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Issue 113 – April 2014
$6.30
Publicatio n o f t h e E m p l o y e r s & M a n u f a c t u r e r s A s s o c i a t i o n Inc
Brendan Lindsay opens up with the Sistema story
The cost of a personal grievance!
Our annual report on the ERA
In this issue: • • • •
Learning the FISH! approach To Board or not to Board Online retailers get physical Bullying: What you need to do
Beanie excitement!
How do you see your staff?
If your “human resources” are hardworking people who give their time and effort to make your company what it is, offering Southern Cross health insurance is the perfect way to reward them. But they’re not the only ones that benefit. Offering health insurance helps retain and maintain a productive workforce. Find out how some of New Zealand’s leading businesses see their staff at www.healthybusiness.co.nz
BusinessPlus is published by : The Employers and Manufacturers Association (Northern) Inc
CONTENTS Advocacy 04 Trade agreement update
159 Khyber Pass Rd, Grafton, Private Bag 92066, Victoria Street West, Auckland 1142 Ph: 09 367 0909 or 0800 800 362 Email: ema@ema.co.nz Website: www.ema.co.nz
05 Dealing with higher interest rates
Chief Executive: Kim Campbell Manager, Advocacy & Govt Relations: David Lowe Manager EMA Learning: David Foley Manager, Strategy & Enterprise: Mauro Barsi
06 Obituary: Jack Christie,
14
IN THE LOBBY: Local councils impact on business
news Murray Rae
06 “Why I joined the EMA” 07 Dr Hamel will tell you what really, really matters
Waikato Denis Quigan 07 823 9311 Russell Drake 07 838 0018
mob 027 203 0694 mob 021 686 621
Bay of Plenty Terry Arnold 07 575 8401
mob 021 662 656
16
16 Beanie excitement! Tax Tips
21
16 Full tilt at Southern Spars
Rotorua / Taupo / South Waikato / Whakatane Clive Thomson 07 348 0334 mob 0274 372 808
BusinessPlus Editor Gilbert Peterson Ph: 09 367 0916 gilbert.peterson@ema.co.nz
20 EXPORT: Letter from Australia: Online retailers get physical
21
EXPORT: Horsing around at ExportNZ Bay of Plenty
features 22 profile: Sistema Plastics, Champion of New Zealand made
Writer Mary MacKinven mary.mackinven@ema.co.nz
24 members noticeboard:
Designer Ripeka Mikaere
advice
Advertising Sales Colin Gestro (09) 475 9313 colin@affinityads.com ISSN No. 1176-4953
24
Golden news for cheese maker
25
08 Personal grievances: Condition stable but still serious
10
Bullying in the workplace: what you need to do
12
EMPLOYMENT CHAT: Can I ask for
Out & About
staff to shorten their holidays? And we’re terrified of the new OH&S law!
LEARNING 19
To Board or not to Board… Pt III of Why you need a board
BusinessPlus news
|
advice
|
learning
networking
Issue 113 – April 2014
$6.30
Publication of the Employers & Manufacturers Association Inc
1
designs itself
“Finding the right people is everything. You can have as many robots as you like but it’s people who drive the business and drive you” – The Sistema Profile is on page 22.
|
Inspiratio
Brendan Lindsay opens up with the Sistema story
25 Fish! culture. The programme
On the cover...
27 28
The cost of a personal grievance!
4
Our annual report on the ERA
Beanie excitement!
In this issue: • • • •
Learning the FISH! approach To Board or not to Board Online retailers get physical Bullying: What you need to do
8
ADVOCACY at work
Trade agreement update New Zealand’s lead negotiator on the Trans Pacific Partnership Free Trade Agreement (TPP), David Walker, discussed progress at a recent EMA Trade and Foreign Policy Committee meeting. The latest round of TPP negotiations concluded last month. Walker is well known to committee members having met with EMA on numerous occasions. He values the comments he hears from us to take forward into the negotiations. Walker said the aim was to try and complete the TPP in the next few months following a key meeting in April when US President Obama is scheduled to travel to Japan.
Schools can apply for Gateway funding to help senior secondary students (Year 11 to Year 13+) undertake structured workplace learning across a range of industries and businesses while continuing to study at school. Manufacturers tour university facilities
Members of EMA’s Manufacturers Forum toured laboratories at the University of Auckland’s Engineering School last month to become better informed about the research and development facilities available to business. The networking session with university staff following was also worthwhile and much appreciated! Electricity ignites business attention
The management of the supply and EMA’s Employer Forum heard cost of electricity was the topic for from and questioned the Minister EMA’s latest Energy and Environment of Education, Hekia Parata, whose Committee meeting. portfolio covers young people till the Chief executive of the Electricity age of 18 years. Authority, Carl Hansen, presented on She described the Authority’s progress with improving NCEA (national the market for electricity competition qualifications with an overview of the market’s rules framework) (the Electricity Industry Participation and National Code), and how the Code is being Standards core enforced, among related issues. data which showed schools On your behalf… areas where they EMA advised government that the needed to direct government procurers of property Hekia Parata their attention. services (eg, cleaning) ought not to She said the Trades Academies require the provider to belong to the programme and the Gateways NZ Building Service Contractors Association. Instead, the provider could workplace learning programme were motivating students by allowing them be required to comply with minimum to do what they loved. employment standards. Trade Academies are based on Our submission on Principles for the partnerships between schools, Property Services Industry was made tertiary institutions, industry training to the Employment Standards Policy, organisations and employers. Students Labour and Commercial Environment in years 11 to 13 (final three years of team at the Ministry of Business, school) can combine school study with Innovation and Employment. study at a nearby academy in trades and We also lodged a submission with the technology to go towards their National Auckland Council on its Draft Annual Certificate of Educational Achievement Plan for 2014-15. (NCEA) and a nationally transferable Our concerns with Auckland tertiary qualification. Council on behalf of business cover 14
“Our concerns with Auckland Council cover 14 areas... transport, integration of council plans, rates, the Uniform Annual General Charge, the business rate differential, debt and PPP’s as ‘revenue sources’” areas including transport, integration of council plans, improving council’s engagement with business, accuracy of population projections, rates’ levels including the use of the Uniform Annual General Charge, the business rate differential, and the use of debt and Public Private Partnerships as ‘revenue sources’.
School-business interface
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Public commentary
In media commentary EMA said changes to the occupational health and safety (OH&S) regime being introduced were a paradigm shift from the existing legislation. In general we support the general thrust of the proposed new law but there is devil in the detail. Missing from the discussion are ways to move a company culture so health and safety practices become more inclusive of all employees including middle and senior managers. Business wants WorkSafe NZ to become a modern, mentoring regulator that is well equipped, skilled and pragmatic, and understands business and with good communication skills. OCR
We also said this was not the time to raise the Official Cash Rate. (See facing page) EMA’s chief executive Kim Campbell said despite the trading banks’ best efforts to talk interest rates up, the fundamentals for New Zealand do not require it with the world’s banking system awash with money. EMA was quoted in the media on a range of other topics as well at the request of reporters.
ADVOCACY By Kim Campbell,
Dealing with higher interest rates Many businesses think the raising of the Official Cash Rate by the Reserve Bank was precipitate, what with inflation currently running below the midpoint of the RB target of one to three per cent. (First published in the NZ Herald, 18/3/2014) After all the exchange rate is running well above the 10 year averages against our trading partners Australia and the US, which means the prices of many durable goods like cars and appliances are falling. House prices in Auckland have flattened off, and no longer a source of inflation. The power companies though promising no increases for the next three years are now reneging with small increases. There is still a lot productive capacity available in the economy, especially from imports and despite projected skills shortages and the wage pressures resulting from them. Furthermore, we are told, monetary policy is targeted at influencing behaviour a year or so down the track, with today’s headline inflation rate having only a minor bearing on how the Bank sees things over the medium term. But the current rise in interest rates will curb spending power almost right away since most mortgages these days are either floating or due to come off fixed rates due to expire this year. Clearly the Reserve Bank can see trends emerging not visible to the rest of us. Or they could be responding to an expectation that the US, Europe and Japan will shortly stop printing their vast swathes of money. The practice has helped keep the world awash with money and the cost of borrowing it far from ‘normal.’ Its an open question when the money printing will stop. Who knows when it will end? Nevertheless the Reserve Bank must act on the hard information it has before it, which is record terms of trade, the rebuild of Christchurch (though vital for
New Zealand this is hardly an overwhelming inflationary force on the country as a whole.) The Bank may also see capacity constraints looming, upward price pressures resulting from the rapid rise in net migration, high rural land values reflecting our high terms of trade, and rising labour costs. Whether realistic or not, like the Bank, businesses must deal with the hand being played: a higher cost of borrowing with the expectation of higher costs to come, and lower returns from export receipts as the exchange rate remains high. Business expectations and confidence will take a hit. The right reaction to the Banks’ move is to call for the government to recognise it needs to contribute to controlling inflation through its fiscal policies. Monetary policy is not the only route to reducing inflation. The government knows if it wants the economy to keep growing it needs interest rates to be competitive, not leading the OECD. The government knows its fiscal and regulatory policies can have a profound effect on inflation – by better managing the ‘supply side’. Business knows they know it. We need in a word, to keep the reform process going forward at pace. So here’s some thoughts to help. 1. Though we have made some gains recently we still have an appalling savings record. More work is needed to encourage personal savings while maintaining disposable income. Cutting taxes could assist with this if, for example, some tax was diverted into savings. Any
tax shortfall could be made up as the recovery continues and the economy grows. Is it time for Kiwi Saver to be made compulsory? 2. More work is needed to reduce friction in the energy market. 3. We need to increase our national and business investment in innovation to boost productivity and investment in productive enterprise. In particular the building industry is crying out for more innovation. 4. More local government reform is required to help with things like the approving of building consents, along with opportunities for local government amalgamation 5. Business wants more labour market reform to eliminate industry specific labour bottlenecks.
“Monetary policy is targeted at influencing behaviour a year or so down the track... but the current rise in interest rates will curb spending power almost right away” The time is 23 years overdue for serious work on coordinating monetary and fiscal policy. The idea that monetary policy needs mates dates back at least to 1991. But nothing much seems to become fixed in place to build this much needed relationship. Leadership is required, so who is up for the job? • kim.campbell@ema.co.nz BusinessPlus
5
NEWS
Obituary Jack Christie MBE, FNZIM (RNZAF Flt Lt) Jack Christie was a life member of the Employers and Manufacturers Association and chairman and president of 30 companies, industry associations, industry training, community, sporting and cultural organisations. He died on March 4th in Auckland in his 90th year. Amongst the organisations he served were: • President of the NZ Electronic Manufacturers Association • President of the NZ International Grand Prix Association • Chairman of the NZ Manufacturers Federation Employment, Education and Training Committee • President of the Auckland Chamber of Commerce (international Section) • Chairman of Ulrich Aluminium Ltd for 15 years After the war Jack started the Atomic Radio Shop in Karangahape Rd selling and repairing radio equipment, then became a partner in Airco which among other things imported Vespa motor scooters. Subsequently he became in 1960 General Manager of the Television Installation and Service Company (TISCO) which
Why I joined the EMA Back in 1999 I took the huge step of forming my own company, a business focusing on utility contract negotiation for commercial clients. I drew on my knowledge of power generation equipment and my background in the gas industry. Like many start-up businesses, Total Utilities began as a one-man band. I worked from home and looked after everything from sales to tendering, invoicing and debt collection. Fifteen years later Total Utilities is a thriving practice working across New Zealand and Australia, and we contend with all the usual compliance issues that impact on every business. As a result of our growth, we joined the EMA in 2009. At the time, the biggest single reason was the Advice Line service. While our management team is capable and experienced in the specific services we provide to our
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BusinessPlus
grew to 26 branches employing 550 staff. As President of the Auckland Employers Association from 1985 to 1987 Jack was an early strong advocate for building employment relations based on individual enterprises, not collective agreements.
Obituary Murray Rae Murray was President of the Auckland Manufacturers Association from 1993 to 1995 and a life member and former President of the NZ Textile and Garment Manufacturers Association and chairman of the association’s Export Trade Group. He died in Auckland on March 28th. Murray was for 33 years a chartered accountant, and for many years Operations Manager for Bendon Ltd. His representations on behalf of NZ’s apparel manufacturers included memorable fashion parades, other fashion celebrations and forthright advice to government. On his retirement Murray owned Waste Food Distribution Ltd and, returning to his roots in the far north, for the last 10 years he operated a charter fishing business out of Houhora. In 2013 Murray was elected a Member of Far North District Council’s Te Hiku Community Board. Murray was 76.
By Richard Gardiner, MD Total Utilities Management Group
customers, we do not have the inhouse resources to keep fully up-todate with legislative changes in areas ranging from employment legislation to tax. As the business has developed, we have relied heavily on EMA’s Advice Line to keep us on the legal and procedural ‘straight and narrow’. The range and depth of information provided in the various EMA publications is also of considerable benefit. We know where to look for topical, accurate updates. The information is invaluable. The EMA employer briefings are another useful feature. I go to them periodically and aside from the updates on business issues, it is good to gain a wider perspective by discussing business challenges and successes with my peers. Given that our company operates
in the energy sector, which is high profile and politically charged, the role of the EMA in communicating the facts to the business community is much appreciated. Our industry has been a political football for the past 20 years or so and the ill-conceived policies mooted in some quarters need to be countered by an objective presentation of the facts. This is a key strength of the EMA. So, why become a member of the EMA? Free legal advice, quarterly briefings, national wage and salary information, employment law guidance, business training. Simply put - EMA provides the support that helps businesses grow.
NEWS
Dr Hamel will tell you what really, really matters Attention is certainly commanded when a management expert says in the media ‘let’s fire all the managers’, and ‘managers have dirty little secrets’. The bloke who had the temerity to say these things – Dr Gary Hamel from the USA - is presenting his latest management thinking in an exclusive Auckland event next month. EMA is proud to be a partner for this event and making him available to EMA members. Hamel is regarded as one of the world’s most influential and iconoclastic business gurus. The Financial Times of England has described him as “a management innovator without peer” and The Economist calls him “The world’s reigning strategy guru.” Hamel’s ground-breaking concepts of strategic intent, core competence, industry revolution and management innovation have changed the language and practice of management in
organisations around the globe. Now, the co-founder of Strategos international management consulting firm based in Chicago and bestselling author of Competing for the Future and The Future of Management is coming to Auckland to deliver a fullday seminar on his latest book: What Matters Now: How to Win in a World of Relentless Change, Ferocious Competition, and Unstoppable Innovation…. (2012) which challenges readers to rethink the fundamental assumptions we have about capitalism, organisational life and the meaning of work. Hamel identifies five issues that are paramount: values, innovation, adaptability, passion and ideology. In doing so he presents an essential agenda for leaders everywhere. Hamel will put forward to New Zealand business leaders his impassioned plea to reinvent management practice.
HIS IDEAS COULD BE A GAME CHANGER FOR YOUR ORGANISATION.
BOOK NOW! Early Bird Pricing up to April 30. Book your seat or Corporate Table of 8! Event Details
27 May 2014 Langham Hotel 83 Symonds Street Auckland Time: 10am to 4pm Date:
Venue: The
Price:
Individual seat: $995.00 +gst Corporate Table of 8: $7560 +gst Register:
www.ema.co.nz/garyhamel Or email to Julie.brough@ema.co.nz
GARY HAMEL
WHAT MATTERS NOW
HOW TO WIN IN A WORLD OF RELENTLESS CHANGE, FEROCIOUS COMPETITION AND UNSTOPPABLE INNOVATION Gary Hamel is one of the WORLD’S MOST INFLUENTIAL and ICONOCLASTIC BUSINESS GURUS. Hamel’s ground breaking concepts of strategic intent, core competence, industry revolution and management innovation have changed the language and practice of management in organisations around the globe. Now, the best selling author of Competing for the Future and The Future of Management, Gary Hamel is coming to Auckland to deliver a full day seminar on his latest work - WHAT MATTERS NOW. In this exclusive seminar Hamel will put forward to New Zealand business leaders his impassioned plea to REINVENT MANAGEMENT.
27
MAY, 2014
Early Bird Rate $995+GST | Table of 8 $7560+GST
10.00AM - 4.00PM
The Langham Hotel SYMONDS STREET AUCKLAND
AUCKLAND
To Register www.emaevents.co.nz/garyhamel or email julie.brough@ema.co.nz
BusinessPlus
7
ADVICE By David Lowe, EMA’s Manager of Advocacy and Government Relations
Personal grievances condition The Employment Relations Authority handling of personal grievance claims was once the source of much criticism and consternation amongst employers, but the situation has stabilised. Nonetheless receiving a personal grievance claim against you is an extremely serious matter. And employers are rightly aggrieved in particular at those who use them for tactical or negotiating purposes. EMA has been analysing the determinations on personal grievances heard in the Employment Relations Authority for the past several years. For 2013 the trend shows the level of consistency attained has continued. We acknowledge the efforts the Authority has made and commend them. But there are always decisions that leave you scratching your head. Even though the Authority is there to dispense justice quickly and without undue formality, the ‘odd ball’ decisions occassionally gets through. But these are far fewer these days, and to a certain extent inevitable given the type of system in which the Authority operates. In 2013 Authority members heard 346 personal grievances, down slightly from 366 in 2012 and 371 in 2011. Employees won 62% of the time, which has been the consistent ratio for some years. Awards for hurt and humiliation average $5,042, slightly lower than last year though consistent with the averages awarded over the last five years.
Auckland’s average hurt and humiliation award was $4,421; Wellington $5,270, and Christchurch $5,798.
“An employer now pays an average $14,787 compared to $12,445 in 2012... Those who use EMA Legal know we charge significantly less [than other law firms]” Constructive dismissal claims continue to be the hardest for employees to win; just 55% employees won them last year. Grievances based on performance issues are hardest for employers to win - only 24% of employers successfully defend themselves in this area. A pleasing trend is the continuing decline in number of cases that settle while before the Authority. In 2012, 85 cases settled as their hearing progressed compared to 58 in 2013. On average, each Authority member settled three cases rather having to decide on them in 2013, down from five in 2012. Employers have sometimes felt pressured at an Authority hearing to settle the matter, but these reports have become
Average cost to win/lose a personal grievance (PG) at the Employment Relations Authority Employer to Win
Employer to Lose
Hurt feelings
$0
Hurt feelings
($5,042)
Lost wages
$0
Lost wages
($13,454*)
Legal fees
($14,787)
Legal fees
($14,787)
Costs award
$5,524
Costs award
($3,802)
TOTAL
($9,263)
TOTAL
($37,085)
Employer to Win
Employer to Lose
Hurt feelings
Hurt feelings
$5,042
$0
Lost wages
$13,454*
Lost wages
$0
Legal fees
($9,168)
Legal fees
($9,168)
Costs award
$3,802
Costs award
($5,524)
TOTAL
$13,130
TOTAL
($14,692)
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BusinessPlus
relatively infrequent. The vast majority of cases are decided on their merits. Employers continue to be troubled by the way personal grievance claims can be used as a threat or bargaining ploy to extract an extra payment. A good strategy to these tactics is not to respond and instead mount a full defence. But that takes time and resources which the employer won’t fully recover. We have often heard of cases when an employee has made no effort at all to raise their concerns at a time when the employer could have done something about them. An area of law largely untested is the employee’s good faith obligations to be active, constructive and communicative in relation to raising a personal grievance. It may be time for this obligation to be examined more closely for when employees who don’t raise their concerns and give the employer a chance to remedy them, instead sit quietly waiting for the employer to reach the point of ‘no return’ then seek a monetary payment. EMA members continue to fare extremely well in the personal grievance stakes winning 66% of their cases compared to the national employer average of 38%. Legal costs for PG’s have increased too, to between $1,500 and $2,000 per case compared to the previous year. An employer now pays an average $14,787 compared to $12,445 in 2012. An employee is charged an average of $9,168 in legal fees compared to $7,843 last year. Those who use EMA Legal will know we charge significantly less. The average cost for an employer to defend and win a claim is now $9,263 ($6,631 last year). To lose a personal grievance now costs on average $37,085 ($34,913 last year). An employee who wins pockets $13,130 net ($14,625 last year), but an employee who loses their claim faces an average bill of $14,693 compared to $13,657 last year.
ADVICE
stable but serious Personal Grievance Awards Analysis [2013] Authority Member
*One decision only In favour of employees
Location
2013 Average hurt & humiliation award
Change from 2012 to 2013
2012 Average hurt & humiliation award
2011 Average hurt & humiliation award
Change from 2011 to 2012
Change from 2010 to 2011
2010 Average hurt & humiliation award
M Ryan
Wellington
64%
$5,389
+18%
$4,550
-
A Dumbleton
Auckland
60%
$1,000*
-87%
$7,750
+53%
$5,062
+43%
$3,528
P Stapp
Wellington
83%
$5,071
+8%
$4,705
-3%
$4,875
+34%
$3,625
A Fitzgibbon
Auckland
41%
$4,000
-38%
$6,500
-
G Wood
Wellington
65%
$5,118
+50%
$3,417
-18%
$4,148
-20%
$5,181
H Doyle
Christchurch
75%
$5,178
-13%
$5,950
-8%
$6,437
+54%
$4,185 $6,133
J Crichton
Christchurch
44%
$4,516
-10%
$5,015
+27%
$3,944
-36%
D Appleton
Christchurch
67%
$6,952
+17%
$5,946
-41%
$10,000*
-
$4,308
-22%
$5,500
$3,382
-18%
$4,105
R Arthur
Auckland
67%
$6,500
+65%
$3,938
-9%
T Tetitaha
Auckland
63%
$4,423
-12%
$5,000*
-
R Monaghan
Auckland
44%
$3,929
+16%
$3,389
0%
C Hickey
Christchurch
91%
$6,023
+42%
$4,250
-
K Anderson
Auckland
40%
$4,932
+2%
$4,840
+19%
$4,055
+30%
$3,107
E Robinson
Auckland
81%
$4,636
+1%
$4,573
-36%
$7,127
+58%
$4,523
M Loftus
Christchurch
56%
$5,182
-19%
$6,393
+98%
$3,233
-68%
$10,000**
R Larmer
Auckland
88%
$4,130
-24%
$5,437
-29%
$7,692
+33%
$5,771
T MacKinnon
Wellington
44%
$5,463
-16%
$6,500**
-
62%
$5,042
-10%
$5,610
+13%
$4,976
-20%
$6,218
Total average
Successful Claims Number of claims compared to 2012
2013
2012
2011
2010
Auckland
+18%
108 in favour of employees out of 186 claims (58%)
89 in favour of employees out of 157 claims (57%)
111 in favour of employees out of 201 claims (55%)
166 in favour of employees out of 309 claims (54%)
Wellington
+10%
42 in favour of employees out of 66 claims (64%)
42 in favour of employees out of 61 claims (69%)
38 in favour of employees out of 75 claims (51%)
65 in favour of employees out of 104 claims (62%)
Christchurch
-36%
64 in favour of employees out of 94 claims (68%)
114 in favour of employees out of 148 claims (77%)
52 in favour of employees out of 95 claims (55%)
115 in favour of employees out of 178 claims (65%)
National
-5%
214 in favour of employees out of 346 claims (62%)
245 in favour of employees out of 366 claims (67%)
201 in favour of employees out of 371 claims (54%)
346 in favour of employees out of 591 claims (59%)
Hurt & Humiliation Average hurt & humiliation award
2013
2012
2011
2010
2009
Auckland
$4,421 (-11%)
$4,941 (+12%)
$4,424 (-27%)
$6,028 (+27%)
$4,888 (+1%)
Wellington
$5,270 (+16%)
$4,545 (-12%)
$5,115 (-1%)
$5,161 (-22%)
$6,593 (+2%)
Christchurch
$5,798 (-10%)
$6,465 (+6%)
$6,091 (+24%)
$4,918 (-5%)
$5,100 (+4%)
National
$5,042 (-10%)
$5,610 (+13%)
$4,976 (-10%)
$5,543 (+8%)
$5,204 (+3%)
Type of Grievance Auckland
24 out of 42 (57%)
$5,910
$4,202
Wellington
14 out of 18 (78%)
$11,424
$6,750
Christchurch
10 out of 12 (83%)
$25,355
$6,800
National
48 out of 72 (67%)
$12,736
$5,572
Misconduct
In favour of Employee
Lost Wages
Hurt & Humiliation
Auckland
39 out of 72 (54%)
$8,435
$5,516
Wellington
16 out of 25 (64%)
$7,644
$4,053
Christchurch
24 out of 35 (69%)
$13,612
$5,988
National
79 out of 132 (60%)
$10,284
$5,318
Reinstatement
Auckland
14 out of 18 (78%)
$4,570 $2,885
Wellington
4 out of 5 $8,149 (80%)
Christchurch
7 out of 10 $2,930 $4,204 (70%)
National
25 out of 33 (76%)
PERFORMANCE 1 out of 2 Reinstatement
1 out of 2
Reinstatement
Hurt & Humiliation
Hurt & Humiliation
Lost Wages
Lost Wages
In favour of Employee
In favour of Employee
Redundancy
$5,250
$4,620 $3,664 -
BusinessPlus
9
ADVICE By Neel Bhowmick, Employer Advisor for EMA’s AdviceLine
Bullying in the workplace: what Workplace bullying is a significant hazard and can disrupt workplaces and reduce productivity. Employers need to deal with it to avoid these pitfalls as well as to ensure they are not breaching the Health and Safety in Employment Act 1992, the Employment Relations Act 2000 or the Human Rights Act 1993. WorkSafe NZ and the Ministry of Business, Innovation and Employment have adopted the Safe Work Australia definition of workplace bullying, which is ‘repeated and unreasonable behaviour towards a worker or group of workers that creates a health and safety risk’. Repeated behaviour is persistent, and can involve a range of actions. Unreasonable behaviour includes victimising, humiliating, intimidating or threatening a person.
their health. Examples of bullying behaviours include direct personal attacks such as intimidation, belittling remarks and insults, or indirect task-related behaviours such as being isolated or someone being set up to fail. EMA has an A-Z Guide on Harassment and Bullying available free to members and WorkSafe NZ’s range of bullying prevention tools including “Preventing and responding to workplace bullying” guidelines
“A single incident is not considered bullying, but it should not be ignored” A single incident is not considered bullying, but it should not be ignored since it could escalate. Harassment and discrimination may also be part of bullying. When deciding whether an employee is being bullied, ask yourself if the behaviour is unreasonable, repeated, and whether it endangers
which can be accessed online from www.business.govt.nz/worksafe/toolsresources/bullying-prevention-tools. (See also last month’s BusinessPlus p19 for an item on WorkSafe’s guidelines on bullying.) Creating an environment that fosters good relationships prevents bullying. Employers should promote a healthy
and respectful work environment and make their workplace’s culture clear. Employers are also advised to provide a designated and trained contact person to receive any complaints or reports about bullying. Their role is to act as a confidential sounding board for employees and must be impartial and neutral. Policies to address and prevent bullying should be included in your workplace standard health and safety system and covered during the induction process. EMA’s A-Z Guide on Harassment and Bullying provides more information on policies and procedures to tackle bullying. Employers should also review staff absenteeism records to see if they may be clustering around specific business units or managers which could indicate the presence of workplace bullying. In such cases, employers may wish to remind staff about their workplace code of conduct. Dealing with reports of bullying
EMA recommends employers:
Specialist Employment Lawyers Our legal team spend 100% of their time working solely with employers, to help build and shape New Zealand businesses. Come in, sit down and talk to us about what’s next for your business – if you’re ready to take the next step, we’re ready to make it happen.
Jo Douglas
Managing Solicitor Phone: +64 9 367 0917 Mobile: +64 27 683 7919 joanne.douglas@ema.co.nz Auckland
Call us toll free on
0800 300 362 130814 Training Directory.indd 1
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BusinessPlus
Brandon Brown
Solicitor Phone: +64 9 367 0912 Mobile: +64 21 515 116 brandon.brown@ema.co.nz Auckland
Matthew Dearing
Solicitor Phone: +64 9 367 0931 Mobile: +64 27 284 4042 matthew.dearing@ema.co.nz
Auckland
Ani Bennett
Senior Associate Phone: +64 7 577 0488 Mobile: +64 27 706 4433 ani.bennett@ema.co.nz Bay of Plenty
Visit our website
www.ema.co.nz 23/09/13 1:21 PM
ADVICE
you need to do • Take all complaints and reports of workplace bullying seriously. • Act promptly and fairly. Try an informal response first. • Ensure none of the parties to an issue of bullying is victimised. • Support all parties ie. tell them what support is available (EAP or peer support systems). Remember anyone involved is entitled to have a support person present at meetings. • Be unbiased. • Communicate what to expect during the process and provide clear reasons for the outcomes. • Ensure confidentiality of all parties involved. EMA’s A-Z Guide on Harassment and Bullying provides more information on confidentiality. • Keep good records even if the issue isn’t formally investigated.
Sample Process
In responding to complaints or reports of workplace bullying, managers should apply the principles of natural justice ie: 1. Raise the allegations or concerns with the employee. 2. Conduct an impartial and independent investigation to establish the facts. 3. Give the employee a reasonable opportunity to respond. 4. Genuinely consider the employee’s explanation. 5. Determine whether it fits the definition of bullying. If not, mediation may be required to resolve the dispute. 6. Take action based on the seriousness of the issue. Options include: - Asking the alleged bully to apologise - Issuing a formal warning - Moving one of the parties into a
“Bullying behaviours include direct personal attacks such as intimidation, belittling remarks and insults, or indirect task-related behaviours such as being isolated or someone being set up to fail” different work unit and/or - Integrating the complainant back to work using a structured programme. Finally it is important for employers to proactively manage workplace bullying by implementing policies that clearly address it. Managers in leadership positions should be expected to deal with reports of workplace bullying swiftly and decisively. advice@ema.co.nz
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BusinessPlus
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EMPLOYMENT CHAT
Can I ask for staff to shorten their holidays? Can we require staff to come back from their holidays early if orders get really good and we need them? – Susie Dear Susie Not really. Which means you could always ask, outlining your reasons, but you might risk giving offence and being turned down. Perhaps you could offer a sweetener though emphasise there is no compulsion to come to work during approved leave periods, and anyone who did return would not be favoured over those who didn’t. This is also relevant if only some staff are needed in a hurry and others not at all.
“You have the ability to manage when holidays are taken and so avoid busy periods.”
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Also you need to allow employees to take their annual holidays within 12 months of them becoming entitled to the holiday. You have the ability to manage when holidays are taken and so avoid busy periods.
We are terrified of the new health and safety law changes coming. We are hardly making a profit. How can we be prepared at no cost?! – Geoff Dear Geoff It sounds like you take occupational safety and health (OH&S) very seriously which probably means you have a safe workplace and need not panic. On the other hand, if that is not the case…you may need to panic. Sorry to be blunt but there is no excuse ethically or legally for putting staff at risk when they come to work. But deciding where to draw the line is clearly the difficulty! If your business is sailing close to the wind perhaps you could benefit from attending our Lean Thinking seminar on ways to reduce waste in its many senses, and cut costs. Demonstrating that you have good intentions will count for the new OH&S requirements. Here’s a summary of some key points to think about. The Health and Safety Bill is expected to come into force on April 1 next year. It aims to provide for a balanced healthy and safe workplace framework involving protecting individuals from harm, providing for their workplace representation, and encouraging unions and employer organisations to take a constructive role in promoting improvements to workplace health and safety practices. It also promotes compliance and the provision of health and safety advice and education. The new law will also ensure the
actions of persons exercising health and safety functions are subject to scrutiny and provide a framework for continuous improvement. Key person
The key term is a ‘person conducting a business or undertaking’ (a PCBU) who can conduct a business or undertaking either alone or with others.’ PCBUs employ people, contractors, subcontractors and their employees, employees of labour hire companies, outworkers, including homeworkers, apprentices, trainees, persons gaining work experience, volunteers or persons of a prescribed class. PCBUs and their officers must exercise due diligence to ensure they comply with their obligations, ie, they must keep up-to-date with relevant knowledge, understand the hazards and risks involved in the particular operation, eliminate or minimise those risks, and ensure there are processes for receiving and considering information about incidents, hazards and risks, for complying with the law and for verifying the provision and use of resources and processes involved in keeping up-to-date and understanding, identifying and eliminating or minimising hazards and risks. ‘Reasonably practicable’
Another important term is ‘reasonably practicable’ meaning that in relation to health and safety, PCBUs must ensure they do everything they are reasonably able to do, taking into account the likelihood of the hazard or risk occurring, and so on. The bill spells out the functions of health and safety representatives and health and safety committees and the quite extensive obligations PCBUs have to both. Workers are also obliged to take reasonable care for their own and others’ health safety, comply with any PCBUs reasonable instruction regarding compliance, and co-operate
EMPLOYMENT CHAT
...we’re terrified of the new OH&S law! with any reasonable PCBU health and safety policy or procedure. • For Small to Medium-sized Enterprises (SMEs): There is very little change to their duties, because of the more direct influence they already have on health and safety of their workers in their size of business. • Larger businesses: The obligations of principals and companies that sub-contract out work are clearer and obligations cannot be contracted away. • Workers are covered no matter the working relationship (broader than employer-employee). • Upstream suppliers of goods and services will have more obligations relating to the things within their sphere of influence, eg, designers, manufacturers, importers and suppliers of plant. The bill places considerable emphasis on penalties for failing to comply with its numerous obligations, eg, maximum fines of $300,000 for an individual who is not a PCBU or an officer of an PCBU, $600,000 for a PCBU or an officer of a PCBU (with the possibility of five years’ imprisonment as well) and $3 million for any other person. Lesser offences include failing to
“Demonstrating your good intentions will count for the new OH&S requirements”
comply with a health and safety duty that exposes an individual to the risk of death or serious injury, and failing to comply with a health and safety duty carries a lesser (but still quite large) maximum fine, and doesn’t require evidence of intent. It is enough to have committed the offence. Insurance contracts purporting to indemnify anyone liable to pay a fine or an infringement free under the Act are not permissible and of no effect. A person affected by adverse conduct may take a claim to the District Court but the bill also amends the Employment Relations Act to provide for adverse conduct to give rise to personal grievance claims. Health and safety inspectors and health and safety medical officers have powers of entry (as currently).
But don’t worry! Business Plus has regular articles on OH&S and EMA is running lots of courses to help businesses gear up – such as the comprehensive OH&S Conference on April 29-30 in Auckland. And the Health and Safety Seminar Roadshow on till May 5th in the regions where EMA’s members do business. As you can imagine, these events are filling fast. Check out our Events listings on www.ema.co.nz • By the EMA communications team in consultation with EMA Advice, and loosely based on real calls to EMA’s AdviceLine. All names are fictional. The information in this article is a guide only and not to be used as business advice without further consultation. EMA members can start with our free AdviceLine team at phone 09-367 0909 or 0800 300 362 (within New Zealand), and 1800 300 362 (from Australia), 8am-8pm weekdays. Alternatively, email advice@ema.co.nz or read or print information such as the A-Z of Employing – a manager’s guide on more than 100 specific employment topics, at www.ema.co.nz
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IN THE LOBBY
Local councils impact on business Local government has a big impact especially on small and medium businesses. Councils supply vital services and infrastructure and regulate many business development activities. But local government actions can also be a challenge for enterprises. High rates are a burden for many, and the practice by some councils of imposing a business differential – higher rates for business than domestic ratepayers - which is not justified for the services provided – can add to that burden. Business now pays around half of all rates paid in New Zealand. Councils administer resource and building consents, a key service for businesses seeking to develop and grow. As monopoly providers of consents, without competitive pressures to keep fees in check, councils effectively determine whether a consent will be granted and how much it will cost, giving them significant power over a small firm’s chance of success.
At the same time, many councils undertake commercial enterprises of their own, in competition with local businesses. Councils in different parts of New Zealand have set up businesses such as cinemas, cafes, gyms, and so on. In smaller centres, this can make it difficult for a small business - when your competitor is a local body that can underwrite its commercial activities using rates money, and is at the same time a regulator, this can make it hard to compete. So business is affected for better or worse by local government, and has a vital interest in the way local government is conducted.
Government Act gave councils more power. Instead of being limited to specific activities listed in legislation, councils were given the ability to undertake just about any activity, as long as it contributed to people’s ‘four well-beings’ - economic, environmental, cultural and social well-being. Well-being is of course desirable, but has since proved inappropriate as an explicit objective of local government. Providing for everyone’s well-being would be an endless task. For example, requests for a council to take action to achieve cultural or social wellbeing could be practically limitless, incurring great expense.
Reform
Local government reform has been ongoing for many years, often changing back and forward with changes in central government. Just over ten years ago the Local
“Councils effectively determine whether a consent will be granted and how much it will cost, giving them significant power over a small firm’s chance of success”
Reforming the reform
This was recognised in a review of the Local Government Act two years ago, which removed the “four well-beings”, replacing them with a directive to provide for “good quality local infrastructure, local public services, and the performance of regulatory functions in a way that is most cost-effective for households and businesses.” While early days, this approach so far appears to be working reasonably
Advice and Support when you need it! We’ve got a team of advisors, lawyers and consultants who’ll do more than take the case - they’ll help you build a workplace for the future.
AdviceLine
Member Only Resources
Don’t just get information – get advice you can rely on from industry specialists.
A library of knowledge, tested in the courts and all in one place.
A free, confidential telephone service providing employers with up to date, direct and practical advice.
Our member only resources allow you to download templates for all the difficult jobs that face employers - like Employment Agreements and OH&S.
Free call AdviceLine, NZ 0800 300 362, AU 1800 300 362 or visit our website, www.ema.co.nz
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10/06/13 12:42 PM
Phil O’Reilly
“National is offering a continuation of the ‘local infrastructure, local public services’ approach. Labour is offering a return to the ‘four well-beings’ approach.
well. It puts the focus on the key needs that councils fulfil – good local infrastructure and services – without encouraging unnecessary activities or expenditure that could put upwards pressure on rates. BusinessNZ believes this approach could be even more specifically defined, to help reduce the temptation for councils to establish businesses
using ratepayer money. A better directive would be for councils to “…provide local public goods and services that cannot be better provided by firms, households and non-profit organisations.” It is important to get the rules set appropriately so we get a local government sector that helps rather than hampers economic development.
Election promises more reform?
This election year is promising the potential for yet more changes and reversals in the rules for local government. The two main political parties are offering very different approaches to the regulation of local government. National is offering a continuation of the ‘local infrastructure, local public services’ approach. Labour is offering a return to the ‘four well-beings’ approach. The other parties are yet to release their local government policies This election business will want to see policies for the appropriate regulation of local government. Phil O’Reilly is Chief Executive BusinessNZ www.businessnz.org.nz.
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13/09/13 5:28 PM BusinessPlus
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TAX TIPS Jo Doolan
Beanie excitement! The most significant accounting changes in the last decade were heralded last month with a muted response from the beanie community. This may have been a personality thing or because accountants are always under loads of pressure at this time of the year. The changes are expected to reduce the number of companies required to prepare general purpose financial statements from 460,000 to less than 10,000, and cut business compliance costs by $90 million a year (Simon Power, Commerce Minister, 14 September 2011). The key question is what difference do these make to your day or pay? Can you now fire your accountant?
The short answer is no. The longer answer is you need to work through the rules to determine how this has reduced compliance burden works for you. We have separate rules for large companies and small to medium companies; what these are depends on whether you are locally or overseas owned, and whether you are an issuer, or have minority shareholders. The new rules apply to companies
with an accounting year starting on or after 1 April 2014. Locally owned companies, (less than 25% overseas owned), will be considered large if they, and any subsidiaries, have annual revenues of $30m or more, or assets of $60m or more, for at least the two preceding years. Overseas owned companies, (more than 25% overseas owned), will be considered large if their annual revenues
Full tilt at Southern Spars Southern Spars is proud to advise it is building two of the largest mast, boom and rigging packages in the world for a large ketch, with each part around 90m long. The details are confidential. Southern Spars custom designs and builds carbon fibre spars (yacht masts and booms) as well as components, rigging and rig servicing. Its just received an investment boost. UK-founded investment company Oakley Capital Private Equity has acquired a majority stake in the North Technology Group of the US which comprises three global marine brands: North Sails, Southern Spars and EdgeWater Boats, a maker of high performance outboard sport boats. Southern Spars also recently moved into its new facility comprising an 8000 sq m warehouse with 1250 sq m of office space, on a 1.5ha site in Avondale, Auckland, a bespoke facility, which Richard Lott, Group Managing Director says will allow them to centralise all their operations under one roof. However commitments to various
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Southern Spars’ 10,000sq m Custom Projects Facility in Avondale, Auckland
competing racing syndicates dictate they operate under a stringent set of security measures, with confidentiality enforced and access to facilities restricted. The company headquarters houses 245 staff with a further 205 in Denmark, Spain, South Africa, USA and Sri Lanka. Southern Spars exports 95% of its products all around the world worth more than $50 million in any given year. The business began in 1989 building its first two masts for Sir Peter Blake’s Steinlager 2 for the Whitbread Round the World Race. Their big growth spurt came with the arrival of the America’s Cup in
2000 and 2003, where the company supplied all of the teams. Their America’s Cup and Volvo Ocean Race experience, continuous innovation and R&D have been pushed into the superyacht market. Lott says doing business in New Zealand is attractive because of the Kiwi ingenuity, innovation, and hardworking, great culture and most of all, kiwi’s want to lead, win and get results. The worst aspects are the New Zealand dollar and distance to export markets. But he says: “Don’t give up: the first years are the hardest. If you have a good product that stands out from the rest, you will get there.”
TAX TIPS
are $10m or more, or assets of $20m or more. Again these thresholds must be breached for at least the two preceding years. Branches of overseas companies will also be required to prepare separate financial statements for a New Zealand business with revenue of $10m or more, or assets of $20m or more; they will also still need to file the financial statements of the overseas company as a whole. If you are not large, not an issuer, and 5% of your shareholders have not insisted they be prepared, then you have the option of producing less complex accounts. (If you want to impress someone these are now called special purpose financial reports.) Rather than needing an intimate knowledge of all the accounting standards, you now only need prepare accounts complying with tax requirements. Of course your banks or financiers, or even shareholders may still demand the complicated version be prepared. The IRD has released minimum requirements for special purpose financial reports. Not surprisingly,
these include producing a balance sheet and a profit-and-loss statement prepared using double-entry accounting on an accruals basis (rather than cash accounting). You also need to outline the accounting policies used, provide comparative figures for the previous period, reconcile tax and accounting profits, and disclose the company’s fixed and/or depreciable assets. From 1 April 2015, you will also need to provide details of certain associated party transactions, (unless you are dealing with an associated New Zealand resident company). The types of associated transactions you will need to disclose are interest expenses, outbound loans or advances, expenditure on services (including salaries, wages or management fees), rent and lease expenditure or expenses on acquisition/use of intangible property. A reconciliation of movements in shareholder equity will also be required. These changes do not mean there is any letting up on the directors’
responsibilities for ensuring on going solvency, keeping proper records and so on. If you are preparing general purpose financial statements, these need to be audited. There are opt-out provisions if you are not required to file them with Companies Office (companies other than issuers or overseas owned). Opt out requires 95% of the company’s shareholders to agree either at the AGM or, if earlier, within six months of the financial period starting. The filing deadline with the Companies Office has also reduced by 20 working days to just five months. Any changes in a company’s balance date must be approved by IRD before notification is provided to Companies Office. Overall these changes are all positive and should enable you to spend more time and money growing your business rather than on administration. Joanna Doolan is a Partner with EY and Claire Dilks is a Senior Manager with EY Joanna.doolan@nz.ey.com Claire.dilks@nz.ey.com
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Keep your nger on the pulse Your people are one of your biggest assets. To make sure your business is performing at its best you need to get their pay and benefits ‘just right’. That’s where we can help. Using our market intelligence you can keep your finger on the pulse of market trends and act with confidence. The National Employers Wage and Salary Survey covers 216 positions. Our comprehensive reports include splits by industry, location and revenue bands: Salary reports: Reflect Salary ranges by position, location, revenue bandings and industry. Beneets and Conditions reports: Position specific analysis of benefits and conditions. You’ll find sample reports as well as a full list of positions and descriptions on our website.
www.nzsalarysurvey.co.nz The
National Employers Wage and Salary Survey is a joint venture between
LEARNING Part III of our series on Why your business needs a board By Jens Mueller
To Board or not to Board… By now you have heard the message that smaller enterprises are disproportionately affected by poor governance, and like small planes need better pilots and equipment than large ones and a larger talent pool to steer a small firm through its ups and down. But there is no TradeMe for directors. If we simply hire folks like ourselves this won’t diversify the knowledge and competence resource for the firm. So where are these directors? We know from research that shareholders, current directors and senior managers look for very specific director resources: 1. Global experience is highly sought after. Even for firms that do not yet have a footprint outside NZ, it is helpful to have someone comfortable with a scan of similar businesses overseas. 2. Only successful executives need apply. The trend is clearly towards executives with demonstrated success, regardless of industry. Historically, we had a lot of lawyers and accountants on boards, but interest in them is waning. 3. No one amongst more than 4,000 respondees to our research seems to care whether the new board director is male or female. Bad news for those who argue it should be obligatory for more women to be represented on boards. Most women leaders I talk to would run miles with their hair on fire, if you threatened them with a quota-appointment. They know they are good, and they want to be appointed for their abilities not their chromosome set. 4. There is an interest in younger board members to diversify a gradually ageing group of directors. The current average age is about 52. Though I personally
think that is a perfect age for just about anything, there clearly are some very clever 30-somes, with a risk appetite, determination and fearlessness that sets them apart. I spent an afternoon the other day watching a 28-year old developer of web apps explain to a business owner how a large portion of the business could run off a few smart phones eliminating the need for staff to come into the office to enter transactions into the firm’s computer system. In the process, with the owner’s eyes slowly glazing over, the young man performed a pretty much flawless analysis of where the business was good and where it wasn’t. If he was coming back as an advisor every month or so, he’d surely unearth more opportunities. Valuable contributors like this exist just about anywhere, so where do we find them? Look at your suppliers, retired senior managers of competitors, successful people you read about in the Herald, and people you meet when you see customers. Good and competent people stick out. They know their business and can communicate their talents well. There are ‘lists’ of aspiring directors around but most are not easily accessible. The Institute of Directors maintains of people seeking board roles, the Department of Women’s Affairs has a list of women interested in governance, and so on. I see at least three names each day in the newspaper where individuals demonstrate superb executive abilities; how hard
would it be to make contact and arrange a lunch to chat? Do directors or Advisory Board members (the training wheel version of company boards) cost a lot? Most executives I speak with indicate they would be keen to initially donate time to get their feet wet, and have the opportunity to contribute in a leadership role. I don‘t know many emerging leaders in New Zealand who would not be responsive to an email saying: “Hey, I noticed the other day how you handled this or that issue at your firm. Can we meet up for lunch to see if you could contribute at our business as a director?” Why not set a goal to write three such emails in the next six months? What is the worst that can happen? Maybe the speeddating doesn’t work out, maybe the chemistry isn’t right… On the flipside, what if it did work out? You might gain a solid supporter with experience that complements your own, someone you can discuss ideas and plans with, and someone not afraid to tell you when you are about to skid off the rails. Give it a try! • Jens Mueller is a longtime company director and corporate leader in New Zealand and overseas. He sits on the PHARMAC board and works with many firms and health boards on improving governance. He is editor/ author of several governance books, and teaches MBA-level governance courses with the Institute of Directors at Waikato Management School. www.muellerjens.com BusinessPlus
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ADVOCACY
Letter from Australia from Marketing Specialist Bella Katz
Online retailers get physical Recently the hugely successful online retailer and manufacturer of contact lenses and glasses, ClearlyContacts, was acquired for $462 million by French lens manufacturer, Essilor, the largest lens manufacturer in the world. It’s a totally predictable next step in the life of this clever Canadian brand, launched by CEO Roger Hardy in 2000. What is less predictable, is Hardy moving ClearlyContacts into physical retail, including upcoming store openings in New Zealand and Australia. Its flagship Auckland store is set to open in Queen Street shortly. In Australia, the emergence of big international chains such as homeware brand West Elm are highlighting just how far evolved their models are compared with slow local retailers. While Myer and David Jones contemplate a possible merger to save both their skins, the sharper internationals lead the charge by offering customers consistently good experiences across all their contact points.
“The sharper internationals lead the charge by offering customers consistently good experiences across all their contact points” In the competitive Australian eyewear industry, ClearlyContacts already has a 4.2% share of a total $76 million market, still a drop in the ocean compared with the $3.2 billion the optometry and optical dispensing industry generates. But with the depth of customer data at their disposal, ClearlyContacts has its eye on a much bigger prize. After all, disposable contact lenses Focus Dailies bought online are no different to Focus Dailies from your optometrist, expect perhaps three times cheaper. Right now lenses
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account for 73% of all sales for ClearlyContacts. Glasses have presented a bigger challenge as customers overcome the try-on factor, however, and hence successful online retailers adopt a “no questions asked” returns policy to mitigate some of the perceived customer risk. Companies including US clothing retailer Anthropologie and online shoe store Zappos offer free delivery and full returns. ClearlyContacts now offers a “try for a month before you buy” on its frames. For regular online buyers like me, including the purchase of both glasses and lenses from ClearlyContacts over many years, there is simply no risk. For those segments where buying online is still a hump, companies like ClearlyContacts are bringing the store to its customers and hoping it generates business back to online. In Sweden, where the company has been trialling physical stores for several years, that has indeed proven to be the case. The flagship stores have been a form of advertising and “live” catalogues, with extensive online sales data informing the instore product and merchandising. As well as showcasing the top products, ClearlyContacts plans to use interactive digital displays in its physical outlets to connect buyers with all stock available that isn’t in the store. Meanwhile, Hardy insists the prices will remain consistent across both platforms, which he says can be as much as 20% less on lenses and 50 to 70% on glasses. The hybrid model has even been embraced by traditional stalwarts such as Walmart, where merchandise ordered online is
“The hybrid model has even been embraced by traditional stalwarts such as Walmart, where merchandise ordered online is shipped for same-day pick up to local stores” shipped for same-day pick up to local stores. ClearlyContacts, whose own model offers 24-hour delivery, now operates distribution centres close to its markets, including one in Australia. With the opening of the first New Zealand store, it’ll be an interesting time for both on and offline retailers as they connect the traditional with, arguably, the “new traditional”.
Bella Katz is an Australiabased brand and marketing consultant who regularly advises New Zealand companies on how best to position there. She specialises in marketing for the manufacturing and industrial sectors. +61 (0) 410 400 657 bella@bellakatz.com.au Bella on LinkedIn www.bellakatz.com.au
Horsing around at ExportNZ Bay of Plenty With the focus on fun at ExportNZ Bay of Plenty events, the Export NZ team has created another hilarious and heart-warming video to promote their annual export awards programme. This year’s Awards theme is country with local sponsors lip-syncing their hearts out to the tune of Islands in the Stream sung by Kenny Rogers and Dolly Parton. The troupe of sponsors plus ExportNZ’s Ange and Tracy, and a horse, end with a chorus referring to the export awards. The video challenges the local export community to dress up in theme for their gala dinner in Mt Maunganui on Friday, June 27. Watch it on YouTube. Search for ‘Launch AV for the BNZ Bay of Plenty ExportNZ Award 2014’. You might recognise some of the people in the video, including: • Gerald Farmer, Barry Folster and Jono Sharrock – BNZ • Kay Rogers and Catherine Membery – United Travel Business
•
Ian Macrae, Pip Ritchie and Todd Ritchie – Page Macrae Engineering • Kylie van Heerden and James Moran – Sharp Tudhope Lawyers • Cate Hlavac and Jenny Milson – NZ Trade and Enterprise Visit the dedicated awards website, www.bopexportnzawards.org.nz, to find everything you need to know about the awards.
Early bird tickets available for Go Global til April 10 This year, ExportNZ is combining with EPIC NZ to present GO GLOBAL - the one-day conference to help maximise and boost your export growth opportunities, on Friday, May 2. This is a rare opportunity to interact with exporting experts. Business speakers include: Phillip Mills, CEO of Les Mills; Greg Muir, MD of Tru-Test; and Sir Ken Stevens, chair of Glidepath. Plus 15 Trade Commissioners and Regional Directors will share priceless insights into key markets. Read more and book your seats at early prices till April 10, at
Who are the finalists for the Auckland export awards?
Don’t miss the announcement of the finalists in the Air New Zealand Cargo ExportNZ Auckland Awards 2014, at a special function in Auckland on Wednesday, April 16. For all the detail, please visit www.hookedonexport.co.nz
www.nzgoglobal.co.nz
North Asia and Indonesia trade missions underway Planning for two Export NZ trade missions is well underway, with both NZTE and MFAT endorsement. Our website www.nztrademission.co.nz has all the updates with registrations of interest coming in thick and fast.
The deadline for this is 31st May, 2014. The programmes will emphasise business matching. Go to www.trademissions.co.nz for more BusinessPlus
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PROFILE In our regular snapshots of EMA member companies, we describe the business of Sistema Plastics headquartered in Penrose, Auckland.
Champion of New Zealand made Who hasn’t heard of Sistema or got some of their plastic ware at home? As you might expect for such a high profile brand, the company is rollicking along. Following are some impressive facts: • Sistema Plastics revenue of $100 million is set to double in the next few years, growing at an average 25% a year and for the foreseeable future. • Sistema’s food-safe, stackable storage boxes and drink bottles are sold in 64 countries. • Australia is the biggest market. England is going very well. The US has the most growth potential, and a French supermarket chain has just bought 10 million units to be delivered in the next 12 months. • Sistema takes 15 new items to market each year. • The Auckland manufacturing and distribution plant is 30,000sq m spread over five sites in the suburb of Penrose, but is moving closer to the airport into a purpose-built, single 50,000sq m facility on the already-purchased 10ha in 2016. • The plant houses 60 injection moulders with robotic pick and place functions, automatic assembly lines and offline automatic assembly. The latest machine is two years old. Five more are on order to increase capacity. Most activity is done in-house: product design, art, labels and photography, the bulk of the legal work, shipping… Owner and managing director Brendan Lindsay says the aim of keeping production in-house is to
Sistema owner and Managing Director Brendan Lindsay
control cost and keep the Sistema DNA in place. “When selling to major retailers overseas we can communicate to our own team, or it could get lost in translation,” he says. And, he adds, he’s a control freak. The in-house automation department of 12 engineers and 10 toolmakers oversee the machinery mostly bought in Japan. Some tooling is outsourced. In fact most toolmakers in Auckland are working for Sistema at the moment and there aren’t enough good toolmakers or engineers in the market, Lindsay says. He automates and ‘roboticises’ as much production as possible, but says there are limits to that: “You can’t take out all the human element, even packing into boxes.” Despite the extraordinary automation, staff levels have not dropped because of the company’s growth rate. There are 550 staff in New Zealand plus 20 in Australia, 30 in the US and 10 in England.
“Keeping production in-house is to control cost and keep the Sistema DNA in place” 22
BusinessPlus
Most staff offshore (managed by in-house New Zealand human resource staff ) are in sales and marketing or in the distribution centres, owned by Sistema in Australia and with a joint venture in the US (20,000sq m in San Francisco). A third party manages their UK distribution in England. Now that the company is going gangbusters, Lindsay finds himself travelling a lot, which he says is not enjoyable. “I’m trying to balance business and personal life. The only way I can do this is being able to surround myself with professional people with the passion to keep the product made in New Zealand.” Ten years ago Lindsay decided he had to stop being a control freak, that he needed to upskill, and not do everything himself. “We have grown a lot since then! And you need the right support at home. My wife encourages me and wants to be part of it and comes on some overseas trips and to distributor meetings where they like to see the husband and wife team. “We have low staff turnover but
PROFILE By Mary Mackinven
because we are expanding we are always looking for people. “Sistema is always keen to hear from people who think they can add value to the business, and talk to them.”
“Finding the right people is everything. You need them. You can have as many robots as you like but it’s people who drive the business and drive you”
NZ made is key
“Manufacturing in cheaper labour markets might save costs but you can’t always find cheaper managers, which negates the cost saving. “[Manufacturing in New Zealand means] we ship New Zealand air and we don’t charge for that! “I could drop our costs by 30% if we manufactured offshore but we don’t need to. We focus on our strength: Made in New Zealand, which helps us with marketing and we are not a ‘me too’. That is the most important part of our sales presentation. “In addition, New Zealanders have a ‘can do’ attitude, not a ‘why should I?”. The current business climate throws up a lot of challenges, such as no export incentives and the high value New Zealand dollar impacting Sistema’s bottom line but Lindsay is pragmatic. “There are swings and roundabouts – it [the dollar] will turn; we have good and bad years. We just need to focus on keeping going.”
While his health and age may eventually get the better of him, Lindsay has no plans to quit while he’s feeling energetic, enjoying himself, and feels he is making a difference by keeping production in New Zealand. “Not many people have the opportunity to do what I have been
able to do and I don’t want to give that to anyone else [outside New Zealand]. “Finding the right people is everything. You need them. You can have as many robots as you like but it’s people who drive the business and drive you; the ones who pick up the baton and run without your having to tell them.”
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members noticeboard
Golden news for cheese maker Corner cheese store in Putaruru, Over the Moon Dairy, has won eight medals at this year’s New Zealand Champions of Cheese Awards. The six-year-old cheese maker and retailer took out the top awards for its signature washed rind, cow’s milk cheese Over the Moon Galactic Gold: and category and gold winner for the Thermaflo Champion Washed Rind Award. This is the fourth national win for this cheese. Company founder/owner Sue Arthur says the cheese’s success is due to the determination of our team to get this enormously complex cheese to perfection. She says “I first tasted this style in Australia when I started my cheese making training and knew immediately we had to make it for the New Zealand market. It made me go weak at the knees!” The company’s other gold winners were: • Over the Moon Ricotta, fresh unripened cheese; and • Over the Moon Double Delight (cow’s cream and goat’s milk blend), for packaging of a soft white rind cheese, that also won the Innovative Packaging Champion Soft White Rind category, and was a world medal winner in 2010. Three silver medals were won by Runaway Spoon Washed Rind,
Over the Moon Dairy people (l-r): Michelle Mason (cheese maker), Sue Arthur (owner) and Grietje de Vries (senior cheese maker).
Over the Moon Pepperino and Halloumi; and bronze medals for Over the Moon Black Truffle Brie and Over the Moon Goat Curd. Sue believes that the high quality of
Galactic Gold cheese is a serial winner
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local milk is a key contributing factor in the success of Over the Moon Dairy cheeses. Not to mention the dedication of the highly trained cheese makers Grietje de Vries and Michelle Mason. Over the Moon and its sister company New Zealand Cheese School Ltd were set up to provide a premier centre for specialty cheesemaking in New Zealand. Most of the cheeses are made from local cow’s milk with some from, or blended with, goat, sheep and buffalo milk - pasteurised with non-animal rennet suitable for vegetarians. The company makes 35 different cheeses amounting to 15 tonnes a year.
www.acepay.co.nz
LEARNING
Fish! culture programme designs itself There’s something fishy about EMA’s latest training programme. The FISH! Programme was designed to achieve change in the workplace and developed by staff at a Seattle fish market. The FISH! approach causes people to do crazy things when they get back to work after for example, an introductory session at EMA. One recent session saw participants from St John hugging each other and doing the darnedest nice things. Already people are smiling more, use more face-to-face communication over emailing, give gifts and high fives to each other, and generally look out for opportunities to enjoy their work, says FISH! programme facilitator Geoff Wake, a leadership and performance specialist. They are more mindful of one another, which builds stronger teams, he says. The FISH! programme can achieve three main objectives0: culture change; customer experience change, and/or leadership change. But its measureable goals or outcomes can be more specific, eg, the cultural change required may be to reduce staff turnover or improve productivity. The impetus of FISH! is based on four philosophies which are: • Play • Be there • Make their Day • Choose your attitude Fish! is not a management programme except inasmuch as it is to create actions that improve the experience of being at work. While Geoff shares the principles, the ideas on how to implement change all come from the staff themselves. There is no right or wrong way to implement FISH! philosophy, Geoff says. Every organization develops its own activities to reach their specified, desired goal. The programme originated about 15 years ago when a filmmaker observed the fun and successful behaviour of fish producers at the Pike Place Fish Market in Seattle. Subsequently he filmed them tossing fish and generally larking about with customers. They became a tourist attraction, and their culture led to the
Percy the Perch, a soft fish toy... for someone having a hard day, to show camaraderie
four observable philosophies developed into a training programme. It’s deliberate and/or spontaneous actions to bring to life the FISH philosophies, eg, gifting a chocolate fish. St John teams have held a FISH barbecue, afternoon tea, a bake-off and other games and creative actions. They act as reminders to be present, look out for each other, and lead to more quality interactions and better communications. Geoff says ‘play’ is the easy focus to start with. Its done for fun and to release energy, and to give permission to be open and authentic at work. But staff come to understand the play is for a reason! Programme delivery
Only staff meeting certain criteria are invited to attend the FISH! training programme. They must be available to attend all training and meetings and have time to do extracurricular stuff in their teams. And they must have unbridled enthusiasm, and a natural affinity to remain positive even when faced with cynicism and resistance, and are imaginative and creative. There is no instruction manual for this team building process. The people involved must be those who others follow, and who believe in the company/employer with a genuine desire to make a difference. Participants receive a 20-minute
DVD of the Pike Place Fish Market team at work. Participants also receive a resource pack of posters, stuffed fish, certificates, thank you notes, pins, etc. The duration of the full day’s training is followed by two, two-hour formal reviews and planning sessions spreads over six weeks. • For information on starting the FISH! Programme in your workplace, contact EMA’s Tailored Solutions team at phone (09) 367-0947 or email deborah.carruthers@ema.co.nz
St John provides ambulance services throughout New Zealand and plays an increasing role in meeting the broader health needs of our communities. For example, St John provides medical services at events for everything from school fairs to major international sports matches; helps patients in hospital with non-clinical support, and their family and friends; offers a Youth Programme, adult first aid training courses and an online shop for first aid kits and supplies. St John also offers a medical alarm service for people in their own homes, a Caring Caller service, and Health Shuttles in some areas to help people with impaired mobility attend essential appointments. Visit stjohn.org.nz
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EMA Alert
APRIL
18th Annual 29-30 Occupational Health and Safety Conference This conference will take an in-depth clause by clause look at the Bill and will overview the changes your business will need to make to comply with the coming Act’s laws and regulations.
Managing Difficult 30 and Disruptive People
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Supervision An Introduction
Learn how you can appropriately manage difficult and destructive people in the workplace without losing your cool.
Gain the key knowledge and skills required to effectively manage a team of people. Rotorua | Craig
Auckland | Craig
Auckland | Karen
MAY
offers you a holistic look at your business and the training needs you have. Whether it be standard training or specialized, we can meet with you, discover your needs, and structure a training plan specifically for you.
Learn how to promote professional occupational safety and health management best practices. Auckland | Kevin
Contact Deborah Carruthers
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This award winning Safety Leadership Programme will help develop safety leaders who are able to foster and sustain a strong safety culture and improve health and safety performance.
Motivating Individuals & Teams
Auckland | Craig
Meeting Skills
Learning the requirements, rituals and rules of effective meetings will stop wasting your and others’ valuable time and improve successful outcomes.
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Hamilton | Caryn
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Gain the tools and techniques to prepare a comprehensive training plan and evaluate your training outcomes. Auckland | Kevin
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Learn how you can help create the right motivational culture to foster high performance teams.
Auckland | Craig
Training Design & Training Needs Analysis
Go Global is about celebrating New Zealand international business success and innovation. It is an informative and inspirational experience, showcasing Kiwi export businesses that have achieved great success. Auckland | Karen www.goglobal.co.nz
deborah.carruthers@ema.co.nz Ph 09 367 0947 | Mob 021 636 799
Safety Leadership Programme Not on Our Patch®
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Diploma in 1-2 (Block 1) Occupational Health & Safety Management (Level 6)
15th Annual 21-22 Employment Relations Conference 2014 is Election Year – what does this mean for Employment Relations and Collective Bargaining? Our 15th Annual Employment Relations Conference is sure to give you the answers you need to manoeuvre your business during election year and beyond.
Conference Contacts Karen Joe | 09 367 0959 | conferences@ema.co.nz Training Contacts Kevin Chambers | 09 367 0958 | kevin.chambers@ema.co.nz Craig Garner | 09 367 0907 | craig.garner@ema.co.nz Deborah Carruthers | 09 367 0947 deborah.carruthers@ema.co.nz Caryn Leitgeb | 07 839 2710 | caryn.leitgeb.@ema.co.nz
Auckland | Karen
www.ema.co.nz | learn@ema.co.nz
Out & About Inspirational Strategies in Talent Retention Workshop, Auckland
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|1 Mel Hawkins and Sina Pereira [Inspire Group] |2 Emilija Nikolic [Inspire Group] and Bridget Morris [EMA] |3 Brenda Myburgh and Linda Sayles [Southern Cross Health Society] |4 Alan Roberts and Naomi Austin [First Assistance] |5 Andy Elliott [ Advanced Aerospace] |6 John Ryan and Megan Adams [JR Duty Free] |7 Sue-Jin Loo [ProPharma] |8 Tim Walton [Auckland Council] |9 Chris Blair and Mish Pepperell [GS Group] |10 Marie Harber [Dean Greenwood Swim School] and Peter Watson [Master Equipment] | 11 Helen Worsop [Rinnai NZ]
Health and Safety Representative Training, Stage 2 - Auckland
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|1 Doreen Grogan [USL] |2 Dean Miller [Transworks], Alexander Topp [Pharmacybrands] and Richard Barge [Mainstream] |3 Jim Thompson [Hydraulink] |4 Grant Lane [Ports of Auckland] |5 Merilyn Mallowes [Designer Textiles] |6 Paul Grimshaw [Linfox Logistics] and Aneel Kumar [Hydraulink] |7 Darryl Keohane [Ports of Auckland] |8 Allan Blom [Ports of Auckland] and Asim Liaqat [Hydraulink]
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Save 14% on a fixed term PowerFreeze electricity plan today.*
At Genesis Energy, we want to help EMA members get a great deal on their energy. That’s why we’re offering members a special 14% prompt payment discount on a fixed term PowerFreeze electricity plan.* We understand your energy needs and are committed to giving you better, simpler and smarter ways to manage them.
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*This offer is only available to EMA Northern region members (EMA Members), who sign up to, or are currently signed up to, a fixed term PowerFreeze agreement with Genesis Energy for the supply of electricity. This offer excludes residential and time of use (TOU) customers, customers on standard electricity pricing plans, and customers of natural gas and LPG products. The Offer is a 14% prompt payment discount (PPD), provided their electricity account is paid in full by the due date. EMA members must contact Genesis Energy on 0800 600 900 and quote their membership number to receive this offer. Once the EMA membership is confirmed the 14% PPD will apply from the EMA member’s next electricity bill. Should the EMA member cancel their membership, the PPD will revert to Genesis Energy’s standard PPD. Genesis Energy reserves the right to change or revoke this offer at its discretion at any time. Eligibility criteria, early cancellation fee and Genesis Energy PowerFreeze terms and conditions apply.