Business - Parry Field Lawyers

The short answer is, it depends. Key factors include what the employment agreement says about varying the agreement, how significant the proposed change is, why there is a need for the change, whether the change is to the employee’s benefit or not and whether the employer and employee agree.

This article considers the situation where the employment agreement states, as is common, “This agreement may be varied by written agreement between the employer and employee”, the change proposed is more than inconsequential and is not to the employee’s benefit.

Good Faith

The starting position is that the employer and the employee are required, when bargaining for a variation to an employment agreement, to “deal with each other in good faith”. At a minimum that means being “responsive and communicative” towards each other and “active and constructive in continuing a productive relationship.”

In short, in the situation outlined above, employers should tell employees well in advance of the proposed change, the reasons for it, and the possible consequences if the change does not go ahead. A possible consequence may, depending on the circumstances, be that the employee’s employment is in jeopardy. However, that should only be raised if that is a genuine possibility, rather than as a threat.

Employees should be given an opportunity to give feedback on the proposal, including any concerns or alternative suggestions. Employers should maintain an open mind to suggestions made and be willing to vary their proposal if feasible.

Employees should also be told, prior to giving feedback, that they are entitled to get independent advice on the proposal and given sufficient time to get that advice, if they so choose.

If an employee’s employment may be in jeopardy if the change does not proceed, then employees should also be given an opportunity to have a support person or representative with them when they give their feedback.

Employees should not simply reject proposed changes out of hand and refuse to discuss them with the employer. They should engage with their employer and be prepared to discuss concerns and put forward alternatives, with a view to trying to reach resolution if possible.

What should happen if agreement is reached?

If agreement is reached, the terms of the existing agreement should be followed in recording that variation. For example, it should be recorded in writing, signed by both parties, and attached to the agreement.

If the change is solely to the advantage of the employer, an employer should also consider offering the employee some sort of “consideration” (i.e. benefit) in exchange, in order to ensure that the change is binding. This could be a one off payment or a pay increase or some other benefit.

While it is not clear legally that consideration is always required where the parties agree to a change, it is prudent to do so to limit the risk of a future dispute.

What if agreement can’t be reached?

This can be a difficult one. On one hand, the law recognises, as a general proposition, an employer’s prerogative to manage or organise its business. On the other hand, that is not an unconstrained right and the terms of the employee’s employment agreement cannot be ignored.

Consequently, where the proposed change effects an express term of the employee’s employment agreement (e.g. their hours of work) and the agreement states that any variation will be by mutual consent, it will be more difficult for an employer to unilaterally effect a change justifiably, particularly a substantial one.

Nonetheless, in some circumstances, a unilateral change may be permitted, where, objectively, that change is “fair and reasonable” and reasonably implemented. Whether any such change meets that test has been said by the Courts to involve “questions of fact and degree”, i.e. how significant is the change and why and how is it being introduced. Consequently, the individual facts of each case will be critical in assessing whether a change is likely to be upheld or not.

Either way, as with changes by agreement, where the change is solely for the benefit of the employer, the employer should offer some benefit in exchange for the proposed change. This also increases the chances of agreement being reached.

Drafting new employment agreements – a take home message for employers

If you are an employer, we recommend that new employment agreements include scope for changes to be made by the employer where business needs justify it. While employers will still need to follow a fair process, in the event of disagreement, more flexible agreement terms potentially provide greater flexibility in implementing change.

This article is not a substitute for legal advice and you should consult your lawyer about your specific situation. Please feel free to contact Hannah Carey – hannahcarey@parryfield.com at Parry Field Lawyers (033488480).

At the start of last year, we were gearing up for the introduction of the General Data Protection Regulations (GDPR). The GDPR is the widest reaching, most stringent set of data protection laws the international platform has seen to date. Nine months later, we are starting to see its impact.

The consequences for non-compliance have been varied. Under the GDPR, the highest sanctions can see a fine of up to €20 million, or 4% of global annual turnover, whichever is higher. A new report by international firm DLA Piper counted just below 60,000 GDPR data breaches reported since its introduction. Despite these numbers, less than 100 fines have been issued by regulators. The DLA Piper researchers attributed this low response with regulators still finding their feet in their heightened supervision roles. Google has been given the highest fine so far at €50 million. At the lower end, an Austrian betting shop was fined €4,800 plus legal costs when their security camera trained on the entrance also captured the footpath outside. It was held in breach of the GDPR as monitoring of public space is not allowed.

Despite being EU legislation, the GDPR can still impact businesses in New Zealand. You will likely need to comply with the GDPR if you:
– have a branch or subsidiary in the EU;
– monitor the behaviour of EU residents (e.g. monitor how many EU customers visit your website); or
– sell goods or services to people who live in the EU.

While there are yet to be any fines outside the EU, NZ companies should not take a relaxed approach to GDPR compliance. As the Regulators establish themselves, we may see more attention turned towards businesses outside the EU.

We would encourage you to get in contact with us if your company doesn’t have a privacy policy or if you’re worried your current policy won’t meet the requirements. Parry Field Lawyers has created a privacy policy template which is GDPR compliant.

Even if you don’t deal with EU customers, it is important to have a robust privacy policy in place. Contact Steven Moe at StevenMoe@ParryField.com or Kris Morrison at KrisMorrison@ParryField.com to see how we can help.

How can you ensure that people have the freedom to share their concerns at meetings without being worried about the consequences of recording them in the minutes? This is an issue which plagues various groups.

The Privacy Act 2020 applies to any agency. This is defined as a person or body of persons that collects, uses or stores personal information. Examples of this include businesses, organisations, church groups or societies. If you are a private organisation (i.e. not a government body), the Official Information Act does not apply and you will have a lower threshold of disclosing information.

Information is considered to be personal when it is about an identifiable individual. It does not have to be private or sensitive to meet this threshold.

When personal information is stored by an agency, the person it relates to has the right to access this information. This may include:

Any references to them in the minutes of a meeting;
Communication between the person and the agency;
Decisions made in relation to the person;
Any complaint the person has made or a complaint about that person.

A request to access this information may be refused if:

the information would disclose a trade secret;
the information would be likely to unreasonably prejudice the commercial position of the agency or person;
disclosure would involve personal information about other people. An individual may only request access to information relating to themselves under the Privacy Act 2020. This may mean that all other references to other people are taken out of the document before it is given to the requester;
disclosure would result in an unjustifiable breach of another person’s privacy.

If you are an agency concerned with not disclosing sensitive information about someone, you should consider:

censuring the names if disclosure was recorded. As personal information has to be identifiable, removing the names would avoid this;
not recording the concerns.

Ultimately your response will be determined by what the agency’s own policy and constitution allows and the current standard practice.

If you want to dive deeper into this topic, the Privacy Commissioner has also published this for clubs and societies.

If you would like assistance in re-writing your agency’s policy or constitution, please contact Steven Moe at StevenMoe@parryfield.com

Under the Financial Services Providers (Registration and Dispute Resolution) Act 2008, everyone who provides, or offers to provide, a financial service in New Zealand or from New Zealand to other countries must register as an FSP. Importantly, before you offer your financial services you must be registered.

There is a simple straightforward application process for registration. This can be found online on the website of the Ministry of Business, Innovation and Employment.

Firstly, the application process depends on what kind of FSP you are. There are three different types depending on your business and the services you will provide – an individual; an entity already registered via the Companies Office; or another entity or body.

Applying as an individual:

There is basic information which you will have to include the application such as your full legal name, date of birth, residential and contact address, your business address and any trading names you use.

Applying as a business already on a Companies Office register:

You will have to provide your company or entity’s name, the Companies Office number or its New Zealand Business Number. If you do not know what this is, you can search for it via the Companies Register. Furthermore, include any trading names you use, your business and contact address and the basic details on your directors and other controlling owners and managers.

Applying as another entity or body:

The basic information you will have to provide is about your business, such as its legal and trading names, the country of origin, the business and communication address and also an email address. You will also have to provide the basic details on your directors and other controlling owners and managers.

For all applications:

Firstly, in completing this process, whatever kind of FSP you are, you will have to provide information about your business and the services it will provide. In the form you fill out online there are a list of services. You would select all the ones that you intend to provide upon registration. This is something that needs to be kept up to date as well. The services that you need to declare can be found under section 5 of the Financial Service Providers (Registration and Dispute Resolution) Act 2008.

Secondly, every individual FSP and those people in charge will have to undergo a criminal history check.

If you are applying to the Financial Markets Authority (FMA), at the same time, to be an Authorised Financial Advisor (AFA), there is additional information to prepare. (https://fsp-register.companiesoffice.govt.nz/help-centre/applying-to-provide-licensed-services/applying-to-be-an-afa/)

When registering as a FSP there are transaction fees to pay:

○ Application fee, incl. GST: $345
○ Criminal history check fee per person, incl. GST: $40.25
○ FMA levy, incl. GST: $529
○ TOTAL: $914.25

Furthermore, after you register you have to pay fees once you’ve completed your annual confirmation:

○ The Companies Office Fee, incl. GST: $75

Alongside this, you will pay levies to the Financial Markets Authority (FMA).

○ The amount of levies you pay depends on your class of service provider and the services you provide.
○ Levies are listed under Schedule 2 of the Financial Markets Authority (Levies) Regulations 2012.

This online process is efficient and easy and should not take up too much of your time.

Please note that this is not a substitute for legal advice and you should speak to your lawyer about your specific situation. Should you need any assistance with this, or with any other Commercial matters, please contact Kris Morrison or Steven Moe at Parry Field Lawyers (+64 3 348 8480).

Trade Mark Protection: Key things to know when registering and maintaining a trade mark in New Zealand

A trade mark protects distinguishing names and logos, making it one of the most important business assets you can own. As the number of enterprises in New Zealand now exceeds over half a million and counting, it is more important than ever to protect your business’s hard earned reputation. One of the best ways to do this can be by registering a trade mark.

Parry Field has previously published an article on this matter. This article seeks to add to this previous publication, by providing links to several further discussions on some of the more complex and often confusing aspects of trade mark registration. Parry Field Lawyers provide legal advice on a range of commercial matters including protecting your intellectual property.

No offence! Ensuring your Trade Mark is not likely to Offend Māori and other Community Groups

What is a Search and Preliminary Advice Report? Do I Need One?

Could you be more specific? Working out your Trade Mark’s Specification

Broadening your Horizons? How to register your Trade Mark Internationally

Applying for a trade mark with IPONZ will only protect your company mark in New Zealand. If you are considering protecting your trade mark in other countries, you can use an international trade mark filing system called the Madrid Protocol. This system can use your original New Zealand application as a base to apply for your trade mark in as many as 119 participating countries.

This application is called a ‘New Zealand Office of Origin’ trade mark and requires only one application, one set of fees, one designated place to update and maintain your application and one global renewal date. As a preliminary step, it might pay to see whether a trade mark the same as, or similar to yours has already been registered in other countries. You can search the International Trade Mark Register here.

While registering your trade mark in a number of different countries might be relatively straightforward, it is by no means cheap. In fact, registering your mark in all of the 119 Madrid Protocol participating countries will cost a little over $40,000. For this reason, it pays to be selective when deciding in which countries you will pursue your application – some registrations can cost a lot more than others. For example, applying for a trade mark in Turkey will cost just over $100, but a trade mark application in Uzbekistan will cost you almost $2,300. You can access a full breakdown of the relevant costs in each country here.

It may also pay to investigate any special requirements a country you intend to register your trade mark in might have. For example, registration in the United States of America requires the additional signing of a Declaration of Intention, while registration in the European Union requires the applicant to designate a second language (French, German, Italian or Spanish) in which contesting parties can challenge your application.

You can find out more about these specific requirements, as well as how to apply for an international ‘New Zealand Office of Origin’ trade mark more generally here.

Should you need any assistance with these, or with any other Commercial matters, please contact Kris Morrison or Steven Moe at Parry Field Lawyers (+64 3 348 8480).

For a more general overview of registering a trade mark, please see our original article here.

To properly classify and protect your trade mark, IPONZ requires each trade mark to be registered within one or multiple goods or services specifications. You must also currently trade, or hold an honest intention to trade in each of the categories you specify. New Zealand uses the World Intellectual Property Office’s ‘Nice Classification’, which contains 45 classes of goods and services.

Of these 45 classes, classes 1 to 34 categorise goods, while classes 35 to 45 categorise services. For example, class 25 includes clothing, footwear and headgear, while class 37 includes construction and repair services. Within these 45 classes, goods and services specified range from abacuses to zip fasteners, art hire to zoological garden services.

With so many categorised types of goods and services, you may find it helpful to use this search database to see what class/classes your good or service falls within. Alternatively, you can find an alphabetically ordered list of all of the ‘Nice Classification’ classes here.

Properly classifying your trade mark is important both before and after you trade mark is registered. To process your application, the class/classes you have applied in will help determine whether the trade mark has distinctive character or is confusingly similar to any already existing trade marks.

Upon successful registration, the specification of the trade mark will also determine the trade mark owner’s rights where they might need to take legal action against an infringing mark by another company. Where the infringing mark is in the same class as specified by the existing trademark, the owner will have a greater claim against that infringement.

For example in a recent High Court case, the court rejected an application for the trade mark ‘Shacman’ in class 12 (commercial vehicles). The court reasoned that the infringing trade mark was likely to deceive or be confused with an already existing trade mark; ‘Man’. Highly influential in this decision was the fact that the already existing trade mark was also registered in class 12.

Therefore, while taking extra care to ensure you register your trade mark in the right class/classes might seem pedantic, it will better protect your intellectual property from infringing trade mark applications in the future.

Should you need any assistance with these, or with any other Commercial matters, please contact Kris Morrison or Steven Moe at Parry Field Lawyers (+64 3 348 8480).

For a more general overview of registering a trade mark, please see our original article here.

The Intellectual Property Office of New Zealand (IPONZ) encourages first time applicants to make an initial application for a ‘search and preliminary advice report’ (S&PA) before making an application to register their trade mark. This article seeks to give some clarification about what an S&PA report is and in which circumstances you may or may not want to make such an application.

An S&PA report consists of two parts and will give you an assessment within five working days as to whether your proposed trade mark complies with the requirements of the Trade Marks Act 2002. More specifically;

1. A search report will find whether anyone else currently holds a trade mark the same as or similar to your proposed trade mark.

2. A preliminary advice report will find whether your proposed trade mark renders your business clearly distinguishable within your industry.

Individually, each service costs $40 excluding GST, or $80 excluding GST for both services. While the services might be useful, applicants should be aware that applying for the reports is not compulsory. In fact, conducting your own search and ensuring your trade mark is distinguishable may not be as difficult as it sounds, and could save you money.

Conducting your own Search

There are four different searches you should complete to check the availability of your trade mark:

1. IPONZ Trade Mark Register

This register is the best place to begin your examination, offering a thorough search of already registered trade marks in New Zealand. You can access this database here.

2. ONE Check

As well as showing you already registered trademarks, ONE Check will also show you the availability of company names and domains. You can access this database here.

3. International Trade Mark Register

Searching this database will allow you to see if anyone has already applied for your trade mark in New Zealand, but it hasn’t yet been added to the New Zealand register. You can access this database here.

4. General Web Search

Lastly, we suggest you use a search engine, such as Google, to search for your proposed trade mark. This will show you any businesses that may already operate under your name. This search is not absolutely necessary, in that businesses with a name or logo that is not trademarked will not prohibit your application, but it may be worthwhile to assess who else could be considering registering a similar trade mark in the future.

If after conducting the above searches you are not able to find an existing trade mark at all similar to yours, it is unlikely you need to procced with the $40 search report. However, if any of the database searches return a similar existing trade mark, we suggest applying for a search report before proceeding. The $40 cost could save you the larger cost of a failed application.

As a general pointer, trade marks that attempt to register a compound word that includes an already trademarked word (registered in the same or similar specification category) are less likely to succeed. For example in a recent High Court case, the court held that the trade mark ‘Shacman’ was likely to deceive or be confused with the existing trade mark ‘Man’. Both trade marks were registered in class 12 (commercial vehicles).

Self-Assessing the Distinguishability of your Trade Mark

The Trade Marks Act requires each trade mark to have a distinctive character. For example, attempting to register the name ‘Budget Supermarket’ for a food and household goods retailer is unlikely to be seen as distinguishable as it could describe many traders in their nature of business. Similarly, the name ‘Blueberry’ as a trademark for fruit would not be seen as distinguishable, because marks that simply describe the good or service often cannot distinguish that good or service of one trader from another. Using the name ‘Blueberry’ as a trade mark for an architecture firm, however, would be distinctive.

If you are certain your trade mark is distinguishable, it is unlikely you need to proceed with the $40 preliminary advice report. However as with the search report, if you have any doubts regarding your trade mark’s distinctive character, it may be worth the $40 cost to save you the larger cost of a failed application.

Before registering, it also pays to ensure your trade mark is not on the list of protected words and is not likely to offend Māori or another significant section of the community. You can read our article on ensuring your trade mark does not breach this ‘offensiveness’ standard here.

Should you need any assistance with these, or with any other Commercial matters, please contact Kris Morrison or Steven Moe at Parry Field Lawyers (+64 3 348 8480).

For a more general overview of registering a trade mark, please see our original article here.

The Trade Marks Act 2002 outlines that trade marks must be rejected if they are likely to offend a significant section of the community. The first part of this article discusses trade marks that are likely to offend a significant section of the community more broadly, while the second part focuses specifically on trade marks that are likely to offend Māori.

Likely to offend a significant section of the community

Adopting the Macquarie Dictionary’s definition, the Intellectual Property Office of New Zealand (IPONZ) acknowledges the word ‘offend’ means to ‘irritate in mind or feeling’ and ‘to cause resentful displeasure in’. Under this definition, when assessing whether a trade mark is likely to offend a significant section of the community, IPONZ outlines that its examiners will take into account the following considerations:

– Each case must be decided on its own merits.

– The question must be considered as at the date of application.

– The question must be considered objectively, from the point of view of “right-thinking members of the public”.

– A mark should be considered likely to offend a significant section of the community where:

– The mark is likely to cause a significant section of the community to be outraged; and/or

– A significant section of the community is likely to feel that the use or registration of the mark should be the subject of censure.

– A significant section of the community is likely to feel that the mark should be the subject of censure where the mark is likely to undermine current religious, family or social values.

Influential on the New Zealand approach to assessing what suffices ‘a significant section of the community’ was the 1976 ‘Hallelujah Trade Mark’ case in the UK. When deciding whether to allow the trade mark ‘Hallelujah’ as the name of a women’s clothing brand, the Registrar’s Hearing Officer found the trade mark was “reasonably likely to offend the religious susceptibilities of a not insubstantial number of persons”.

Although this trade mark application might be decided differently today, the Hearing Officer stressed that rejection of an application is warranted even where the group of people offended are a minority, so long as they are substantial in number. Influenced by this UK decision, IPONZ also outlines that its examiners will also take into account the following considerations:

– The significant section of the community may be a minority that is nevertheless substantial in number.

– A higher degree of outrage or censure among a smaller section of the community, or a lesser degree of outrage or censure among a larger section of the community, may suffice.

Lastly, one interesting principle that the IPONZ examiner will consider is that the application should not be rejected merely because the mark is considered to be poor taste. In a more recent decision by the Office for Harmonisation in the Internal Market (the trade mark registry for the European Union) the previous examiner had rejected the trade mark ‘Dick & Fanny’ on the basis it could offend a significant portion of English speaking consumers. However upon appeal, the trade mark was accepted, on grounds that the trade mark “may, at most, raise a question of taste, but not one of public policy or morality”.

This decision has made it clear that a distinction should be drawn between trademarks that are offensive and trade marks that could be considered poor taste. While the former will be rejected, registration of the latter is not necessarily prohibited.

Likely to offend Māori

In the mid 1990’s, in response to claims that the Trade Marks Act 1953 insufficiently protected Māori intellectual property, the New Zealand Government established the Māori Trade Marks Focus Group. On the focus group’s recommendation, the commissioner now has access to the Māori Trade Marks Advisory Committee when making decisions on Māori trade marks. While not binding, the committee provides advice to the commissioner to minimise the risk of registering trade marks that are likely to cause offence to Māori.

All trade mark applications using Māori text or imagery will be referred to the advisory committee, who will then make a recommendation to the commissioner. One of their key considerations concerns the Māori words ‘Tapu’ and ‘Noa’. Tapu is the strongest force in Māori life, and can be used to describe people, objects or places that are ‘sacred’ or carry ‘spiritual restrictions’. Conversely, noa can be used to describe people, objects and places that are ‘common’, from which the tapu has been lifted. Therefore, trade marks that combine or associate tapu and noa can be considered offensive or inappropriate to a number of Māori.

For example, in 1927 the ‘Native Brand Co’ produced Worcester sauce under a logo that depicted a rangatira (Māori Chief, which is a position considered tapu). IPONZ considers that such a trade mark would not likely be registered today, because associating tapu (a Māori Chief) and noa (a household food items) signifies an attempt to lift the tapu of a Māori Chief, which could be considered offensive.

In some circumstances, it may be appropriate for a Māori name to be gifted to a business or organisation by tangata whenua – the Māori people of the land. Such a gifting or blessing is often done in accordance with mana whenua – the mana or power that comes from the land or rights to the land. A recent example was the gifting of the name ‘Tūranga’ to the new Christchurch City Central Library by Ngāi Tūāhuriri, a subtribe of Ngāi Tahu. Because the name honours a North Island settlement that was home to the Ngāi Tahu ancestor Paikea, use of the name without Māori consent could have likely been considered offensive.

If you are still unsure whether your trade mark might be considered as too offensive to be registered, you may like to consider getting a ‘Search and Preliminary Advice Report’ from IPONZ. This preliminary assessment will give an indication whether your Trade Mark will be allowed. You can read our article about getting a Search and Preliminary Advice Report here.

Should you need any assistance with these, or with any other Commercial matters, please contact Kris Morrison or Steven Moe at Parry Field Lawyers (+64 3 348 8480).
For a more general overview of registering a trade mark, please see our original article here.

Some of our staff from Parry Field recently attended an Institute of Directors seminar on the topic of culture and board. These are some key points that emerged that we thought were worth sharing:

When it comes to culture, Board members will always be looked at – so what culture will they model for those in the organisation?
Boards have a dual leadership role ensuring accountability (ensuring that purpose and values are kept to) and assurance (ensuring that executive is taking to action to achieve the desired culture.
Values may be written and put on the wall, with a vision statement and policies – those are visible, but they are just the tip of the iceberg. There are also invisible factors such as the water cooler conversations, the shared myths over what is important and the “unwritten rules”. An example is the the myth that Kodak did not innovate enough, when in actual fact they invented the first digital camera well ahead of the game. They commercialised one of the first digital cameras in the 1990s and spent a lot on R&D, but the people at the top of Kodak were ‘film’ people with 80% market share. So while values did not include profitability, ultimately the unwritten value, the invisible factors, drove the decisions that led to their end.

Reflection

How well is your culture living and breathing in your organisation? The key is that all of this needs to stay on the radar!
There are some key elements of culture indicated in the “Johnson and Scholes Cultural web” that include:
- Stories – who is respected within the organisation? How are the events that occur interpreted?
- Symbols – for example, who has open plan, who has corner office, who has car park?
- Rituals and Routines – morning teas, Friday evening drinks etc.
- Power Structures – who has the power within the organisation (whatever their title)?
- Organisational Structure – what do informal relationships signal (for example, does the Chair defer to someone else on certain things)?
- Controls – what is it that controls how things are done in the organisation? An example is asking whether budget and profit are valued over values (which could mean a person simply meets targets but does not model what the organisation stands for).

(More information here).

The real focus and point of this article was to make you aware of visible and invisible factors and the messages that are sent through the key elements set out above. It is important to make sure that values are understood and clearly communicated.

This article is not a substitute for legal advice and you should speak to your lawyer about your specific situation. Please feel free to contact us at 03 348 8480 or by email Steven Moe – stevenmoe@parryfield.com