Childcare teachers working for Evolve Education have been asked to move on to flexible-hours contracts which their union says are illegal.
The company, which reported a $13.3 million loss in the year to March 31 last week, has been hit by lower attendance rates as some parents are working from home or have lost their jobs due to the Covid-19 recession.
It has offered teachers new contracts stating that hours of work will be between 20 and 40 hours a week, with a guaranteed minimum of only 20 hours.
NZ Educational Institute (NZEI) secretary Paul Goulter said the institute’s legal advice was that the proposed contracts are illegal because they do not provide any payment for teachers to be available for the additional 20 hours when work is not guaranteed.
He said fluctuating hours for teachers would also affect children.
“How can you have high-quality early childhood education when you have got essentially a casualised workforce?” he asked.
Evolve chief executive Tim Wong said he took legal advice when drafting the proposed contracts and had followed that advice.
“After a two-week initial consultation period with our people, we decided to offer an alternative employment agreement to staff at some of our centres,” he said.
“This alternative agreement is intended to enable us to adjust to lower occupancy levels by sharing the work around and keeping all staff employed. With unemployment predicted to rise substantially in NZ, we think that it would be reasonable to assume an adverse effect on occupancy levels.
“It is entirely voluntary for our people to take up the alternative employment agreements. If they choose not to, the existing employment agreements will continue.”
But Education Minister Chris Hipkins has asked Education Ministry officials to investigate.
“Early childhood services should act as responsible employers,” he said.
“The Government gives them funding certainty, and we worked very hard to ensure that they had certainty during the Covid-19 lockdown period and beyond.
“I expect that good faith and goodwill to be shown in the way they are treating their staff.
“I’ve asked the Ministry of Education to have a closer to look at this to ensure all the licensing and funding requirements are being met. If there are wider employment issues, then that’s a matter for the employees and the unions to be taking it up with the appropriate authorities.”
Evolve, which is listed on the NZ sharemarket, took a $12m wage subsidy that enabled it to pay all of its almost 1900 employees in full from the start of the level 4 lockdown on March 25 until June 17.
Its annual results say it does not meet the criteria for the extended wage subsidy, which requires a 40 per cent drop in revenue due to Covid.
But a note in the report says the average occupancy rate across the company’s 120 centres was only 72 per cent in the latest financial year even before the lockdown, down from 76.5 per cent last year and well below the industry average of 79 per cent.
“Occupancy projections used for impairment testing have been scaled back from the group’s expected level of 80 per cent by 2025, due to the uncertainty regarding the impact of Covid-19,” it says.
“This projection assumes occupancy only regains its 2020 level of 72 per cent by 2025.”
Wong said Evolve was “looking at better ways to engage its workforce to avoid redundancies given a potential deterioration in the economic environment”.
“Evolve has gone to all our centres to ask for suggestions and ways of assisting the company through a tough market. We feel that everyone in the company should have a say,” he said.
“So the contract presented last week was an optional agreement for consideration. We have requested all team members to make changes to suit individual needs or they could remain on their existing contract.”
organiser Susan Bates said children who had stable, trusting relationships with their teachers, had now lost them.
“Lots of teachers have resigned rather than sign this contract, and many more will do so this week. Was this the real goal?” she asked.
More than 4300 people have signed a petition asking the Government to stop Evolve’s “unfair and unlawful” contracts.
National data shows that school attendance has now completely recovered after the lockdown and early childhood attendance has improved on Tuesdays, the day of highest attendance each week, from 51 per cent on May 26 to 60 per cent on June 16.
Sector leader Kathy Wolfe says 95 per cent of children who attended childcare before the lockdown are now back, but many have come back for fewer hours because parents are working from home or have lost their jobs.