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What are your employer rights if Cyclone Cook closes down your business?

It’s fair to say that NZ has seen its fair share of natural disasters over recent years with Christchurch and Kaikoura devastated by earthquakes, and the more recent damage caused by freak summer storms and Cyclone Debbie.  Many regions of NZ are battening down the hatches in preparation for yet another storm, as Cyclone Cook threatens to hit our shores just in time for the Easter holidays.

The volume of natural events is starting create questions from business owners who are wanting to find out what their obligations are when they and/or their employees are affected by such an event. 

Here are some tips for business owners faced with not being able to open for business because of a natural disaster:

Before looking to make any deductions from employees’ wages/salaries:

  • Check your employment contract to see if contains a force majeure clause, and specifically a clause allowing you to deduct from wages/salary.
  • If your employment agreement does not contain a force majeure then you cannot deduct from an employee’s wages/salary, particularly where they are ready and willing to work but simply can’t because the premises are damaged/unable to be opened.

This of course then poses another question, what if I am open for business but my employee(s) have been affected and can't attend work?

  • In the event that the business is unaffected and is open for business but employees are unable or unwilling to attend work due to the natural disaster then there is potential for the employer to make a deduction from wages.

Invoking such clauses requires a robust process to be followed, and we strongly recommend that you contact a member of in2HR for further advice should your business be confronted in such situations.

With that said, our recommendation would be to do the right thing wherever possible, and pay the employees for hours that they would have otherwise worked (particularly when the business interruption is short term).  Additionally, the emotional toll these types of events has on employees can vary greatly; while some employees remain relatively unaffected emotionally and just seem better equipped to handle this type of stress, others may need further support.  Employee Assistance Programmes such as those offered by EAP (www.eapservices.co.nz) are a great resource to call on for employee support post a natural disaster.  For short term interruptons, these recommendations are sure to get your business and employees back up and functioning normally as quickly as possible.