Limiting triangular employment to three parties ensures legal clarity

New regulations on triangular employment and accreditation 

The New Zealand government has released updated regulations on triangular employment, emphasising the legal risks employers face when placing migrant workers with another triangular employer. Employers participating in such arrangements may risk breaching employment agreements and immigration rules, resulting in serious consequences including suspension of accreditation. To ensure compliance, employers must strictly adhere to the requirement that triangular employment arrangements involve only three parties. 

Additionally, for employers using controlling third parties, additional accreditation requirements are required. These include ensuring clear monitoring systems, accreditation standards, and appropriate management of worker conditions 

What is triangular employment? 

Triangular employment involves the worker, the employer (usually a labour-hire or recruitment agency), and a controlling third party (the business where the worker is placed). The worker signs an employment agreement with the agency, but their day-to-day work is managed by the controlling third party. 

Ensuring compliance by limiting triangular employment to three parties 

Limiting triangular employment to three parties: the worker, the employer, and the controlling third party is to ensure clear legal relationships. When additional parties are involved, monitoring employment conditions becomes challenging and may result in breaches of employment agreements. New Zealand’s employment laws and immigration guidelines highlight the risks of compromising employment conditions and jeopardising an employer’s accreditation when this limit is exceeded. 

Protecting workers in triangular employment 

Limiting the relationship to three parties ensures workers have clear legal protections. In the event of personal grievances, workers can hold both the employer and the controlling third party accountable if their actions contribute to the issue. This system guarantees that workers in triangular employment receive fair treatment and are protected under New Zealand’s employment laws. 

Extra requirements for controlling third-party accreditation 

Employers using controlling third parties must adhere to additional requirements set by Immigration New Zealand. These extra requirements are designed to ensure that controlling third parties meet specific standards for worker management and compliance. The requirements may include: 

• Ensure accreditation standards: confirm that the controlling third party is accredited to manage workers, meeting specific criteria regarding workplace safety, fair treatment, and adherence to employment laws. 

• Implement monitoring plans: establish robust monitoring and reporting systems to track worker conditions, performance, and compliance with employment agreements. 

• Define clear contractual obligations: specify the roles and responsibilities of both the labour-hire agency and the controlling third party to prevent overlaps and ensure accountability. 

• Provide training and support: offer appropriate training and resources to the controlling third party to uphold employment standards and effectively manage workers. 

• Conduct regular audits: perform audits and assessments regularly to verify compliance with accreditation requirements and promptly address any issues. 

These additional requirements help maintain the integrity of triangular employment arrangements by ensuring that workers are protected and that all parties comply with legal and regulatory obligations. Failure to meet these standards can result in the loss of accreditation, legal penalties, and damage to the reputation. 

For further information or assistance on these updates, please contact Arno Nothnagel, our NZ Immigration Director, at arno.nothnagel@absoluteimmigration.com.