Government to keep dismissal of non-performers law in place

Lianne Dalziel

The Government has rejected a legislative proposal which small businesses say would have been the single most important change to employment laws.

Small Business Minister Lianne Dalziel yesterday gave the Government's response to the Small Business Advisory Group's (SBAG) first annual report which suggested ways to help small and medium-sized enterprises (SMEs) grow.

SBAG's report - released in August last year - made 19 recommendations and the Government "essentially support 18 of the 19 recommendations, if not in form, in substance", it said.

But it rejected a recommendation to revise laws for dismissing non-performing staff and to provide qualifying periods for personal grievances for probationary staff.

SBAG believed they were the single most important changes "and that they would lead directly and immediately to employment and business growth".

The Government's response said the Employment Relations Act (ERA) already allowed employers to set probationary periods and gave probationary staff the same protection as other staff.

"The recent changes to the ERA aim to balance issues of fairness to employers and employees in personal grievance situations, by specifying an objective test for justifiability," the Government report said.

Dalziel said that as alternatives to a probation period, she wanted to target the employment consultant grievance industry and the confidentiality criteria on settlements.

However, she could not be more specific. SBAG member Lachlan McKenzie said he was pleased the Government had accepted there was a problem with the grievance industry.

Dalziel said most other SBAG recommendations had already been implemented or were being addressed, including:

* Extra funding for mentoring services, including funding to help SMEs establish advisory boards.

* Upgrading www.biz.org.nz to provide all business information needs.

* Establishing internal advocates for SMEs in Government departments including labour and economic development, and the IRD and ACC.

* Looking at how the Government can measure and publish compliance costs.

* Simplifying depreciation and fringe benefit tax regimes.