Cancelling shifts - what you need to know

Those of you who work shifts or organise them will need to understand recent changes made to the Employment Relations Act.

There is now a specific provision relating to the “cancellation of shifts”.

Legal definition of ‘shift’

For the purposes of the law a shift is a continuous (or effectively continuous) period of work performed in a “system of work” - in other words where the employee is part of a larger operation - which may occur at different times on different days of the week.

The rules now say that if the employee is to work a shift then the employer must not cancel a shift unless the employment agreement specifies a reasonable period of notice before the shift is cancelled. If the employer cancels a shift without giving the “reasonable period of notice” then reasonable compensation must be paid, and this must also be set out in the employment agreement.

What is ‘reasonable notice?’

There are specific guidelines established in the Act for determining what may or may not be reasonable notice and also how much compensation is “reasonable”.

The reasonable period of notice is determined after having regard to all relevant factors which include: the nature of the employer’s business (including the employer’s ability to control or foresee the circumstances that would give rise to a cancellation of the shift); the nature of the employee’s work (including the likely effect of the cancellation on the employee); and the nature of the employee’s employment arrangements, including whether there are agreed hours of work in the employment agreement (and if there are then the number of guaranteed hours of work, if any, within those agreed hours).

Measuring reasonableness

The Act also specifies criteria against which the reasonableness of compensation is to be measured. Those criteria include: the period of reasonable notice; the amount of remuneration the employee would have received for working the shift; and whether the nature of the work requires the employee to incur any costs in preparing for the shift, for example travel costs.

So what happens if a shift is cancelled and the employment agreement does not meet the requirements of the Act? Answer: then the employee is entitled to be paid for the whole of the shift as if he or she had worked it.

In other instances where the shift is cancelled but the employee was not notified of the cancellation until the start of the shift, then he or she is entitled to be paid for the whole of the shift

And, if the remainder of the shift is cancelled after the shift has begun then the employee is entitled to be paid for the whole of the shift.

Employee working for another person

New restrictions have also been placed on employers about when they can, and when they cannot, prohibit or restrict an employee from working for another person.

Employers cannot restrict or prohibit an employee from working for another person unless they have genuine reasons, based on reasonable grounds, for doing so. The Act provides guidance on when a restriction or prohibition may be able to be used. Such reasons may relate to: protecting an employer’s commercially sensitive information; protecting an employer’s intellectual property; protecting an employer’s commercial reputation; or preventing a real conflict of interest that cannot be managed without including a “secondary employment provision”.

Do you need to vary your current Employment Agreement?

These changes may require a variation to your current employment agreement wording, or may suggest to you that you now include such a restrictive provision in all new employment agreements. If you have any queries, or are unsure of what the changes mean for you, then seek out someone who you trust to speak to; whether that be a union; a community law centre, your lawyer or an employment advisor.