Idea Services Ltd v Attorney-General - [2022] NZCA 470

Date of Judgment

04 October 2022

Decision

Idea Services Ltd v Attorney-General (PDF 299 KB)

Summary

Epidemic Preparedness Act 2006 – COVID-19 – Immediate Modification Orders 

In March 2020, the Prime Minister issued in response to COVID-19 an epidemic notice under the Epidemic Preparedness Act 2006 (the EPA) which has been renewed every three months since.  Section 15 of the EPA provides that whilst an epidemic notice is in force, the Governor-General may by Order in Council, made on the recommendation of a relevant Minister, modify “any requirement or restriction” imposed by an enactment.  Before a modification can be made, the Minister must be satisfied that the requirement or restriction must be impossible or impracticable to comply with because of the effects of the epidemic.   

In April 2020, an IMO modifying aspects of the collective bargaining provisions of the Employment Relations Act 2000 (the ERA) came into force and continued in force until May 2022.  Section 53(3) of the ERA provides that a collective agreement that would otherwise expire continues in force for 12 months, provided that collective bargaining to replace that agreement has been initiated before it has expired.  Clause 8 of the IMO modified s 53(3) by providing that the 12-month extension period did not start to run while the epidemic notice was in force.   

This appeal concerns the lawfulness of that IMO.  The appellant, Idea Services Ltd, unsuccessfully sought in the High Court declarations as to the IMO’s invalidity.  It had argued that the 12‑month extension period was not a statutory “requirement or restriction” for the purposes of s 15 of the EPA.  Idea Services Ltd now appeals the High Court decision.   

Held: Appeal allowed.  A declaration is made that cl 8 of the IMO was invalid because it modified a statutory provision that did not fall within the scope of s 15 of the EPA. 
 (1)  The Court acknowledged two important points of context for this appeal. The first was the nature of the power in s 15 of the EPA which, given its constitutional concerns, is to be narrowly and strictly construed.  The second was the uncertainty created by COVID-19.
(2)  However, s 53(3), properly construed, was not a “requirement or restriction”. Section 53(3) extends the life of an existing agreement by up to 12 months in the circumstances noted, but it does not require the parties to conclude an agreement.  There are consequences if the bargain is not concluded within the 12-month extension in that the current agreement will then expire, but there is no statutory requirement to avoid that.  Even if s 56(3) could be termed a “restriction”, it is not one with which compliance is required.  It followed that the IMO which modified s 56(3) was beyond the powers granted by s 15 of the EPA.
(3)  In considering whether to grant relief, the Court noted the purported but invalid amendment of legislation engaged fundamental constitutional issues.  Where there is a purported exercise that goes beyond the power’s scope, the court’s role is to declare that to be so.  Whilst there will be impacts on some cases where the existing agreement remains in force  only because of the purported extension, it will not impact the terms and conditions of the individual worker and the duty to negotiate in good faith continues regardless of the status of the previous agreement. It was therefore appropriate to make the declaration. 

(4)  The Court otherwise dismissed the appellant’s arguments that the IMO was only intended to last for the three-month period of the initial epidemic notice, and that it was not open to the Minister to be satisfied compliance was impossible/impracticable.