Two top employment law experts are questioning whether Spark is within its rights to give 1900 staff five days to sign new employment contracts agreeing to new ways of working, or leave the company.
Spark staff are being asked to adopt a new way of working popularised by the software industry called Agile.
Employment law expert Barbara Buckett of Buckett Law said she was “sceptical about the company’s restructure approach” describing it as a “potential recipe for disaster which leaves Spark open to challenge”.
“Unless the majority of the work these employees are carrying out is no longer available, this is not a situation where the employer should be considering redundancy, as there has been no actual disestablishment of their earlier roles,” Buckett said.
“We are concerned that there may not have been sufficient consultation with employees as to whether an Agile business model will actually serve Spark’s needs. Generally untested in New Zealand, Spark also needs to consider whether the Agile business model is a legally complaint infrastructure,” she said.
Bucket said she also had concerns about the employees only being given five days to provide feedback on their proposed roles.
Buckett’s comments echoed those of fellow employment law expert Max Whitehead who also said Spark staff appeared to have been given too little time to consider their options.
He also believed they might be able to argue their old jobs still existed and they could not be forced out the door.
“If their job hasn’t varied much at all then technically it is not a redundancy situation, so they shouldn’t be facing potential dismissal. I would think those individuals could claim their job still exists and they are not prepared to accept redundancy even though their employer may want it,” he said.
Spark spokeswoman Lucy Fullarton said it had sought “extensive legal advice” and was absolutely confident its approach was fair, reasonable and complied with employment law.
“While the new contracts don’t alter aspects like people’s pay and hours of work, the shift to Agile will mean significant changes to people’s titles and roles, the way they work and how they are organised, so there is sufficient change to require a new contract,” she said.
The new contracts have been prompted by Spark deciding last month to bring forward the adoption of Agile as part of a wider structuring programme that is expected to see several hundred staff leave the company between June last year and this December.
Agile tends to involve people working in more informal groups to implement changes incrementally, rather than work being organised into larger, more hierarchical projects.
Spark spokesman Andrew Pirie said about 40 per cent of its employees were being invited to sign new contracts, which have been going out to staff this week.
But some employees in the affected parts of the business had already decided it was “not for them” and would be leaving Spark, he said.
“As part of the move to Agile, a reasonable number of people in the engine room of the business – product development and marketing, those sorts of roles – are being organised into new teams.
“People are being offered new roles, so they are being given the opportunity to sign new contracts and if they don’t want to sign a new contract then obviously they have the opportunity for redundancy.”
Staff would have five working days to decide, he said.
Pirie said not all staff were being offered new contracts. “There may be some people who would like to stay and who will be leaving but I haven’t got the numbers on that.”
Nor would Pirie say how many staff had already or were expected to turn down the offers.
“We have made it quite clear to the market we are on a glide path towards lower staff costs in certain parts of the business and this is one of them.
“The course of the telecommunications business is one that staff numbers are declining.”
Spark has indicated it expects its labour costs to fall by about a fifth over the 18-month period.
But Pirie said that did not necessary mean staff numbers would also fall by a fifth – which would imply about 1000 jobs losses.
“As part of this process we are looking to internalise some of the capital work that we might have used outside agencies, such as IT contracting firms, for,” he said.
Communications Minister Clare Curran said that if hundreds of job were lost it would be “one of the impacts of digital disruption that was impacting on every single sector” of the economy.
Curran, who was responding to questions at a select committee, said she imagined Spark was trying to “reorient in a way that is more focused on the fast-moving pace of technology”.
The Government had to provide people with the means to reskill, open up new areas for job creation, and ensure there was “some income security for people while those disruptions take place”, Curran said.