From Friday, new legislation will require employers to retain copies of all employment agreements.
This applies to all employees even if they were employed before July 1.
Employers who do not have employment agreements for existing staff will need to ensure they provide copies to employees for signing and get them signed if practicable.
They otherwise face a penalty under the Employment Relations Act 2000 of up to $10,000 for an individual or $20,000 for a company or other corporation.
Otago-Southland Employers' Association chief executive John Scandrett said yesterday the current law expressly required that an employment agreement must be in writing.
That aspect of the law would be extended on Friday to require employers to retain a signed copy of the individual employment agreement or retain a copy of the terms and conditions of employment that made up the employee's individual terms and conditions, he said.
Also, the employer must retain a copy of the intended employment agreement even if the employee has not signed it or agreed to it.
If an employee requested a copy, the employer must as soon as reasonably practicable provide a copy of the individual agreement, the current terms and conditions or the intended agreement.
Employment law specialist Anna Irving said many employers did not have employment agreements with their staff.
"A lot of people were already in jobs when the obligation came in and employers opted for the status quo."
Although the existing legislation always had penalties for employers not having contracts with their workers, the law was hard to enforce. The only way to get a judgement was through the Employment Authority.
In practice, that meant that employers generally had been penalised only when the employment relationship had gone wrong in some other way and an employee had brought a claim about the problem, Ms Irving, an associate at Mitchell Mackersy Lawyers said.
"The only way these things sometimes come to light is when an employee is facing a disciplinary matter and says 'By the way, I don't have an employment agreement'."
However, the penalty went to the Crown, in the first instance, and employees were not likely to pursue a case on their own.
She was not aware of the Labour Department pursuing a claim for the lack of an employment agreement of its own volition even though it already had the ability to do so.
The department's resources were probably better spent in other areas, she said.
Employers already had an obligation to ensure employees had a written agreement.
"Many employers do not comply with the obligation and I doubt whether the new obligations will have any real effect on how those employers operate.
"It remains to be seen whether the Department of Labour will utilise these new powers more frequently than it has done in the past."
Disciplinary matters were often not covered in employment agreements, Ms Irving said. They were either covered by an "understanding" or in work rules.
An employee caught stealing would be seen as breaching an agreement and breaching the law and could be fired.
Ms Irving was not expecting a flood of complaints from Friday.
