Exclusive EMA news, advice, learning and networking Isn’t ... · On the cover: 16 Influence Baby...

AucklandPlus

ManukauWater

PotableWater

Waste

CivilDefence

AnimalPolicy

AucklandBotanicGardens

MOTAT

EconomicDevelopmt

UnitedWater

PTInfrastructur

e

Ontrack

Mt SmartStadium

ZooEnterprise

Board

Zoo

PT Services

ARTA

Crown

Art Gallery

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Auckland CityManukau CityPapakura DistrictFranklin DistrictWaitakere CityNorth Shore CityRodney District

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Ltd

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Tra cMgt

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Enterprise:FranklinManukauNth ShoreWaitakereRodney

4 C Boards

WaitakereCity

StormwaterEnvironment

Regulatory

Planning

ParksLibraries &CommunityFacilities

6 C Boards

Housingfor Elderly

Metrowater

Current Auckland Governance

Mt AlbertSwimmingPool Trust

MayoralForum

ElectoralCollege

ArtsRegional

Trust

RegionalGrowthForum

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TourismAuckland

Exclusive EMA news, advice, learning and networking I ssue 39 + Ju ly + 2007

■ The AdviceLiner: Bullies, BO & prayers at work

■ Are there tax advantages for landlords?

■ Finding out The Truth - Our P.I. investigates

In this issue:

Isn’t it time we fixed Auckland?

Staff appraisals. Or performance management?

You need to get into flexible work practice!

Where's the labour market heading?

EMA Northern & Central are the major stakeholders in:

Auckland governance: Lines of "accountablility"

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Our Vision. Your Success PAGE 1

New jobs site!

Lucky number plate for winning car

Eye care next on healthcare plans?

The real state of the labour market

04

04

16

19

02

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is published for:

EMA NORTHERN

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Ph: 09 367 0900 or 0800 800 362

Email: [email protected] Website: www.ema.co.nz

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ISSN No. 1176-4953

Globalisation and commonsenseWith Paul Winter

Kiwisaver faults in an otherwise good concept - Alasdair Thompson explains

The AdviceLiner: Bullies, B.O, and prayers at work

Are there tax advantages for landlords? (EMA's E&Y tax tips.)

GenY - A new breed?

Staff appraisals vs performance management?

Privacy: Who can you talk to?

Flexible work a must do

The risks of rushed carbon trading

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You deserve to know the truthOur private investigator and THE TRUTH

What really makes technology work?

Do meetings steal your time?

Boost your productivity: Get into Lean Production

Learning online

Auckland behaves like a ill-tempered small town. The city's cross-boundary wrangles and delays might be funny except they cost Aucklanders, and the whole country, dearly. The tangle of lines on our cover represents the plethora of interminable interconnections our 8 councils must undertake every time they do anything.The Auckland issue is not just a cost for those living in NZ's one big city. The cost of Auckland's 264 elected representatives and their council duplication is at least $400 for every ratepayer more than it needs to be, every year. Add to that lost opportunity cost and poor productivity. Auckland's dysfunction has gone on to long. We need to fix it, not by tinkering, but through transformational change. EMA has volunteered to lead the charge. The campaign starts now. www.fixauckland.com

On the cover:

16

Influence Baby Boomer Born 1946-64

GenX Born 1965-77

GenY Born 1978-94

Musical icons Elvis Presley Madonna EminemMoney Earn it It’s not everything Give it to meLoyalty

to Employer

Work my way to

the topShortcut to the top

Give me Saturday

off or I’ll quitRespecting your

eldersAutomatic Is polite Whatever!

Sex After marriage On the backseat On-lineChange Resist it Accept it Want it

(Peter Sheahan “Gen Y: Thriving and Surviving with Gen Y at Work” Hardie Grant Books, 2005)

Generation characteristics, and those of their predecessors

AucklandPlus

ManukauWater

PotableWater

Waste

CivilDefence

AnimalPolicy

AucklandBotanicGardens

MOTAT

EconomicDevelopmt

UnitedWater

PTInfrastructur

e

Ontrack

Mt SmartStadium

ZooEnterprise

Board

Zoo

PT Services

ARTA

Crown

Art Gallery

Orchestra

Nth ShoreStadium

Transit NZ

Techscape

NorthShore

StadiumTrust Board

PapakuraDistrict

AucklandCity

Auckland CityManukau CityPapakura DistrictFranklin DistrictWaitakere CityNorth Shore CityRodney District

LTNZ

Rail Track

AucklandRegionalHoldings

MuseumTrust Board

Museum

Wastewater

WatercareServices

Ltd

AucklandRegionalCouncil

ManukauCity

10 CBoards

8 C Boards 3 C Boards

FranklinDistrict

LocalRoads

Tra cMgt

StateHighways

ARTNL

NorthShore City

RodneyDistrict

Enterprise:FranklinManukauNth ShoreWaitakereRodney

4 C Boards

WaitakereCity

StormwaterEnvironment

Regulatory

Planning

ParksLibraries &CommunityFacilities

6 C Boards

Housingfor Elderly

Metrowater

Current Auckland Governance

Mt AlbertSwimmingPool Trust

MayoralForum

ElectoralCollege

ArtsRegional

Trust

RegionalGrowthForum

The Edge

AoteaCentre

TourismAuckland

08

get a griphot tips for higher productivity

EMA Business Plus Magazine - Exclusive EMA news, advice, learning and networking

By Paul Winter, Chief Executive, EMA Central

With the failure of the Doha round, the EU struggling to negotiate an acceptable ‘reform treaty’ and America’s politicians trying to out do each other in slowing down the off-shoring of American jobs, the forces of globalisation could be finally waning. But commonsense indicates otherwise.

A Newtonian law of physics says every action creates an equal an opposite reaction and good ideas and philosophies can behave similarly, but the strength and value of ideas and innovations will ultimately win out, though their shape may change as a result of debate and experiment.

Two centuries ago Adam Smith identified the economic ideas around shaping our modern competitive economies, and why globalisation makes sense. From being brought up over looking the North Sea, Smith could see that trade was the engine of wealth creation. He recognised that the specialised division of labour drove growth in UK cities and regions, and also nations to seek comparative advantage through innovation and trade. His book The Wealth of Nations records these ideas.

The inherent weaknesses of planned economies led to the widespread collapse of communist societies and took a long time to work through to reality.

Today ironically it is Nicolas Sarkozy,

the new ‘right wing’ French President who has succeeded in removing “free and undistorted competition” from a list of the EU’s core objectives in their new reform treaty.

The UK’s new PM, Gordon Brown, from the left, apparently had to make a hasty call to Tony Blair to get the phrase re-introduced into a protocol to the deal; political ideas like globalisation will ebb and flow.

Looking forward, commonsense and the desire of poorer nations for development will advance a more integrated global economy, for several sound reasons. Bill Gates speaking recently at an international conference said: “Your salary, which historically was mostly determined by what country you were in, in the future will not be determined by that, but rather will be determined by what education you’ve had.”

All countries now have a greater sense of connectedness. Advances in technology and communications are forcing the pace of globalisation. They also deliver the benefits of education to more people, provided their society values people development and the contest of ideas.

Health, like education is another driving force for globalisation. India’s PM has called for an ‘inclusive globali-sation’. He meant a partnership between rich and poor countries to address the health and educational needs of the poor

as well as their economic growth. While calling for greater interdependence for the benefit of poorer nations, the threat of avian flu demonstrates rich and poor alike are mutually dependent.

This same principle applies to other global issues such as access to energy, other natural resources and the fight against terrorism. Let’s include action against the potential impacts of climate change, provided the alarmists are shunned, and we focus on evidence and cost/benefit analysis.

Commonsense dictates we need to oppose those wanting again to isolate New Zealand. The damage being done to the productive capacity of our economy right now is because we want the benefits of aspects of globalisation – cheap finance for our housing and consumption binge – though we are unwilling to tune our fiscal policies to the realities of trading in a global economy. If we were, our nation’s policies would favour private sector investment rather than government spending.

Gordon Brown the UK’s new PM summarised all this neatly. He said recently: “I happen to believe that there is a common sense world view of an inclusive globalisation founded on free trade, open markets, flexibility and matched with investment in equipping all people to master change - including environmental change - in both developed and developing countries.”

Globalisation and commonsensePAYROLL P

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Our Vision. Your Success

By Alasdair Thompson, Chief Executive, EMA Northern

The concept of KiwiSaver is to be applauded especially because it shifts the responsibility for saving away from the government and onto individuals.

In addition it will make more funds available for investment into business through fund managers.

At least we hope it will; much investment will go offshore and to big listed companies. Only those who can afford to save will enroll, and of course people with surplus incomes already save in a whole variety of ways.

So what do Kiwi businesses stand to get out of it?

Employers weren’t consulted about the compulsory contri-butions they are being told to give their staff as announced in the Budget. KiwiSaver Mark II effectively commanded businesses to award pay rises to all staff enrolling in KiwiSaver at government dictated levels.

For the earlier KiwiSaver Mark I version there was a comprehensive consultation between business, unions and the government. The Department of Labour even set up an employer’s reference group. Not so for Mark II.

The mandatory one per cent contri-bution employers were told to pay their staff from next April might not sound much, but by 2011 a number of smaller and new businesses won’t be able to pay the four per cent required by that time.

There is a way Government can help business overcome the extra unbudgeted cost hurdle of KiwiSaver, and make the economy grow even faster, and that is that KiwiSaver surely provides an opportunity for futher tax cuts. That's in addition to the

Government contributions to those going into Kiwisaver, which is effiec-tively a tax cut for those who can afford to save of between $3-4.5 billion.

Until now we have been over taxed partly so the government can save for its national super fund. Now that the government’s need for revenue is

being provided by KiwiSaver its tax requirement is reduced; its need for tax on income has room to go down too, to compensate.

KiwiSaver won’t raise the total savings of New Zealanders very much, nor increase the nation’s GDP or our standard of living. Treasury acknowledges as much.

In the big picture too, saving doesn’t increase wealth; return on investment in value adding businesses does.

New Zealand businesses do not need access to a new warehouse of money so much as they need the confidence to invest in the skills of their staff and in new plant and equipment.

New Zealand needs a business environment that lets us take a risk to grow; cutting the company tax rate to 20 cents in the dollar would do that. Our economic modeling has shown the result from doing that would be greater productivity, higher wages and greater GDP.

On the positive side, KiwiSaver will give all those going into the scheme an interest in equity markets, and in the companies where their money is invested. It will make people more aware just how important business success is to them. And it’s never too late to fix the faults in the scheme.

Will KiwiSaver save us?

KiwiSaver discriminates against people aged 65 and over. This,

from the government that sensibly passed the law removing a

retirement age from all employment agreements and reinforced

the illegal nature of any discrimination against older people.

By making people 65 or over ineligible for KiwiSaver, and also

thoses under 18, Government is denying them access to the

$1000 tax funded kick start, a $1040 annual tax credit, and tax

free employer contributions. Its serious discrimination against

equal opportunities for older people giving older people no

encouragement to keep working though they are well valued in

today’s tight labour market.

KiwiSaver’s age discrimination is taking us in the opposite

direction from Australia. Across the Tasman from today, their

Better Super scheme will see older people in work paying

extremely low tax rates by offsetting tax free income from their

superannuation savings. This is specifically aimed at keeping

them in the workforce.

KiwiSaver seems clearly in breach of the Human Rights Act,

the Bill of Rights, and the Employment Relations Act 2000. Section

21(i) of the Human Rights Act states no one can discriminate on

the basis of age. Section 22 (1) (d) notes it is illegal to discriminate

against age for the purposes of retirement.

Section 105 (1) (i) of the Employment Relations Act states

that ‘age’ discrimination is grounds for an individual to bring a

personal grievance claim against their employer. Why should

Government rule itself above these laws?

KiwiSaver breaches human rights, employment law

KiwiSaver will give all those

going into the scheme an

interest in equity markets, and

in the companies where their

money is invested.


Students leaving university no longer have an excuse to go on the dole. They can go online instead – and find a career with your business, on the new website, www.nzunicareerhub.ac.nz.

CareerHub is a recruitment site where employers advertise for university students and recent graduates – targeting people with the qualifications and skills they need.

Employers can advertise to potentially 200,000 students in one place, instead of at seven different universities. Currently CareerHub provides access to more than 62,000 students and recent graduates.

It is priced to ensure small and medium businesses can afford it as a recruiting tool. And it is an opportunity to actively promote internships (for working on research projects).

The site has been developed by the University Career Advisers of New Zealand with support of seven of the eight universities in New Zealand, ie, Auckland University of Technology (AUT), Lincoln, Massey, University of Auckland, University of Canterbury, University of Otago and Victoria University of Wellington.

The site also entertains student visitors with events, news, employment articles and links. It replaces www.jobs4grads.net and other university job vacancy systems.

CareerHub provides search facilities and category browsing options to enable students and recent graduates at each university to find your job.

It’s also great the universities are working collabora-tively with employers to maximize opportunities for both. Learning and business are inseparable.

The site will help address the problem of skill shortages that plagues business.

New jobs site provides professional staff

Paid parental leave payments rise

From July 1st the maximum parental leave payment

increased by nearly $20 per week. The rate went from

$372.12 per week to $391.28 per week and applies to all

new applicants as well as those already receiving parental

leave payments. People already getting payments will be

advised of the increase by Inland Revenue.

Over 60 per cent of women now participate in paid work,.

The benefit applies for 14 weeks, and is now available to

nearly 90 percent of all women in paid work.

The payments come out of general taxation funding.

Winners of our Nissan Maxima Ti, the Abbott family that owns

Vellade Abbott King Ltd in Penrose: From left, Jan Abbott with

Alasdair Thompson (chief executive of EMA Northern), Jan’s

daughter Louise Abbott and husband John Abbott.

The Vellade Abbott King family firm was drawn from all EMA

Northern financial members as at June 30 to win the Nissan

Maxima Ti (pictured).

The company’s marketing manager Louise Abbott says she will

be using the car. She says her parents recently got new cars

and she usually drives old sales reps’ cars, so its “my turn.”

“I’ll feel like the queen driving around in a brand new car!” she

said.

Now that Louise has a car worth showing off, she’s planning

to decorate it with the company ‘Ella’ brand livery, and put her

personal number plate (Ella3) on it. Her mum’s car plate is Ella1,

dad’s is Ella2, and Louise’s has her lucky number, three.

The Abbotts founded their importing and distribution business

partnership with the King family in 1988 , building a warehouse

under the garage at the Abbotts’ home. The company has been

owned by the Abbotts since 1995. Four family members are

among their 11 staff.

Vellade Abbott King imports cosmetics, hair and body care

products from Australia, China, Hong Kong, England, France,

and elsewhere. They’re the agent for BYS cosmetics and Ella

hair accessories and jewellery brands sold in pharmacies.

Lucky number plate to go on winning car


From KiwiSaver... Lately I’ve been flat out with queries about KiwiSaver of course since any new legislation gives rise to a flood of calls. I’ve had lots of factual questions like, “if someone joins at 62, when can they withdraw their money from KiwiSaver?” and “what happens to your savings if you die?”

The answers to these were easy: A person can’t withdraw from the scheme for five years or till age 65, whichever comes first – in this case, for five years by which time he’ll be 67. When you die your savings become part of your estate.

Someone asked: “If an employee opts out of KiwiSaver can they rejoin at a later date?” I said yes they could, but only during the first six week opt out period. Once that passes there is no opting out, unless you’re leaving the country permanently (which is for a year or more).

But then I pointed the callers to where it says in print, to - the KiwiSaver website and the actual page in the Inland Revenue’s Guide for Employers. I emailed them a link to our EMA website too; members can download our guide – we have guides on everything!

But some people don’t like to read much. So I tell them the answers and processes to follow. I know the facts but if there’s something I can’t recall off the top of my head I look up my guide. Its right beside the phone these days because we like to give callers an answer straight away. People need to know right away.

...bullies...Some things take a bit of time to talk

through. The right answer can depend on the context of the problem, and it might boil down to communication. Communication with staff is key in employment matters. But that might

sound glib coming from me, sitting here removed from the heat of the moment.

Employers sometimes ring up frustrated and angry, but no matter how dramatic their work situation, I tell them there are the correct processes to follow to sort things out. Bullying is the latest thing.

You have an obligation both to the person who complains of being bullied, and to the alleged bully, or you could end up with a personal grievance claim from either! Or both!

You have to be fair to both parties and this means you have to do something about it. Your HR person might have to front up if you can’t face the problem, or if an informal chat can’t fix things. But you must always get back to the matter if things don’t improve. Set up meetings, talk.

... and B.O...Body odour is a delicate issue, and I

keep on getting calls about it.It’s bloody hard to deal with this.

You have to avoid hurting a person. Yet some people don’t mind being told; everyone reacts differently.

I reckon you, or a manager (and some people are more confident doing these things than others), should start off informally but delicately pointing out the person has body odour. Don’t make it a big deal. Check if there’s a reason they can’t help it, such as a medical condition. If they say they don’t then you have to look further into the situation. Again I use that term – follow the right processes.

You have an obligation to your other staff to deal with smells. If an odorous person is a sales rep, the smell could be making him or her ineffective. It could also impact on your company’s image (to be blunt). It’s all part of presentation – you wouldn’t let them be scruffy at work would you?

... to prayers at workOur society is changing! Here’s a

new one to me – should we allow Muslims to fit in their compulsory, five ritual daily prayers at work?

One boss rang asking if he had to allow a worker time to pray, and go to mosque once a week on a weekday. I said it’s like any other workplace issue such as time out to smoke.

You need to consider in good faith any request and deal with it in good faith. Work it out by talking with the person. Find out the prayer times and how it affects their job, and your special leave obligations. Tell him what you can accommodate; maybe the worker doesn’t take other breaks.

The law is not black and white on these human rights and privacy issues. It depends – if a person works up a crane, taking time out every hour or so to pray will be some challenge! I tell you, it’s never boring here at AdviceLine.

What employers are asking AdviceLine this monthThe AdviceLiner

Lotto size panic attackYou thought you had employment problems?! Check out this US law suit.A California Superior Court has awarded US$6.5 million to a healthcare case worker who claimed he was denied a promotion because his panic attack disorder prevented him from meeting clients. George Alberigi accused the Sonoma County of failing to reasonably accommodate his mental disability. For most of his 14 years working for the county human services department Alberigi was allowed to interview clients by phone. But a promotion he applied for in 2001 required meeting clients in person. He was denied the promotion. The jury awarded Alberigi US$1.5m in lost wages plus US$5m for pain and suffering and other damages, together with attorneys’ fees. Only in California!


The discussion over perceived ‘tax advantages’ landlords are said to have over other investors focuses almost entirely on residential property investors. It begs the question: What are these ‘advantages’ and are they unique to residential landlords?

Real estate investors can borrow 100% of the investment purchase price of a property but this funding ability is not a product of any tax rule, and certainly is not unique to residential property investors.

Residential landlords are entitled to claim tax deductions for certain expenses including interest costs, repairs and maintenance, insurance, rates, and management fees meaning their taxable profit is reduced by the amount of the expense. The rules for these are the same as those applying to any other investor or business owner.

Residential landlords can claim tax deductions for depreciation of the building, smounting to a tax deduction for a non-cash expense which reduces their overall taxable income. Depreciation is an economic cost of owning real estate and using it to earn income. Wear and tear is an economic reality and depreciation deductions reflect this. The tax rules here are the same in principle as accounting rules. Investors and business people who own and use plant and equipment such as motor vehicles, computers or factory machinery are also entitled to claim tax deductions for depreciation. Residential landlords don’t get special treatment here.

Nevertheless, in the case of residential real estate, recent experience seems to indicate that the value of property has increased rather than decreased. The tax deductions for building depreciation don’t really reflect what has been happening to property values overall but this isn’t a product of the tax system. It is a consequence of substantially increasing

land values. It is not an advantage peculiar to residential property investors, and only ever a timing advantage. When a real estate investor sells an investment property its owner has to pay tax on the gain they make up to the value of the depreciation deductions they previously claimed. This ensures deductions for depreciation are not allowed where economically there has in fact been no depreciation.

Perhaps the advantage is the ability of landlords to sell their investment property and not be taxed on the capital gain (apart from any depreciation claw back as mentioned above) is not peculiar to residential property investors. Shares, artwork, gold or any other appreciating item get the same treatment. The tax rules here already single out real estate investors in some situations. For example, if the residential landlord is related to a property developer, or if they themselves have subdivided a property in the past, they may find their capital gain is taxed. These rules don’t apply to investors in other types of appreciating assets.

The final ‘advantage’ residential landlords may have is their ability to offset tax losses incurred against other income to reduce their overall tax bill. The loss attributing qualifying company (“LAQC”) regime in the Income Tax Act is in wide use by commercial landlords and other business people.

The regime was deliberately enacted to allow investors and business people to use the tax losses from their investment to offset other taxable income while retaining the benefit of the limited liability provided to a company. Residential landlords don’t get any special treatment here. But the combination of depreciation deductions for a non-cash cost and this loss offset mechanism gives real estate investors, arguably a timing advantage in that they can reduce their overall tax liability straight away.

Its not unique to residential landlords and not solely a by-product

of the LAQC rules. Other investors who make tax losses get the same treatment.

Even if there were no LAQC regime the same result would follow from other investment ownership structures.

There is talk of introducing rules to ring fence losses from residential property investment so they cannot be used to reduce other taxable income.. Surely if such a serious step were to be taken it would be only fair to have ring fencing rules for all investment and trading losses? Removing this for only one type of investment risks creates an equally undesirable incentive for taxpayers to flock to some other form of investment that doesn’t have the same restrictions. The cost of attacking one imbalance could be to create another.

In summary, the only real tax distinction between residential property investment and other forms of investment appears to be the temporary tax benefit landlords have from being able to claim deductions for depreciation.

If, as has often been the experience in recent times, the value of the buildings has not depreciated at the same rate as the tax deductions claimed there is an advantage for the landlord, but only until they sell the property when the advantage is neutralised by the claw back rules.

Any tax benefit from depreciation deductions (and remember in the current environment it is a timing benefit only) is simply an inevitable consequence of increasing property values.

Changing the tax rules by limiting depreciation deductions or the ability to offset tax losses from residential property investment is unlikely to have a material impact on residential property values for the simple reason that those features of the tax system aren’t really significant benefits at all and certainly aren’t unique to residential real estate investment.

EMA's TAX TIPS

Do landlords get tax advantages? Fiction or fantasy?By Iain Blakeley, Tax Director, Ernst & Young


Stack the risk and return in yourfavour…

Building a business and setting up the right assets that will provide for your financial securitydemands hard work, sacrifice and carefulplanning.

Very often we’re working so hard and making thesacrifices that we slip up on the planning, or put itoff until later…sometimes until it’s too late.

Having the right plans in place at the right timecould make all the difference. Have you everwondered how someone’s business can go belly upand yet their lifestyle hardly misses a beat? They continue to live in the comfortable familyhome, enjoy weekends at the bach and by allaccounts, life is as it was before.

The answer is simple:Have proper plans in place, in time, and keep them up to date.

Guardian Trust is New Zealand’s specialist trusteeand financial adviser. Our qualified team oflawyers, accountants and financial advisers canhelp you set up co-ordinated legal arrangementsthat will provide for anticipated or unforeseenevents, making sure your hard earned assets areprotected and you and your dependents continueto enjoy their benefits:

• Wills Have you reviewed your will in the last threeyears to ensure it still meets your wishes?

• Enduring Powers of AttorneyHave you appointed someone to manage youraffairs if you became incapacitated and wereunable to do so?

• TrustsCould a trust give you better planning powerand protection?

• Retirement and Investment PlanningWill your investments fund the lifestyle youenvisage in your retirement?

• Buy/Sell AgreementsHave you planned ahead for a smooth transitionto avoid potential conflict and stress?

Guardian Trust is the EMA’s preferredpartner in asset protection andmanagement.

For a complimentary consultation to discuss your options or review yourexisting plans, contact

Bryan Ivamy on (09) 529 1659


This generation has been shaped by the influences of their time; they’re defined as those born between 1978 and 1994.

Understanding the mindset of GenY will better equip you to attract, manage and engage not only with this generation, but all generations.

GenYs are usually mature beyond their years. They were raised in “families” with two working and often divorced parents, thrive on dealing with challenges and have a practiced resilience. They seek to apply their analytical skills and come up with enterprising solutions. They prefer “figure it out” vs “do” kinds of respon-sibility.

Consequently they want to work in proactive organisations. GenY seek

change as part of their work ethic and a culture they can thrive in.

Staff turnover in this generation is not because something is too challenging, rather that it is boring and lacks personal challenge. They become valuable employees in businesses where innovation and achieving improved productivity are required.

Tom Peters said “innovate or die” – bring on the GenYs!

GenY embrace diversity. They are socially, culturally and environmentally aware and seek workplaces that match this. GenY thrive in a team that is genuinely inclusive and open to their

ideas and viewpoints and they have no hesitation in expressing them. They have a practical approach to life and work. They genuinely need to know the answer to “Why?” - “because” is just not the right answer!

Typically well educated, a third of GenY worked part-time while at school and the majority will continue with some other post-secondary training: They value on-going learning.

Bombarded with ads from a young age, they have grown up constantly engaging their search and selection skills and have a well-refined “bullshit” meter.

On the downside, they can be manipulative. They won’t follow rules and policies you have put in place, specifically those that you don’t enforce. Have clear guidelines and, enforce them consistently, otherwise inequalities will be discovered and exploited. GenY will

test you to see if you are for real and if you will keep them accountable.

They are big on wanting:■ A real job - one with purpose and

meaning to their work ■ Significant responsibility■ Increased employability as a result of

being with your company■ Opportunities for exploration and

creativity within clearly defined boundaries and deadlines.

■ Flexible work schedule ■ Fun – which makes the workplace

more enjoyable, stimulating and importantly, productive.

■ Social as well as work activity with their colleagues

■ Opportunity to travel and do charitable work

■ Latest technology toolsLook at ways of making your

business more interesting rather than trying to make it sound more interesting. GenY place a high value on truth. Brands that appeal to GenY are authentic, unique, integral and share their success in ways that benefit the community.

Do some analysis to identify what unique value your company offers from a GenY perspective.

Then, in going to market, look at what media you are using and how your message is portrayed. For GenY it must be on-line. If you’re the recruiter and not GenY, involve someone who is in every step of the process fronting expos and campus visits, creating ad copy and style, induction training etc.

Word of mouth has been replaced with word of SMS. After all they want to work surrounded by “friends” so will have a vested interest in assisting you.

The key to engagement for GenY is to make things interactive, creating an experience. Integrate your application process on-line. Engage in authentic conversation asking about real situations, not hypothetical ones. Get a feel for their values and what is important to them. Involve others from the work team in the interview process.

GenYs see entry level employment as a stepping stone to bigger things, not just a means to an end. Be ready with development programmes and future career opportunities.

GenY want to know what they will get for joining your organization. Identify what is negotiable and what is not, before you engage in conversations about work arrangements.

Finally, if you want the best GenY talent available, move fast.

Contact Myriam Heynen on 09 459 1501 or 021

920 414, email:[email protected]

GenY: A new breed of employeesBy Myriam Heynen, EMA Northland

Influence Baby Boomer Born 1946-64

GenX Born 1965-77

GenY Born 1978-94

Musical icons Elvis Presley Madonna EminemMoney Earn it It’s not everything Give it to meLoyalty

to Employer

Work my way to

the topShortcut to the top

Give me Saturday

off or I’ll quitRespecting your

eldersAutomatic Is polite Whatever!

Sex After marriage On the backseat On-lineChange Resist it Accept it Want it

(Peter Sheahan “Gen Y: Thriving and Surviving with Gen Y at Work” Hardie Grant Books, 2005)

Generation characteristics, and those of their predecessors

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Staff appraisals and performance management are often placed in the same box, but are they really the same? Are staff appraisal systems also performance management systems, and vice versa?

The term ‘staff appraisal’ conjures up memories of the old public service where everyone used to be marked out of 10. Then, we took our lot to the annual marking conference where we had a bun fight and reshuffled all the scores. And these were the marks used as key criteria for promotion!!!

Maybe staff appraisals for you are that cumbersome, disliked process where you have a once-a-year discussion with your employees about their performance, career aspirations and training needs. Is this the same as an objective and effective performance management system? Do we confuse these things?

To me an effective performance management system is a process that enables an organisation and its people to focus on the key strategies and objectives that will ensure success in financial, growth and customer service terms

An effective performance management system will tend not to revolve around the annual performance review meeting but more on maintaining a constant focus on the key organisational objectives and cultural behaviours.

I compare the two systems in broad terms:

Staff appraisals (which tends to be primarily departmental and position focused)■ Objectives are generally set on a

departmental or individual basis solely as a result of a discussion between manager and subordinate and often using the position description as a basis.

■ Often behavioural objectives are set

in terms of the job competencies and what the employee needs to do to meet them.

■ The annual performance appraisal is generally based solely on the review of the individual objectives set at the beginning of the year and where little discussion has occurred during the year.

■ The process is often driven solely by the HR department as a must do compliance matter rather than a means to achieve organisational goals.The process is often very frustrating

for both manager and subordinate because much of the assessment is based on subjective information. The frustration can even be greater if the subjectivity is linked to salary.

Performance Management (which tends to be focused primarily on organisational outcomes and the team)■ Objectives are set as part of the

business planning cycle by the senior management team after receiving input and suggestions from staff at all levels.

■ Objectives are translated into key KPI and targets to deliver the desired company outcomes.

■ Objectives are cascaded down through the company and weighted according to team and individual roles after team and individual ‘discussion and agreement’. Objectives are often set under headings such as cost, quality, growth and people.

■ Objectives are agreed with each team and individuals consistent with overall company and team focus.

■ Key KPI’s that will drive organi-sational performance will count for 50% of team and individual performance.

■ Key behavioural standards that will drive organisational culture. performance will count for the other 50% of team and individual performance.

■ Performance against KPI’s will be measured at least monthly but in some cases weekly or daily.

■ Monthly action plans will be required by teams and individuals to close any performance gaps.

■ A six monthly assessment of team and individual objectives is carried out with adjustments made if necessary according to changing organisational needs.

■ An annual review will be held with each team and individual to assess performance based on objective data. Because the assessment is objective a rating can be given that can feed into a salary review process which may also be linked to incentive schemes.

■ Objective data is based on actual organisational outcomes such as profit, budget, customer complaints, meeting specification, developing new initiatives, safety incidents, staff turnover, etc. Cultural behaviours are objectively assessed by way of culture/climate surveys and/or 360 degree feedback etc.

■ At the annual review it would also be a time to discuss ongoing individual development needs where objectives have not been met as a result of knowledge or competency gaps.As you can see there are very clear

differences in my mind between a staff appraisal system and a performance management system, and we must be clear when we debate the value of each system.

Often staff appraisal systems can be done away with because they do not achieve any definable outcome for the organisation. But when we debate the value of a performance management system there is much more to consider lest we throw the baby out with the bathwater.

Kerin Robert is senior HR consultant with

EMA Central. Contact: (04) 470 9921 or

email [email protected]

Staff appraisals. Or performance management?By Kerin Roberts, EMA Central

What are we really talking about?


www.horizonrecruitment.co.nzthe future just got brighter...

Sometimes obligations under the Privacy Act 1993 (“the Act”) become strained when employers want to find out as much as possible about a job applicant, and check many different sources.

But conducting reference checks with persons not authorised by the job applicant can see them fall foul of the Act.

Checking the references of candidates for internal job vacancies or transfers should be relatively straight-forward but privacy issues can arise. Case Note 88333 [2007] NZ PrivCmr 4 from the Privacy Commissioner casts doubt on an employer’s ability to share an employees’ personal information with others during such processes.

Application of the ActThe Privacy Act applies to

any agency dealing with personal information and includes nearly all employers. The Information Privacy Principles (“IPPs”), in Section 6 of the Act, are critical to its observance.

Privacy principlesThe twelve IPPs set out how

employers are expected to deal with employees’ personal information. IPPs 2, 10 and 11 are relevant to the flow of information within an organisation:■ IPP 2 requires agencies to collect

information from the individual concerned with certain exceptions.

■ IPP 10 requires an agency to use that information only in connection with the purpose for which it was collected for, with

certain other exceptions. ■ IPP 11 limits the disclosure of

personal information by any agency, again with certain exceptions. These principles will not be

breached if an agency obtains the consent of the individual concerned.

Agency within an agencyThe Act defines agencies as “…any

person or body of persons, whether corporate or unincorporate.”

The Privacy Commissioner holds that the definition of an “agency” is wide enough to include both individual natural persons through to corporate entities.

Recruiting managers may see it as their right to check with an internal applicant’s current manager about his or her suitability for a vacancy. However, if the recruiting manager is an agency separate from the candidate’s current manager, then seeking such information without the employee’s consent could breach IPP 2 and/or IPP 11.

Case Note 88333This scenario was considered

in Case Note 88333. An internal applicant for a role in a public sector organisation was unsuccessful. But it transpired that as part of the internal application process the person interviewing her had contacted her former manager for a reference. This person was still employed in the organisation.

The employee had not listed this person as a referee and had not provided authorisation for the interviewer to contact him.

The Privacy Commissioner found

the organisation had breached IPP 2 as the interviewer and the employer had failed to seek the information directly from the employee (by virtue of section 4 of the Act.) However the Commissioner found there was insufficient evidence to show any harm had resulted from the unauthorised reference.

The lawThe Privacy Commissioner’s

opinion appears to conflict with earlier cases heard in the Human Rights Review Tribunal, Ram v Kmart New Zealand [2003] NZHRRT 27, and a decision of its predecessor the Complaints Tribunal, KEH and PH v DWI (CRT 36/00). These cases suggest that information kept by an organisation, including the opinions of colleagues as to an employee’s performance and suitability, can be used by anyone in the organisation. The Act states that information held by an employee in the course of business belongs to the organisation.

CommentThe Privacy Commissioner did

not consider whether IPP 11 had been breached in Case Note 88333. Instead the focus was on IPP 2, which refers to an agency collecting personal information from sources other than the person concerned.

The Case Note seems to gloss over the point that the information about the employee was already held by the employer in the employee’s former manager. By virtue of section 3(1) of the Act information held by that manager is held by the employer.

The question is whether knowledge

Internal recruitment privacy: Who can I talk to?

by Blair Scotland, Solicitor, EMA Central

>


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GE

D83

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GED8343 EMA Business Mag 128x1851 1 12/1/06 9:48:22 AM

accumulated in the course of employment about employees is information belonging to the organi-sation. EMA believes it is artificial to think it is not.

There are also impractical flow-on effects. For example, permission would have to be needed before information about a person could be passed from a Manager to an HR Manager or to payroll.

The Privacy Commissioner did not investigate IPP 10 in relation to internal recruitment processes. The legal question is whether information held by an employer regarding an employee’s performance, behaviour, etc, can be used for another, potentially unrelated, purpose, i.e. to assess the employee’s suitability for an internal vacancy.

Implications and adviceThe Privacy Commissioner and her staff are experts in the areas of privacy law and it would be unwise to ignore their opinions on the

application of the Act to employment scenarios. However it is worth noting that the Privacy Commissioner is not empowered to make binding determinations on parties regarding complaints alleging any interference with the privacy of an individual (section 78 of the Act).

Only the Human Rights Review Tribunal and the higher courts have the authority to make binding decisions for or against an employer.

The Commissioner gives the parties to a privacy dispute an opportunity to settle matters for themselves, and would provide support and assistance, including its findings on factual and legal matters, to give effect to this. The determi-nation does provide the position the Commissioner will take should such matters come to light.

Case Note 88333 reflects the Privacy Commissioner’s opinion on this particular issue; its not a binding determination, and it may not necessarily reflect the law on the issue.

NEXT STEPS

Employers who wish to comply with the Privacy Commissioner’s finding should make sure they get an applicant’s consent before contacting anyone for a reference, regardless of whether the referee is a current employee within the same organisation. If the applicant refuses consent you should ask them to provide their reason for refusing, and evaluate that reason on its own merits.All workplaces are required to appoint someone to be the privacy officer. The Office of the Privacy Commissioner offers training courses for these appointees. Other general recommen-dations are to have a privacy policy in place, and a documented recruitment process. All employees should be aware of privacy policies, which should cover how information will be dealt with, and by whom in your organisation.

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Striking a balance between paid work and personal responsibilities is a challenge for the modern workforce.

And it’s not just mothers or people caring for sick family members who desire more flexible arrangements to help manage commitments to their employer with those outside their jobs.

Employees of all walks of life now seek opportunities to adjust the hours they work and where they work, for many different reasons.

Many companies are already concerned with helping them achieve this balance with flexibility policies, and in the current tight labour market, many others are trying to catch up.

Recent Government research reveals there’s a strong will to make flexibility suceed, with more than 90 per cent of employers and employees who participated in a Department of Labour survey supporting an increase in flexibility in their workplaces.

For good reason. Such policies can also give employers a competitive advantage, with the potential to improve productivity and strengthen the bottom line.

A recent booklet by Business NZ outlines simple ways employers can offer greater flexibility to their staff.

We encourage employers to voluntarily examine all options for

flexibility with an open mind, and to promote creative conversations in the workplace to find solutions that will make workplaces as productive as they can be.

Flexible working hours are only one example. Flexible work can also include allowing leave of a one-off nature for an employee to attend a medical appointment or watch a child’s school production, study leave to further their training, or working from home on a particular project.

It may also include more permanent arrangements such as a job sharing or moving to part time work or working reduced hours.

Flexible workplace policies are largely common sense. The main thing is to ensure the guidelines are well communicated so employees are clear about their options. Lack of even-handedness by the employer can be one of the pitfalls of a flexible work policy.

But a flexibility policy will be of no ultimate use if helping employees comes at the expense of business performance. Because the needs of every enterprise are different, a one-size-fits-all flexibility rule could work against companies’ ability to be nimble in a very competitive market.

That’s why we believe its better that businesses voluntarily choose to seize the benefits of flexibility now, to avoid facing regulation and compliance costs in this area in the future.

Flexible work a must do Benefits of flexible workplace policies for

employers include:

■ Higher morale. Flexibility can

heighten job satisfaction for

employees and reduce stress

– helping them to perform better

at work and boosting staff morale

and commitment

■ Improved recruitment: Flexibility

can enhance the ability to attract

candidates with specific qualifi-

cations and experience – in other

words, becoming an employer of

choice

■ More responsive to market

demands. A more diverse staff

helps a business respond to

diversity in its customer base

■ Better staff retention: Employees

who feel valued by their employer

are less likely to resign and go to

a competitor

■ Reduced absenteeism and sick

leave

■ Community benefits: Helping

employees improve their work-

life balance helps to build a

successful community in which

businesses can flourish

Strategic advice Practical solutions Skilled representation

Key contactsSusan-Jane Davies (04) 470 9923 [email protected] Akbar (09) 367 0931 [email protected] Brown (06) 843 3419 [email protected]

Specialist Employment LawyersOur high success rate reflects our expertise. Our 13 lawyers specialise in employment law and only act for employers. As part of a member-owned organisation, EMA Legal offers services that are excellent value.


New analysis carried out by Business NZ (How should we pay for our Kyoto liability? - available under surveys on www.businessnz.org.nz) shows an enormous cost to business if planned carbon trading initiatives go ahead.

The Business NZ analysis looks at the real costs if the Government transfers its Kyoto liability to individual firms by 2012 as announced.

The plan is to transfer or ‘devolve’ the New Zealand Kyoto liability to individual firms, meaning they will have to buy carbon credits on the international market if their emissions get above 1990 levels. Given most businesses have grown considerably since 1990, their emissions will have grown also, so the financial liability for businesses will be consid-erable.

Of course, firms could reduce their emissions levels to pre-1990 levels by reducing their activity but for many this would also mean a potential decrease in profitability. They could also invest in new, more energy-efficient technology to reduce emission levels, but that would be expensive and difficult to achieve within five years.

The Government initially planned to meet the Kyoto commitment itself when it was thought it would turn a profit but now that the commitment has become a liability it wants to pass on the liability to individual businesses.

Transferring the liability to business makes the cost more than seven times higher than if the Government paid for it out of the consolidated account, because individual businesses cannot command the price that the Government can.

Since the Government liability in dollar terms would be around $600,million the transfer of it to individual companies would be around $3.5 billion in direct cost to the New Zealand economy in five years’ time. This would also be seven times higher than the cost claimed by the Government, with knock-on costs higher and businesses forced to pass them on to consumers.

Business NZ says it was the Government that made the commitment to the Kyoto Protocol, not New Zealand businesses, and the Government should deal with it.

A lot of consequences would follow from the Government’s

decision to transfer the liability to the private sector. Businesses buying carbon credits from overseas would see New Zealand rushing into a carbon trading system almost immediately. This is dangerous territory. A flawed carbon trading system brings the risk of being ‘gamed’ by large international companies, as occurred with Enron in the US.

The EU is taking six years to establish a carbon trading regime, and Australia has a four-year time line to develop its system; how New Zealand expects to plan such a system within just a few months is dangerous indeed.

To achieve it would mean consul-tation on proposed legislation would overlap the actual writing of it, making any consultation a sham.

Business NZ believes the Government should meet the 2012 liability itself rather than multiply its cost many times by passing it on to

businesses. Also, we need to slow down and design a proper, robust carbon trading system, just as the EU and Australia are doing.

Business NZ and the business sector are committed to positive change on carbon emissions. We are showing leadership on the issue by researching a robust carbon trading, among other things. The research

earlier this year, and new analysis, demonstrate the positive, fact-based approach needed in this important area.

The Business NZ analysis How should

we pay for our Kyoto liability? and the

previous research NZIER: Emissions

Trading System for NZ are available on

www.businessnz.org.nz under surveys.

The NZIER study was commissioned

by Business NZ and funded by Contact

Energy, Fletcher Building, Fonterra,

Genesis Energy, Mighty River Power,

NZ Steel, Rio Tinto Aluminium and Solid

Energy.

Business NZ’s CEO Phil O’Reilly

Big costs for business with rushed carbon trading

Now that the Government commitment has become

a liability, it wants to pass on the liability to individual businesses


Corporate healthcare plans are fast becoming one of the most sought-after perks among proposed and current employees and eye care is rapidly becoming part of workplace health care plans.

It is certainly a truism that healthy employees perform best, hence the growing awareness that healthcare is more an investment in overall productivity rather than an expense.

Organisations valuing employee wellbeing as essential to produc-tivity could consider initiating programmes to fund vision correction procedures; it translates

to reduced downtime for employers, increased safety and efficiency, and a better overall work environment.

Some career choices, such as joining the police force, require candidates to have excellent vision as a basic necessity, while others opt

to undergo vision correction surgery as a personal asset to the nature of their jobs, especially those where 20/20 vision improves safety and effectiveness.

Since introducing its laser vision correction to New Zealand last year, the Eye Institute has performed the procedure on over 3000 eyes.

The leading eye specialists at Auckland’s Eye Institute say a recent initiative by the US Navy to fund vision correction surgery for its personnel prompted them to recommend the same for New Zealand’s Armed Forces.

One surgical technique, Intralase, a new form of LASIK surgery reshapes the cornea using a

permanent laser vision correction procedure. Its the most advanced and accurate method of improving eyesight.

The entire procedure, including preparation time, is often completed in both eyes in 30 minutes. Using

it, surgeons can tailor-make the patient’s ideal corneal flap to increase the likelihood of achieving 20/20 vision.

Its completely blade-free and reduces recovery time drastically using a computer-controlled laser to create a corneal flap essential for the next step of reshaping corneal tissue by the procedure.

Prior to the introduction of Intralase, the corneal flap was manually created using a microkeratome, an oscillating handheld blade, the cause of most patient fears and longer recovery periods.

Intralase technology “locks” the corneal flap back into place quicker and it begins to heal rapidly, with most patients reporting near perfect vision the very next day.

Almost all of Eye Institute’s patients have undergone vision correction surgery at their own expense. Intralase Custom LASIK costs $5600 for both eyes, a substantial personal cost on its own, though most patients who have opted for vision correction for career purposes have seen marked improvements in the quality of their professional and personal life resulting in improved morale and better work-life benefits.

Contact Barbara Cable, Business

Manager for Eye Institute on

b a r b a r a . c @ e y e i n s t i t u t e . c o . n z ,

09 522 5775

Eye Institute was established in 1995, has

a staff of 46. It's eye surgery, services

refractive-cataract, vitreo-retinal

surgery, and oculo-plastic and glaucoma

surgery. Eye Institute also offers

expertise in glaucoma management,

neuro-ophthalmology, retina, squint,

eyelid surgery, eye infections and inflam-

mation. Go to www.eyeinstitute.co.nz.

Eye care next on healthcare plans?

Illness cost NZ business $940 million* last year. (makes you sick doesn’t it?)

Southern Cross Medical Care Society, Grafton Road, Auckland

*Conversa Global Research July 2005

$940 million. It’s hard to swallow, but all that money was wasted waiting for staff to return to work. Fortunately Southern Cross Corporate Solutions has a remedy that could curb your losses considerably. Whatever your budget, we can tailor a health and wellness solution to help you reduce absenteeism, improve staff morale and boost productivity. To fi nd out more, talk to us today. Call 0800 438 268,email [email protected] or visit www.healthybusiness.co.nz


Over the past 20 or so years, IT companies have extolled the virtues of technology to improve productivity and operational efficiency here in New Zealand as elsewhere. We have energet-ically supplied hardware, applications, networking gear, support, consulting and general advice on how the latest and greatest widgets and internet technology will change the landscape of their business performance.

We have competed against one another on product features and benefits, bells and whistles, and our customers have invested. But how much has IT really increased productivity and operational efficiency in New Zeland? Are we deriving the benefits that were planned and promised?

The best answer is, “it depends”. It depends on how technology is deployed in company planning, and on why it is applied, and how. Technology for technology’s sake is no solution or advantage in and of itself.

Technology needs to be part of a company’s overall strategic planning cycle. Indeed if a company depends on it for competitive advantage, it needs to be central to a company’s planning cycle, and tightly coordinated with a company’s overall productivity goals.

In particular it must facilitate strong

business process and supported by formal measurement systems. Other critical issues to take on board are a company’s culture, worker skills, the other work tools in use, and environ-mental influence.

The link between strong business process and IT technology, and its resultant effect on improved efficiency has been measured in numerous studies. One, Net Impact: Europe eGovernment - From Connectivity to Productivity in 2004, found important links between process change and application deployments. Companies which change their processes before introducing technology to facilitate these processes can make cost savings of between 20 and 30 percent. Doing it the other way round can lead to losses of 50 percent.

More practical examples of business processes facilitated every day by IT technology follow.

Now we can give our employees secure access to consistent information, allowing them to react more quickly and with more data to changing marketing conditions. Streamlined communications with customers can be made by delivering to our employees the right information at their fingertips. Mobile and remote access to the business systems ensure they can be knowledgeable and productive out on the go.

IT technology connects us more effectively with our business partners, which for some is a precondition for doing business.

Integrated voice, video, data and wireless, or interactive calendaring, video conferencing and IP communi-cations facilitates collaboration internally amongst staff as well as with business partners. Also, by enabling phone contact through mobility and unified communications, we can greatly reduce the operational inefficiencies caused by not being able to reach colleagues and customers.

Again, none of these functions and applications can reach their full produc-tivity potential without prerequisite pre-planning around business goals and business processes.

While the successful deployment of IT technology increasingly provides competitive advantage, it is becoming more important to attract and retain good staff.

Let’s face it, our younger employees, and children, are leaving school and entering the workforce with a whole lot more knowledge and familiarity about IT technology and what to expect from it in the workplace.

Suzanne Hansen is Regional Manager, NZ

Operations and Marketing, Cisco Systems

NZ Ltd

What really makes technology work?

By Suzanne Hansen, Cisco Systems ltd

Give your business sales and services a boost

*Based on surveyed pass on rates.

Go to www.ema.co.nz under Resources for full reader information and scheduled rates, email:colin@affi nityads.com or [email protected]

by inviting 20,000* potential customers to choose your products and services.

Expose yourself in EMABusiness+


The tight labour market and higher labour cost inflation are here to stay for a protracted period, which has some major business risk management implications.

The black in the first chart shows annual average inflation in the All Sector adjusted Labour Cost Index (LCI). The adjusted LCI is designed to measure post-productivity increases in labour costs, so it understates actual labour cost inflation which is running at 5-6% based on hourly earnings data from the Quarterly Employment Survey. However, the adjusted LCI is a measure the Reserve Bank (RBNZ) pays particular attention to.

The coloured lines in the first chart report a sample of the RBNZ’s forecasts for this measure of labour cost inflation (e.g. the dark blue line is the forecasts released in June 2007). Despite consistently under-estimating labour cost inflation over the last few years the RBNZ continues to predict that it will magically abate over the next couple of years.

The RBNZ’s forecasts are based more on wishful thinking than on quality analysis. The second chart presents a sample of the analysis we use to assess labour cost inflation prospects, and it tells a very different story.

The second chart shows a near perfect inverse relationship between annual inflation in the adjusted LCI and the unemployment rate. The best fit between the two lines is with the unemployment line advanced or shifted to the right by four quarters, reflecting how long it takes changes in the unemployment rate to impact on labour costs. The fall in the unemployment rate between 2000 and 2005 was always going to generate higher labour cost inflation even if the RBNZ was inclined to assume it away.

The unemployment rate has remained stable at just under 4% for the last year, which implies that labour cost inflation will remain elevated at around the current rate for at least the next year. However, feedback from the many firms we meet in our travels tells us that employees are still waking up to their newfound bargaining power, implying upside risk to labour cost inflation.

Recent interest rate hikes will slow economic growth but not enough to tame the labour market monster, especially given the inevitability of the government throwing $2-3b at the economy next year. Labour cost inflation, which is at the heart of domestic inflation, will continue to exceed the RBNZ’s predictions, which implies more OCR hikes ahead.

Some important business risk management messages stem from our analysis of labour market prospects. The tight labour market is here to stay for some time, so work especially hard on the labour relations side of your business and on the cost recovery side, and do not be surprised if interest rates end up significantly higher than you currently expect or hope.

Rodney is Managing Director of Strategic Risk Analysis Limited.

Visit www.sra.co.nz to subscribe to our free reports and view the

samples of our pay-to-view services. Contact him on 09 437 6699

The real face of the labour marketBy Rodney Dickens, Strategic Risk Analysis Ltd

ANALYSIS


We are all human, and many of us have personal issues or points of concern in common. Here’s an example.

When I first began as a private investigator many years ago, there were several spouse infidelity investi-gations each year. The trend was that, as summer approached, we would get far more enquiries for this type of surveillance. The reasons for the trend were often the subject of lively discussion between myself and my associates.

But nowadays there is no such trend. People; husbands, wives, partners often come to me with their concerns, and there appears no correlation between them and the time of year.

I think that television and other media coverage has educated people that many others have faced their own infidelity issues in their relationships, and that it is possible to front up to these issues with professional help from

agencies like mine.I am often asked by friends and

acquaintances, how many of the cases regarding infidelity actually result in proof being obtained that the partner involved was being unfaithful. They are always surprised when I reply that virtually all investigations have that precise result.

It is clear to me that nearly all people who approach me for this type of work already know deep down that this type of activity is happening, but they can’t bring themselves to face the truth about it, or take affirmative action. To give them the necessary courage, they need proof that can’t be explained away by the offending party.

Once positive evidence is made available to them, to help guide them through, they are much more likely to address the issue in a concise and informed manner.

However this straightforward explanation does not account for the woman who appointed us five times before she was emotionally able to

write off her marriage as unsalvageable, despite the fact that each time we confirmed her husband was taking his mistress to motels.

Another regular question asked of me is: “Do you feel guilty following people and invading their privacy?”

My job is not to invade anyone’s privacy. My task is to obtain evidence to assist my clients address issues in their lives, and to help them through the distressing times that often accompany it.

There seems no pattern to the number or males or females who employ my services. For that matter, age or occupation is no distinguishing factor either.

After all, we are all human and we all have the right to know the truth.

Rod Moratti is the principal at Moratti &

Associates, Licensed Investigators since

1989. Feel free to contact Rod on 027-

6958863 at any time or email rod@moratti.

co.nz or visit www.moratti.co.nz

True stories from the security files of:True stories from the security files of: Rod Moratti, Private Investigator Rod Moratti, Private Investigator

You deserve to know the truth

◆ A cash tax-free lump sum payment in the event of serious accidental injury or death

Special Benefits:◆ Accidental death at work benefit of

$100,000*◆ Accidental injury benefits of up to

$100,000* for example for loss of sight and total paralysis

◆ A funeral benefit of $5,000 on death by natural causes*

For only $39 per annum per insured safetynet@work represents great value

By making safetynet@work available to your employees you are providing them with:◆ Low-cost insurance ◆ A means of helping to ease the

burden of financial hardship on their families in the event of accidental injury or death

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Benefit to Employers:◆ Your key to business growth is happy,

productive, secure employees◆ By making safetynet@work available

to your employees you demonstrate you value them by recognising their commitment and responsibility to their families

For more information contact:Suzy Roper – EMA NorthernEmail: [email protected]: 09 367 0909Fax: 09 367 0920

* Conditions apply please refer to the Benefit Summary**There are some occupations that are considered by the New Zealand Accident Compensation Commission to be unusually hazardous and the Scheme is consequently not available to those companiesBenefits underwritten by Pacific Life Limited

Safetynet@work insurance is:


8TH ANNUALEMPLOYMENT RELATIONSCONFERENCE

With speakers Hon Ruth Dyson, Chief Judge Colgan, Bill Ralston, CTU's Carol Beaumont and more

PREPARING FOR CHANGE

Stamford Plaza Hotel, Auckland25 and 26 July 2007

REGISTER AT WWW.EMA.CO.NZ/ER_07

KiwiSaver Employee Workshops

Your employees’ need to know about KiwiSaver:

For more information call:

0800 800 362

• Do they have to join?• How does KiwiSaver work?• What should they do?

A workshop run at your workplace will ensure your employees’ get the information they need direct from the experts.

You can rely on EMA to explain KiwiSaver in a way that supports your business.

Run by experienced EMA consultants at membership rates.

True stories from the security files of: Rod Moratti, Private Investigator


Time isn’t just wasted with unproductive and poorly run meetings - it is literally stolen. Spending time in meetings that go nowhere should be a crime. When we account for pay rates and compute the dollar cost of yawning and staring into space, the high cost of ineffective meetings is undeniable!

A solution for time theft isn’t meeting avoidance. A well run, on-target meeting is a key form of business communication. The key is good planning and follow through.

Steps for an effective meetingBefore you commit to a meeting, ask

yourself:■ Do we really need a meeting?

Is there another way to inform stakeholders and reach decisions?

■ If a meeting is needed, do all the stakeholders need to be present? Can attendees effectively brief absentees?

If a meeting is in order, the next step is preparation:■ Draft an agenda. If you can, invite

contributions from attendees. ■ Place the most important topics

at the top. This way, critical items will be covered if time runs out or someone must leave early.

■ Think through what closure looks like for each item. This will keep you on course and help determine when to move on.

■ Assign a start and end time; allot specific time periods to each item.

■ Circulate the final agenda before

meeting time, a few days beforehand if possible. This lets attendees prepare if needed.

At the meeting:■ Start on time. If someone comes

late, don’t stop and recap. Leave latecomers to find their own ways of catching up.

■ Stick to the agenda. If other relevant issues are raised, hold them until agenda items have been completed. They may need to be held over.

■ Get closure on each item before moving on.

■ Get someone to take minutes. Keep them simple - actions and by whom.

■ You may ask someone else to keep time. This lets you be attentive to the topics under discussion.

■ Finish on time. Immediately after the meeting:Distribute the minutes with a

summary of action items and account-abilities. This closes the communication loop and provides a written record that can be used to brief absentees and to manage the commitments made in the session.

Tips and TrapsIf you work in a “culture of lateness,”

you may be all alone at the start of the meeting. Start anyway. It may take some courage, but if you can stick to this your attendees will learn they need to be in their seats on time to get in at the beginning of things.

If the designated chairperson is habitually late, ask another participant to start. If the chairperson is a senior

manager, find a way to respectfully let him or her know in advance that you will start on time with someone else and they can take over when they arrive.

During agenda planning and in the meeting itself, don’t waste the time of the whole group on an issue which can be easily resolved by a smaller group after the session concludes.

Avoid the temptation to pack the agenda with lots of items. It’s better to come to closure on one thing than to bring up five things and leave them all hanging. Be realistic and allow appropriate time to bring each item to closure.

While democracy is a great thing, if you allow ten people two minutes each to contribute their opinions on an issue, you will eat up 20 minutes! Solicit input and opinions during agenda planning and distribution so that as much discussion and deliberation as possible can take place before the meeting clock starts.

If meetings that you attend are inefficiently run, don’t suffer in silence. Request that the issue of meeting management be added to the agenda and make your case for a change. It’s hard to deny the benefits of a well-run meeting when confronted with the numbers!

Robyn Pearce is an international produc-

tivity and time management speaker and

author. You’ll find a bundle of further free

help at www.gettingagrip.com, including

a fortnightly Top Time Tips e-zine (email

magazine).

get a griphot tips for higher productivity

By Robyn Pearce CSPAre meetings stealing your time?

Tues, 17 July 7.00am – 9.00am Tatapouri Sports Fishing Club, Gisborne Wharf GISBORNETues, 17 July 2.45pm – 4.15pm War Memorial Centre, Marine Parade NAPIERThurs, 19 July 10.00am – 11.30am Collegiate Motor Inn, 122 Liverpool Street WANGANUIThurs, 19 July 3.30pm – 5.00pm Te Manawa, 396 Main Street PALMERSTON NORTHTues, 24 July 3.30pm – 5.00pm Rutherford Hotel, Trafalgar Square NELSONWed, 1 August 3.30pm – 5.00pm Duxton Hotel, 170 Wakefield Street WELLINGTON

EMA CENTRAL WINTER BREIFINGS UPDATEUPDATE To register: Call Sandra Webley (04) 470 9947; or email: [email protected]


Last month I touched on the difference in philosophy separating Lean Production from conventional industrial practice. Now I’ll explore these differences to illustrate the potential of the system.

Push versus pullUnder Lean Production the trigger for any activity is a customer order. Put simply, an order pulls work through the system in the exact amount required to satisfy the demand. Contrast this to a conventional operation where it’s a sin to allow machines or employees to work at anything less than maximum capacity; production is geared towards achieving this rather than on actual need. The inevitable result of this focus is:■ Waste of Labour and Plant, because

they are doing more than necessary at any given time.

■ Waste of materials because output is greater than actual need at any given time.

■ Elevated on–line and finished goods inventory, i.e., more than is actually needed to satisfy immediate demand.A more sinister by-product of ‘the

more the merrier’ principle is the imbalance between processes. For instance when process #1 is geared to produce to capacity, it’s highly unlikely that processes #2 and #3 are capable of exactly matching this. Figure I shows a typical result of such a mismatch.

In this example, the operators on stations #1 and #3 could be considered to be under utilised whilst their unfortunate colleagues on Assemblies #2 and #4 are overworked and can never hope to keep pace with the flow of work being served to them. It’s also

evident that this system guarantees that there will always be a build up of WIP inventory between stations #1 & #2 and #3 & #4. This is a crazy situation but common in all conventionally operated businesses. Although the

diagram shows a manufacturing facility, it’s important to realise that the same problem (doing more than is absolutely necessary at any time) affects office operations, repair shops, warehouses, hospitals, etc, etc:

If we look at the diagram again and ask the question, “What could operators #1 and #3 have been doing instead of producing sub assemblies which could not immediately be used?” I’m sure the answer would include they could perhaps help their unfortunate colleagues at the other work stations. All well and good, but this would create consid-erable logistical problems and, I suspect, some interpersonal strife between the

employees. The Lean way of addressing this situation is known as One – at – a – time – processing. Figure 2 below shows this in action.

Under this regime, each of the processes takes exactly the same amount of time to complete. As a downstream operation is completed, the operator Pulls new work from the upstream station.

This results in:■ Work flowing unhindered through

the process.■ The shortest possible cycle .

■ Stress free operators. ■ The lowest possible raw material and

in-process inventory. ■ An ability to respond very quickly to

demand.In a true Lean enterprise the entire

range of manufactured items is routed along a single production line. This is made possible by standardising all process times reducing on–line inventory to the exact amount required

I’m sure sceptics will think it’s impossible to achieve a standard time for all processes. That maybe true for businesses locked into the traditional ways, but it’s certainly not for Lean enterprises because a fundamental aspect of the system involves a deep understanding of the ‘How–To’ and the ‘How Long’ of each process.

Yes, Lean Production realises all employees must know exactly what to do at any time, and understand exactly how much time each process should take if it is to be consistently performed to 100% accuracy. Sadly, very, very few companies measure and/or standardise their operating procedures and even fewer seem to understand the impact this omission has on their bottom line.

Next I’ll explain the ‘tools’ of the system and how these can be used to achieve a best practice operation. Barry Nolan is the principle of Total Quality Logistics, consultants in Lean Production and Logistics. He worked at British Leyland in the UK in the 1970’s and was National Distribution Manager for Toyota NZ from 1977 to 1996. He trained in Kaizen and Lean Production in Japan and the USA, and led the Palmerston North Distribution Team to world best status in the Toyota hierarchy. Phone 06 326 8907 or 0275 387 565

By Barry Nolan

Increasing productivity the Lean Way


Training at EMA Northern is being embellished with online components.

Since learning at a computer screen is not as compelling as in a classroom, EMA’s learning team is developing online teaching to augment classroom teaching, and to make it fun.

EMA Learning’s manager, David Foley says studying online can be a boring way to learn. Even learning how to use a computer and just reading material takes a lot of self-determination and conscien-tiousness for most people.

“We are trying to add a bit of fun and interest so people learn things before coming on the course,” he said.

“The online component aims to add value to the course, not replace it or duplicate the course book.”

Online preparation might take an hour, and can be done at work.

Questions asked of students before they attend a course include things like ‘what is your job and what do you expect to get out of the course?’

“This helps customize what people want to get out of a course.

It helps make courses more useful,” David said.

“Some reading material is presented online too, to familiarise people with the terms and concepts of their topic, and the programme,

before the day’s learning starts, and has links to further resources.”

The course content is linked to interactive games such as ‘memory’ matching pairs of cards, and short quizzes based on the television show Who Wants To Be A Millionaire? The online section

is password protected and active for 12 months, making it a useful resource for students after the training.

David credits colleague Nirupam Sarkar, training resources co-ordinator, for the technical development, including designing the games.

Nirupam used eQuip software designed by Digital learning Solutions Ltd, and added the

learning content developed by EMA.He worked part time on the

project for EMA Northern while completing his Graduate Diploma in 3D Imagery and Visualisation at Auckland’s Media Design School.

Learning online with a giggle

■ EMA Northern offers about 600 courses a year for members

and non members (with a fee differential). Each class is

limited to about 18 people and generally aimed at managers

and business owners.

■ Topics are broad, such as environmental law, occupa-

tional safety and health (OSH), first line management and

leadership, behaviour modification and stress managerment.

Examples are “Procedural Fairness and The Disciplinary

Process” (one day), “Payroll Calculations” and “Creating a

Great Place to Work I – Attracting Good People”.

■ There are opportunities to sit unit standards assessed

according to New Zealand Qualifications Authority (NZQA)

standards, and accredited towards qualifications such as

the “Graduate Diploma in Business (Employment Relations

Management)”. These are run in association with Massey

University with EMA Northern delivering some of the

papers.

More recently EMA has been offering National Certificates for

day courses in:

■ Adult education (for trainers)

■ OSH, levels 3 and 4

■ First line management, levels 3 and 4

EMA’s fully equipped training rooms are available for hire, and

able to be configured in varying sizes.

EMA trainers for Tailored Training work with employers

according to their needs, and hold classes at the employer’s

venue of choice (optionally at the EMA training rooms in

Newmarket, Auckland).

Trainers are all contracted facilitator,s well experienced

practitioners in their fields, and in teaching.

Contact EMA Learning: Auckland 09 367 0909 or toll free 0800

800-362, email [email protected] Waikato/Bay of Plenty: Ken

Vesey 09 367 0955 or 027 495 4393, email [email protected].

Also see www.ema.co.nz.

EMA Learning, at a glance

Studying online can be a

boring way to learn

KiwiSaver employee workshopsWhen: By arrangementWhere: Your workplace or other venue of

choicePresented by EMA consultants and tailored to your workplace to help your employees weigh up whether to join the KiwiSaver retirement savings scheme.Contact: EMA at 0800 800 362

Fresh technology breakfast When: 19 July 2007Where: Prime Bistro, PWC Tower, AucklandLearn about the features of new Apple technologies that can help you maximize the spread of audio-visual information within your business and to your clients - video podcasting, Apple TV and more, from Paul Johnston, MD of Renaissance.Contact: Grant Dixon 09 367 0965 Register at www.ema.co.nz and click on Learnin

8th Annual employment relations conferenceWhen: 25 & 26 July 2007Where: Stamford Plaza Hotel, AucklandHear new employment relations and human resources developments and trends. Be up-to-date in all factors affecting your future workforce.

Contact: Grant Dixon 09 367 0965Register at www.ema.co.nz

Debt collection/legal action workshopWhen: 25 July 2007When: Grand Tiara Hotel, RotoruaHalf-day course with the latest information and a disc on how to empower attendees to credit-assess prospective clients and reduce the payroll delinquency of existing clients.Contact: Ken Vesey 09 367 0909 or Email [email protected]

Payroll calculationsWhen: 1 August 2007Where: EMA Training Centre,159 Khyber Pass Rd, AkldOne day practical course on essential calculations for a range of payment requirements, eg, holidays, paid parental leave and KiwiSaver.Contact: David Foley 09 367 0909 or Email [email protected]

Fresh people summitWhen: Friday 24 AugustWhere: Aotea Centre, AucklandA full day of great speakers and practical information designed to help you, the HR professional, keep up to date with market trends and new ways to manage people.Contact: Rachel Briscoe 09 367 0925 Or email [email protected]

Business unit management certificate courseWhen: 1 August 2007Where: EMA Training Centre, 159 Khyber Pass Rd, AkldComprehensive course providing a clear, flexible framework for middle managers to manage day to day responsibilities, including workplace based assignments to ensure practical application.Contact: Andrea Shine 09 367 0957www.ema.co.nz/Business_Uni_Management.htm

OHS national certificate level 3When: 1st block of 4, 9 & 10 August 2007Where: EMA Training Centre,159 Khyber Pass Rd, AkldIntroduction to legislative and regulatory obligations and practice for workplace safety; four blocks of two days each.Contact: Joanne Pinkney 09 367 0958 www.ema.co.nz/ema_certificates.htm

OHS national certificate level 4When: 30 & 31 August 2007(1st block of 4)Where: EMA Training Centre,159 Khyber Pass Rd, AkldProgress your experience with OSH from level 3, for those developing a career in OSH or have management input into OSH policy and practice; four blocks of two days each.Contact: Joanne Pinkney 09 367 0958 www.ema.co.nz/ema_certificates.htm

How not to sweat the small stuffWhen: 14 August 2007Where: Anglesea Motel and Conference Facility, HamiltonWhole day course for managers, team leaders and customer service professionals on how to reduce the impact of stress from all sources.Contact: Ken Vesey 09 367 0909, or email [email protected]

JULY 2007

Participate NOW!

For more information visit

www.nzsalarysurvey.co.nz

Gain access to NZ’s most comprehensive wage

and salary information

214 positionswithin 19 fields

641 participantscovering 38,016

employees(2006)

Non-membersgain access only

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Participating members

pay only 1/3 of thepurchase price

(04) 470 9947(09) 367 0974 (03) 456 1806(03) 366 5096

Exclusive EMA news, advice, learning and networking Isn’t ... · On the cover: 16 Influence Baby...

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