PAGE 4 RETURN TO FRONT PAGE Business briefs Companies Act reforms announced The government has announced a suite of changes to the Companies Act 1993 aiming to improve fairness and the ease of doing business in New Zealand. The reform is expected to take place in two phases. Phase One: The first phase focuses on the modernisation and simplification of the Act to better reflect a more evolved business and technological landscape. Specific proposed changes include: + Providing a process for reducing the share capital of a company that does not require court approval + Amending the definition of ‘major transaction’ to exclude transactions relating to the capital structure of a company and clarify that a series of related transactions are captured by the definition + Adding additional types of transactions that can be approved by unanimous shareholder consent + Allowing companies to mingle unclaimed dividends with other funds after two years + Assigning unique identifiers to directors to prevent ‘phoenixing’ (where a new company is registered to take over an insolvent or unsuccessful one), and + Allowing directors and shareholders to have their residential addresses removed from the Companies Register, resolving safety and privacy concerns. Further insolvency law amendments are also being proposed, including extended claw back periods, preference for long service leave and greater honouring of gift cards. Phase Two: The second phase will involve a Law Commission review of directors’ duties and related issues such as director liability, sanctions and enforcement. The bill introducing Phase One is expected to be introduced in early 2025 and Phase Two will closely follow. Siouxsie Wiles employment decision In July, the Employment Court ruled that the University of Auckland had breached its health and safety, and good faith obligations to Associate Professor Siouxsie Wiles.4 Dr Wiles was prominent in the media during the Covid pandemic, communicating complex Covid information in an understandable way to the public. Dr Wiles received harassment and abuse, both online and offline, from those who disagreed with her. She sought help from the university, but was told that it was not part of her academic duties and that she should minimise further public statements until a security audit had been completed. Although the university was commended for the actions it did take, ultimately, those actions were insufficient. The Employment Court was critical of the university’s delay in responding to safety concerns and the university’s misplaced focus on Dr Wiles’ outside activities. The court found that the onus was on the university to obtain the right health and safety advice, and proactively put a plan in place. By failing to do so, the university was not acting in good faith and was breaching its contractual obligations to be a good employer. This ruling serves as a good reminder that employers, especially those in the public sector or that engage with the public, should consider health and safety risks in relation to employees’ work-related activities, including where those activities pose a risk of harassment. Employers may also be responsible for work related activities occurring outside of an employee’s work premises and normal working hours. New bill to improve consumer data rights Parliament is currently considering the Customer and Product Data Bill – a bill designed to increase consumer control over their data. It is currently with the select committee. If passed, the legislation will create an obligation for businesses that possess customer data to provide, on request, that data to those customers and certain third parties. The bill will help consumers access their data to compare services and change providers, making it easier for new or smaller businesses in an industry to compete with the ‘big players.’ The bill introduces hefty fines for non-compliance, including a fine of up to $50,000 for failing to respond to a data request and a fine of up to $5 million for making an unauthorised data request. Initially, the bill will only apply to the banking, electricity, and telecommunications sectors. Changes to insurance industry coming The Contracts of Insurance Bill, that awaits its second reading, will make significant changes to the rights of policyholders and insurers to promote confidence in the insurance market and ensure that insurers operate fairly. The bill proposes several changes to insurance contracts legislation, including: Commercial eSpeaking ISSUE 68 Spring 2024 CONTINUE TO PAGE 5 4 Wiles v University of Auckland [2024] NZEmpC 123.
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