Employment law at Alert Level 4: here we go again, but it’s different this time

30 August 2021

We have been in Alert Level 4 before, bu​​t many things have changed since the early days of 2020.

This time around:

  • We are dealing with the Delta variant of COVID-19, which raises different health and safety considerations.
  • Vaccinations have become increasingly available.
  • We have the benefit of several cases from the Employment Relations Authority and Employment Court which addressed different employer responses to the last Alert Level 4 period.
  • There are different forms of government support available.

This update provides answers to some “frequently asked questions" we have received from employers over the last two weeks, since New Zealand went back to Alert Level 4.

Can employers require their employees to be vaccinated?

Current employees – subject to the Vaccinations Order

Workers who carry out work that is subject to the COVID-19 Public Health Response (Vaccinations) Order 2021 (Vaccinations Order) are called Affected Persons. Employers of Affected Persons must ensure that Affected Persons obtain vaccinations by the dates specified in the Vaccinations Order, unless an exception or exemption applies.

The nature of the work that is the subject to this Vaccinations Order is listed in a Schedule to the Order, and relates to workers at managed quarantine or isolation facilities, at affected airports, at affected ports, air crew, and workers who handle certain items that pass through managed quarantine or isolation facilities, airports, or ports and have contact with workers at those places.

If Affected Persons fail to obtain vaccinations by the required dates, and no exception or exemption applies, their employer must not allow them to perform the relevant work from those dates.

Employers in that situation will need to undertake a fair process in good faith with those Affected Persons to determine why they have not been vaccinated, and, if an employee refuses to be vaccinated, whether they can be given alternative duties or redeployed to any work that is not covered by the Vaccinations Order.

Ultimately, if the employee still refuses to be vaccinated and cannot be given alternative duties or redeployed, then in our view it is likely to be fair and reasonable for the employer to terminate their employment. As with all terminations, the employer will need to conduct a fair process, consider the facts and circumstances before reaching that outcome, and comply with any relevant employment agreements or policies.

Current employees – not subject to the Vaccinations Order

It is much less clear cut, at this stage, whether employers can require their employees to be vaccinated for roles where their work is not covered by the Vaccinations Order.

At a high level, we consider that it is only likely to be lawful and reasonable for employers to require employees to be vaccinated to perform certain work:

  • If those employees perform work that could be fairly described as being “high risk" of either catching COVID-19 or transmitting COVID-19 (particularly to vulnerable co-workers such as the immune compromised, or vulnerable customers like those at aged-care facilities) and existing control measures are inadequate to minimise the risk sufficiently.
  • If the employer has conducted a thorough health and safety assessment with their workers and unions before introducing any such policy in relation to any positions, applying usual good faith consultation principles.
  • The employer has also fairly considered the timing of any such policy taking effect (given the status of New Zealand's vaccine roll-out) and any exceptions that may be applied (for example, where employees choose not to be vaccinated, whether for religious, health or other reasons).

Employers who are considering mandatory vaccination policies for specified roles should consult WorkSafe's guidance, and ensure that they are complying with all information privacy principles regarding both their consultation process and the implementation of such a policy. The Privacy Commissioner issues regular publications on these issues, which should also be taken into account.

We note that there are moves towards compulsory vaccination orders being issued in relation to certain worker groups overseas, beyond just border-related workers. In the UK, it will be compulsory for rest home or residential care workers to be vaccinated from November 2021 (with limited exemptions), and the UK government is considering whether to extend mandatory vaccination to NHS staff. In New South Wales, the state government has mandated that all healthcare employees must have their first dose of a vaccine by 30 September 2021, and be fully vaccinated or at least have their second vaccination booked by 30 November 2021. Any staff who cannot provide evidence to their employer that they have received their first dose by the September deadline must be excluded from the workplace.

Every employer's workforce will raise different considerations, and it is prudent to take specific advice on these issues. Overseas experience suggests that the conversation about compulsory vaccination here could shift towards a wider range of workplaces being justified in introducing a mandatory vaccination policy if the risk associated with COVID-19 increases. That may occur, for example, if the current outbreak is not brought under control through the current alert level settings and there is wider community spread. We also recommend that employers monitor government guidance and orders in this space.

Prospective employees

In principle, an employer can make a new employee's employment conditional upon that person providing the employer with evidence of their vaccination status (and appropriate maintenance of this over time). However, in our view, whether such a condition is lawful will still depend on the level of risk associated with the work to be performed by the employee.

This is because such a condition will require the employer to collect personal information from the prospective new employee about their vaccination status. Under the Privacy Act 2020, such collection can only be undertaken if (a) that collection is for a lawful purpose connected with a function or activity of the employer, and (b) that collection is necessary for that purpose.

As such, an employer seeking to impose that condition must still establish that there are health and safety reasons which make it necessary for it to collect information about a potential employee's vaccination status – and to form such a view, the employer should conduct a health and safety assessment with their workers and unions (as per WorkSafe's guidance noted above). Care will also need to be taken to ensure that the imposition of such a condition does not amount to unlawful discrimination.

If a person's vaccination status has little implication for their safety in performing their role (for example, because they work from home), then it is highly unlikely to be appropriate to impose a condition on prospective employees to be vaccinated, or to require it of current employees.

What can we learn from the cases arising from the last Alert Level 4 period?

Each of the cases relating to issues arising in the last Alert Level 4 period is very fact-specific to the particular response adopted by that employer. However, the cases give rise to some key principles:

  • Employment law principles continue to apply regardless of alert level – employment law is not suspended in lockdown.
  • If an employer wishes to restructure its business, it will still need to have a genuine commercial rationale and consult in good faith with employees before implementing any substantial changes or disestablishing any positions.
  • An employer needs to be very careful before it reduces or withholds employee pay, even if the employee is unable to perform their work at Alert Level 4. The risks associated with reducing employee pay will be reduced if the employer obtains employee consent through a fair consultation process first, or the relevant employment agreement provides for a reduction in pay in this type of situation. Given the uncertainty of the legal position, there will be legal risk in reducing employee pay without an employee's consent. The extent of that risk will depend on factors such as the terms of the relevant employment contract, and any consultation conducted by the employer before it introduces any reduction in pay.

What financial support is available for employers?

There are three different forms of government support available: the August 2021 wage subsidy; the short-term absence payment; and the leave support scheme. Further information about these schemes can be obtained here.

We recommend that employers carefully review the declarations associated with each form of government support before submitting an application. The eligibility criteria are strict, and there are a number of requirements imposed on employers who receive money from the government under these schemes. Employers should retain evidence to support their applications for any government support, as any support given can subsequently be audited by IRD.

If an employer is eligible for financial support, is the employer required to apply for it?

No. An employer is not required to apply for financial support from the government, and there may be many commercial reasons why an employer chooses not to.

If an employee or union requests that an employer consider obtaining financial support, the employer should however consider that request in good faith.

For further relevant reading please see our recent publications Australian case finds that mandatory flu vaccination policy for childcare workers was a "lawful and reasonable instruction" and COVID-19: The shift back to Alert Level 4.

If you have any questions about the matters raised in this article please get in touch with the contacts listed or your usual Bell Gully adviser. To receive all Bell Gully's updates on COVID-19 you can subscribe here.

Disclaimer: This publication is necessarily brief and general in nature. You should seek professional advice before taking any action in relation to the matters dealt with in this publication.