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ISSUE 141 - OCTOBER 2016
BUSINESSPLUS
NEWS AND COMMENTARY FOR EMA MEMBERS
BUSY BEES GROWING
THE NZ ECONOMY
READ MORE: PAGE 29
MORE STORIES
Page 5, 8: Environment law protects no one
Page 13: Manufacturing driving NZ’s growth
Page 19: 90-day trials strictly enforced
Page 26: Nothing like a trade mission to get you going
PLUS: Spring Member Briefing schedule and more...
“THE BEST WAY TO DEAL WITH ANY EMPLOYMENT RELATIONS MATTER IS WHEN YOU KNOW THAT YOU ARE ON THE RIGHT TRACK, FOLLOWING THE RIGHT PROCESS. THE EMA SUPPORTS AND COACHES MEMBERS, LIKE US, TO BE PROFESSIONALS LIKE THEM” Marilou Cuison, Human Resources Manager | PAK’nSAVE Papakura Do you need help with restructures, union negotiations, personal grievances or other staff issues? LET AN EMA CONSULTANT HELP YOU. Visit ema.co.nz or call 0800 300 362 to find an EMA consultant near you.
“To champion
BUSINESSPLUS
ISSUE 141 - OCTOBER 2016
BUSINESSPLUS
New Zealand business and NEWS AND COMMENTARY FOR EMA MEMBERS
is published by
The Employers and Manufacturers Association help our members succeed” BUSY BEES GROWING
THE NZ ECONOMY
(Northern) Inc (EMA) READ MORE: PAGE 29
EMA is the major shareholder of national lobby group, BusinessNZ.
EMA head office:
145 Khyber Pass Rd, Grafton, Auckland, New Zealand
On the cover...
Private Bag 92066, Victoria Street West, Auckland 1142, NZ Manuka honey production pioneer, New Zealand
Ph: +64-9-367 0900 Manuka Group, keeps innovating and growing.
Email: ema@ema.co.nz
In Hamilton:
Full story, p29. MORE STORIES
Page 5, 8: Environment law protects no one
EMA/ExportNZ Waikato Page 13:
Page 19:
Manufacturing driving NZ’s growth
90-day trials strictly enforced
103 Tristram Street, Hamilton.
Page 26: Nothing like a trade mission to get you going
CONTENTS
PLUS: Spring Member Briefing schedule and more...
PO Box 490 Waikato Mail Centre, Hamilton 3240.
Ph: +64-7-839 2713
In Tauranga:
ExportNZ Bay of Plenty Commentary
Smart Business Centre, 65 Chapel Street, Bay Central, Tauranga, 3110. 5 EMA’s CEO Kim Campbell on: Effective use of our resources
PO Box 13202, Tauranga Central, Tauranga 3141. – a case for change
Ph: +64-7-571 0600
AdviceLine: 0800 300 362 (in NZ) or 1800 300 362 (from AUS) or
Winston Peters guest speaker at AGM in November
advice@ema.co.nz 6 Want better transport? Over to you, Aucklanders
Phone 8am-8pm weekdays for information about employment and 7 Obituary to Sir Graeme Douglas
more, plus referrals to EMA Legal lawyers and your local EMA consultant
in employment relations and/or occupational health and safety. 8 Report backs need for resource management reform
Visit www.ema.co.nz for owner and staff training programmes, confer- 9 BusinessNZ CEO Kirk Hope on: We need people with skills and work visas
ences and other events, employer guides and templates, manufacturer
services, media statements and submissions, export development and more 10 Tapping into global expertise
EMA contacts
Survey: How well does this magazine keep you informed?
Chief executive: Kim Campbell 11 Opotiki – more than farms and shops
Membership manager: Roger Carson
External Relations manager: Val Hayes
12 Seen @ Mayoral candidates’ debate - Auckland
Advocacy and Industry Relations manager: Mark Champion 13 Manufacturing driving NZ’s economic growth
Learning manager: David Foley Employment
Enterprises and Strategy manager: Mauro Barsi
Industrial Relations and Safety manager: Paul Jarvie 14 Avoiding employment traps with employment agreements
Finance and Technology manager: Paul Yeo 15 Apprenticeships making a comeback in NZ
Corporate and Building Services manager: Sheree Alcock
ExportNZ manager: Catherine Lye
16 Employment Chat – Q and A: Coping with health and safety, underpaying
competitors and public holiday pay
BusinessPlus is free and available to EMA members only 18 20 EMA members reach finalist status in Best Workplaces Awards
Editor: Mary MacKinven, +64-9-367 0939, mob +21 636 089,
19 Case law: Strict rules relating to 90-day trial periods
email mary.mackinven@ema.co.nz 20 The end isn’t nigh for worker safety and wellbeing
Designer: Ripeka Mikaere | Printer: MHP | Distributor: Rocket Mail In business
Advertising sales: Colin Gestro, Affinity Ads, mob + 27 256 8014,
email colin@affinityads.com 22 ICT: Choose the computer solution based on the business problem
ISSN No. 1176-4953 23 Wellbeing: Nutrition - the game changer your business needs?
24 Marketing: Marketing-led approach leads to market leading
25 Selling up: Strategically exiting a significant business
International trade
EMA is yours 26 Nothing like a trade mission to expedite exporting
Enterprises of all types and sizes belong to EMA for a variety
of benefits: 27 Business opportunities for NZ in Cuba
• The latest information and advice on everything to do Member profileS
with employing staff or managing contractors, and legal
representation if employers require - at member rates;
29 Manuka Group: Busy bees grow their Manuka honey business
• A choice of 100-plus courses and tailored training 30 Zealong Tea Estate: NZ tea tempts German tastebuds
options, plus specialist seminars and events on topics
Over the Moon Dairy: International recognition for NZ cheese
such as Lean practice and developing markets offshore
through EMA’s Export New Zealand division – all 31 Spring Member Briefings schedule: book now!
providing opportunities to network;
• Ensuring your voice is heard by local and central
government, since our aim is to improve the environment + Inside: Training Plus insert detailing October training courses, and more
in which your business operates.
BusinessPlus October 2016 3
10 WAYS WE HAVE HELPED
YOUR BUSINESS
Been deeply involved in making Provided economic and employment
01. practical changes to the Health & 02. updates to more than 6000 people
Safety at Work Act via our regular Member Briefings
Introduced the concept of Employment Continued to raise the importance of better
03. Readiness Certificates for school leavers 04. transport infrastructure and funding for
this
Promoted the need for a more efficient Been instrumental in the passing of
05. planning and consent process 06. legislation protecting migrant labour from
exploitation
Fought to mitigate members having to Answered more than 30,000 queries from
07. bear unnecessary costs of earthquake 08. members via our AdviceLine service in the
strengthening for buildings in low risk past year
areas
Provided more than 750 training, Delivered a reduction
09. networking and conference events for 10. in ACC levies
our members, which were attended by
more than 10,000 people
NZ 0800 300 362 | AU 1800 300 362
www.ema.co.nz
CEO COMMENTARY
By Kim Campbell
Effective use of our resources
– a case for change
The launch of our campaign to reform the EMA has been vocal on reforming the its environmental goals.
resource management system marks a Resource Management Act (RMA) for many
significant milestone for the EMA. years. We know that this piece of legislation Rigorous evaluation and monitoring of
has been the bain of your life and most outcomes has been limited, resulting in
In late September, we and the Property businesses consider it a handbrake on an erosion of the potential for adaptive
Council of NZ and the New Zealand Council development - particularly when it is governance and robust implementation.
for Infrastructure Development, released combined with the Local Government
a ground-breaking piece of research Act and the New Zealand Transport It’s time to put the party politics aside, and
conducted by the Environmental Defence Management Act. have a mature debate about how we as
Society (EDS) – which you can read more a nation want to effectively manage our
about on page 8. In this latest development, we can now resources.
say the current system is not working for
You may well wonder why business business, nor serving the needs of the While we initially believed a reform of the
organisations such as ourselves would environment. We commissioned the EDS to Act was required, we are now of the view
have teamed up with an environmental explore whether the RMA had delivered to that the debate goes beyond this. There is
organisation. The answer is simple: the desired environmental outcomes, as part no quick fix on offer here.
current resource management system of a wider assessment of the efficacy of the
is not working for anyone – no matter Act. What’s important is that we, as a nation,
which side of the debate you sit on, the need to explore the options for change.
one thing we all agree is that there is an Now in its 25th year, and having been These may be legislative, they may
overwhelming need for change. amended more than 20 times, the RMA be institutional, these may be around
has not met the environmental outcomes process – whatever they are it’s important
This research delivered the empirical expected of it, according to this research. that we marshal a new era for resource
evidence that our current system is failing management.
the environment. A lack of national direction has limited the
potential of the resource management • Kim Campbell is the CEO of EMA. Email
As a member, you will be well aware the system to effectively and efficiently achieve kim.campbell@ema.co.nz
Winston Peters guest speaker at AGM
Come along to our annual general meeting known for his role as kingmaker when he held
(AGM) on November 9 and gain an insight into the balance of power after the 1996 election. He
how New Zealand politics will shape up over the eventually formed a coalition with National.
next 12 months leading into the 2017 general
election. The question is, will he be kingmaker again in
2017?
With The Right Honourable Winston Peters as the
guest speaker, you will be left in no doubt about AGM details:
his view of his role in the next Government. Date: Wednesday, November 9
Time: 4pm-6pm: AGM meeting, guest
While he is the current MP for Northland and speaker and refreshments
Leader of New Zealand First, his political career Venue: EMA Business Hub, 145 Khyber Pass
spans almost 40 years since he first entered Road, Grafton, Auckland
Parliament in 1978 as a National Party MP. Please register your interest with kylee.
goodwin@ema.co.nz if you would like to
Arguably, under the MMP environment, he is best attend the AGM.
BusinessPlus October 2016 5
COMMENTARY “The EMA would have liked the same urgency applied to
By Alan McDonald actually building the required infrastructure.”
Want better transport? Over to you,
Aucklanders are going to have to pay more options for progressive congestion our transport future. But, they must also be
for better public transport, better road charging. convinced that the future vision will deliver
links and less congestion on the roads - the promised benefits. That leadership
somehow. Enhanced roading, public transport and must come from our Mayor, Council and
traffic management systems are all part perhaps a specialist ATAP-style body
That’s the clear message that emerged of the equation, but ATAP is pinning its charged with delivering the newly aligned
from the findings of the Auckland Transport hopes on reduced congestion on a yet- transport strategy.
Alignment Project (ATAP) announced in to-be-identified road pricing mechanism.
mid-September. ATAP has been a success That is hoped to shift the mindset and Public Private Partnerships would be
for Transport Minister Simon Bridges behaviour of Auckland drivers towards one way to speed up project delivery;
and Auckland Mayor Len Brown, in that off-peak schedules and public transport in Infrastructure Bonds could spread costs
central government and Auckland local sufficient numbers to reduce congestion in over future generations of Aucklanders
government, plus the transport planning 2027 by about 6 per cent of 2013 numbers. who also benefit from today’s projects; and
agencies, all now agree the transport That’s roughly equivalent to the freer flow asset reallocation might help unlock the
priorities for the city and the region. of traffic we see every school holiday in Government’s wallet by demonstrating
Auckland. Auckland is willing to contribute its share
The result is a 10-year programme of – much as Christchurch has shown during
transport priority projects – basically the Who pays the $4bn the rebuild.
Auckland Transport Plan developed by shortfall?
Auckland Council and Auckland Transport In the meantime there is no urgency to The ATAP report acknowledges the
two years ago, plus a NorthWestern reduce worsening congestion and not urgency around finding funding solutions,
Busway. even a hint at where that extra $4bn might and proposes a work stream to address that
come from, although Auckland Council’s issue as early as next year.
At nearly $24 billion that’s $4bn more than chief executive Stephen Town made it clear
the previous forecast spend. But there is no at the ATAP briefing that the majority of The EMA would have liked the same
clue as to where the $4bn will come from. that funding was expected to come from urgency applied to actually building the
Auckland Council. required infrastructure.
Why the 10-year delay in reducing
congestion? That’s how long it will take Auckland ratepayers and road users will The EMA takes issue with some of the ATAP
to assess and implement the technology have to accept they have a role in funding priorities, as enhanced port access and the
6 BusinessPlus October 2016
Obituary to Sir
, Aucklanders Graeme Douglas
second stage of improved airport access
By Kim Campbell
should be included in the early priorities
rather than in the intermediate phase. Founder and joint managing
director of Douglas
We will also continue to push for three- Pharmaceuticals, Sir Graeme
laning of the Mt Wellington overbridge as Douglas, passed away on
part of the East/West link. September 1. The company has
been a member of EMA for 35
But ATAP has also been a significant success years.
in identifying an agreed set of priorities.
With the multitude of agencies and It was as if you were the only
ownerships/responsibilities for various parts person on earth when you met
of Auckland’s transport network, it’s great to him; his personal attention and
have that alignment. simple, old-world manners never
permitted him to be anything but
Let’s get on with it. attentive, polite and charming…
year in and year out.
Proposed contractors law
defeated A quiet, determined man with
A special thanks to all our member unshakeable personal values,
companies who responded to our call possessed of a sharp intellect and Sir Graeme Douglas
to action recently, which resulted in tough inner resolve.
defeating the Minimum Wage (Contractor
Remuneration) Amendment Bill. Often underestimated, Sir Graeme Douglas was at the same time a shrewd
and determined businessman and a generous, charitable philanthropist. He
Our members emailed MPs and raised was a colossus in the Auckland business community, standing stride of an
awareness of what was a flawed piece of international pharmaceutical enterprise he started in his Pharmacy in Te Atatu
law – and which was defeated by one vote in , and now employing more than 450 people.
Parliament in late August.
I doubt his headmaster at New Plymouth High school saw the promise of the
That was influenced by your direction and distinguished old boy he would spawn, nor indeed his best mate Sir David
support, along with pressure applied by our Levene who was knighted on the same day as Sir Graeme at Government
sister membership organisations around the house. Graeme would marry Ngaire, whose sister would marry David.
country.
We first met when we were competitors in the pharmaceutical industry nearly
The Contractors Bill would have imposed 30 years ago, and he subsequently asked me to become a director of his
restrictions on contracts for services, company.
requiring those in contracting arrangements
to be paid the equivalent of the minimum In the intervening years I have observed how he was able to build his business
wage or higher. Members were telling us steadily; without fuss, enter and exit markets with good timing, believing in his
their concerns were not that businesses people and building durable relationships around the world. He was the type
would have to pay the minimum wage. of businessman who makes you proud to say you are in business.
Rather, it would have meant Government
would have to set a minimum contract rate He will be deeply missed by his many charities, his dedicated staff, his sons Jeff
for services in order to address concerns and Richard, his wife of nearly 60 years Ngaire, his extended family and a huge
about poor remuneration practices. The community of colleagues and business associates.
Bill would have blurred the line between
contracts and employment agreements. New Zealand has said farewell to one of its leading citizens and I have lost a
dear friend.
• Alan McDonald is policy director at EMA.
Email alan.mcdonald@ema.co.nz • Kim Campbell is chief executive of EMA. Email kim.campbell@ema.co.nz
BusinessPlus October 2016 7
COMMENTARY
By Alan McDonald
Evaluating the
Report backs need for resource
environmental
management reform
outcomes
The Reso
urce Mana
human gement
activities Act has
landscap on New jurisdicti
es and Zealand’ on over
unique s fragi many
outcome wildlife. le islan of the
s of the d ecos impacts
RMA have This repo ystems, of
of poor rt conc exception 9. A narr
impleme not met ludes al
ntation, expectati that the ow rang
Addressin but also ons, large environm e of instr
g air disc due to ental has been uments
impleme harges, a wide ly as a employed
most poin range result
nting mitig behaviou to gene
of the R
t source of othe r chan rate
standard ation and r facto ge whic
ising deci offsetting freshwate rs. instances h, in man
MA
most com sion-ma to addr r disc harges, , has not y
munities king and ess unav purpose. been fit
can func providing oidable better for
tion are a fram impacts, likely poss outcome
all achi ework ible throu s are
The effec evements within
tiveness which a broa gh emp
of the it can der rang loying
commun claim. e of instr
ity aspi RMA woul including
rations d seem uments,
but has to have economic
been weak are more instrume
easily been grea
The Act est whe reconcile test whe nts.
has been re reso d with re 10. futu
urces extractive re refor
and weak strongest are past m of the
Evaluating the
est on on adju comforta inter ests, managem resource
dicating
Our report on the environmental There were two parts to the report.
longer overarch ble alloc ent syst
term strat ing man individua ation limit New Zeal em for
egic issue agement l perm s. and shou
the goal of cum itting func
of sust s. As a ulative tions, only whe ld proc
environmental
ainable result, effects re the eed
below. managem it has and othe anticipate
Some largely improvem
are sym ent to failed r ents are d
ptoms date. The to achi
of othe key issue eve and whe certain
r key issue re any
outcomes
1. Whil s are iden changes
e the RMA s – they tified based are
outcomes of the Resource Management
has brou are all on robu
linked:
A report by the
it coul ght toge st evid
d be more ence.
integrate ther a lot of
be bett The rese
of the RMA
er joine d. Ther decision tting of
d up to e are still -making case law
enhance key exclu processe King Salm through
overall sions that s, on and
2. A lack environm improvem the ongo
of effec ental outc should ing
tive strat ent in
omes. planning
Part one lookedEnv
has redu egy and of natio , availabili
Act (RMA) paints a dim picture. ironme
at what measures were
ced the oversigh nal direc
ty
ntal Def
including potential t of deci public tion and
A report by the to prot expectati rising
ence Society
the capa ect envi sion-ma
city to ronmenta king potential ons sign
manage al that
Environmental Defence 3. The cumulati l value
s,
of the
Act is the
Society incorrect
jurisprud
ve effec
ts.
unlocked
. The RMA
only just
being
undermin ence relat for New is the
ed the Zealand’ flashpoin
potential ed to the s effor t
June 2016 reset of ‘overall with sust ts to grap
available to assess the outcomes for
the case for envi balance’ ainability
law and ronmenta and it ple
l bottom approach seem woul
other we have som d
4. Agen amendm lines to
ents are be appl e work
cy capt likely to ied. The to do.
ure of see this
vested (particula This chall
interests rly loca improve. enge is
appropria has redu l) gove projected far from
ced the rnment dissipatin
June 2016
tely man power by populatio g.
age effec of the economic n and
A little over a year ago the EMA joined the environment since the introduction
ts on the RMA to growth
5. A lack environm pressure will only
of natio ent. s on the sharpen
system nal direc restructu environm
to effec tion has ring of ent, and
tively limited econ
and effic the pote will be omic syst
iently ntial of required ems
6. Agen achieve the RMA sustaina to achi
cy capa its envi bility (suc eve genu
The purpose of this project city has ronmenta ine
h as ‘curb
forces with the Property Council NZ and of the RMA. They painted a pretty dim
is to explore whether the the RMA often l goals. the appe
Resource Management and oppo been insuffi tite of ing
Act 1991 (RMA) has delivered finan amended rtuni
and much-discussed cien mus the afflu
desired environmental outcomes cial and ties for cent , t to succ t recognis ent’).1
for logistical ral gove essfully e the curre We
New Zealand. It is intended the Act’s impact on ort impleme of the
to complement wider assessments supp economic and rnment nt RMA and nt failin
of have gene to prov act upon gs
the efficacy of the Act. 7. The environmental outcomes rally not ide to mars
The project is focused on design is a common hal in them,
gathering the best of impl been take a new
available information on different topic of ementing although
conversation, n. genuine era of
the state of the environment more
in New Zealand mandate institutio adoption
New Zealand Council for Infrastructure picture, with much of our native flora
and the influence of the the best more the sformer requires than the latter. ns and of sust
RMA on that state. This means systema allocation ainability
evidence is intended .
to help enable an informed of deliv tic revie of
discussion on the future ering on w to ensu
of the RMA. statutory re it is
8. Rigo Often missing from this aspiratio
rous eval discussion
uation ns.
The RMA was the first legislation eroding is an empirical
and mon element. The
internationally to enshrine the pote itoring
sustainability in its overriding the concept of ntial of
critical issue
for really is, has theoutc omes
purpose which is ‘to promote adaptive RMA has been
the sustainable
Development to commission a report and fauna, maritime and freshwater
management of natural delivered on its environmental governan limited,
and physical resources’. ce and
Now in its 25th year,AEvAluA
the TINg ThE robust
of the Act remains high profile ENvIRO goals impleme
JuNE 2016T by ThE ENvIRONMENTAl and if not, why not? This
REpOR
amongst observers of environmental ntation.
and economic NMENT OuTcOMES
management and it is highly is theAlkey
DEfEN Of ThE
question
y that this
cE SOcIET RMA
visible compared with other
legislation. Often
report seeks to answer. 1 benid
ickson
et al, 2011
to analyse the effectiveness of the environments, in a poorer state than they
EvAluATINg ThE ENvIRONMENTAl
A REpORT by ThE ENvIRONMENTAlOuTcOMES Of ThE RMA
JuNE 2016 DEfENcE SOcIETy
RMA in protecting and managing New were in 1991.
Zealand’s environment. Part two of the report focused on the
The purpose of this proje
ct is to explore whether
The notable exceptions were
Act 1991 (RMA) has delive
red desired environmental
implementations
the Resource Management andamen
effectiveness of the
ded and much-discussed
outcomes for ,
Those findings are now available and improvements NewinZeala
airnd.quality,
It is intendedpossibly
to complement wider asses RMA, and
sments of
the results are
the telling.
Act’s impa ct There
on economicis and
the efficacy of the Act. envir onme ntal
we’ve been sharing them with key driven as much by the HealthTheAct
available information on
and
project is focused on gathe
wide agreement
ring the best among thoseoutco various
mes is a common
topic of conversation, altho
the state of the environme ugh
nt in New Zealand
stakeholders, relevant Government other legislative change,
and the as much
influence of the RMA on as by stakeholders
that state. This evidence
involved on
more a daily basis with
the former than the latter
.
is intended
to help enable an inform
ssion on the future the
of theAct,
Ministers and opposition politicians the RMA, and in the significant reduction RMA. that it needs significant or some
ed discu
Often missing from this
discussion
leading up to, and since, the formal of point source (drains,
The RMA was thesewers,
first legislation internation
reform to meet its environmental is an empirical element.goals.
The
ally to enshrine the conc
ept of
launch of the report’s findings late last wastewater outlets) pollution
sustainability in its overr
into
iding purporivers,
se which is ‘to promote
the sustainable
critical issue really is, has
the RMA
management of natural delivered on its environme
month. lakes and maritime environments.
of the Act rema
and physical resources’
. Now in its 25th year, the
profile
CONTINUED on
goals and
ntal pg28
ins high amongst observers if not, why not? This
of environmental and econ
management and it is highl omic is the key question that
y visible compared with this
other legislation. Often
report seeks to answer.
EvAluATINg ThE ENvIRON
MENTAl OuTcOMES Of
A REpORT by ThE ENvIRON ThE RMA
MENTAl DEfENcE SOcIETy
JuNE 2016
8 BusinessPlus October 2016
“We have skills shortages despite bringing in many
skilled migrants basically because our economy BusinessNZ COMMENTARY
keeps growing. The shortages are a by-product of By Kirk Hope
economic growth - surely a good thing.”
We need people with
skills and work visas
Migration is in the news at present. We of your city or town are students We have skills shortages despite bringing
hear concerns about large numbers of paying fees to New Zealand education in many skilled migrants basically because
immigrants, especially in Auckland, and organisations, accommodation our economy keeps growing. The
about the fact that many low-skilled providers and host families. shortages are a by-product of economic
people are getting work visas. growth - surely a good thing.
Temporary migrants also come as
These concerns have a lot to do with working holiday-makers. This is another The issue of low-skilled migrants
business. large group, of mostly young people displacing low-skilled New Zealanders is
from Europe, the US and other places. not such a good story.
The numbers need to be seen in context. They fill skill gaps in many parts of the
Globally, temporary migration is not country, for example, the Christchurch Employers are commonly seeking
out of the ordinary. Just about every rebuild and Queenstown’s hospitality employees who are available where the
developed country is seeing rapid scene rely heavily on these workers. job is located, who have a driver’s licence,
growth in migrants because people are drug-free and have a positive attitude
worldwide are more mobile and many Then there are people on essential skills to work. Unfortunately it can be hard to
economies are in a state of flux. work visas, employed in New Zealand find such employees in New Zealand, and
with skills that are in short supply – or a migrant on a work visa can be a better
In New Zealand the rise in immigration not. option.
is not out of the ordinary either. New
Zealand has always been a country of Addressing concerns What should we do about these issues?
high inflows and outflows of people, There are two concerns being voiced There’s no shortage of things we can do
often on a cyclical basis – only a few around these. to improve the delivery of skills into the
years ago there was huge concern about economy.
a brain drain and exodus. The first is that many visa holders don’t
have the right skills to address our We should keep improving the targeting
The immigration effect is more shortages of high-level skills – in trades, of skills by Immigration NZ and make it
noticeable in major cities because technical areas and so on. easier and faster to get in-demand skills
that’s where migrants tend to go, and onto Immigration NZ’s skills shortage lists.
Auckland’s growing pains are similar to The second concern is that many
what’s happening in many other large visa holders are low-skilled and are We should work towards getting a more
cities in the world. displacing low-skilled New Zealanders in responsive education and training system
a number of occupations. to produce more of the skills we need.
Immigration is not a simple,
undifferentiated pipeline; there are It’s suggested that our immigration We should reduce the requirements on
several ways temporary migrants come system could address both issues by small businesses when seeking to hire a
here. better targeting important skill needs. worker from overseas.
First, they come as tourists. Tourism is a Immigration does need to provide us We should investigate how to address
major earner for New Zealand, making with skills to drive quality economic “willingness to work” issues.
us over $10 billion a year and many growth, while helping businesses
temporary migrants are simply tourists. manage the transition up the value What we shouldn’t do is clamp down on
chain. temporary migrants coming here on work
They also come as students. Export visas, because for many reasons in many
education (schooling overseas students While the immigration system could be workplaces we need them.
here) is another major industry, earning improved – and business would like to
us about $3 billion a year. Many young see some changes – the issues aren’t • Kirk Hope is chief executive of
people you might see on the streets just about immigration. BusinessNZ. Visit www.businessnz.org.nz
BusinessPlus October 2016 9
COMMENTARY
Tapping into global expertise
Read how Callaghan Innovation helped “Engaging with this expert gave us
Methven get the international design answers to our questions, led to a far
expertise it needed, without it leaving the greater knowledge of the topic at
country. hand, and brought out valuable new
knowledge in other associated areas.
Methven is a market-leading designer and
manufacturer of showers, taps and valves. “The value for us lies in both the quality
It is an international business operating and the speed of knowledge gained,
in New Zealand, Australia, China, the UK, without our allocating any significant
Europe and the Middle East. internal resources.
Methven celebrates 130 years of innovation “This has saved us two to three months
in 2016 and has recently set out plans to by greatly reducing the need for in-
grow the business to $130 million revenue house research and identifying technical
by June 2018. risks early on.”
In November 2015 Methven approached Methven was awarded a Callaghan
Callaghan Innovation for assistance Innovation Growth Grant, co-funding the
with a project: the company was company $3-5 million over a maximum
investigating new technology to be used in period of five years, to increase its
manufacturing its products and engaged investment in research and development
Callaghan Innovation’s Global Expert (R&D).
programme, which enabled them to speed
up their development cycle and get to According to Methven Group chief
market faster. decisions about future manufacturing executive David Banfield, investment
processes which can be applied to many in R&D is critical for Methven to deliver
Callaghan Innovation, through its different processes, ensuring that Methven more ground-breaking products that
international networks, was able to find a would remain innovative in the industry. drive value for the business and its
technology expert who was the perfect shareholders.
fit: someone with the right balance Methven’s senior technology development
of technical knowledge and industry engineer, Stephen McCutcheon, says, • Callaghan Innovation is the
experience who was able to recommend “The Global Expert service allowed us to Government’s agency aiming to help
the best options to Methven. access specialist technical expertise quickly New Zealand businesses succeed
and effectively, with minimal time and through technology. Visit www.
This enabled Methven to make informed resources expended. callaghaninnovation.govt.nz
How well does this magazine
keep you informed?
It’s a year since we made some changes appreciate your taking a few minutes to in New Zealand and emailed to
to EMA’s monthly, free magazine for answer the multiple-choice questions. members in Australia, as part of your
members, BusinessPlus, which you are annual membership subscription.
reading right now. Our reason for the survey is to ensure
the magazine is providing a genuine Thanks in anticipation of your reply
So this month, I hope you don’t mind member benefit. when you receive the survey.
that we will email you a brief survey
to gauge your views of it. I would BusinessPlus is posted to EMA members – Mary MacKinven, BusinessPlus editor
10 BusinessPlus October 2016COMMENTARY
“We like to say we roll out the red
By Aileen Lawrie
carpet rather than the red tape!”
Opotiki – more than farms and shops
Recent economic statistics from the eastern beaches, a slower pace of life and a real relations, and Alan McDonald, policy
Bay of Plenty back up what many locals community feel. And as a Council we are director, recently travelled to Ōpōtiki to get
have known for a long time – Ōpōtiki is the working hard to make it as attractive to a better sense of issues facing members in
place to live, work and play. businesses as it clearly is to individuals. regional New Zealand.
We like to say that we roll out the red
Recent indicators show growth across the carpet rather than the red tape! Aileen says, “That visit was an opportunity
primary and manufacturing sectors across to raise awareness of the on-the-ground
Ōpōtiki, Whakatāne and Kawerau, which issues for those in the regions, and it
“Online consumption
is matched with strong growth in incomes was a great opportunity to show off the
means that even more
and spending across sectors. businesses doing well such as NZ Mānuka
businesses can base and OPAC.
The chief executive of Ōpōtiki District themselves in the places
Council, Aileen Lawrie, says the numbers they choose, rather than “I think people are often surprised at the
reflect the excitement in businesses across the places that cities range of industries we have here in town,
a wide range of industries. choose for them.” and the opportunities that just abound
here.
She says, “We have a booming local “But the formula for making that work
economy in growth industries like kiwifruit is largely our size – we are a very small “Gone are the days when regional New
and the dairy and farming sectors. But we council so the planners know the Zealand was just famers and shop owners
have a wide variety of other sectors that consents team and they know the asset – there are opportunities for businesses of
also offer fantastic opportunities in the people and the people who are planning all sizes. Online consumption means that
district. our infrastructure. We are small enough even more businesses can base themselves
to talk and still make things work in a in the places they choose, rather than the
“Mānuka products and honey are practical sense rather than get caught in places that cities choose for them. And who
spreading wealth into smaller communities red tape.” wouldn’t choose to live in a place like this?!”
up the East Coast. Agar is an unusual but
growing local industry. Tourism is growing EMA’s staff Mark Champion, general • Aileen Lawrie is chief executive of Opotiki
rapidly as well, with visitor nights up more manager of advocacy and gvernment District Council. Visit www.odc.govt.nz
than 7 per cent in the last year driven by
attractions like the Mōtū Trails.
“The high-profile Ōpōtiki Harbour
redevelopment will see a local harbour
built to service a marine farm operating
just 8km off the Ōpōtiki shoreline. The
infrastructure we are building will allow the
mussels from that aquaculture venture to
be processed right here in Ōpōtiki.
“We are already well underway planning
for the workforce needs for that industry
and the associated research, education,
infrastructure, services and skills that the
industry will need.”
Most locals and visitors can see the
attractiveness of living and working in
Ōpōtiki, with its beaches, bush, rivers and a
busy, historic main centre.
A conceptual image of the Opotiki Harbour development with
“Ōpōtiki is incredibly attractive to people – marina and revived town area (January 2016).
BusinessPlus October 2016 11@
en Mayoral candidates’ debate
Se - Auckland
Raewyn Brajkovich, Viv Beck and Fiona John King [EMA life member] and Rob Kate Marsh [Auckland Council] and Shane
Johnston [Heart of the City] Young [Platform 1] McMahon [NZ Bus]
Steve McCrone [Cornwall Strategic] and Chris Farhi [Colliers International] and Susan Warren [Comet Auckland] and
Raveen Jaduram [Watercare] Dan Boyd [Heart of the City] Margaret Brown [EMA board]
David Vinsen [Imported Motor Vehicle Adre Hodgskin [Architex NZ] and Victor Stuart Stitt, Tracey-Lee Wood and David
Industry Association] and Regan Hall Yukich [Eurotec] Bodenham [Fujitsu NZ]
[Heart of the City]
Colleen Stairmand [EMA board] and Liz Thomas and David Jack [EMA board] Jeremy Hall [Ministry of Foreign Affairs
Verity Craft [Intelligent Ink] + Trade] and Paul Sullivan [Cornwall
Strategic]
12 BusinessPlus October 2016“Yet manufacturing is an unsung hero, and its
importance is not widely recognised. This is despite COMMENTARY
the fact that it employs quarter of a million New By Catherine Beard
Zealanders, contributes $12 billion in wages, and
earns billions in export revenue every year. “
Manufacturing driving NZ’s
economic growth
New Zealand’s positive growth story manufacturing’s share has now stabilised Both those trends – part-outsourcing and
continues, with the latest GDP figures at a more realistic 11 per cent, similar to global supply chains – reflect our more
confirming that the economy is growing that of many other developed countries. connected, mobile world. They don’t mean
solidly. The international index (the PMI) which we’re losing manufacturing to “overseas”.
measures manufacturing sectors around the Instead, we are creating products in new
Even more positive is the role that world shows New Zealand manufacturing ways, making more from our creativity
manufacturing is playing in this. The has had an almost unbroken run of and design with the use of new global
latest Economic Survey of Manufacturing expansion since the Global Financial Crisis. efficiencies.
from Statistics NZ shows very strong
growth in the manufacturing sector, with Manufacturing is not a sunset industry – it Myth #4: The future is in
manufacturing for the construction sector is stable and growing. services, not manufacturing
growing 9.5 per cent and meat and dairy The service industry is growing all around the
product manufacturing growing by 8.6 per Myth #2: Food manufacturing world. As countries become richer and more
cent over the last quarter (to June). isn’t real manufacturing developed, their consumers spend more
There’s a common belief that “hard” on services – information, entertainment,
These are outstanding results, and are manufacturing is what matters, eg, financial and many other kinds of services.
obviously part of the driver for current machinery, equipment, cars, metal-based
GDP growth - manufacturing is having a products, engineered components and But the growth of services doesn’t mean
huge impact on how well the New Zealand widgets; and that “soft” manufacturing the end of manufacturing. In fact, what is
economy fares. such as bio-based, chemical, nutraceutical, happening is that manufacturing and services
food or beverage manufacturing isn’t really are morphing into each other, especially at
Yet manufacturing is an unsung hero, and manufacturing at all. more sophisticated levels. High level services
its importance is not widely recognised. – legal, financial, accounting, marketing,
This is despite the fact that it employs This belief is wrong, because manufacturing computing, etc – are increasingly part of
quarter of a million New Zealanders, is a diverse activity that includes all those the makeup of sophisticated manufactured
contributes $12 billion in wages, and earns categories and many more. In New Zealand products. And it’s becoming harder to
billions in export revenue every year. our climate and abundant natural resources say whether software, a critical part of
make food manufacturing a good strategic manufacturing, is even a product or a service.
I believe there are a lot of misconceptions choice. This doesn’t mean we don’t excel in
about manufacturing, and four myths in “hard” manufacturing – we do. But we have It’s truer to say that the future is in
particular mean manufacturing doesn’t particular strengths in food manufacturing, manufacturing and services.
earn the credit it deserves. These myths and are on a journey to turn even more of our
need busting: unprocessed food exports into manufactured Examining these four myths reveals some
food products to reap higher revenues. Food important truths about New Zealand
Myth #1: Manufacturing manufacturing is real manufacturing and it manufacturing: it’s strategic, it’s broad-
is a sunset industry earns us billions every year. based including both food and non-food
The myth of manufacturing’s decline manufacturing, it’s well integrated in the
harks back to a previous age when Myth #3: It’s all made global economy, it’s based on the ingenuity
manufacturing was a more dominant overseas anyway and creativity that New Zealand is famous for,
sector of the economy - but only because These days New Zealand firms often and it’s bringing economic growth.
it was heavily protected. Before 1984 outsource parts of the manufacturing
manufacturing made up around 40 per process to other countries where The true story of manufacturing in New
cent of the economy, however, this was efficiencies in scale and labour costs can Zealand is great news.
artificially high because tariffs and import help their competitiveness. They also
regulations protected New Zealand goods increasingly take part in global supply • Catherine Beard is executive director
against competition. chains, contributing components towards of ManufacturingNZ, a brand of
finished products that may be made up of BusinessNZ.
In today’s less regulated economy, components from many parts of the world. Visit www.manufacturingnz.org.nz
BusinessPlus October 2016 13EMPLOYMENT
By David Shannon
“…the key is choosing the right type of employment
agreement from the beginning – and putting it in writing.”
Avoiding employment traps
with employment agreements
Employers, envision this nightmare scenario. Briefly, they differ as follows: • Remuneration to be provided,
• Options for resolving any employment
The manager of a small firm, George, is • A Permanent Employee is employed relationship issues,
approached by his neighbour’s son, Mike, for an indefinite period – either full time • Reference to “time and a half” if the
who is looking for work and says he is open or part time. Employment will consist of employee is working public holidays,
to anything. regular, predictable work patterns until the • An Employment Protection Provision in
employee resigns or is dismissed. Provision the event of sale [of the business], transfer
George says, “Sure, Mike, come down to the for annual holiday pay and sick and or contracting out, and
plant and I’ll put you to work.” bereavement leave, as well as an agreed • A Restraint of Trade provision, if applicable.
notice period, must be specified.
So Mike arrives, and George sets him to Other clauses that may be included, but
general cleaning tasks. Mike works diligently • A Fixed Term Employee agrees to carefully written, could provide for:
and satisfactorily for three solid weeks. temporary employment, which ends upon • Deductions from wages for “reasonable
expiry of a fixed term, ie, on a date, or after cause”,
Once the plant is tidy, George says, a period or event. Such employment must • Prohibition on other employment if there
“Thanks, Mike, here is your pay. But we be based on “genuine reasons based on is a genuine reason, and/or
won’t be needing you anymore.” reasonable grounds.” • Trial period of employment if relevant.
The agreement must state how and why the
Here comes George’s nightmare. employment will end. Seasonal employment One of the hot issues in employment is the
is the most common example of this, as inclusion of “zero hours” arrangements in
Mike replies: “Thanks for the pay, but you there are specific agreed criteria for ending contracts, whereby the employer does not
can’t just kick me out. You employed me the employment, but the agreement must guarantee specific hours of work in a week,
indefinitely, so I am a permanent employee specify carefully the criteria. but may expect the employee to be available
and you will have to give me proper notice of At the end of the term, the employment must for any period up to the full work week. Such
dismissal. I did not agree to any temporary or end or a new agreement must be signed. clauses must have genuine reasons for the
casual employment arrangement. availability provision and include guaranteed
• A Casual Employee has no guarantee hours of employment. Reasonable
“You also owe me time and a half for working of work from one week to the next, but compensation must also be paid for the hours
Sunday – a public holiday – and I want is engaged “as and when needed”. This of availability that are not actually worked.
compensation for the leave I did not get.” is typically useful when the employee is
needed for a short period for a specific However, there are consequences if the
Mike is correct: if the employer does not purpose, such as Mike’s cleaning work. employer gets it wrong.
specify the nature and conditions of This can mean an irregular work pattern,
employment, the employee has the right depending on the work demands and the It is usually difficult to get an agreement
to assume he/she is being taken on as a employee’s availability. signed after the employee starts, as all kinds
full-time, permanent employee with all the It is important to monitor the work to of issues and objections can be raised.
rights that adhere to that condition. ensure it does not evolve into a part-time,
permanent arrangement with an ongoing There are penalties running into thousands
The key to avoiding George’s nightmare is expectation of work. Such a situation is of dollars for an employer who fails to have
choosing the correct type of employment often better served with a short, fixed-term an employment agreement in place.
agreement from the beginning – and agreement as described above.
putting it in writing. And a final word of advice: do not take this
Employment agreements article as an authority for drawing up an
Employment types At a minimum, an effective employment employment agreement. Refer to your EMA
There are three basic types of employment: agreement should include the following: employment lawyer to ensure you get it right.
permanent, fixed term or casual. Each has • Names of the parties,
different terms and conditions, including • Description of the work to be performed, • David Shannon is EMA’s remuneration
entitlements for holidays and other leave. • Location and hours of work, consultant. Email advice@ema.co.nz
14 BusinessPlus October 2016“Our workplaces are our most up-to-date
classrooms, and employers are making a EMPLOYMENT
huge contribution to the development and By Michael Burgess
deployment of skills in our workforce.”
Apprenticeships making a comeback in NZ
Consolidation in the provision of trades
training in New Zealand has seen the
number of industry training organisations
(ITOs) reduce from 42 to 11 in recent years.
But trainee numbers are growing.
These registered, but industry-owned ITOs
include the Boating Industries Association
of New Zealand Incorporated, the Building
and Construction Industry Training
Organisation and Competenz Trust. They
are responsible for:
• setting national skill standards for
their industry,
After a drop in hiring industry trainees and apprentices around
• providing information and advice to
the GFC, employment is on the increase.
trainees and their employers,
• arranging for the delivery of on- and
off-job training (including developing per cent of the tertiary budget for tuition engineering professionals (11 per cent).
training packages for employers), subsidies ($1.100m), as well as more than
• arranging for the assessment of $800m each year in student loans and Auckland has the largest construction
trainees, and allowances, according to the Industry workforce requirements in New Zealand,
• arranging the monitoring of quality Training Federation (ITF). requiring about 185,000 employees by
training. 2021. Occupations that are expected to
But as ITF chief executive Josh Williams experience the largest levels of growth
Today, 138,000 industry trainees and says, “New Zealand needs skilled workers include project builders (39 per cent),
apprentices are being supported to learn to meet the pace of technological change plumbers (38 per cent) and carpenters
on the job, receiving just 7 per cent of the and keep up with global challenges. and joiners (34 per cent), according to the
tertiary budget, or $180 million. These Our workplaces are our most up-to-date report Future Demand for Construction
learners are employed, are paying tax and classrooms, and employers are making a Workers in July 2016 from the Ministry of
are economically active. They earn while huge contribution to the development and Business, Innovation and Employment.
they learn, and do not require study and deployment of skills in our workforce.”
living subsidies through student allowances, A recent survey* of employers in the UK
or attract debt through student loans. The New Zealand apprenticeship system is highlighted the following benefits from
now open to all age groups. In 2015 there hiring apprentices:
The last official count showed almost was a 17 per cent increase in those aged
42,000 people in the New Zealand over 35, reaching 4,650 apprentices; and a Benefits of hiring Agree
Apprenticeships scheme - representing a 25 per cent increase in those aged 55-plus. apprentices (%)
slightly higher proportion of the workforce Improved product or service quality 72
than apprentices did in 1987 when the The Government’s 2016 Budget will help Improved productivity 68
apprenticeships scheme began to take a support another 5,500 apprentices into Improved staff morale 67
dive in line with growing unemployment training on the job by 2020. Improved staff retention 60
after the share market crash, among other Improved ability to attract good staff 55
factors. Construction-related Brought new ideas to the organisation 54
apprentices in demand Improved image in the sector 49
Apprentices gain a Level 4 national Across New Zealand, demand in Won business 24
certificate after two to four years combined construction-related occupations has been Lowered overall wage bill 19
work and study. projected to increase by 10 per cent or 49,000 *(Source: UK Department for Business, Innovation and Skills)
employees by 2021, to a total of 539,500.
There are almost as many industry trainees Occupations that are expected to experience • Michael Burgess is a senior policy
as there are university students, but the the largest growth include electricians (14 analyst at EMA.
146,000 university students absorb 53 per cent), plumbers (13 per cent) and civil Email michael.burgess@ema.co.nz
BusinessPlus October 2016 15Employment CHAT
Coping with health and safety, underpayi
Q. I’m dismayed that my managers are
“We also have a new health Dear Elliott
not taking health and safety as seriously There was a law change last year
and safety training game
as they should. How can I drive home the specifically designed to manage the
importance of the new law requiring us all
called WorkplaceSIM that’s exploitative employment practices around
to be proactive about these matters? - Dan done online.” immigrants, ensuring they are employed
with the minimum legal employment
Dear Dan Repeat as often as you need to, that standards such as the minimum wage, five
The quick answer is to send them to a employers – owners and managers- have days paid sick leave and four weeks paid
training programme here at the EMA a responsibility to protect people from annual leave for full time workers. Also
Learning centre in Auckland – some harm caused by workplace hazards. This is because of the kind of thing you are talking
programmes are also held in other centres not just a concern for the heavy industrial about.
or as one-off webinars, or online courses. sectors; even small office enterprises can
We also run tertiary courses resulting in have health and safety risks that could That’s the Immigration Amendment Act
NZQA-approved certificates and a diploma. result in prosecution if neglected, or worse, (No 2) 2015, which imposes up to seven
cause harm to staff or customers if ignored. years in jail for exploitation of migrant
We also have a new health and safety workers or fines of up to $100,000.
training game called WorkplaceSIM that’s It might be that a new clause needs to be Employers here on residence visas who
done online. added to their employment agreements exploit migrant workers could be deported
and those agreements re-signed and re- if offences are committed within 10 years of
Whether you want to know how to run printed for both parties. Call our AdviceLine their gaining residence.
an effective health and safety committee, to find your local EMA employment
conduct an ACC audit, identify and report relations consultants to get help in Tougher search powers were extended to
hazards or gain a better understanding of drafting that clause. You can incorporate immigration officers to enter employers’
your legislative requirements, we have a measurements and consequences for premises.
programme to suit you. failure to adhere to health and safety
practices that are required. Furthermore, this year the Government
A separate or simultaneous approach is toughened the sanctions against
to make prominent all company policies Q. How will I compete with migrant employers for breaching minimum
relating to health and safety, and make the employers who are underpaying migrant employment standards. These include
topic top of the agenda at team and other workers? Can I complain about the the possible banning of individuals from
meetings, to rub it in. treatment of migrant workers? – Elliott being a manager for serious breaches or
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16 BusinessPlus October 2016Employment CHAT
ing competitors and public holiday pay
exploitation of migrant workers. Sunday without their being required
“You decide if it’s worth
to give a reason.
it for your brand and
If you witness or have good reason to
suspect problems, you can complain to
in relation to your They will also be able to take a personal
the government agency, Immigration New competitors.” grievance if they are treated adversely
Zealand or the Labour Inspectorate at or compelled to work on Easter Sunday.
the Ministry of Business, Innovation and Remember to alter or create new
Employment, whose Labour Inspectors employment agreements to reflect • By the EMA communications team
make sure that workplaces meet at least this. in consultation with EMA Advice,
the minimum standards and requirements and loosely based on real calls to
of employment law. Or even the police. Yes there is a cost with growth, or EMA’s AdviceLine. All names are
selling more. You decide if it’s worth it fictional.
Other than that, you have to rely on the for your brand and in relation to your
usual practices to compete in business… competitors. The information in this article is a
like having a good product/service, good guide only and not to be used as
pricing/margins, great branding and Shops have been able to trade on some business advice without further
communication including your website, public holidays for a long time – except consultation.
great customer service, strictly managed for Easter Friday, Easter Sunday and
terms of trade, cash flow…not to mention Christmas Day and the morning of EMA members can start with our free
good people! ANZAC Day. You will be referring to the AdviceLine team at phone 09-367
recent law change allowing shops to 0909 or 0800 300 362 (within New
Q. Now that we can open shop on public trade on Easter Sunday, as long as your Zealand), and 1800 300 362 (from
holidays, this will make leave and rostering local territorial authority allows it. Australia), 8am-8pm weekdays NZ
more complex. Will I have to pay more to time; or email advice@ema.co.nz
attract people to work on those days? – Rose Recent legislation allows territorial
authorities to put in place local policies You can also find information at
Dear Rose that will permit shops within their area, www.ema.co.nz such as the A-Z of
Yes, when people work on statutory or parts of it, to trade on Easter Sunday. Employing – a manager’s guide on
(public) holidays you have to pay them time more than 100 specific employment
and a half to meet minimum employment The law also gives all shop employees topics, or the detailed Employer
standards. the right to refuse to work on Easter Guides on 12 popular topics.
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BusinessPlus October 2016 17You can also read
