exclusive ema news, advice, learning and networking ...€¦ · 159 khyber pass rd, grafton,...

Exclusive EMA news, advice, learning and networking I ssue 57 + March + 2009

■ Two big features on continuous improvement

■ Re-deploying your staff: How to manage it well

■ We NEED this recession!

In this issue:

Licorice all sorts:The company profile

EMA Northern & Central are the major stakeholders in:

Why cutting company tax is fairest

Winning ways for exporters

Many changes to tax start April 1: Are you ready?

The best wayto keep staffhappy sincewages.

activa is brought to you by Activa Health Limited. The activa Account and related banking services are provided by ASB Bank Limited. Activa Health Limited receives services fees from ASB Bank Limited and Southern Cross Medical Care Society. Neither Activa Health Limited nor the Southern Cross Medical Care Society is a registered bank. A copy of ASB’s disclosure statement is available free of charge at www.asb.co.nz.

The activa card is a simple, fun way to attract, retain, and inspire your staff. You set the annual amount, then your staff use their activa card to enhance their health and wellbeing. It’s what you’d call a healthy incentive. To find out more about the benefits of activa for your staff talk to Southern Cross on 0800 323 555 now or visit www.healthybusiness.co.nz.

MeMber profile

Our Vision. Your Success PAGE 1

FINANCE

NETWORKING

TECHNOLOGY

MANUFACTURING

RECRUITMENT

Govt. backs Business NZ report

EMA widens skills programme

Changes to Copyright law deferred

Single trade window on horizon

Skills you want taught for exporters


The sweet story of RJ's licorice

05

06

15

17

18

19

23

02

03

12

Your team is in control Paul Winter urges you to harness your workplace team

Government has to keep focus on businessAlasdair Thompson says cutting company tax would be fairest

Recession: What's coming up next ?

Coping creatively with the recession

EMA's E&Y's Tax Tips - New tax package to assist business

Mediation: How confidential is it?

07

08

10

FINANCE

NETWORKING

TECHNOLOGY

MANUFACTURING

RECRUITMENT

14

20

21

22

24

Now's the time for independent directors

Space: A valuable commodity! - MAkE iT LEAN

Harnessing your company's creativity : Apply TFM

We NEED this recession!

EMA People

FINANCE

NETWORKING

TECHNOLOGY

MANUFACTURING

RECRUITMENT

RJ's developed a new market category for licorice in New Zealand by applying all sorts of innovations.Yum. Read more on page 23

On the Cover

is published for:

EMA NorthErN

159 Khyber Pass Rd, Grafton,

Private Bag 92066 Auckland

Ph: 09 367 0909 or 0800 800 362

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

Chief Executive: Alasdair Thompson

Advocacy Manager: Bruce Goldsworthy

Manager, Employment: David Lowe

Manager EMA Learning: David Foley

Manager EMA Events: Mauro Barsi

Whangarei

Myriam Heynen

09 459 1501 mob 021 920 414

Waikato

Denis Quigan 07 839 2995 mob 027 203 0694

Cor Speksnijder 07 853 0018 mob 027 203 0694

Bay of Plenty

Kim Stretton 07 577 9665

Terry Arnold 07 575 8401 mob 021 662 656

Rotorua

Clive Thomson

07 345 8122 mob 027 437 28 008

EMA cENtrAl

PO Box 1087 Wellington

Ph: 04 473 7224 Fax: 04 473 4501

Email: [email protected]

Website: www.emacentral.org.nz

Chief Executive: Paul Winter

Gisborne office: 06 863 2438

Hawke’s Bay: 06 843 3419

Taranaki: 06 759 4006

Manawatu/Wanganui: 06 350 1825

Nelson: 03 548 4528

Editor

Gilbert Peterson 09 367 0916

Writer

Mary MacKinven

Published by

TPL Publishing Services

Project Manager

Lisa Morris 09 529 3022

Advertising Sales

Colin Gestro (09) 444 9158

[email protected]

iSSN No. 1176-4953

The AdviceLiner

get a griphot tips for higher productivity

2524

PRESENTS

BNZ PARTNERS

ESENTSPRES

19

FINANCE

NETWORKING

TECHNOLOGY

MANUFACTURING

RECRUITMENT

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

By Paul Winter, Chief Executive, EMA Central

New website for EMA Central membersEMA Central is getting a new-look website to help members keep up to date with the

latest employer information and to access valuable resources and publications online.

Keep an eye out for the new site on:

www.emacentral.org.nz.

No matter the external environment, you can always do something, and the most important bit of advice I ever had is for us all to focus our efforts on our Circles of Influence and not get distracted by our Circle of Concerns.

Some readers may wonder what on earth I’m talking about, but anyone who has read Stephen Covey’s book on the Seven Habits of Highly Effective People won’t be.

For the vast majority of our businesses and other enterprises the external economic environment is making life a lot tougher - some are finding their very survival threatened. But while there is little we can influence about the rough economic weather we can influence how we respond to it, and what actions we take.

I stressed last month the importance of focusing on the value our businesses and enterprises deliver to our customers. That’s exactly the same as the new Government is asking every Government Department head to do in a line-by-line expenditure review. What should happen from the process is money freed up from programmes that have delivered poor outcomes will be redirected into new areas to raise productivity and our quality of life. (‘Quality of life’ is core to the concept of productivity; otherwise for most people the word conveys soulless effort.)

You and your people know your

business better than anyone else so long as you maintain an openness to ‘knowing what you don’t know’. Our EMA consultants are often called in to help members who don’t have their areas of expertise covered in-house.

As Kiwis we are learning to overcome our DIY habit. In many respects DIY is laudable, but like any strength it becomes a potential weakness if we don’t have the common sense to know our own limitations, and when to call in an expert.

We had a visit recently from the chair of the British Government’s Better Regulation Executive, Sir William Sargent, a successful private sector CEO running a government agency that saves about two billion pounds a year from its initiatives. The two key values they have found successful and that are fundamental to any good organisation are transparency and accountability.

Transparency is about being able to see clearly what is happening. In successful organisations this is not

a police role, but is about helping people understand what their job is, their role, how it adds value, and what activities don’t add value.

If you have got the right people in your organisation they will want to be accountable, so long as they can see that their contri-bution to the success of the organi-sation will be rewarded, not just in remuneration but in growing their part in the organisation’s success. More than money they want greater satisfaction from their increasing contribution.

Harnessing the specialist knowledge and skills of the people in our workplace teams is fundamental to the success of all enterprises.

Underpinning that, is your people absolutely need the five core competencies that create really enterprising people: ■ thinking skills, ■ use of language, ■ symbols and numbers,

■ self-management, ■ communicating with others, and ■ participating and contributing.

These five competencies are a powerful cocktail you can use to transform your organisation from one that is less reactive challenging times, to one that adds increasing value, proactively, for the benefit of customers, staff and the investors.

To quote the Billy Ocean song: “When the tough get going, they can climb any mountain because the have the want, the will and the skill.”

Your team is in control

"Harnessing the specialist knowledge and skills of the

people in our workplace teams is fundamental to the success of all enterprises."

Our Vision. Your Success

By Alasdair Thompson, Chief Executive, EMA Northern

The recession has reminded us how dependent we all are on the success of our businesses. Without business success there are no jobs, and no growth in wages and salaries.

It's obvious if we want to save jobs, first we must save our businesses, and the key to overcoming the recession will be to give sound business enterprises every opportunity to survive and grow. You might think a National-led government would already know that.

Business activity actually pays all the taxes collected by the Government. Businesses have to generate sufficient income to pay their own expenses as well PAYE tax on their employees’ payroll, GST, FBT, company income tax and the business owner’s own tax bill.

So any Government actions that cost-effectively help businesses succeed will help save jobs, ultimately leading to a return of growth in wages and salaries.

The worthwhile things a government can do to help businesses succeed are many and varied. Some of them have been brought forward including early investment in infrastructure, and some tax benefits to assist the cash flow of small businesses.

The Jobs Summit canvassed many more.

But business managers themselves know what hinders their success and what helps them; for example, excessive compliance costs, high interest rates and volatile exchange rates hinder; a skilled workforce and access to long term loans help.

Some more things the Government could do to help include getting its own house, in order, in particular to:

■ Eliminate wasteful government spending.

■ Reduce the company tax rate well below the present 30 per cent level.

■ Eliminate excessively restrictive business compliance costs - the Resource Management Act under review is just one area in need of a fix.

■ Ensure our banking system is always able to lend to any person or business that can repay the debt. If banks cannot collectively access funds to extend credit sufficiently, the Reserve Bank should be required to step in.

■ Issue infrastructure bonds and invest in infrastructure projects

with high returns on investment. Borrowing to fund high quality government infrastructure is simply good business.

Of these two are particularly important at the moment; cutting the company tax rate, and keeping access to credit.

Some people oppose reducing company taxes apparently on ideological grounds. They appear

blind to the connection between successful businesses and their own incomes, and their dependency on taxpayer funded services and/or welfare. Perhaps they don’t see that a company is not a person. Taxing its profit indirectly taxes us all.

By all means, tax the business owner’s income, and tax shareholder dividends in the same way that employees are taxed through PAYE.

But taxing a company’s profit is tantamount to slowing down business growth by choking off its investment in employing more people, new plant, product and market development and skills.

The fairest way the Government could help our businesses survive,

retain jobs and grow would be to reduce the company tax rate. This would help them service their debts, while leaving more money for reinvestment to grow again, when demand recovers, as it will.

The other big business issue at the moment is access to credit, or borrowing. Bank lending to business in New Zealand has actually been increasing since the recession began but at a rate less than non-bank lending to business has been contracting. During the US originated ‘credit crunch’ the Government must ensure that responsible borrowers here, whether individuals or businesses, have access to credit.

The US Government is printing bonds and selling them to the Federal Reserve which is ‘printing’ money to buy them. The Government then uses the money to ‘stimulate’ the economy. If necessary there is no reason why our Reserve Bank could not also ‘print’ money to buy bank issued bonds to ensure our banks can continue lending to prudent borrowers.

Government has to keep focus on business

“Taxing a company’s

profit is tantamount to

slowing down business

growth by choking off

business’ ability to invest

in employing more people,

new plant, product, market

development and skills.”


TimeFiler ups ante for iMS Payroll

Major changes to employment-related laws are coming into effect now. And more and more businesses are considering their restructuring options.

You need to be on top of the latest developments.This 2 hour EMA Advice seminar presented by David Lowe* will be presented at 16 venues and will cover:■ The new grievance-free trial period law, including sample

clauses for your employment agreements■ KiwiSaver changes from April 1, 2009 including: • Changes to employer and employee contributions rates, and tax• Personal grievance claims around KiwiSaver• New rules for the inclusion of contributions in remuneration• Refresher on redundancy and restructuring including: • Different requirements for restructuring, downsizing or closure• Consultation requirements• Government redundancy support package• Other proposed payroll and tax changesGet it right first time. This EMA seminar will show you how. To register go to: www.ema.co.nz/adviceHurry. Places are limited, and some sessions are sold out

Grievance-Free Trial Periods, kiwiSaver and more

Plus refresher on restructuring and redundancy

Employers can now offer employees online access to timesheets, rosters and leave requests

IMS Payroll’s 10,000 customers can look forward to a sophisticated new functional – the ability to offer their employees online access to their timesheets, rosters and leave requests.

To achieve this, Patrick Hegarty, IMS Sales Manager said they had seamlessly integrated IMS payroll software with TimeFiler, a system developed by Christchurch company Enfinit Software, which is housed at the Canterbury Innovation Incubator.

The TimeFiler system has proved its value since release last year with customers including TNS Asia Pacific, Solid Energy, Colmar Brunton, NZ Aviation Security, Mercy Hospital, and Christchurch International Airport.

Mercy Hospital, for example, estimates a saving of 16.5 minutes in HR administration per employee, or roughly 50 hours per fortnightly payroll thanks to TimeFiler. Hospital staff are also very happy that they can now access their timesheets, leave requests and rosters online.

“We anticipate strong demand for the new combined IMS Payroll and TimeFiler solution,” says Patrick Hegarty.


A review of the electricity sector commissioned by BusinessNZ that recommends a new approach to its regulation has been endorsed by the Government.

The review, prepared by consultants LECG Ltd, was based on wide consultation with companies involved in generation, transmission and industrial use of electricity.

Hon Gerry Brownlee said in his first major prepared speech as energy minister that he found the report “very useful and relevant” and said he intends to use it as the basis for a Ministerial working party review of the governance of the electricity market.

The report is highly critical of the Electricity Commission which was set up in 2003 to oversee the electricity system and has been criticised for

hindering transmission investment the lack of which has been blamed for power blackouts.

Mr Brownlee said it's too early to say if the Electricity Commission will be abolished,” adding that he wanted to see “a removal of duplication, removal of unnecessary regulation and removal of processes that slow decisions that should be made relatively quickly."

Business NZ Chief Executive Phil O’Reilly said a notable degree of consensus was achieved between the generators, Transpower and large electricity users during the report’s preparation.

The electricity sector is complex and critical to our economy, so its governance is also critical, he said.

“Numerous pressing issues include security of supply, investment in infrastructure, efficiency in market transactions and wholesale and retail competition.

“We need to ensure the right institutions are responsible for the right parts of the system.

“This review makes recommen-dations for consideration by current industry players and regulators and provides a possible pathway for change.”

The report, Determining outcomes or facilitating effective market processes: A review of regulation and governance of the electricity sector by Graham Scott, Kieran Murray and Toby Stevenson of LECG has been sent to ministers, senior Government officials and industry stakeholders for consideration. Its available on www.businessnz.org.nz.

The report’s endorsement by the Government is a strong demonstration of the value and influence of the Major Companies Group of Business NZ and reflects the effectiveness of Business NZ’s lobbying on behalf of EMA members.

Report on electricity wins government backing

GED1045 Pukeko Office Ad_EMA.indd 1 19/9/08 4:48:33 PM


EMA is continuing a work stream to build links between school and work/life by showcasing work options to secondary school students close to leaving age (legally, 16 years or older).

At the same time, employers are being given the opportunity to ‘sell’ their workplaces to young people.

EMA programmes in the education sphere help employers up-skill their workforce by:

improving literacyTo help members identify if low literacy levels in employees is limiting productivity, EMA Northern and Workbase are holding a ‘literacy breakfast seminar’ in Auckland on March 26. Discussed will be case studies of three employers who discovered that if certain workers could read and do sums better, their company’s bottom line would improve. They did, and it did.

The presentation will show how to figure out if you need to take action on your staff literacy.

Enjoy a light breakfast and networking opportunities while you are at it.

The Workbase programme is targeted at the 43 per cent of adults aged 16 to 65 (1.1 million people) who have literacy skills below those needed to participate fully in society. Most of them are in work.

Our literacy programme is fully funded by Government. It incorporates a “needs analysis” from which Workbase can assess specific requirements. A tutor will go to your site at agreed times to evaluate identified staff for a minimum of one hour a week for 24 weeks. A very good DVD is available which demonstrates how easy and effective the programme is.

Showing offEMA is a member of the Pathways to Employment Trust

whose two-day career expos at Mt Smart Stadium provide organizations with display space to promote themselves as great workplaces. They also have the option of presenting to 1500 senior secondary students from about 50 schools on why working for them is worthwhile.

An expo showcasing the ICT, engineering and electro technology sectors is scheduled for April 1 and 2.

A further expo concentrating on the health sector and related industries is tentatively scheduled for September 23.

A new programme links with Fulton Hogan’s Project Aspiring in partnership with Te Puni Kokiri. It will run at Tikipunga High School near Whangarei. Students will plan and build a driveway and parking lot at a local marae. The Trust is also working with MITO (Motor Industry Training Organisation) on an automotive industry pilot project.

LEARNiNG TO SELL The Student Enterprise Learning Link programme (SELL)

has 26 schools north of Taupo enrolled to compete in a practical business exercise.

SELL is a three-day, practical business education programme for year 10 and 11 students. They form companies, do research and decide on a product or service, write a business plan and launch it in a competition. Each team’s business ideas, creations and discoveries then go on display at a business expo. If you are interested in getting involved, please contact [email protected]

Access to skills widenedBy Mike Burgess, executive office, EMA Northern

This EMA/Workbase initiative will deliver improved productivity for your business, at no cost!

Low literacy and numeracy in your workforce could be costing your business:

• A printing company where talk of team improvement was met with silence.

• A timber processing plant where employees don’t read safety and hazard warnings.

• A food processing company where employees weighing ingredients don’t know the difference between 10 grams and 100 grams.

RSVP Anne Clarke on phone 367 0968, Fax 367 0914or email [email protected] by Friday 20th March

Name: ..................................................................................................................................

Company: .............................................................................................................

Phone: ..................................................................................................................

Email: ...................................................................................................................

Thursday 26th March 20097.30 - 9.30am light breakfast providedEMA Boardroom, 159 Khyber Pass Road, Grafton, Auckland

LIMITED SPACES

his EMA/Workbase initiative will deliver improved productivity or your business at no cost!

Is (the lack of) literacy costing you money?

Low workplace literacy levels are a major, under recognised problem in the workplace, harming productivity. Reduce waste and errors, build higher employee confi dence and motivation, and get better health and safety compliance.

Come to our free morning seminar and fi nd out how you can start improving literacy in your workplace. There’s no charge.

• Katherine Percy, CEO, Workbase• Video case studies from Fletcher Aluminium and Deane Apparel

Workbase is a not for profi t organisation focused on improving literacy in our workplaces and has worked with over 100 businesses.

The seminar will describe how you can identify if low literacy skills are preventing improved productivity. Find out what help and government funding is available to support you to improve workplace literacy skills.

where employees weighing difference between

a

ar

ce.

base


The AdviceLinerWhat employers are ask ing AdviceLine th is month

Callers have been looking for the best ways to get through the recession, and of course some of their creative solutions have centred around how staff can be re-deployed and the roles they serve.

What could be smarter?We had a call from David who had

changed the hours of a staff member so he could keep her on. She had been such a valuable full time team member for the past eight years but David was finding he could only afford to keep her position for half days in some weeks.

Naturally her employment agreement stated certain hours of work.

So David raised the matter sensitively with her and the two reached a verbal agreement that she would start and finish an hour earlier each day "to see how it went".

But after a couple of months David wanted her back working the original full time hours as stated in the employment agreement. She was not happy about being mucked about – even though David thought he was helping by providing more work and income! He phoned us. Good idea.

We advised that the matter came down to interpretation and the understanding reached when the verbal agreement was entered into, and if he could show it was a temporary arrangement they should be ok. After all they had not let the temporary arrangement go on too long before calling a halt to it.

In cases like these a new employment agreement should be drawn up with the new work hours specified. We can’t stress enough how

important it is to have agreements detailed and in writing, so everyone is on the same page, so to speak, with no room for misunderstanding.

Breaking up the day upIf an employer wants to cut a

person’s hours because of lack of available work it would be risky to unilaterally impose that on an employee.

Even if the employee’s hours were reduced the employer may have to pay the employee for the full week.

Reducing work hours can have benefits of reducing other employer costs such as for electricity, and it avoids people sitting around doing

nothing. But to cut back a person’s 40-hour week to 20 or even 30 hours is a dramatic change and is tantamount to constructive dismissal.

Always remember the employment agreement: What does it say and how might you alter it if you needed to? It is certainly legal to reduce hours if you genuinely cannot sustain the role full time. But phone us to discuss your options.

Briefly, it’s advisable to hold a staff meeting saying something like, “Things are quiet and we are looking at suggestions to avoid the extreme option of restructuring and redundancies.

“As well as cutting back on use

of paper/fuel/ etc, other ideas being canvassed are people offering to go without pay rises this year, or taking their paid leave now, or going on unpaid leave, or working reduced hours on an agreed short term period with a review at the end of the agreed term.”

The Holidays Act allows room to move on how to reach agreement and if unions are involved it would be wise to talk to their rep(s).

Then you must talk to each staff member individually about any change to their work arrangements, come to an agreement with them, and then make the changes agreed to their employment contract.

Employers have no recourse to the flexible working law (under the Employment Relations (Flexible Working Arrangements) Amendment Act 2007) which relates specifically to the requirements around employees taking leave to look after a dependent.

Next month on April 1 the new law prescribing how and when employees take breaks at work (for meals and tea/coffee

or to breastfeed their baby) also comes into effect. People who aren’t sure they are doing it right, or who have complex shift patterns such as single-person stores and all night service stations, might like to double check the rules with us.

You can also find the breaks law explained in our A-Z of Employing publications on www.ema.co.nz/advice entitled “Breaks”.

Phone AdviceLine at 0800 800 362 or 09-367 0909 (for EMA Northern) or 04-473 7224 (for EMA Central), 8am-5pm weekdays. Alternatively, email [email protected], and read or download information at www.ema.co.nz

Coping creatively with the recession

"We can’t stress enough

how important it is to

have agreements detailed

and in writing"


In February the Government announced a package of tax reforms targeted at small and medium enterprises, but with benefits for larger businesses too.

In recognition of the tough business conditions and the squeeze on business cash flows, the Government has made changes to the provisional tax and use of money interest ("UOMI") regimes. There are also changes in many of the filing and payment thresholds of particular value to SMEs.

The Government has estimated the cost of the reforms at $484 million over the next four years.

Provisional tax changesThe first of the changes is removing

the five per cent "uplift" rate that businesses use in calculating their provisional tax installments throughout the year. To calculate the provisional tax they must pay in any given year, most businesses use the previous year's income and add five per cent to cover likely growth in the new income year – this five per cent uplift will be removed for the rest of this year and next year.

The uplift rates for calculating provisional tax will be reduced for the 2008/09 and 2009/10 income years as follows:

While the change is welcome, taxpayers should remember that they have always had the option of "estimating" their provisional tax liability for the year if they thought the five per cent uplift would result in an overpayment of tax.

Under the estimation method, the taxpayer pays one third of the estimated liability at each installment date rather than 105 per cent of their previous tax liability. The estimation method is not without risks, in particular if the estimate turns out to be wildly wrong; in that case the IRD may impose penalties.

Also, individuals using the estimation method are not eligible for the safe-harbour exclusion from the UOMI regime. So the changes to the standard method of calculating provisional tax obligations should help many taxpayers, but businesses with a significant fall in their taxable profit should still investigate if the estimation method is better for them.

The second and more welcome change to provisional tax is a reduction in the UOMI rates on underpaid

and overpaid tax. The rate for underpayments reduces from 14.24 per cent to 9.73 per cent and the rate for overpayments falls from 6.66 per cent to 4.23 per cent. These changes applied from March 1, 2009.

The previously excessive interest rate charged on underpayments of tax has encouraged businesses to tie up more money in tax payments than necessary for fear of getting a hefty interest bill from the IRD at the end of the year. This change will allow them to redeploy funds to more productive uses.

Changes to other taxes and thresholds

The other changes announced are:■ The GST payments basis threshold

will be raised from $1.3 million to $2 million, allowing more businesses to enjoy the cash flow advantages of only having to account for GST when payment from invoices is actually received. Taxpayers changing to the payments basis should remember that this means they are not able to claim back any GST until they have paid the invoice the GST relates to. A "hybrid" basis whereby businesses could claim inputs based on invoices received and account for outputs

EMA's TAX TiPS

New tax package to assist businessMethod Current rate New rate

Uplift on year before last 110% 105%

Uplift on prior year 105% 100%

Transitional taxpayers 100% 95%

Several changes have been made to KiwiSaver:Trevor Mallard’s law allowing a personal grievance to be taken on the basis of KiwiSaver has been repealed as at December 15, 2008. The rules allowing for a total remuneration approach to include KiwiSaver employer contributions have been changed as of the same date. A total remuneration approach can now be safely agreed with employees, but it must be agreed in good faith in employment agreements and the employer contribution component must be clearly accounted for. From April 1, 2009 further changes to kiwiSaver take effect:■ The minimum employer contribution is 2 per cent and will not

increase in future years.

■ The employer tax credit will not be available.■ The default employee contribution rate for people who are

automatically enrolled or join voluntarily will be 2 per cent, not 4 per cent.

■ The fee subsidy will be phased out.■ The exemption of employer contributions from ESCT tax will

drop from 4 per cent to 2 per cent, and the rate of the tax will change.

Other tax changes from April 1 relate to: ■ PAYE ■ FBT ■ ESCT ■ Secondary tax■ Independent earner tax credits ■ Extra pay ■ R&D tax credits

Memo to self: Re April 1st….

>


EMA's TAX TiPS

based on payments received would have provided greater cash-flow benefits for small businesses.

■ The GST registration threshold will be raised from $40,000 to $60,000, allowing businesses with sales of less than $60,000 a year to de-register from GST if they wish. This may not impact many as experience suggests a large number of businesses below the threshold voluntarily register for GST because it can be beneficial to do so.

■ Businesses with $10,000 or less of business-related legal expenditure will be able to fully deduct the expense in the year it was incurred, regardless of whether it is capital in nature or not.

■ The PAYE once-a-month filing and payment threshold will be raised from $100,000 to $500,000, allowing more employers to file PAYE returns and pay PAYE once

a month instead of twice a month. Businesses short of cash should be cautious about using money that has been set aside for PAYE for any other purpose, as this money (unlike most other taxes) is held on trust for the Crown and failure to pay it, once deducted from employees' wages, can result in serious consequences.

■ The FBT annual filing threshold will be raised from $100,000 to $500,000, allowing more employers to file FBT returns and pay FBT annually rather than quarterly.

■ The value of minor fringe benefits (such as chocolates and flowers) that can be provided to employees without attracting FBT will be raised to $300 per quarter per employee (from the current $200) and $22,500 a year per employer (from the current 15,000). This will mean fewer businesses will

be required to return FBT on certain minor benefits provided to employees.

■ The FBT prescribed interest rate applying to low-interest, employment-related loans will be lowered from 10.90 per cent to 8.05 per cent. The changes that involve law

changes will be included in a taxation bill introduced for application generally from April 1, 2009, or from the 2009/10 income year where appropriate. The new use of money interest rates will applied from 1 March 2009, and the new FBT rate on low-interest, employment-related loans will applied from January 1, 2009.

Aaron Quintal is a Tax Director at Ernst & Young. If you require any assistance with any of the issues discussed above, contact Aaron on 09 377 4790 or email [email protected].

sorted!

Building Compliance

Chubb is a building services company expert in the management of Building Act compliance and the design, installation and maintenance of fi re protection, HVAC (heating, ventilation and air conditioning) and access control systems.

With a ChubbCare plan every aspect of your compliance with the Building Act can be managed.

Chubb is the EMA’s Preferred Partner for property and business security

0800 800 535 www.chubb.co.nz

CHEMA3

Chubb EMA ad.indd 1 6/9/08 1:16:27 PM

<


How confidential is a settlement agreement reached at mediation and when can it be enforced?

The key to successful mediation is that all matters discussed and any agreement reached is confidential. But a sticking point in settling matters can often be if one party does not trust that the other party will in fact keep matters confidential.

Judge Shaw in Grenside v Gaskin said: The imposition of the penalty is necessary not only to mark the breach of the agreement but to act as a deterrent to those who have entered into confidential settlement agreements. The Authority and the Court take the undertakings as to confidentiality seriously. Unless parties strictly adhere to their obligations of confidentiality, the integrity of the mediation process would be undermined.

In this case a $4,000 penalty awarded by the ERA was upheld and costs awarded against the party who appealed.

Can confidentiality ever be broken and if so what are the consequences?

Confidentiality is a statutory obligation codified in the Employment Relations Act. This is so highly regarded that the Court of Appeal has said that nothing said in mediation can be made public, unless what is said amounts to a criminal act.

Statements made by parties and documents exchanged at mediation are not able to be relied on or

produced in any other forum.However, this statutory obligation

is not enforceable by way of seeking penalties. The Authority and Court only have the ability to order penalties for breaches of the Act where the Act provides penalty for doing so.

Most settlement agreements reached at mediation contain a confidentiality clause which is generally applicable to the parties and persons present at mediation. If this is breached it can be enforced by order at the Employment Relations Authority. The level of evidence has to be reasonably high, meaning you need to be able to show a clear breach, usually including who breached. If you are concerned about the level of confidentiality this clause needs to be carefully drafted as a bulk standard clause may not protect you.

What happens if a government agency wants to know what happened - surely i can’t lie?

This is a question we are often asked in relation to requests from WINZ for information about how a relationship ended. WINZ is able to ask this information as a matter of law. Does the law protect you?

It is possible that unless the settlement agreement allows disclosure if required by law, any disclosure to a government agency could constitute a breach of any confidentiality requirement.

What if i don’t want to seek a penalty?

Other claims can be made by an aggrieved party for other than a penalty. Damages can be claimed if the loss is sufficiently linked to the breach – generally this is limited to special damages as compared to general damages. A claim for general damages is a common mistake in a claimant’s filed statement of problem.

What if you don’t reach a settlement agreement?

While section 148 of the ERA requires parties to keep things confidential, if there is no settlement agreement reached then there is no resulting ability to seek a penalty (excluded because the Act does not allow a penalty for such a breach). However, claimants may wish to consider mounting an action on a simple breach of statutory duty seeking damages (again these would need to be specific).

As far as we are aware this type of claim has not been tried for unsuccessful mediation in the employment arena. It has been tried for enforcing obligations under the Health and Safety legislation, however, it is difficult and costly leaving in realty an unenforceable part of the Act.

As confidentiality is key to the process it is vital that you ensure the confidentiality clause in your settlement agreement meets your needs, and any possible future needs you may think you might have.

Contact Caroline at email: [email protected]

The confidentiality of mediation

By Caroline McLorinan, Senior Solicitor, EMA legal

TECH/OPSEXECUTIVE OFFICE SUPPORTSALES/MKTINGTEMP/CONTRACT ACCOUNTING

Go to www.ema.co.nz/memberbenefi ts or call 09 966 7478

Check out our special offer exclusive to EMA members.

The confidentiality of mediation

Y&R

ORB

0538

ORB.CO.NZStores Nationwide 0800 ORB COM

We’re big on small business

Telecom terms, conditions, minimum monthly spend and early termination fees apply. Offer ends 30 April 2009 or while stocks last. OKTA Touch requires a voice plan and a data plan.

Excludes trade-ins. See orb.co.nz for more information.

FORM OR FUNCTION? CHOOSE BOTH.

• TouchFLO® technology

• Windows Mobile® 6• 2.0 MP Camera• Email via

Microsoft Outlook®

OKTATOUCH

$264+GST

When you sign up to a 24 month Flexi Business plan

HALF PRICE

ORB 0538 OKTA Mag A4_03.indd 1 27/2/09 4:19:41 PM


I’m often asked what’s coming next for New Zealand in the economic downturn.

Until now we have escaped the large scale closures and redundancies being seen in some other countries, but there are concerns that more such events might be on the way here.

Meanwhile all the ideas from last month’s jobs summit are yet to be translated into reality.

So in many ways it feels as if we have a hiatus in New Zealand, with bad news trickling through only from time to time.

In many ways we are fortunate. The jobs summit revealed the enormous amount of consensus there is in New Zealand about lessening the impact on jobs of the economic downturn.

For example there was widespread acceptance of the importance of helping people ‘stick’ in the labour market. It’s very easy for those with fewer skills to get unstuck from employment.

It’s important that those who are on the margins of employment – including young, less skilled Maori and Pacific men and women – remain in

the labour force, not spun off at the mercy of economic change.

There was also a lot of support for the idea of a nine-day fortnight and we are likely to see that taken up in some companies.

Reorganising workplaces so the tenth day is spent in training - with the assistance of Government funding for the training institutions concerned - would lighten the load for employers who may at present find it hard to meet payroll payments. There are estimates that this could save as many as 20,000 jobs.

Where possible, business, Government and training institutions need to work collaboratively to make it happen.

It would be a waste not to use the downturn to upskill our people, so that we emerge from it better skilled than

before. The fact that the Government already plays a large part in tertiary education provision will help us in turning this ambition into reality.

Requiring training to be part of infrastructure projects is another way that we can use the downturn to improve our skills. If we are going to channel taxpayer money into providing roads, broadband, cycle tracks or any other infrastructure, it makes sense for us to use some of that money to train people as we go. After all, the value of infrastructure is not just in the physical assets that are created, but also in the

related skills capital of New Zealanders.

Then there are other ideas, including an equity fund jointly backed by the banks and the Government to help companies get access to needed capital, and the possibility of the creative use of Maori land and assets to generate jobs.

What all these ideas have in common is that they are focused on our domestic economy. That’s

great – it’s our economy we need to be concerned about. But it should be remembered that our economy is very small by international standards, and not large enough to furnish high living standards just from New Zealanders trading among themselves.

By Business NZ’s CEO Phil O’Reilly

The economic downturn – what’s next?

"there was widespread acceptance of the

importance of helping people ‘stick’ in the

labour market."

>

Strategic advice Practical solutions Skilled representation

Key contacts Susan-Jane Davies (04) 470 9923 [email protected] Parvez Akbar (09) 367 0931 [email protected] Maree Kirk (03) 548 4513 [email protected]

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


Phil O’Reilly

Regardless of whether we are in downturn or upturn, we need to trade internationally and earn those export dollars. So we should also keep a good focus on our external trading partners, particularly the ones that are coping with the downturn better than others - including Australia and China.

Australia has weathered the global financial crisis in reasonable health, with an economy that is still growing - although slowly - without the major banking collapses and company failures seen elsewhere. The banking system that is so highly inter-related between New Zealand and Australia continues to hold firm, in contrast with those in many other countries.

These bring at least some hope for the future of New Zealand exports. Australia’s performance provides a measure of how well New Zealand exporters are likely to fare, since a stronger Australian economy will generally ‘suck in’ imports.

Economic activity has continued to decelerate in Asia, largely because of reduced external demand. However it remains a region of comparative economic strength, particularly China, where GDP growth is still above 6%.

If New Zealand exporters are able to capture market share in Australia, China and other growing regions like India, this could be one of the pathways out of the economic doldrums.

So what is the outlook here in New Zealand?

Certainly the slump in global demand is beginning to be felt by businesses in terms of their own activity outlook and is starting to impact on the household sector as a result of redundancies and rising unemployment.

One bright spot is that the inflation genie is firmly back in the bottle. This will allow the Reserve Bank to lower interest rates further should they so wish, although it is not a given that lowering the official cash rate will automatically result in one-for-one cuts to interest rates for households and businesses, because of the extent to which banks borrow on wholesale markets overseas.

There are other bright spots too. A significantly lower exchange rate that helps New Zealand exporters, overall declines in fuel costs and more tax cuts to come – these are all positive for business.

Moreover, Government debt is still low by international standards, unemployment is still low and there is still room for significant interest rate cuts if necessary. We do not have a surplus of housing stocks nor have banks, in general, supplied finance to those unable to service housing debt.

Although commodity prices are continuing to drop, New Zealand sells the kind of things that the world

wants - food and fibre, building materials, specialised machinery, education and engineering services, and great tourism experiences.

The Government’s fiscal stimulus package can be used for constructive infrastructure investment rather than poured down bottomless pits as has occurred in a number of overseas bailout packages.

The reform measures that we have seen so far have been generally positive and targeted towards reducing blockages in the economy and improving overall productivity.

We should not underestimate the severity and depth of this global downturn, but we should also celebrate the positives for New Zealand and build on them to come out of the downturn stronger and sooner. >

<

PAYROLL P

AYROLL

More New Zealand businesses use Ace Payroll than any other computerised

wages program.

Visit our constantly updated website at www.acepay.co.nz

for employment law, legislative links, tax planning etc

or call toll free on 0800 223 729 for a free demonstration kit.


At no time have companies needed the wisdom, experience and judgment of their boards of directors as they do now!

Boards are critically important in a tough environment. The quality and commerciality of decision-making by your board of directors may spell the difference between life and death for the businesses they govern.

Today as New Zealand businesses, and the country, operate in largely uncharted waters, they have to rely heavily on the skills and experience that can be offered by independent directors.

Many owner-operator businesses have no outside directors. This involves a real opportunity cost. Even the savviest owner operators have gaps in their knowledge or skills that can be supplemented or enhanced by directors with specific expertise in those areas. So why would a business not want to access a range of proven, mature individuals or experts to assist at the governance and strategy levels as independent directors can?

Perhaps the relative lack of independent directors in the SME sector reflects the general public’s apparent confusion about the role of a board versus the role of management.

In addition there is a view that

says “we can manage on our own.” as part of a wider market failure to understand the value of good governance, as well as a simple inability of many to answer the basic question: “What is governance, really?”

You need to answer these questions for your business, and identify independent directors for it, then confront the inevitable issue of what to pay those directors. There is an established market. Of course, the more experienced, successful directors are likely to demand higher rates for base annual director fees. So “what are market rates and ranges?”

To make proper, informed decisions, you need current, reliable market data. Recently Published in October 2008, the Sheffield/Business New Zealand/EMA Director Fee Survey is the authoritative source, with information from nearly 300 New Zealand businesses in both public and private sectors.

In addition to data, the report includes commentary on market practice and trends, and Australian data. This can guide you in your decisions regarding appropriate and competitive fee levels.

Once you’ve decided what to pay your independent directors, we recommend you initiate a process to review fees on an annual basis. Traditionally, boards review fees every

two, three or even four years, which is in direct contrast to executive and staff pay that is almost always reviewed annually. No self-respecting CEO would tolerate going three years between pay reviews!

The rationale for annual reviews of director pay levels is that they move three times as fast as executive pay. The Sheffield/EMA Director Survey confirms that the median base salary for CEOs has been rising approxi-mately five per cent annually whereas the market median for director fee adjustments has been boosted by 15 per cent each year. Its that easy to falll behind the market!

Sometimes you read about companies proposing 50 per cent, 75 per cent or even 100 per cent director fee increases in a single year; the reason is they are often that far behind. Big adjustments like these can cause stakeholder and perception problems too.

Accordingly, we recommend companies review fees annually. Take “smaller bites” each year to avoid large, one-time, catch-up moves which inevitably attract negative shareholder and public attention. Hence the Sheffield/EMA Director Survey is a valuable resource.

For more details and to order please contact Debbie King at [email protected] or phone (09) 367-1523.

The case for independent directorsBy Sheree Maier

Dire

ctor

Rem

uner

atio

n

Dire

ctor

Rem

uner

atio

n


“Essential

reading in

today’s tighter

economy”

Call Attaché for your free Plain English Guide to Next Generation software or a complimentary assessment.

0800 288 224 www.attache.co.nz

Has your business grown up? While your financial software hasn’t!

Changes to the Copyright (New Technologies) Amendment Act 2008, which were to be effective from February 28, 2009 have been delayed until late this month following strong opposition.

The new law is unlikely to be enacted until a new code of practice concerning s92a of the Act for Internet Service Providers (ISP) is in place.

The new law means that should a copyright holder make a complaint to your ISP that someone at your ‘address’ has downloaded a copyright protected file without permission, (eg software, document, music or video) then the ISP may be called on to ‘take action’ against the offending entity resulting in the curtailment of your telecommuni-cations.

In many instances that would mean cutting off phones and other telecom-

munications as its all connected. It means a supplier could stop your business on the basis of an unsubstan-tiated claim.

Section 92a of the Act states:■ “(1) An Internet service provider must

adopt and reasonably implement a policy that provides for termination, in appropriate circumstances, of the account with that Internet service provider of a repeat infringer.To address your workplace risk ask

these questions:1. Do any of your staff have

unrestricted access to the Internet?2. Do any staff download material that

might be considered protected by copyright, without knowledge or permission of its owner?

3. Is that material stored on your network?

4. Is that material shared with other persons?

5. Do you have a clearly defined Internet policy?

6. Is the policy monitored and enforced?

7. Do you keep details of infringements?

8. Is the policy reflected in your employment agreements?

NATCOM, which specialises in managed fibre internet services for businesses, says there is technology available that can virtually eliminate the prospect of illegal downloads - hardware based products are suited only to large networks because of cost and support needs.

However NATCOM’s SLAM™ firewall can identify unwanted protocols and risky websites and is scalable for small to medium and large enterprises.

EMA has briefed its Advice team and can provide further information and advice.

Changes to copyright law deferred


Types of diabetesType 1 diabetes is an ‘auto-immune’

condition, usually brought on suddenly when the body ceases to make meaningful amounts of insulin. It most often occurs in childhood, but can occur at any age. People who have Type 1 diabetes do not make insulin (or have very little). The body is unable therefore to use glucose for energy as the immune system has damaged the pancreas and stops it making insulin. People with Type 1 diabetes need daily insulin injections. In New Zealand about 15,000 people suffer from Type 1 diabetes.

People with Type 2 diabetes are making some insulin, but the production becomes sluggish or their body becomes resistant to it. Type 2 diabetes is a progressive disorder. Being overweight is a major cause for the body becoming resistant to insulin, triggering Type 2 diabetes, even in young people. Type 2 diabetes can be treated initially through weight loss and regular physical activity. Medication in the form of tablets is often required later to reduce the resistance to insulin or to stimulate the pancreas to make more insulin. Some Type 2 patients may eventually require insulin injections. In New Zealand about 142,000 people suffer from Type 2 diabetes. This is an epidemic in New Zealand.

Reduce the risk of diabetes4 Stay physically active with daily

exercise. Thirty minutes of brisk walking each day is fine, even in three lots of ten minutes.

4 Eat healthy food. Avoid foods that are high in fat, sugar and salt.

4 Maintain a healthy weight.

The ideal PlateIt is important to eat a variety of

healthy food. The portions on your plate should be based on the ‘ideal plate’. Does your main meal look like this?

Diabetes symptomsThe early detection of diabetes symptoms and treatment can decrease the chance of developing diabetes. Some diabetes symptoms include:■ Frequent urination■ Excessive thirst■ Extreme hunger■ Unusual weight loss■ Increased fatigue■ Irritability■ Blurry vision■ Recurring infections

Diabetes can be present even if you have no noticeable symptoms. If you think you may already have or be at risk of developing Type 2 diabetes, “Take The Test” at www.diabetesauckland.org.nz and discuss the results with your doctor.

Diabetes risk factorsBelow is a list of risk factors. You have

control of each of those indicated under ‘Modifiable’:

Modifiablev How often you exercise? - Exercising regularly lowers the riskv The amount of fat you eat - Eating a

healthy diet reduces the riskv Being overweight - People who are a

healthy weight are less at riskv Taking action if you have been

diagnosed with ‘Pre-Diabetes’You can prevent many problems with Type 2 diabetes if you know you might be at risk early and take action to manage it.

Non-modifiablev Your agev Risks increase with agev Your family history of diabetes. Risks

are higher if family members have diabetes

v Your ethnicity - Maori, Pacific and Asian people are at greater risk

v Giving birth to a large baby. Greater than 4kg / 9lbs increases the risk

Did you know?19 people are diagnosed with diabetes

every day in New Zealand. Over 160,000 people have diabetes. Another 160,000 people have diabetes but don’t know it. A further 800,000 people are at risk of developing diabetes due to being overweight or obese. Up to 80% of Type 2 diabetes is preventable. Many children in New Zealand are seriously overweight. Some already have Type 2 diabetes.

Unite for DiabetesDiabetes has become so serious across

the world that the United Nations has passed a Resolution that all countries need to take action on diabetes.

diabetes in new zealandDiabetes awareness

Diabetes is a condition which occurs as a result of problems with the production and supply of insulin in the body. Most of the food we eat is turned into glucose, a form of sugar. We use glucose as a source of energy to provide power for our muscles and other tissues. in order for our muscles and other tissues to absorb glucose from our blood, we need a hormone called insulin. Without insulin, our bodies cannot obtain the necessary energy from our food. insulin is made in a large gland behind the stomach called the pancreas. it is released

by cells called beta cells. When a person has diabetes, either their pancreas does not produce the insulin they need, or their body cannot use its own insulin effectively. As a result, people with diabetes cannot use enough of the glucose in the food they eat. This leads to the amount of glucose in the blood increasing. This high level of glucose or “high blood sugar” is called hyperglycaemia. High levels of glucose in the blood can lead to serious complications. At present there is no cure for diabetes.

The best wayto keep staffhappy sincewages.

activa is brought to you by Activa Health Limited. The activa Account and related banking services are provided by ASB Bank Limited. Activa Health Limited receives services fees from ASB Bank Limited and Southern Cross Medical Care Society. Neither Activa Health Limited nor the Southern Cross Medical Care Society is a registered bank. A copy of ASB’s disclosure statement is available free of charge at www.asb.co.nz.

The activa card is a simple, fun way to attract, retain, and inspire your staff. You set the annual amount, then your staff use their activa card to enhance their health and wellbeing. It’s what you’d call a healthy incentive. To find out more about the benefits of activa for your staff talk to Southern Cross on 0800 323 555 now or visit www.healthybusiness.co.nz.


When you want reliable door-to-door delivery at an economical price, choose DHL ECONOMY SELECT. For door-to-door shipments to Australia, and a new service delivering to Asia, it’s the more convenient international alternative to standard freight forwarding services.*

Ideal for your less time sensitive heavyweight shipments, DHL ECONOMY SELECT has a delivery time of an additional 2-3 business days to Australia and Asia. It’s the simple solution for reducing your delivery costs while still enjoying DHL’s world-leading service and reliability.

Call Customer Services on 0800 800 020

NEW ECONOMY prICED SErvICE TO ASIA AND AuSTrALIA

*For the exact delivery commitment on your shipments please call our award winning Customer Service Hotline at 0800 800 020

New Zealand exporters and importers could be trialing a simplified new border crossing administrative system late next year: The Trade Single Window.

New Zealand Customs has been leading the development of the Trade Single Window as a single interface with all Government agencies for any import/export shipment.

EMA Northern is considered the lead non-Governmental organi-sation (through its coordination of the Tomorrows Cargo Logistics Group) to represent manufacturers on this, and we have been party to the consultations.

The Trade Single Window involves major Government investment which has not yet been signed off, though the implementation timetable assumes

approval this year.The project has substantial potential

benefits and almost universal support across logistics/transport companies, ports, shipping companies and airlines.

The cost benefit is mostly around the improvements it would create in dataflow and logistics improvements for both exported and imported products.

It is also a stepping stone towards inter-Government data flows to allow exporters to ‘see’ their shipments cleared before goods reach major markets, or to uncover any problems in advance to prevent a shipment being halted for inspection or other reasons.

Its best described in terms of its benefits to exporters and importers with:■ Only one data entry for all

Government agencies (Customs, Immigration, Ministry of

Agriculture and Fisheries/forestry),■ Only one online location to view

the status of shipments,■ Online links to ports, shipping lines,

transport companies will be possible,■ Online links to overseas agencies,

ports and authorities will be enabled,■ Ports and logistics companies can see

data about exports earlier, and cargo movements can be scheduled more efficiently,APEC has a working group focused

on developing a single trade window across APEC countries to ensure data used for one country uses an acceptable definition for others. Trials with it will include trade with New Zealand, Australia and Singapore once agreement is reached.

Implementation and refinement of the Trade Single Window are expected the year after trial in 2011.

Single trade window on horizonBy Garth Wyllie, Executive officer, EMA Northern


The New Zealand International Business Awards are up for grabs for the first time this year. They replace NZTE’s Export Awards but not the Export NZ regional awards, which are being actively promoted in Waikato, Auckland, Bay of Plenty, Hawkes Bay and Wellington.The International Business Awards recognise New Zealand companies that successfully grow their businesses in international markets either through exporting directly or by undertaking joint ventures offshore, investing trade overseas or otherwise take kiwi enterprise to other countries to build their revenues, and earnings for New Zealand.This year the awards will also deliver sound benefits to all participants by aligning the entry process to the Baldrige business excellence criteria. They will get the chance to benchmark their performance against other top international businesses and receive feedback from the assessors and judges, thereby building capability.That’s in addition to the chance to win an award with the associated morale boosting profile. One entrant will be named the Supreme Award Winner and collect a $100,000 cash prize for use in funding further growth internationally.

The Awards are organised by New Zealand Trade and Enterprise (NZTE). Their sponsor is ANZ Bank. For more details go to: www.nzte.govt.nz

Exporting goes global EMA ran a survey in January to

find out what skills exporters want taught and, importantly, what they see as the big priorities for courses on exporting.

So we asked exporters to rank the importance of a range of topics core to exporting capability. We asked about topics that were:■ Very important (a MUST have to

stay in business), ■ Important (would assist the

business to grow) ■ Not important (of interest but not

critical), or■ Not Applicable

For example, under logistics and transport topics Collating for Dispatch, EDI and EDP, Export Procedures, freight forwarding, Supply Chain and logistics, and ‘weightless Exports were some of the topics covered.

Other headline topics analysed in this way included finance and accounting for export, culture and trade practices, tariffs and non-tariff barriers, legal compliance and IP protection, and marketing offshore.

The survey with 138 replies also asked:1) For other topics exporters want

addressed in training courses. These included Logistics, establishing

letters of credit, finding and managing a distributor or agent, project management and capital raising.

2) The emphasis they place on formal recognition of the course undertaken: National Certificate and Diplomas in Exporting were the most popular. NZQA unit standards rated well too.

3) For their experience of skills training providers – Export NZ and the Business NZ group training were the most frequently employed.

4) And to specify their preferred method for acquiring skills training. Networking with peers and web based research rated highly.

What exporting skills you want taught

0

10

20

30

40

50

60

70

80Very importantImportantNot importantN/A

Logistics and Transport

Collatin

g for d

ispatch

Electronic Data Exc

hange &

Electronic Data Process

ing

Export P

rocedures

Freight F

orwarding -

Global

Supply Chain

Management - Global%

01020304050607080

Marketing

Writing fo

r intl t

rade

Intl Marke

ting

Intl Trade Rese

arch

Market E

ntry Stra

tegies

Sales and M

arketin

g

Stats and tra

de analysis%

0

10

20

30

40

50

60

Formal Qualifications sought

NZQA unit s

tandards

National C

ertificate in

Export

National D

iploma in Exp

ort

Degree in Exp

ort Studies%


What exporting skills you want taughtExport NZ’s Bay of Plenty region is the first off the block to launch its export awards this year - with the celebration and fun theme of a night at the circus!

MC on awards night (June 26 at BayPark Stadium in Tauranga) for the BNZ Partners 2009 Bay of Plenty Export Awards is comedian Te Radar.

BoP exporters are invited to nominate companies or organisations they consider would be worthy winners. Or your company can enter

in its own right for the Emerging Exporter of the Year, Innovation in Exporting or Exporter of the Year.

Nominations are also invited for the Services to Export Award and Export Achiever Award. The latter is new, and for an individual within a Bay of Plenty business who has made that vital difference to achieving exporting success and growth.

Nominations close on April 30 and businesses receiving them will be approached to submit an awards entry. For more information and to receive and entry form, contact Angela Wallace, Export NZ BoP executive officer, at phone: (07) 571 0600 or email: [email protected]

The new Export Achiever Award category is sponsored by Waiariki Institute of Technology.


PRESENTS

BNZ PARTNERS

ESENTSPRES

< This image of naming rights sponsor BNZ will appear in the audio visual presentation of the award finalists and winners, and will be animated so that at regular intervals the characters tip their hats.

Inspiring Workplace Conference 2009

Employee engagement means a successful business. Do your staff have a common goal, feel involved in the business and go the extra mile to ensure their success and that of the company?

Who should attend:CEOs, business owners, senior managers, HR professionals. Anyone whose business depends on attracting and retaining good people. Anyone who leads or manages a team of people.

Where and when:Wellington: Thursday 26 March 2009– James Cook Hotel Grand Chancellor

Auckland: Tuesday 31 March 2009– The Langham Hotel

Timing: Registration 8.30am, Conference runs 9am – 4.30pm

For more information contact: Georgiana McIntyre on 09 909 6983 or email [email protected]

Visit www.unlimited.co.nz/ul/conference for further updates

If your organisation’s goal is to become the best workplace in New Zealand, this conference is a must.

Hear from executives of some of New Zealand’s employers of choice how they implemented innovative and effective measures to improve their workplaces and boost the bottom line.

Attend the full-day conference in Auckland and Wellington and hear from great keynote speakers on how to build, inspire and lead a great workplace. These speakers represent New Zealand’s great workplaces. That is the simple truth.

Proudly brought to you by:

RN_InspiringWorkplaces_280x360.indd 1 27/02/2009 1:58:51 p.m.

Inspiring Workplace Conference 2009

Employee engagement means a successful business. Do your staff have a common goal, feel involved in the business and go the extra mile to ensure their success and that of the company?

Who should attend:CEOs, business owners, senior managers, HR professionals. Anyone whose business depends on attracting and retaining good people. Anyone who leads or manages a team of people.

Where and when:Wellington: Thursday 26 March 2009– James Cook Hotel Grand Chancellor

Auckland: Tuesday 31 March 2009– The Langham Hotel

Timing: Registration 8.30am, Conference runs 9am – 4.30pm

For more information contact: Georgiana McIntyre on 09 909 6983 or email [email protected]

Visit www.unlimited.co.nz/ul/conference for further updates

If your organisation’s goal is to become the best workplace in New Zealand, this conference is a must.

Hear from executives of some of New Zealand’s employers of choice how they implemented innovative and effective measures to improve their workplaces and boost the bottom line.

Attend the full-day conference in Auckland and Wellington and hear from great keynote speakers on how to build, inspire and lead a great workplace. These speakers represent New Zealand’s great workplaces. That is the simple truth.

Proudly brought to you by:

RN_InspiringWorkplaces_280x360.indd 1 27/02/2009 1:58:51 p.m.

Visit ema.co.nz for further updates & to register


Like it or not, charges for rent, heat, light, insurance, maintenance, etc make warehousing an expensive undertaking so it makes sense to use all the available space wisely.

Lean operators begin space saving exercises by conducting frequent (monthly at least) analyses of inventory speed of movement. Any non-moving stock is pulled from the shelf and either scrapped immediately or relocated to a bulk stacked area pending an urgent decision on its disposal. An item which has fallen into the ‘slow moving’ category is critically analysed with a view to reducing the stock holding. These measures may seem like common sense, but the failure to closely monitor stock movement and hanging on to dead and slow moving stock are the two prime reasons why businesses mistakenly feel they are short of space.

In last month’s edition, I outlined the importance of reducing the shelf opening - the vertical distance between shelves- to reduce the ‘air space’ above the stored items. It’s equally important to ensure that the physical layout of the warehouse maximises space usage.

Figure 1. shows a typical warehouse profile where the shaded areas above the shelves, above stored items and in the aisles represents wasted space.

A Lean operation saves space by:1) Reducing shelf openings to

allow extra shelves to be added

2) Storing Reserve stock on the top shelf

3) Reducing the aisle width to enable additional shelving to be constructed.

Reduce shelf openings

Last month I covered the rationale for reducing shelf openings and in my experience this measure often yields an almost unbelievable 20-30 per cent increase in available storage space. So it’s well worth the effort.

Reserve stocks

Conventional operators tend to store reserve stock wherever it will fit which usually means it ends up occupying prime locations or cluttering receiving and despatch areas.

Figure 2.

Lean practitioners insist on having reserve stock available at the right time and in the correct quantity without compromising ‘productive’ space. This is achieved by using the Kanban system which involves placing a Kanban Card (see Figure 2) in the stored product so it alerts staff to the need for replen-ishment at exactly the right time.

For example, if an item sold 20 units per day, the Kanban card would probably be placed on the third item from the bottom of the stack. When a picker uncovers the Kanban, it’s taken to a central point and displayed in sight of the replen-ishment team who refill the prime location before a nil stock occurs.

It is standard procedure to

store excess stock on the top shelf immediately above the prime location so replenishment is easily and quickly achieved.

Where it’s necessary to use more than one location for reserve stock, this is block-stacked in a remote (tertiary) location and a Kanban card is placed on top of the stock in the secondary location. (See Figure 3.) Though this depicts palletised product, the Kanban system is effective regardless of the type or size of stocked items.

Aisle width

The topic of aisle width is very interesting. Many conventional operators use forklifts trucks which, because of their size and charac-teristics, can only operate in a 3-4 metre width aisle. But some modern trucks can operate in an aisle less than two metres, so there are lots of distribution centres where the aisles are twice as wide as they need be. A standard pallet rack is 900mm wide, so such operations have the potential to double their available storage space by simply employing the right type of fork truck.

There are a number of other common practices which contribute to poor space utilisation. These include:

■ Holding inward consignments and outbound stock at floor level instead of placing it on racking. Shelving enables product to be stacked to the maximum allowed height, pending check, receipt and loading activities.

Space: A valuable commodity!By Barry Nolan - Making it Lean

>

Figure 3


Its been a year with a barrage of stories about business excess and inefficiency coming to light. But why not take the doom and gloom as an opportunity? Even the most careful and responsible businesses stand to gain substantially from taking a close look at their operations.

Streamlining processes and eliminating waste creates a more productive workforce and greater business returns; music to the ears of any employer regardless of the current economic situation.

The question you may ask is how can I do that creatively and innova-tively? Toyota was ahead of the game at this. They recognised that to truly streamline their assembly line, they had to harness the expertise of the factory floor worker and the middle manager, not just the CEO.

The KAIZEN philosophy this system inspired is a revolu-tionary humanistic approach to understanding and managing employees and change in organi-sations. And it incorporates more than just the technical tools of ‘Lean’ management.

In Japanese, ‘Kaizen’ means continuous improvement, not just in business practices but as a general philosophy in all areas of life.

Total Flow Management is part of the Kaizen arsenal to look

specifically at how businesses can streamline their operations. With TFM, both employers and employees can take a microscope to wasteful practices.

Applying TFM can create space, reduce operating costs, increase product availability, reduce waste and improve responsiveness. It’s also an investment in your workforce; staff equipped with TFM skills are more motivated, satisfied, healthy, and safe, and tend to stay with the company for longer.

What does Total Flow Management do?

What type of waste is your company suffering from? There are many types of waste to be found in any process. At KAIZEN we call them Muda, Mura and Muri.

If your organisation suffers from Muda, it engages in activities that consume resources without creating value for the customer. These are the seven wastes of Muda: 1. Defects & rework 2. People waiting 3. People moving 4. Over-processing 5. Material waiting 6. Material moving 7. Overproduction

Mura means that your operation is uneven – you may be going through cycles of hurrying, then waiting.

If you have a case of Muri you are overburdening equipment or

operators, and putting excessive strain on your people or processes.

Total Flow Management training also asks: ■ How can you eliminate

inefficient batch processing and move to one-piece flow?

■ How can the ergonomy of the workplace be improved to heighten staff performance?

■ How can you achieve ‘Standard Work’ – the optimum method of work, safety and quality?

■ How can you create a continuous flow of materials and information to your supply chain?

■ How can you reduce the time taken to change from one product to the next?

With Total Flow Management, employers can channel the creativity and productiveness of the people within their business to get rid of waste and keep processes ‘fresh’, relevant and efficient.

Richard Steel is Chief Operating Officer for KAIZEN Institute New Zealand and oversees a team of consultants delivering a wide variety of Lean / Kaizen projects focused on all aspects of business process improvement. His industry experience includes Services; Process Manufacturing; Discreet Manufacturing; as well as Distribution and Logistics. Current and recent clients’ projects include FMCG; Retail and Distribution; Tertiary Education Provision and Utilities. Visit www.nz.kaizen.com

Harnessing your company’s creativity to get results from Total Flow Management

By Richard Steel, Chief Operating Officer, KAIZEN Institute New Zealand

■ Carrying large stocks of packing material constitutes a waste of space. A maximum of one week’s packing material should be held on site and the balance held by the supplier and called in as necessary. Once again, the Kanban system is very effective for monitoring such supplies.

Finally, and this is often a huge problem, never, ever be regarded as a ‘Bottomless Pit’ for storing the detritus from other departments. Sadly, that’s often what happens, and large areas are given over to ‘comes in handy’ redundant plant and equipment lying forgotten and unused for years.

Barry Nolan is the principal of Lean Production Consulting. He 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

<


I was enjoying a meal at the Thistle Hotel in Wellington with a small group a couple of weeks ago and the conversation turned to the current economic climate. Then we started to reflect on how the experiences of our early years had influenced our resilience levels.

Almost everyone around the table had experienced hardship, feelings of inadequacy, low self-esteem, and times of ‘doing without.’

Our conclusion? Hardships and hard times are a precious gift. They teach us. They toughen us. They give us strength, IF we approach them with the determination to overcome. Every one of us agreed that if we’d not experienced those earlier tough times we’d not now be capable of doing the work we do.

Many readers of this magazine may have noticed that those who’ve had an easy life prior to arriving in the workplace are usually the hardest to motivate, manage, lead or direct.

Often the brightest, who’ve not had to work hard in school or even university, struggle the most when complex tasks require solid application. When times get tough and jobs get scarce, those same people are not well equipped to cope. Many of them find it scary, depressing and mighty uncomfortable.

But, if you’ve already been at the bottom of the pile, and survived on the smell of an oily rag, been unemployed or part of a group that the ‘popular’ crowd don’t want to be bothered with, you know you can deal with it – because you’ve done it before.

This journal is for employers and managers and many of you

are parents so I make no apology for taking a few lines to address our child-raising techniques. (I speak from the perspective of having raised six children, and as grandmother of ten).

I profoundly believe if we make our children’s lives soft and easy, if we take away risk and challenge, if we always seek to protect our children from adversity, we weaken, damage and distort the precious young lives we’re entrusted with.

But how often do you hear successful people – who have experienced tough beginnings – say ‘I don’t want my kids to have to go through the hardships I did.’ And

they bend over backwards to do everything they can to smooth the path for their children, to make life easy for them.

How sad that many people with wonderful easy childhoods end up living adult lives of boredom, emptiness and quiet desperation. Softness makes us weak and ineffective.

My husband and I live on the shores of the Waiuku River. It’s harsh for a garden – salt-laden wild west winds, and the soil isn’t brilliant. When discussing our options our landscaper said: “Make sure any plants you purchase have been hardened off. Most nurseries don’t do it. They raise their plants in protected enclosures. If your plants haven’t had a bit of exposure to wind, sun, cold and rain before you transplant them, they

won’t survive in your rough conditions.”So how do we develop resilient

young people? Here are three of my basic rules:■ From an early age let them

feel the consequences of their actions. Let the punishment fit the crime.

■ Don’t give them everything they want. Make them earn and save for their rewards.

■ Link pocket money to tasks. It’s not a right.

■ Read Maggie Mamen’s book ‘The Pampered Child Syndrome – how to recognize it, how to manage it, and how to avoid it. A guide for parents and professionals’ 2004 (Rev. ed. 2006).

I’m glad about the economic mess the world is in right now. We need it. To become an effective nation, and effective people, we must become resilient again. Resourceful and resilient people and companies thrive. They’re prepared, with the right attitude. They know how to rise above immediate circumstances; they have the

long view, and they are determined. This is a great time to be in

business.

Robyn Pearce CSP (Certified Speaking Professional) is the Time Queen. She mastered her own time challenges and now helps people around the world overcome theirs. She can show you how to transform your time challenges into high productivity and the life balance you desire.

Download her free report “How to Master Time In Only 90 Seconds”, a simple yet powerful diagnostic tool to help you identify your key areas for action. You’ll find it at www.gettingagrip.com/products/e-books/index.asp And while you’re there, enrol for your free Top Time Tips – practical advice every two weeks.

get a griphot tips for higher productivity

By Robyn Pearce

We NEED This Recession!

"...those who’ve had an easy life prior to arriving in the workplace are usually the

hardest to motivate, manage, lead or direct."


MeMber profileIn our regular snapshots of EMA member companies, we describe the business of RJ's Licorice in Levin

Taking an old fashioned product to the wider world has proved to be a very successful formula for Levin based RJ’s Licorice.

Last year was a good one for RJ’s. The company increased its exports and grew its domestic market share. It was a finalist in the 2008 Export New Zealand - Exporter of the Year awards, and its founder and Executive Chairman, Roger Halliwell, received the Australasian confectionery industry’s most prestigious accolade - the Alfred Stauder Award for Excellence.

The New Zealand owned, family operated business proudly promotes itself as the only company in New Zealand to exclusively produce liquorice products.

Employing 63 locals, RJ’s has experienced exceptional growth in the past three years with export sales increasing from five to 40 per cent of turnover. Exports go to Australia, the UK, the US and Europe.

Managing Director, Regan Halliwell says another export destination has just been added: “As we speak our first ever shipment of product should have arrived in Canada, and we’re excited about that.”

The RJ’s brand was born in 1994 after Regan’s father, Roger Halliwell, purchased the former land and buildings of Granny’s Liquorice. He then set about enticing Regan, who was on his OE, to return and embark on a mission ‘to take the traditional liquorice market and turn it into a category highlighted by innovative products.’ RJ’s, named after Regan (James), from the outset was set up as a family business.

Up to five family members (currently four) have worked at the same time in the company, and a very clear culture of family values is

evident in its day to day running.

Although it has three core products - Allsorts, raspberry and black liquorice - each year the company produces over 50 different product lines, including the chocolate logs unique in the world. Sixty percent of product lines are sold into the New Zealand market, giving it a healthy 50 per cent plus market share.

As a branding concept, many of its traditional liquorice products are referred to as herbal because they use only authentic liquorice extract from the root of the blue flowering snow pea plant, sourced from the Middle East.

Regan says RJ’s main export promotion is a display stand at the annual week long ISM Fair, the largest in the world for confec-tionary products, usually held in Europe. “Its not a cheap exercise but the exhibition provides very good exposure.

“We really have a simple business model for exporting. We have one agent in each country and it works well.” And with added plant and significant productivity improvements Regan anticipates continuing rapid export growth in the future.

“A major project last year was to

commission a robot on the packaging line which increased efficiencies and reduced staff from 16 down to two. But by changing the shift patterns, we have kept the staff on and moved to a 24/7 operation.”

“Apart from the current global downturn, another factor effecting us that licorice is a confectionary product totally reliant on crops. International raw material price fluctuations and exchange rates can have an impact on our profitability.

But Regan rightly remains very optimistic for the company’s future and has many new ideas in the ‘top draw’.

“The key to RJ’s reputation and growth is a strong focus on quality and innovation. And continuing to introduce new and innovative products is the key to us staying on top,” he says.

By Gary Morrison, EMA Central

RJ's innovation makes over market category


Business Women’s Network

Janice Hodgins (Hubbard Foods), Michelle Verner (Hubbard

Foods), Catherine Semisi (ANZ National Bank Ltd),

Queensy Chan (ANZ National Bank Ltd)

Judi Adams (NZ Post), Anne Andrew

(Waitakere City Council)

Yvonne Brownlie (Look Good, Feel Better)Bridget Copland (Look Good, Feel Better)

Christine Hobbs (Nuzilla Ltd)

Fiona Macky (The Franchise Coach), Carolyn Marriott

(Orica Chemnet), Karen Retief (Orica Chemnet), Ani Ruawhare

(Orica Chemnet), Colinda Van Der Sluis (Orica Chemnet)

WomenAchieving

More

Kay Niepold (Glover Real Estate Ltd)

Donna Glover (Glover Real Estate Ltd)

Tracy Richmond (Eye Institute)

Kay Thomson (Eye Institute)

Tracey Baird (Kelly Services NZ Ltd)Nadine Wrighton (Farmers Trading Co)

Gaylene Douglas (Sky Network TV Ltd)

Hayley Cornell (Sky Network TV Ltd)

Sharon Speyers (ASB Bank Ltd)Alison Cameron (ASB Bank Ltd)

Zoe Timbrell (EMA (N)), Guest Speaker Annette Presley,

Ellen Reimann-Filby (Telstra Clear)

people

Wed, 11 March 10.00am - 11.45 am Collegiate Motor Inn, 122 Liverpool Street WANGANUIWed, 11 March 3.30pm - 5.00pm Te Manawa, 396 Main Street PALMERSTON NORTHThurs, 12 March 3.30pm - 5.00pm Quality Hotel Plymouth Int'l Hotel NEW PLYMOUTHTues, 17 March 7.30am - 9.00am Tatapouri Sports Fishing Club, No.2 Shed, Gisborne Wharf GISBORNETues, 17 March 2.45pm - 4.15pm Napier War Memorial Conference Centre, Marine Parade NAPIERThurs, 19 March 3.30pm - 5.00pm Rutherford Hotel, Trafalgar Square NELSONTues, 24 March 3.30pm - 5.00pm Angus Inn Hotel, Cnr Cornwell St & Waterloo Rd LOWER HUTTThurs, 26 March 3.30pm - 5.00pm Duxton Hotel, 170 Wakefield Street WELLINGTON

EMA CENTRAL Register on-line at www.emacentral.org.nz For further information phone Sandra Webley (04) 470 9947; or email: [email protected]

Summer Schedule - 2009 FREE briefings for all EMA members

be sure

exclusive ema news, advice, learning and networking ...€¦ · 159 khyber pass rd, grafton,...

Documents