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Submission by Hospitality Association of New Zealand To the Transport and Industrial Relations Committee On The Immigration Bill
12 October 2007 Hospitality Association of New Zealand Immigration Bill Members of the Select Committee The Hospitality Association of New Zealand represents a diverse variety of New Zealand hospitality businesses including restaurants, caf￩ bars, hotels, off-licenses and a wide array of short and long term accommodation providers. The Association is voluntary and is primarily funded by membership subscriptions. Our membership of approximately 2350 plus members employ 11,610 full-time and 19,674 part time employees for a total of around 30,000 people. Approximately 83% of the Association’s members are small businesses and owner operated. The Association asserts that this figure mirrors the wider hospitality industry. There is also a perception that the Association speaks for and represents the interests of the hospitality industry as a whole. The Association has considered the bill and makes appropriate comment on selected aspects of the bill. The Association would like an opportunity to be heard before the Committee on its submission. Bruce H Robertson Executive Summary The Association does not oppose the Bill. The Association considers that immigration law needs to provide a framework so that policy is able to be implemented effectively as needs require. This includes the flexibility to ensure New Zealand’s economic and security interests are protected. This inevitability leaves details to be adjusted by the use of regulations. The Association supports this flexibility as currently provided, especially as far as adjustments to alleviate skill and labour shortages that if this flexibility were not apparent could impede economic growth. Where the Association does however have concerns is in the proposed Clause 313 of the Bill in respect of employer obligations to ensure that persons who are not entitled to work in New Zealand are not employed by New Zealand organisations. We are concerned about the lack of clear and fixed rules about employers’ obligations and defences in the proposed Clause 313(3) that may make compliance with the law difficult and costly for businesses. The Association would therefore like to recommend that Clause 313(3) be reworked to more clearly state employer obligations and defences. Such an amended section 313(3) might look like this: (3) It is a defence to a charge under subsection (1) (b) that the employer did not know that the person was not entitled to do the work and took reasonable steps and due diligence to ascertain whether the person was entitled to do the work. An employer is deemed for the purposes of this section to have taken reasonable steps and due diligence if the employer holds: (a) a tax code statement issued by the Inland Revenue Department that states that the person to which that tax code relates is entitled at the time of employment under this Act to undertake employment in the employer’s service; or (b) Any other documentation that has been deemed to be suitable identification for the purposes of this section by the Department; or (c) Has a declaration from the person that they are entitled to work in New Zealand and the employer has retained a copy of that declaration. It is the Association’s view that this approach should provide both clarity to employers and flexibility for officials to introduce new forms of evidence as necessary. The Association would also like to recommend that the Government be invited to instruct the Inland Revenue Department, Department of Labour and Immigration Service, and any other relevant agencies, to establish processes for data-sharing so that official tax code or file number statements can also provide immigration status information. 1. INTRODUCTION 1.1. Immigration plays a pivotal policy role in supporting economic growth by: a) Growing the nation’s labour force and consumer markets, b) Offsetting skill and labour shortages, and c) Bringing new skills, knowledge and experiences into New Zealand firms and the wider New Zealand economy. 1.2. Immigration as a tool to promote economic growth is likely to take on a greater importance as New Zealand’s economy expands and the labour market ages and international competition for skills and talent increase. 1.3. The Association therefore endorses moves to modernise New Zealand’s immigration legislation and policy to support this initiative. 1.4. Many of the Association’s members operates in sectors where labour supply and talent are at a premium necessitating that such businesses seek to enlist the assistance of persons that require approval to work in New Zealand. 1.5. The Association considers this initiative a useful, real and often necessary mechanism to alleviate labour and skill shortages in the hospitality and tourism sectors. 1.6. The Association does however have concerns with the changes to employer obligations proposed in Clause 313 of the Bill. 1.7. The Association is also concerned about the lack of clear and fixed rules about employer obligations and defences in the proposed Clause 313(3) that may make compliance with the law difficult and costly for businesses. 1.8. It is this aspect of the Bill that the Association’s submission is primarily focused on. 2. DISCUSSION 2.1. Under the current Immigration Act, employers have a reasonable excuse against a charge of allowing a person who is not entitled to work in New Zealand to undertake employment where the employer did not know that the person was not entitled to undertake that employment and holds a tax code declaration that states that the person is entitled under the Immigration Act to undertake employment and that declaration was signed by the person before or when that employment began. 2.2. Clause 313(3) of the new Bill retains this ground of employer ignorance as a defence to charges of employing people without an entitlement to work, but replaces the holding of a tax code declaration with a generic requirement on employers to take “reasonable precautions” and exercise “due diligence to ascertain whether the person was entitled to work.” 2.3. It is appropriate that the Government should have a policy against and take measures to address and minimise the number of people working illegally in New Zealand. 2.4. However, as with all enforcement mechanisms, it is important that policy responses are proportionate to the problem and do not create undue negative consequences. 2.5. The Association is therefore concerned that the proposed new employer obligations outlined in the Bill may not meet either of these considerations and that the lack of a clear definition of “reasonable precautions” or “due diligence” may create uncertainty and risk for employers. 2.6. Although the Bill is designed as a framework, indications of the parameters of employer obligations may be given by the ‘Employers’ section of the ‘Business compliance cost statement’: “In the fruit-picking industry, a recruitment or contracting agency could include a check box about entitlement to work on registration forms and request proof of that status from a prospective employee. They could hold that proof on file. Retaining a copy of a New Zealand birth certificate, passport, or citizenship paper would generally be evidence of reasonable steps to establish a person was a citizen.” 2.7. The underlying requirement of these scenarios appears to be that employers should ask most, if not all, employees to provide evidence of their entitlement to work in New Zealand and retain that evidence for inspection by immigration and/or Labour Department officials. 2.8. The Association must therefore raise the concern of the time, space, compliance and cost measures necessary to comply with the need to copy and store entitlement to work records. 2.9. The Bill’s ‘Statement of net benefit of the proposal’ further notes that “There is a risk that removing the sighting of an IR 330 form as a reasonable excuse for employers could increase discrimination against persons who employers think may be non-citizens.” 2.10. This is certainly a plausible outcome, as employers will have to grapple with the question of how to identify illegal workers in an environment where more and more New Zealanders are born offshore. 2.11. A requirement for employers to sight evidence of entitlement to work in New Zealand could therefore raise possible discrimination issues when employers ask all potential employees for evidence of their entitlement to work and evidence of identity documents such as birth certificates and passports are presented for this purpose. 2.12. The situation is further complicated by the fact that many citizens or residents who are entitled to work will not have on hand the paperwork required to demonstrate that entitlement. Moreover, if employers were to seek evidence in the form of a birth certificate, that might, in some circumstances, open them up to charges of age discrimination. 2.13. This could mean that well intending employers could effectively face competing pressures as they act to minimise breaching the Act by asking for evidence of entitlement to work and in doing so risking charges of discrimination. 3. AN ALTERNATIVE APPROACH 3.1. Our preference would be that the law is as clear and specific as possible about employer obligations. Certainty should reduce unnecessary cost and should lead to greater understanding of and compliance with the law. 3.2. The Association accepts that the use of tax code declarations as a reasonable excuse may not be optimal as such declarations do not always provide up-to-date information on an individual’s work entitlement. 3.3. However, there may also be potential to resolve many of the issues regarding illegal employment through better inter-agency cooperation. For example, the IRD and Immigration Service could share information, so that the formal tax code or tax file number statement prepared for an individual by Inland Revenue also lists their work entitlement status. 3.4. Such a measure in the Association’s view could alleviate compliance on employers and provide effective certainty by organisations with the most efficient resourcing to achieve this certainty of persons entitled to work in New Zealand. 3.5. The Association would therefore like to recommend that Clause 313(3) of the Bill be reworked to more clearly state employer obligations and defences. 3.6. Such an amended Clause 313(3) might look like this: (3) It is a defence to a charge under subsection (1)(b) that the employer did not know that the person was not entitled to do the work and took reasonable steps and due diligence to ascertain whether the person was entitled to do the work. An employer is deemed for the purposes of this section to have taken reasonable steps and due diligence if the employer holds: (a) a tax code statement issued by the Inland Revenue Department that states that the person to which that tax code relates is entitled at the time of employment under this Act to undertake employment in the employer’s service; or (b) Any other documentation that has been deemed to be suitable identification for the purposes of this section by the Department; or (c) Has a declaration from the person that they are entitled to work in New Zealand and the employer has retained a copy of that declaration. 3.7. It is the Association’s view that this approach would provide both clarity to employers and flexibility for officials to introduce new forms of evidence as necessary. 3.8. The Association would also like to recommend that the Government be invited to instruct the Inland Revenue Department, Department of Labour and Immigration Service, and any other relevant agencies, to establish processes for data-sharing so that official tax code or file number statements can also provide immigration status information. |
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