Starting up a new business can be daunting, especially when it comes to hiring staff.
It is not uncommon for a start up business to employ a friend or family member as their first employee. An employer needs to ensure that they provide a letter of offer to the employee for the position and an Employment Agreement for them to sign before they start work.
An offer of employment should not be taken lightly, as the employer is unable to change their mind once the offer is made. Best practice is to provide the prospective employee with the proposed Employment Agreement prior to the offer being made so any discussions and/or negotiations regarding the terms of the Employment Agreement can take place. In any event after the offer is accepted, the employer must provide to the prospective employee an Employment Agreement, which must be signed by the employee and employer prior to the start date.
An Individual Employment Agreement is a contract between the employer and the individual staff member. The Employment Agreement must:
- Be in writing and include the names of the employer and the employee.
- Describe the work that is expected to be undertaken by the employee.
- Record where the staff member is to work and their hours.
- Contain details of their remuneration.
- Advise where they are to go for help with any problems.
- Record payment details if they were to work on a public holiday.
- Clearly detail the length of their trial period (if any)
- Explain what is to happen to their employment if the employer is to be restructured or sold.
- State that personal grievances must be lodged within 90 days of an incident occurring.
An employer is obliged to tell their prospective employee that they can seek independent legal advice if they want to before signing an Agreement. They must also give them a reasonable amount of time to get advice.
If you require any advice or further information on the matters dealt with in this publication please contact the lawyer at Farry and Co. who normally advises you, or alternatively contact:
Steven Lee
slee@farry.co.nz
09 379 0055 or 03 477 8870
The information contained in this publication is intended as a guide only. It does not constitute legal advice and should not be relied upon as such. Professional advice should be sought before applying any of the information to particular circumstances. While every reasonable care has been taken in the preparation of this publication, Farry and Co. does not accept liability for any errors it may contain.