All in a Season's Work

Tuesday 8 October 2013

Authors: Marija Batistich and Anna Holland

First published in NZ Winegrower, October-November 2013 edition.

It is widely recognised that the wine industry depends heavily on employing seasonal workers. What may come as more of a surprise is that seasonal employment is not a recognised category of employment under the Employment Relations Act (ERA). This article clarifies the nature of seasonal employment, and sets out tips for employers.

What is seasonal employment?

Seasonal employment is not recognised by the ERA as a category of employment. Rather, seasonal employment is likely to fall within the legal category of fixed term employment or casual employment.

While it is important to have written agreements with all employees, identifying whether they are permanent, fixed term or casual, an employment relationship is defined by its "real nature", rather than the associated paperwork. This means that it is important to correctly categorise the true nature of employment at the outset, when hiring for the season.

Fixed term employment

Seasonal employment is fixed term employment if an individual's employment will end:

  • on the occurrence of a specified event (for example, the end of a season); or

  • at the conclusion of a specified project (for example, at the end of harvest).

Before entering into a fixed term employment, an employer is required to:

  • advise the employee when or how their employment will end, and the reason for it ending in that way; and

  • have genuine reasons based on reasonable grounds for specifying the employment of an employee is to end in that particular way.

A good example of a genuine reason for a fixed term employment relationship is where an employer takes on extra staff temporarily for the length of time it will take to harvest. On the other hand, employing an individual for the purpose of establishing their suitability for permanent employment is not a genuine reason for a fixed term employment relationship. (Put another way, fixed term employment cannot be used as a probationary period or "trial".) Where a fixed term employment agreement is not based on genuine reason, the employment relationship will be deemed permanent and any termination at the employer's initiative will be a dismissal, rather than the expiry of a fixed term.

An employer with good reason to employ on a fixed term basis should ensure that the employee's fixed term employment agreement clearly sets out the way in which the employment relationship will end, and the reasons for it ending in that way. Failure to do so will deem the employment relationship permanent.

An employee's fixed term employment can be renewed before its expiry date for another fixed term where there is genuine reason based on reasonable grounds to enter into another fixed term employment relationship. For example, an individual initially employed to harvest for the season may be offered another month's work to assist with processing. However, there is a limit to how frequently renewal may reasonably occur before an employment relationship becomes permanent.

Earlier this year the Employment Court ruled in the Talleys Group case that an employer who employed an employee on a fixed term basis to perform seasonal tasks, then seamlessly re-engaged the employee consistently over a long period of time to work on other seasonal tasks, did not have a genuine reason for fixed term employment. In that case, the employer was a seafood processor, and each "season" of work related to different processing work, according to catch variety. The Court held that the employee who had worked for Talleys more or less continuously for a number of years was in reality a permanent employee, and her employment relationship was of indefinite duration.

Casual employment

Casual employment is another legally recognised category of employment. The following characteristics are indicators of a genuine casual employment relationship:

  • employment is for short periods, for specific purposes, on an "as and when required" basis;

  • there is no regularity or continuity of work;

  • the employee is free to work for others;

  • the employer offers no guarantee of future work;

  • work is not allocated to the employee in advance (for example, by a roster);

  • either party can terminate the employment relationship "on the day" without providing notice of a minimum period to the other; and/or

  • there's no legitimate expectation of ongoing employment.

Each time a casual employee goes to work counts as a separate engagement with their employer. A casual employment relationship may change over time to become permanent in the event that engagements become regular or routine.

A casual employment agreement should set out clearly that the employee is employed as a casual employee on an irregular, intermittent basis, and that further employment is not guaranteed. Casual employees are entitled to annual leave, which is calculated at eight percent of their gross earnings and paid at the same time as their wage.


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.

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