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Employment Relations (Protection of Young Workers) Amendment Bill (Consistent) (Sections 5, 19) [2012] NZBORARp 73 (14 November 2012)

Last Updated: 27 May 2020

Employment Relations (Protection of Young Workers) Amendment Bill

Consistency with the New Zealand Bill of Rights Act 1990: Employment Relations (Protection of Young Workers) Amendment Bill

14 NOVEMBER 2012

1. We have considered whether the Employment Relations (Protection of Young Workers) Amendment Bill (‘the Bill’) is consistent with the rights and freedoms affirmed in the New Zealand Bill of Rights Act 1990 (‘the Bill of Rights Act’). The Bill is a Member’s Bill in the name of Rino Tirikatene MP. The Bill was introduced into the House of Representatives on

18 October 2012 and is awaiting its first reading. We understand that the next Members’

Day is scheduled for Wednesday, 14 November 2012.

2. We have concluded that the Bill appears to be consistent with the rights and freedoms affirmed in the Bill of Rights Act. In reaching that conclusion, we have considered the consistency of the Bill with s 19 (freedom from discrimination).

The Bill

3. Currently, workers of any age employed under a contract for service (contractors) are excluded from the definition of “employee” under the Employment Relations Act 2000 (the Act). Contractors are not automatically eligible for the legal protections and benefits an employee is entitled to under the Act and other legislation, such as annual holidays, sick and bereavement leave, the ability to apply for flexible working arrangements, the entitlement

to lodge personal grievances and the benefits of the common law mutual obligation of trust and confidence between employers and employees.

4. The effect of the Bill is to deem all persons aged 16 and under who perform labour for remuneration under a contract for service in New Zealand are an employee, unless the labour is for an individual’s personal, domestic, household use or consumption. The Bill does this by amending the definition of employee under the Act (cl 5).

Consistency with the right to Freedom from Discrimination

5. Section 19(1) of the Bill of Rights Act affirms the right of everyone to be free from discrimination on the grounds set out in the Human Rights Act 1993. The grounds of discrimination are set out in s 21 of that Act, and include age (commencing at 16 years of age).

6. A provision may limit the right to freedom from discrimination where:

a. it draws a distinction on one of the prohibited grounds of discrimination; and

b. the distinction involves material disadvantage to one or more classes of individuals.

7. In Ministry of Health v Atkinson, the Court of Appeal held that “differential treatment on a prohibited ground of a person or group in comparable circumstances will be discriminatory if, when viewed in context, it imposes a material disadvantage on the person or group differentiated against.” 1

8. Clause 5 of the Bill creates a distinction between workers employed under a contract for service aged 16 and under, and those employed under a contract for service who are 17 years and older, meeting the definition of differential treatment in comparable circumstances.

9. The advantage conferred, automatic entitlement to various protections and benefits of an employee under the Act and other legislation, could be construed as “material” – the express intention of the Bill appears to be conferring an advantage on a group perceived to be vulnerable.

10. However, workers aged 17 or older, employed on the same type of contract, would not be automatically entitled to any of these protections and benefits. Such workers would have to negotiate with an employer to obtain similar benefits, which is the current position for people of all ages employed as a contractor. In terms of vulnerability and maturity, a 17 year old may be in a substantially similar position to a 16 year old.

11. We have considered whether the Bill could fall within s 19(2):

Measures taken in good faith for the purpose of assisting or advancing persons or groups of persons disadvantaged because of discrimination that is unlawful by virtue of Part 2 of the Human Rights Act 1993 do not constitute discrimination

12. Butler suggests that s 19(2) is best understood not as a formal exception but as an aid to interpreting the scope of the prohibition in s 19(1). 2 The measure being implemented by the Bill aims to advantage young workers who are perceived as being vulnerable. However, there is no evidence showing that those aged 16 and under have been discriminated against because of their age to bring the Bill within s 19(2). In this instance we consider that the better approach is to consider whether the differential treatment is justified under s 5 of the Bill of Rights Act.

13. We have noted that the precise effects of the amendment are not clear as the current legal context and market influences are complex. Some employers specifically employ younger workers 16 years of age as contractors, for example to complete a paper run or circular delivery. The Bill may have the inadvertent effect of deterring employers from seeking to hire those aged 16 and under, but we ultimately have no evidence to suggest that is the case. It is also unclear to what extent the benefits of being an employee will confer a real advantage in the context of some of the types of work undertaken by those aged 16

and under. We also note the different treatment of employees and contractors who are

minors (including 16 and 17 year olds) under the Minors’ Contracts Act 1969.

1 Ministry of Health v Atkinson [2012] NZCA 184 at [109].

2 Butler and Butler, The New Zealand Bill of Rights Act: A Commentary at 17.18.3

14. On balance, despite the fact that the precise effects of the Bill and extent of the advantage being conferred are unclear, we consider that the Bill does confer an advantage that could be construed as material, and consider that it is appropriate to consider whether the differential treatment is justifiable under s 5 of the Bill of Rights Act.

Justified limitations

15. Where a provision appears to limit a particular right or freedom, it may nevertheless be consistent with the Bill of Rights Act if it can be considered a reasonable limit that is demonstrably justified under s 5 of that Act. The s 5 inquiry may be summarised as: 3

a. does the objective serve a purpose sufficiently important to justify some limitation of the right or freedom?

b. if so, then:

i. Is the limit rationally connected with the objective?

ii. Does the limit impair the right or freedom no more than is reasonably necessary for sufficient achievement of the objective?

iii. Is the limit in due proportion to the importance of the objective?

16. The objective of the Bill appears to be to protect young workers from exploitation. Young workers may be vulnerable during contractual negotiations or during the term of employment. We consider the objective of protecting young workers to be sufficiently important to justify some limitation on the right to be free from discrimination. We also consider that the automatic conferment of the status of “employee” on those aged 16 is connected to the objective of protecting young workers. By virtue of the amendment, workers aged 16 and under will no longer have to negotiate to obtain the benefits of an employee. At a general level, those aged 16 will be less mature (and more vulnerable) than those aged 17.

17. When considering whether the limitation minimally impairs the right it is appropriate that a degree of deference or latitude is given to Parliament.4 Employment relations and the entitlements of young people are key social policy areas. The Bill, in seeking to advance the interests of young persons who are perceived as vulnerable in an employment context because of their immaturity, must draw a line somewhere by way of age restriction. In this context we consider that the question is not whether the proposed limitation on a right or freedom is the least intrusive limitation possible, but whether it lies within the range of

reasonable limitations. In Hansen, Tipping J made an analogy to a shooting target where the

3 Hansen v R [2007] NZSC 7.

4 Hansen v R [2007] NZSC 7 at [113] – [116] per Tipping J.

subject matter is the bull’s eye, and the area around the bull’s eye represents the margin or

latitude available to Parliament. 5

18. In previous advice we have noted that age restrictions necessarily involve a degree of generalisation, without regard for the particular abilities or maturity of individuals within the distinguished age groups. Age restrictions are set in law at different points for different

purposes. In some contexts (e.g. the Second Hand Dealers and Pawnbrokers Bill in May 2003 and the Wills Bill, August 2006) an age restriction has been justified in terms of section 5 of the BORA as a reasonable limit prescribed by law as can be demonstrably justified in a free and democratic society. In other contexts (e.g. the Care of Children Bill in May 2003), we have concluded that they cannot.

19. The Minors’ Contracts Act 1969 defines a minor as being any person who has not reached the age of 18. This Act creates a distinction between the enforceability of contracts against minors and those who are of full age; offering a degree of protection for minors that appears to be based on their perceived immaturity. However, we note that the Act distinguishes between minors who are contractors (s 6, the contract is presumptively unenforceable against a minor) and minors who are employees (s 5, the contract is deemed to be of full effect).

20. In contrast those aged 17 and over are treated as adults for the purposes of the criminal law and are dealt with in adult court.

21. In drawing the line at those aged 16 and younger we consider that the Bill falls within the range of reasonable alternatives, despite being inconsistent with the approach in the Minors’ Contracts Act 1969. As mentioned above, some deference in this context, where Parliament is being asked to draw the line at which a benefit is conferred, is appropriate. The current position of those aged 17 and older is not affected by the Bill, other than through the relative advancement of the position of those aged 16. Generally, a 16 year old

is less mature (and more vulnerable) than a 17 year old. It may be unreasonable to conclude that the Bill unlawfully discriminates because it fails to deal with every case of disadvantage at the same time, effectively inhibiting government from taking steps to alleviate disadvantage of some without doing it for all. We also consider it is relevant that the precise effects of being automatically deemed an employee are unclear in the employment context.

22. On balance we consider that the differential treatment between 16 year old and 17 year olds created by the Bill is justifiable under s 5.

Conclusion

23. We have concluded that the Bill appears to be consistent with the rights and freedoms affirmed in the Bill of Rights Act.

5 Hansen v R [2007] NZSC 7 at [119] per Tipping J.

Melanie Webb

Acting Chief Legal Counsel

Office of Legal Counsel

In addition to the general disclaimer for all documents on this website, please note the following: This advice was prepared to assist the Attorney-General to determine whether a report should be made to Parliament under s 7 of the New Zealand Bill of Rights Act 1990 in relation to the Employment Relations (Protection of Young Workers) Amendment Bill. It should not be used or acted upon for any other purpose. The advice does no more than assess whether the Bill complies with the minimum guarantees contained in the New Zealand Bill of Rights Act. The release of this advice should not be taken to indicate that the Attorney-General agrees with all aspects of it, nor does its release constitute a general waiver of legal professional privilege in respect of this or any other matter. Whilst care has been taken to ensure that this document is an accurate reproduction of the advice provided to the Attorney-General, neither the Ministry of Justice nor the Crown Law Office accepts any liability for any errors or omissions.