Work trial helps disadvantaged

Last updated 05:00 11/06/2014

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Small businesses are more likely to hire disadvantaged job hunters since a 90-day trial period was introduced in 2011, research shows.

The Ministry of Business, Innovation and Employment has released a research report evaluating the short-term results of changes to the Employment Relations Act and the Holidays Act in 2011.

Legislation changes included allowing employers to use a trial period of up to 90 days for new staff, the ability for employees to cash in up to one week of annual holidays, and changes to union access and problem-resolution processes.

The changes were designed to lower employers' compliance costs, resolve problems faster and reduce confusion.

A national survey of employers found that 72 per cent of those which used trial periods had not dismissed an employee during that time, while 27 per cent of employers had dismissed at least one worker during the trial period.

The report said smaller employers were most satisfied with the 90-day trial because they faced greater risks and costs when recruiting.

Larger employers benefited less, mainly because they had more robust recruitment processes and greater resources to manage risk, it said.

Under the 90-day trial, about one third of employers said they hired staff they would not have otherwise taken on.

Some employers were now also more prepared to give jobs to groups they would not have previously considered.

Changes to the Holidays Act had partially met objectives and had minimal impact on firms' costs, the report said.

Employers and unions said the ability to allow cashing up to occur and to transfer public holidays was sensible.

But some employers said the Holidays Act provisions were difficult to apply in some cases, such as for people with variable work hours or shifts.

Changes to union access and communication during collective bargaining had little impact on employers and unions and did not increase the number of problems reported.

MBIE spokeswoman Abby Johnston said while it was too soon to assess the full impact of the changes, there were indications that some were working as intended.

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