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T+P are hosting seminars on water & nutrient management in Christchurch, Ashburton and Timaru once Plan Change 5 has been released.
Please pre-register your interest here and we will contact you as soon as the dates are confirmed.
A will would be your flour. Plain or wholemeal, no matter, so long as you have a cup or two to start with. Without a will you’re at the mercy of the Administration Act 1969: it dictates who gets what and how much. Whilst the provisions of the Act are sensible – a widower receives his wife’s property, for instance – they are not necessarily reflective of the best outcome for your family and its farm or business. Without a will, the legal process to be followed after you lose a loved one also tends to be more expensive, and can be more complicated than it needs to be.
Baking powder, an essential
A good will should cover off: who is in charge of your estate (your executor); who will look after your children (if they are under age); and who is to receive which of your assets. While this sounds straightforward enough, these appointments and the treatment of your legacies need to be worded accurately and appropriately to ensure your wishes are met. Don’t buy a will off the internet – it may fail to rise.
Keep it sweet Sugar
As with carbohydrates, I have a love/hate relationship with family trusts (or, more specifically, the endemic way in which Kiwis employ them). Admittedly, not all sugar is bad: if you’re after a treat for the diabetics, you’d best steer clear, but if you want to bake a gateau, you’re going to need some. Settling assets upon a trust can result in complexity, administrative costs, and perceived (and actual) loss of control. However a trust can also provide a wonderful succession planning tool in the right circumstances: trusts can offer asset protection against creditors, a vehicle for collaboration between family members and advisors, and sustained ownership in the face of a bereavement. Crucially, a trust can also help to secure your family capital against relationship property claims that your children could be vulnerable to in the future, promoting protection of family capital for succeeding generations.
Binding agent
If you do have a family trust, then you’ll definitely be wanting some eggs to make sure everything sticks together just right. A Memorandum of Wishes gives your surviving trustees directions as to how the trust is to be operated after you pass away. It should set out who are to become trustees, and how assets are to be dealt with. For example: is the farm to continue in operation or is it to be sold and the proceeds distributed. If the former is the case, who is to run the farm – and how should any non-farming children be tended to?
Greasing the pan
Discussing your intentions with your children – and where appropriate other family members – is an important part of your succession planning. Are your executor and/or your intended trustees happy to take on that responsibility? Are the intended guardians of your children agreeable – and do they understand your wishes for the care of your children? If your children are adults – or approaching that age – have they a desire to begin or continue farming? And if not do they have other business aspirations you want to assist them with?
A Deed of Family Arrangement may be just the baking paper you are after – a document which records agreement among family members. These can be used to set out the family’s plan going forward and are signed by all relevant parties, ensuring everyone is aware of and agrees to the programme. They are also used in the settlement of disagreements following the death of a family member, but the aim is – of course – to avoid that scenario through adequate planning and disclosure.
To mix
You’ll need some good utensils – a sieve, a whisk. Your accountant will perform the vital role of sifting through the books and setting out your fiscal position. They’ll also proffer advice as to taxation implications arising from your structuring and anticipated succession plan. Bankers, farm advisors, and succession planning mentors are other crucial members of the team.
Meanwhile your lawyer wears the chef’s hat, and will fold together your wishes and knowledge, the contributions of your advisors, and their own legal expertise. In preparing your succession plan we need to gain a sound understanding of your family and its vision for its future: your taste in cake will determine the ingredients we use. In other words – if we can forget the carefully sustained analogy for a moment – the pivotal thing is that we understand what you want to achieve for your family. It’s important that we all work in conjunction with each other to ensure that everyone is on the same page (and the oven is the right temperature).
Let it cool
Documenting your succession plan brings with it peace of mind: your house is in order. But don’t forget to review things periodically. As time passes, and your family grows and changes, tastes change too.
Anna O’Callaghan
Tavendale and Partners
Sustainable management - it’s the cornerstone of the RMA and the touch point against which all decisions relative to the Act are made.
At its heart, the RMA is simply about allowing the use of resources in a manner that ensures that people can provide for their social, economic and cultural wellbeing in the here and now, while ensuring something is left for future generations.
There’s no doubt it’s a delicate balancing act and it’s not easy to strike the right balance.
Recent developments in the regulation of on-farm nutrient management may leave some increasingly frustrated, and feel that achieving “sustainable management” is becoming a moving target.
The attention on farming land use and nutrient management is a direct result of the Government’s soon to be updated National Policy Statement for Freshwater Management 2014 (NPS). Mandated by the RMA, the NPS directs regional councils to set allocation limits for water quality and quantity, and objectives to ensure freshwater quality is at or above national standards or “bottom lines” by 2030. The NPS is silent on how the bottom lines are to be achieved and it has left that up to individual councils to determine through their own regional planning processes.
Whatever view you have of the NPS, the reality is that it, and the regional plans that will implement it, are law. Burying your head in the sand, in the hope that it’s an aberration might seem like the easiest option at the moment. But we urge you to take some control. Be proactive and stay informed and be engaged. That way, you’ll know what you’re facing
and can make the right decisions for your operation based on knowledge, not knee jerk reaction.
As the saying goes “knowledge is power”. Ensure you fully understand the regional plan rules that apply in your patch, and what steps you’ll need to take on-farm (operations) and off-farm (consents) to comply. Read the plan or the proposals and ask your regional council whether any explanatory material exists. Talk to your neighbours, friends and colleagues. Attend seminars and workshops in your area. Seek advice from your farm advisor, environmental consultant or lawyer.
In most regions, there are still good opportunities to get involved in the regional rule making process. The recent law reform has imbedded the “collaborative” planning process rolled out by the Canterbury Water Management Strategy for progressing catchment-specific regional planning regimes in the RMA (with a few tweaks). It’s likely that this approach - which allows for early stakeholder involvement in plan development – will be adopted in regions other than Canterbury.
There’s no denying that regional plan changes resulting from the NPS will be a game changer for many farmers, and there’s still considerable uncertainty around what the future holds under a much stricter land use management regime. So stay engaged and make your voice heard. Remember: a regional plan is only ever going to be as good as its inputs.
And while the enforcement of nitrogen base lines (and in some areas – reductions below base lines) might be seen as prioritising preservation of the environment over the land owner’s rights to use their property however they wish, the law is simply asking for commercial practice to be carried out in a responsible manner, and the upshot of that will be the continuation of land use for commercial activity in decades to come.
Georgina Hamilton
A passion to deliver an outstanding theatrical performance resulted in more than a standing ovation for one Auckland school.
In April 2016, St Kentigern’s compelling rendition of the musical Sweeny Todd went horribly wrong when two of the cast suffered serious lacerations to their throats during a dramatic shaving scene.
As a result, the school’s Trust Board had allegedly breached their obligations under the Health and Safety at Work Act 2015. Their crime? Failing to ensure, so far as reasonably practicable, the health and safety of their students.
The Trust Board acknowledged that they were at fault and proposed an ‘enforceable undertaking’ rather than face prosecution under the Act. The undertaking is a legally binding agreement between WorkSafe New Zealand and a duty holder (in this case the Trust Board), in which the duty holder commits to learn from the incident. Learning is demonstrated by way of training, the preparation and implementation of a new health and safety policy. The intent is to progress best practise for the benefit of those in the workplace, the wider industry or sector and/or the community.
WorkSafe New Zealand accepted the Trust Board’s proposal citing the following reasons:
The enforceable undertaking was signed on 4 April 2017, thereby committing the Trust Board to:
The St Kentigern’s incident was indeed unfortunate but it was also totally unforeseen and therefore serves as a reminder to all employers to be conscious of their health and safety responsibilities, and the requirement to adequately protect their employees is timely.
While an enforceable undertaking was acceptable in St Kentigern’s case, it may not be an option in other situations where the Act has been breached and WorkSafe may consider prosecution to be more appropriate in different circumstances.
It is well known that farmer owner and farm employers have a range of obligations that require them to take a proactive approach to quad bike safety. Quad bikes are notoriously dangerous. Every year, on average,850 people are injured on farms riding quad bikes and there are on average five deaths a year. It is crucial that you as farm owners and employers have health and safety policies that say that workers should wear helmets on the quad, but equally important that it’s not just a written policy but it is part and parcel of farm culture and working expectations. So what do you do if your workers aren’t following the policy that they’ve signed?
If you know that your worker doesn’t wear their helmet then you can’t rely upon the existence of your policy if something goes wrong. Just having a written policy is not enough. On top of any legal consequences you know quad bikes are dangerous, you don’t want to see someone that you deal with every day injured (or worse) if that can be avoided by you taking the simple step of enforcing the policy. It is too late to do something after someone gets hurt.
The first step in enforcing your policy is ensuring that everyone understands what it means. A refresher course on quad bike safety is not going to be a waste of time and can give you the opportunity to remind everyone of the policy. This can be done by simply talking to your staff, telling them the statistics and making it clear that not only is health and safety a legal matter, but that you care about your employees’ safety
The second step is ensuring that you are modelling the behaviour you expect from your workers. If you aren’t treating your policy seriously, or acting when there is a breach, then you cannot expect your workers to take the policy seriously either.
If you suspect that this isn’t enough, we recommend that you have a casual conversation to see what the resistance is. Are the helmets uncomfortable? Do they impact the worker’s vision? Are the workers worried about time? These are all fixable problems.
Once you have a policy that is known and understood, you should be confident in enforcing it. Take a photo with your phone if you see someone not wearing their helmet. When you get back to your computer, write a letter to them which puts your concerns to them and invite them to an investigation meeting. It is important that you don’t pre-determine any outcomes but listen to their explanation for their breaches, and consider with them if there is a way forward that will ensure their compliance with the policy, and protect them from harm. You will then decide (with reference to your employment agreement) what you think the appropriate reaction is and advise the worker of your decision. An employer is always vulnerable in an investigation/discipline process and we are happy to help you with this.
From 1 April this year, the minimum wage will go up:
- for adults, by 50 cents an hour, to $15.75.
- for the starting-out and training rate, by 40 cents an hour, to $12.60.
Employers will need to ensure their affected staff get the new rates. It might
also be a good time to check other aspects of your payroll system to
make sure it complies with NZ law.
If you would like to discuss your particular needs, then please contact:
Kirsten Maclean
kirsten.maclean@tp.co.nz
021 221 0721