One such argument arose over the intention of a clause in a Collective Agreement for bus drivers. In April 2007 the minimum annual leave was raised from 3 weeks to 4. The bus drivers’ had negotiated through their Unions to have 3 weeks annual leave plus an extra week “in recognition of the nature of the work”.
Of course the drivers said that they were now entitled to a total of 5 weeks – the statutory minimum of 4 plus the extra week.
The Employment Court considered that the clause in the collective employment could have two possible interpretations, hence the problem.
The first interpretation was that the combined clauses referring to annual leave made 4 weeks in total which was sufficient for the bus drivers’ even when taking into account the “nature of the work” – good for the employer.
The second interpretation is that the first part of the clause refers to whatever the statutory minimum was and that the second part was to be an additional week to whatever the minimum happened to be as it was to be in “recognition of adverse working conditions” and so they felt justified in an increase above the general minimum – good for the employees.
The Employment Court decided that that the stated goal in the collective employment agreement was for there to be annual holidays of 4 weeks; the amendment to the Holidays Act meant that this goal was reached and so the clause had become obsolete – in other words employees were entitled to four weeks.
In the Court of Appeal the majority of Judges found that the Employment Court had over analysed the language used by Parliament. The Court of Appeal sent the matter back to the Employment Court to reconsider.
Perhaps the most important lesson in light of this case is to be sure that you are taking into account the current legislation when drafting an employment agreement. Although the bus drivers’ agreement was executed in 2005, after the Holidays Act 2003, the Holidays Act 1981 was still referred to. If the drafters of the agreement had simply modified the clause slightly to allow for the amendment that was to come in regards to the minimum leave then the entire matter may well have been avoided.
I will let you know what the Employment Court say when they reconsider the matter as I know that this is an issue that many of you will have had to deal with.
This article originally appeared in the Southland Times Work To Rule column. Mary-Jane Thomas is head of Preston Russell's employment law team. Contact her by clicking here
