire new job candidates. LinkedIn is the most popular, but Facebook also has an effective platform for promoting new roles. Make sure your own business Facebook page has relevant, up-to-date content to give potential candidates a true insight into your culture.
Facebook groups. Are you a member of your local community Facebook noticeboard? Search for it and post your job advert there. It’s a great way to spread the word because people can tag friends or family who may be interested in the role.
Widen the net. The New Kiwis website links skilled migrants living in New Zealand with employers, and Work & Income New Zealand has a free phone service for recruitment, call 0800 778 008.

Sick leave entitlement changes

The recent passing of the Holidays (Increasing Sick Leave) Amendment Act increased the employee sick leave entitlement from 5 to 10 days per year. The change comes into effect on 24 July 2021. The day in which the employee’s sick leave increases is based on their next entitlement date and not automatically from 24 July.

Median wage increase

The median wage increased from $25.50 to $27 gross per hour from 19 July 2021. This has implications for employers who may be intending to employ staff on an essential skills visa or residence visa

Covid-19 travel policy

The current pause in the trans-Tasman bubble and Wellington’s recent alert level change serves as a timely reminder that businesses need to plan for on-going travel uncertainty. Make sure you have an updated travel policy in place that covers what to do when an employee’s work or personal trip is extended, and the steps that employees should take when travelling in the bubble.

Covid-19 vaccinations and employees

As the vaccination programme rolls out across New Zealand, you might be wondering what your obligations are as an employer. Make sure you are clear on what you can and cannot do when it comes to Covid-19 vaccinations and your workers. Employment New Zealand has released some guidelines to help employers understand their role in the vaccination process. The guidelines can be found on their website together with a one-page PDF for your workplace.

With the introduction of the 39% tax rate for individuals from 1 April 2021, the Inland Revenue is increasing the information it collects from trusts to assess compliance with the new tax rate and to monitor how trusts are being used.

Trust disclosure obligations

The additional information that needs to be included in a trust’s tax return (from the 2022 tax year) includes:

name, IRD number and date of birth of beneficiaries, settlors and those with power of appointment and removal of trustees
financial statements
details of settlements
details of distributions to beneficiaries

Non-active trusts, charitable trusts, Maori authority trusts, and New Zealand trustees of foreign trusts do not need to provide this additional information.

Increased disclosure obligations to beneficiaries

In addition to the above, from January 2021, trustees need to disclose the following trust information to all beneficiaries, including parents/guardians where the beneficiary is under 18:

that they are a beneficiary
name and contact details of all trustees
that they can request a copy of the trust deed and the financial statements

Trustees can choose not to provide requested information to beneficiaries provided the request has been reasonably considered. The beneficiary does not need to be told the reason for not providing the information.

Change to definition of settlor

There has also been a change to the definition of a settlor. A beneficiary with a current account greater than $25,000 will now be deemed to be a settlor if a market interest rate or Inland Revenue’s prescribed interest rate is not charged. This can have implications for the beneficiary such as student loan repayments and social assistance.

Since the 2012 income year the depreciation rate for commercial and industrial buildings had been reduced to 0%. Following the Government’s raft of Covid-19 support measures, depreciation can now be claimed on commercial and industrial buildings from the beginning of the 2021 income year. The reinstatement will mean commercial and industrial buildings are now depreciated at 2% diminishing value or 1.5% straight-line. Residential buildings continue to have a 0% depreciation rate.

If you had previously depreciated your commercial or industrial building prior to the 2012 income year, you must continue to depreciate the building from the 2021 income year. Alternatively, if you own a commercial or industrial building that you held prior to the 2012 income year and you had previously elected not to depreciate, you must continue not to depreciate.

Make a list of seven key clients or customers to call for feedback.

Decide who is going to make the calls or split them between two staff members. Email in advance explaining how committed you are to improving your customer service and experience, that you value their constructive feedback, and would like to interview them via phone or Zoom. Each call should take 10-15 minutes and be focused on their experience with your business.

Prepare questions.

Don’t be afraid to have deep discussions with your clients – ask open-ended questions such as: “What do we do well? What do you like about working with us/using our service or product?” and “How do you think we could improve?” Take notes during the call or do a Zoom and record it.

Be open with your interviewees.

Reiterate that you’re having the conversation because you want to learn. Tell them that anything they can offer will
help your business so there’s no need to spare your feelings! Remember, any improvements you make to your business based on their feedback is a win for them too. Find the themes.

Once you have all the feedback in front of you, segment it by theme ie: customer service, processes, or marketing.

Engage your team.

Now it’s time to let your management team walk in your clients’ shoes. Schedule a meeting to discuss the feedback themes. Don’t make any decisions at this point, just let everyone digest and discuss.

Wait.

It’s easy to jump into action but everyone needs time to sit with the feedback. Organise a meeting a week later to look more closely to identify worthwhile changes, then make an action plan.

Embrace the gift of knowledge.

Most of the feedback will be positive and open you up to learning, growing, and tweaking your business for the better. It can be hard to hear constructive criticism but once you reflect on it, you’ll realise how powerful it is for change.

Did you know customer retention is faster and, on average, costs up to seven times less than customer acquisition? If you’re looking to improve your bottom line by turning your current customers into lifetime customers, here’s the best way to communicate with them.

Communicate kindly
Customer service is key, whether it’s in-person, on the phone, or via email, it’s what everyone remembers. Mistakes and delays are inevitable in business, but people are happier to ride those waves with you if you communicate in a kind and friendly manner. It’s not the mistakes that lose clients, it’s the lack of communication around it. If you’re not responsive, they think you don’t care. If they think you don’t care, they are more likely to look for a new company.

Communicate early
Put yourself in your client’s shoes – if something doesn’t turn up on time, you’re left wondering, right? Communicate early if there is going to be a delay or problem they need to be aware of. People are really understanding if you say something early, rather than leave it until later when it affects their day negatively. Plus, speaking up early about a problem or issue will build trust.

Communicate when necessary
You often hear ‘regular communication is best’, but what if you’ve got nothing to say? Concentrate on creating great e-newsletter content so they’re more likely to welcome the next one. Sending irrelevant, untimely, or lacklustre messages won’t improve your relationship. Understand when people need your services and communicate to them then. Trying to pressure them through too many emails or calls won’t end well.

Communicate cleverly
If your potential client or customer has requested a quote, you know they’re going to read that email so throw in something small at the bottom of it that communicates your message. Or how about putting a joke or inspired one-liner underneath your email signature to brighten someone’s day?

Now’s the time to let staff know applying for paid parental leave just got easier. As of March 2021, your staff can apply for paid parental leave via myIR on the Inland Revenue website. The site can now pre-populate information it already holds for customers, such as contact details, name of employer(s), and an estimate of average weekly income for employees, making the process much quicker.

Do you have staff taking leave over Christmas? Are systems in place to make sure everyone gets what they’re entitled to? Even if someone else handles your payroll, you are responsible for making sure holiday pay and leave payments are handled correctly.

Remember:

Whether your staff work full-time, part-time, casual, on-call, or shift work, they’re entitled to any benefits that come from working on public holidays.
If your employee agrees to work on a public holiday that falls on a day they would normally work, they will need to be paid time and a half PLUS receive another paid day off later, otherwise known as a day in lieu. If an employee works on a public holiday, and it is not a day they would usually work, the employee is only entitled to the time and a half. The entitlement to time and a half has to be included in employment agreements.
Employees can choose to take their day in lieu:
- on a mutually agreeable date that is not a public holiday
- on another day on which they would normally be working
- for a whole working day, regardless of how much of the public holiday they actually worked.
If your business is having a closedown period, employees are entitled to a paid public holiday if they would ordinarily work on the day of the public holiday.
Make sure your payroll system:
- is flexible enough to handle different working arrangements (eg, changing employee work schedules)
- records all relevant time worked and payments made
- has accurate and up-to-date information.
If you realise an employee hasn’t been paid the right amount, be up front and correct the mistake immediately.

On average, Kiwi women earn 9.2% less than men

While the gender pay gap is smaller than a decade ago, a collection of top New Zealand business people are working hard to reduce it further. CEOs and Chairs from companies such as IBM, Saatchi and Saatchi, PwC and Vector have joined Champions for Change. Together, they’re advocating for greater inclusion and diversity within their own organisation, sector, and the wider public arena. Why? Because creating gender balanced workplaces is not only the right thing to do, it’s the smart thing to do.

What are the business benefits of closing the pay gap?

Good for your bottom line. Research shows the most gender-diverse companies are 21% more likely to experience above-average profitability.
Good for your brand. People will be attracted to buy from you and work for you, if you’re committed to equal pay and a diverse and inclusive workplace.
Great for brain power. A gender balance ensures multiple perspectives, which sparks creativity and innovation.
Great for sales. A diverse workforce better represents your customers, which means you’ll communicate with them more effectively.

So, does your business have a gender pay gap?

Look at your people data: how many men and women work for you? Are there more men at senior levels or in roles that lead to senior positions? What’s the difference in pay between all men and all women? Once you know where your problems lie, you can start fixing them.

Four smart ways to address the pay gap

Lead from the top: Everything you say, do, measure, and prioritise impacts your business’s culture. Treat gender diversity as a business priority. Help build a respectful, accepting workplace where everyone feels safe and supported.
Make a plan to make a difference: Carry out a pay equity audit, set yourself a target, then put aside money to review and address the issues. Look at all levels of your business, from the way you advertise jobs to professional development opportunities.
Be aware of bias: Around 80% of the gender pay gap is driven by hard-to–measure factors, including bias, which often creep in when making recruitment, performance and pay decisions. Make decisions based on transparent, performance-related criteria, have group sign off, and use gender-neutral language in job descriptions.
Get flexible: Tap into a bigger talent pool by showing you support employees on, and returning from parental leave. Consider ways people can work from home, condensed hours, flexi-time and job share.

‘For me, unconscious bias is the main challenge – addressing it starts with looking in the mirror and realising that you have it whether you are aware of it or not.’
Simon Mackenzie, CEO of Vector.

How well are your staff performing? Do they love their job? Performance reviews, an open two-way conversation held once or twice a year, are a great way to find out. While you’re not legally bound to do appraisals, they’re a great tool to keep your business running smoothly.

Open communication lines early
Whether you have five or 50 staff, communication is key when it comes to performance reviews. Let your staff know early (ideally during induction) what goals and objectives they need to meet and give them a chance to voice their ideas. By reviewing and updating these at each review, it will be easier to explain why they’ve received a less-than-perfect appraisal if their performance wanes.
Address challenges ASAP
If an employee is under-performing, there are a range of things you can do to help. Just make sure you do it sooner rather than later. Try observing them and gently offering constructive advice to help them do their job better. You could offer extra training to improve their skills if necessary. Consider any challenges they’re facing outside of work – flexible working conditions may be a positive solution for both of you.
Preparation is key
Give your employee at least a couple of weeks’ notice so you both have time to prepare for the appraisal. Look at your employee’s job description, notes from previous reviews and performance indicators in advance. Send your staff member a list of questions to review ahead of time, in relation to areas such as job satisfaction, responsibilities, and work/life balance. If your employee is a star-player, get feedback from other employees or key customers to support that view.
Keep it formal but friendly
A performance appraisal isn’t Dragons’ Den or a casual chat over coffee, it’s somewhere in between. It’s a chance for both of you to honestly discuss the role, whether goals have been met, what’s good or bad about the job, and if their pay will increase and why or why not.
Write everything down
Take notes at each review and share a written summary with your employee afterwards to ensure you agree it’s a true reflection of what was discussed. This is key if a staff member isn’t performing because if you have to let them go, you’ll have proof of warnings and the steps you took to try to help them improve their work.
Book in regular catch ups
Keep employees engaged and avoid potential issues by setting up informal chats once or twice a month. You don’t have to wait for the full performance review to give staff feedback or get feedback from them.

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