Part 3: Role during apprenticeships and training

Inquiry into the Plumbers, Gasfitters, and Drainlayers Board.

In this Part, we look at the Board's role while people are in apprenticeships or training, or are working without full qualifications. Under the 1976 Act, the role had two main aspects:

  • issuing limited certificates for apprentices and others who were not fully qualified; and
  • overseeing the requirements for supervising the holders of limited certificates.

Under the 2006 Act, only those in training need limited certificates from the Board. Other unqualified people work under defined statutory exemptions.

Summary of our findings

Our main findings about how these functions worked under the 1976 Act were:

  • The policy statements and guidance developed by the Board on the supervision requirements were confusing and inconsistent.
  • The Board's responses were not always supported by their published policies. Responses were sometimes inconsistent about what information on the supervision arrangement was required with an application for a limited certificate, and about enforcement action when a person appeared to be working without proper supervision. Because of this inconsistency, some people perceived their treatment as vindictive.
  • There was some legal risk with the Board's actions, because:
    • it was relying on an implied power when cancelling limited certificates outside the statutory disciplinary process, rather than being able to point to an express statutory power and clear decision-making process; and
    • its communication with the affected person was not always clear on the process for refusing or cancelling a certificate, where the person was up to in that process, or on the person's procedural rights before final decisions were made. These were potentially natural justice failures.

In 2010, when we assessed the approach taken under the 2006 Act, we had slightly different concerns. The Board had carefully considered its approach to those in training and those working under exemptions when it consulted on and developed the registration and licensing categories under the 2006 Act and the New Zealand Gazette notices that put them into effect. It also developed a Licensing Policy Statement to sit alongside the Gazette notices and explain how the system would operate in practice. We saw these efforts to clearly communicate the new requirements as positive.

However, we were concerned that the relevant New Zealand Gazette notice – and the Licensing Policy Statement in particular – set out policies that we regarded as having some legal risk. Our main concerns related to the approach taken to people working under the exemptions in sections 19, 21, and 25 of the 2006 Act, but we also queried other more minor issues.

We discussed these concerns several times with the Board, which took our concerns seriously and engaged a lawyer to assist it. As we set out later in this Part, on some minor matters, the Board agreed to look further at the issues we had raised, but it disagreed with our view on the risks associated with its approach to sections 19, 21, and 25.

In our view, a regulatory authority of this kind should take a conservative approach to legal risk – especially to legal risks with its core operational activities that have a significant practical effect on those it regulates. When its actions are effectively stopping a person from working, and are a reasonably regular part of its work, we consider that the legal authority for those actions needs to be more than arguable. It should be clear. It is a problem if a regular part of an authority's regulatory work operates at the margins of its legal mandate. If the Board sees deficiencies in the legislation and its legal powers, it should take that up as a policy issue rather than attempt to find a way around the perceived deficiencies.

What we found in 2008/09

The limited certificate system under the 1976 Act

The legal requirements

The Board's main role under the 1976 Act, for people who were in training, was to administer the system for issuing them with limited certificates.

If a person was not registered as a plumber, gasfitter, or drainlayer, they could apply to the Registrar for a limited certificate to do plumbing, gasfitting, or drainlaying work. The application had to be countersigned by the registered or craftsman person who employed the applicant or supervised their work. If these requirements were met, the Registrar was required to issue the limited certificate.

The 1976 Act also set out the supervision requirements for the work of limited certificate holders. They were complex, but in summary they required:

  • someone on the "time served"6 path to work under the direct supervision and in the presence of a craftsman or registered plumber or gasfitter (as the case may be) for the first two years of their limited certificate; and
  • an apprentice, or someone on the "time served" path who had held a limited certificate continuously for two years, to be supervised or employed by a craftsman or registered plumber or gasfitter (as the case may be).

There were equivalent requirements for drainlayers, but they were simplified to take account of the fact that this trade did not have formal apprenticeships or craftsman status.

The Board had an internal manual of procedures that covered issuing limited certificates. The manual required staff to check that the application was countersigned by the registered person who would supervise the work of the applicant. If the applicant was an apprentice, staff had to also check that the applicant was enrolled with a training provider.

The internal manual explained the supervision requirements. The internal manual differed from the requirements of the 1976 Act and also contained very stringent practical supervision requirements for non-apprentices.

The Board's published policy

In March 1996, the Board published its policy determinations on the practical meaning of the words "direction" and "supervision". This guidance was explained in a document published on its website called Obligations of Registered and Non-registered persons under Plumbers, Gasfitters and Drainlayers Act 1976.

In essence, this document simply repeated the requirements of the legislation. It gave some guidance on the meaning of supervision, as follows:

  • Supervision requires the supervisor to make their own assessment of a particular job by attending the site, or giving appropriate instructions, and approving what the limited certificate holder proposes to do.
  • The supervisor is not required to be continuously present while the work is being carried out.
  • The supervisor must attend the job on a basis that is sufficient to satisfy the supervisor that all phases of the job, especially critical testing phases, have been correctly carried out.
  • On completion of the work, the supervisor must take responsibility for "sound trade practice" and compliance of the work.

The document did not explain whether there were any equivalent expectations under the alternative option that someone is employed rather than supervised. Nor did it explain what is meant by "direct supervision and in the presence of" the supervising person, although the Board's internal manual did set out an interpretation.

The policy statement was confusing. On the one hand, it said that a limited certificate holder was required to work in the presence of a registered person. On the other hand, the statement says that a supervisor did not have to be continuously present while work was carried out.

The Board's policy statement contradicted the requirements in its internal manual for limited certificate holders. The manual referred to the need for the supervisor to be in "line of sight or earshot", which was contrary to the policy statement that the supervisor did not have to be continuously present while the work was being carried out.

In our view, the Board's policies for the supervision of limited certificate holders were not clear and were unlikely to provide meaningful assistance to those in the industry. They did not add significantly to the requirements set out in the Act, and they were not consistent with the internal policy manual. Parts of the internal manual were also potentially inconsistent with the 1976 Act.

The Board later told us that the internal manual was a draft and was not the operational policy on supervision for limited certificate holders. However, the internal manual we received did not indicate in any way that it was a draft. Our comments in Part 2 on the Board's lack of effective operational policies when we began our work are relevant here.

What was happening in practice

We reviewed a sample of the registration files held by the Board to establish whether the confused nature of these policies had resulted in any unfairness to limited certificate holders or to applicants for a limited certificate. During our inquiry, we also spoke to a range of people about how the supervision requirements worked in practice.

Our review of the files and standard forms for limited certificate holders showed that applicants were required to record the name and registration number of the person supervising them. An apprentice applying for a limited certificate was required to state the name of their employer and the training agency providing the apprenticeship training.

The records we examined indicated that Board staff checked all relevant details before the Registrar approved applications. This process happened reasonably efficiently.

However, we saw some files where the approach taken was not consistent with usual practice. For example, in one file in early 2009, an apprentice plumber enrolled for a course in plumbing. The apprentice then applied to the Board for a limited certificate. The name of the craftsman plumber who was to supervise the plumbing work was provided as part of the application. The Board wrote to the craftsman plumber asking him to complete a statutory declaration that he would be supervising the apprentice when sanitary plumbing work was being carried out. The craftsman plumber was also asked to provide details of the supervision arrangements.

In our review of the registration files, we did not see any other records where the supervisor of an apprentice was asked to sign a statutory declaration confirming the supervision arrangements as well as being asked to provide a statement setting out the details of the arrangements.

The statutory declaration and a statement setting out the supervision arrangements were provided. There was a further letter from the Board, which stated that the supervisor had not described what was meant by "direct supervision". The letter said that until the Board received this information:

… and I [the Registrar] have satisfied myself that you will be working in accordance with section 38 of the Plumbers, Gasfitters and Drainlayers Act 1976, I will not be issuing your limited certificate. You have the right to appeal to the Board if you wish. The Board has the power to confirm or reverse my decision or direct that a limited certificate be issued when any conditions that it specifies have been met.

The apprentice believed that the supervisor had already provided the Board with enough details. The apprentice decided to act on the recommendation in the letter and sought an opportunity to appeal to the Board. The apprentice wished to appear before the Board. The next letter from the Board said that the Registrar had not declined the application, but was seeking further information. The letter requested an explanation from the supervisor about the supervision arrangements and a copy of the training agreement, and stated that the application could not be approved or declined until this was received.

A copy of the training agreement was provided. The Board then responded, saying that the certificate could not be granted because the supervising person was not the employer of the apprentice. The Board's interpretation of the 1976 Act was that either the apprentice had to be employed by the supervising person or the supervising person had to be employed full time by the firm where the apprentice worked. In this case, the supervising person was not employed full time by the company where the apprentice worked.

The apprentice was eventually granted a limited certificate, but it was revoked almost immediately when the person who had agreed to be the supervisor withdrew from this role.

In our review of the registration files, we did not see another example of the Board checking on the employment status of the supervising person.

In the case of non-apprentice limited certificate holders, the Board seemed to have a more relaxed approach to the supervision requirements. Two years ago, the Board was asked if someone in the first two years of a plumbing or gasfitting limited certificate could work as a self-employed contractor. The Board replied that:

The Board does not give advice to a limited certificate holder relating to the manner in which they choose to work. However the Board does have power to ensure that limited certificate holders work legally. In particular, in the first two years the limited certificate holder is required by law to work under supervision and in the presence of a registered person who is named as the limited certificate holder's supervisor. Whether or not the limited certificate holder works as a self-employed contractor or employee is not a matter under the Board's jurisdiction: i.e. the terms of his or her engagement with the supervisor.

The Board's position seemed to be that, in the case of an apprentice limited certificate holder, the terms of employment of the supervising person of the apprentice was a matter that it should be concerned about, and it had refused a limited certificate because it was not happy about these employment arrangements. But in the case of a non-apprentice limited certificate holder working in the first two years of the certificate, the Board had stated that the terms of the employment arrangements for the limited certificate holder were not under the Board's jurisdiction. It was difficult to reconcile the Board's position in these two files.

We also observed some serious inconsistencies in the way in which the Board acted to enforce the supervision requirements for limited certificate holders:

  • In one instance, the Board was aware that a plumber who had given up his apprenticeship before completing it was running his own business and was working without supervision. The Board was aware of this situation because complaints had been made to it. Despite the Board insisting on written explanations from the limited certificate holder, none were received and it took months for the craftsman plumber to send in the statutory declaration confirming that the supervision arrangements complied with the 1976 Act. The Board seemed reluctant to take more immediate action to ensure that the limited certificate holder complied with the 1976 Act.
  • In the same year, there was another instance involving a limited certificate holder (a gasfitter) who was running his own gas appliance retail business. In this case, the gasfitter held a limited certificate and had a craftsman gasfitter to supervise his work. The craftsman gasfitter lived several hours away. The supervisor would visit to inspect the work completed by the limited certificate holder. The Board was informed of this situation and immediately rang the limited certificate holder and the supervising craftsman for details of the supervisory arrangements. The Board took the view that these supervision arrangements did not comply with legislative requirements, because the limited certificate holder was not working in the presence of the supervisor, and cancelled the limited certificate. Both the limited certificate holder and the supervisor made written submissions explaining the supervision arrangements, but the limited certificate was not reinstated.

The prompt way in which action was taken against the second person was in direct contrast with the first case, where the Board took some time to act after the limited certificate had lapsed. In the earlier case, the Board also did not insist that the limited certificate holder had to work in the presence of the supervisor. We have not formed a view on which approach was the more appropriate; our primary concern is with the inconsistency.

We also note that there was some legal risk involved in the second situation, as there is no clear statutory power to cancel a limited certificate outside the formal disciplinary process. However, the Board's legal advice is that it has an implied power to take such actions to support the public safety purpose of the legislation. In such situations, it is also important that the Board explains the process to the affected person carefully and clearly to safeguard their procedural rights.

We talked to several non-apprentice limited certificate holders who said that they had never been supervised and knew of other non-apprentice limited certificate holders who also received no supervision. We also talked to many more senior people in the trade who thought that there was widespread flouting of the supervision rules, particularly in larger urban centres. It was suggested to us that many junior employees "were given a van and a phone" within a few weeks of starting work and sent out on their own.

In this general context of a widespread perception of a relatively relaxed approach to these requirements, the firm treatment of individual cases such as those we have noted stood out as anomalous. The former Registrar and the Board told us that they acted when cases came to their attention, but could not control practice or enforce requirements where they were unaware of problems. However, many of the people we talked to clearly felt that they had been singled out for no apparent reason. Without any other explanation, they tended to assume that the decisions were motivated by bad faith or personal relationships.

Recent changes

New systems introduced by the 2006 Act


For people in training, the 2006 Act takes a similar approach to the 1976 Act. Trainees are exempted from the prohibition on unregistered people doing plumbing, gasfitting, and drainlaying, provided they carry out their work in keeping with a limited certificate issued by the Board. Trainees are defined as people who are undergoing instruction or training in plumbing, gasfitting, or drainlaying work for the purpose of registration, and includes apprentices. Under the 2006 Act, the Board may issue trainees a limited certificate, subject to such terms and conditions as it thinks fit. It also has the power to amend any condition on the certificate, and to either cancel a limited certificate or refuse to renew it.

The Board has made clear policy decisions under the 2006 Act about the types of training that it will recognise for the purpose of registration. It is clear who can apply for a limited certificate as a trainee. The powers of the Board to impose conditions on those certificates, and to take action to enforce them, are clear in the legislation.


The 2006 Act also provides for a number of exemptions from the prohibition on unregistered people doing plumbing, gasfitting, or drainlaying. There are two broad kinds of exemptions:

  • Some exemptions exist by virtue of a set of facts being present (exemptions in sections 19, 21, and 25).
  • Some exemptions require the person to satisfy the Board that they are competent to carry out the exempted work (exemptions in sections 18, 20, and 24) and to have an exemption formally granted.

There are different legislative provisions for each of these different exemptions. Some of the provisions enable the Board to impose terms and conditions on the exemptions, including time limits, but others do not.

The exemptions that exist as a matter of fact under the 2006 Act are:

  • section 19 – an unregistered person can do plumbing work under the supervision of a certifying plumber holding a current licence or the holder of an exemption under section 18;
  • section 21 – an unregistered person can do gasfitting work under the supervision of a certifying gasfitter holding a current licence or the holder of an exemption under section 20; and
  • section 25 – an unregistered person can do drainlaying work under the supervision of a certifying drainlayer holding a current licence.

People who previously worked as non-apprentice limited certificate holders will now work under these exemptions. These exemptions also apply to any person, whether working casually or on a personal and domestic basis, so long as they are working under proper supervision.

The exemptions that must be applied for and approved are:

  • section 18 – the Board can approve an exemption for an unregistered person to install and maintain particular plumbing equipment;
  • section 20 – the Board can authorise an unregistered person to carry out or supervise particular gasfitting; and
  • section 24 – the Board can authorise gasfitters to fix water heaters.

Supervision requirements

As we discussed above, the supervision requirements under the 1976 Act were complex. The 2006 Act simplifies matters significantly by directly defining supervision. Supervision is defined as meaning that:

… the work is undertaken under the control and direction of a person authorised under this Act to do the work or, in the case of sections 19, 21, 22, and 25, a person authorised to supervise work under those sections as is sufficient to ensure–

(a) that the work is performed competently; and

(b) that while the work is being undertaken, appropriate safety measures are adopted; and

(c) that the completed work complies with the requirements of–

  1. regulations; and
  2. in the case of sanitary plumbing or drainlaying, regulations under the Building Act 2004; and
  3. in the case of gasfitting, regulations under the Gas Act 1992.

The Board has set different supervision requirements, as a matter of policy, depending on the level of experience:

  • A trainee in the first year is required to work in the presence of the certifying plumber, gasfitter, or drainlayer, or a registered person who is supervised by that certifying person. After one year of work experience, the trainee must simply be supervised.
  • A person working under the exemptions in sections 19, 21, or 25 must work in the presence of the certifier or another licensed person who is supervised by the same certifier, for the first two years. After two years, the general supervision requirements apply.
  • A registered person must be supervised but does not have to work in the presence of the certifying person.

These policies are put into practice by imposing conditions on the relevant licences or certificates. The primary obligation is on the certifying person, and their licence requires them to meet these various supervision obligations.

Issues that still need attention

We reviewed the parts of the Licensing Policy Statement issued by the Board in March 2010 that deal with exemptions and limited certificates. We also reviewed the licensing and registration New Zealand Gazette notices issued for each trade and the Gazette notice that set out the fees payable to the Board. We identified a number of concerns with the parts of the Licensing Policy Statement relating to exemptions and limited certificates. Many of these were about whether there was a clear legal basis for the Board's stated policy.

People working under sections 19, 21, and 25

Our main concern related to the way in which the Board appeared to be thinking about people working under the exemptions in section 19, 21, and 25. As noted, under the 2006 Act, these exemptions exist as a matter of fact and the Board does not have any direct power to regulate people working under these exemptions.

Although these provisions cover people whom the Board used to regulate as non-apprentice limited certificate holders, the coverage is potentially wider than this group. For example, this exemption could cover workers or property owners assisting a qualified person. However, the Board's approach to this exemption appears to have concentrated on the group that it used to regulate.

The Board's consultation documents on the implementation of the 2006 Act show early recognition that the 2006 Act does not cater for non-apprentice limited certificate holders and that the Board can no longer directly regulate this group of workers. The focus of the discussion was on how to continue to control the way in which this group worked. The Board's legal advice was that it would need to focus on the certifying person and impose conditions on the way in which they supervised these people's work.

On this basis, the relevant New Zealand Gazette notices require the supervisor, as a condition of the supervisor's licence, to:

  • submit to the Board the name, address, and telephone number of every person who intends to work under these exemptions, before the person does any work;
  • submit this information annually on or before 1 April each year (the licensing renewal date);
  • pay an additional fee for each notified person, each year;
  • supervise notified people in keeping with the Board's requirements (that is, in the presence of the supervisor or another registered person for the first two years, then generally); and
  • require the exempt person to carry an identification card issued by the Board and produce it on demand.

We accept that the Board is able to put conditions on the supervising person to ensure that the work they are responsible for is safe. However, there must be limits to the Board's ability to control the work and activity of a third party through such conditions. For example, we question whether the capacity extends to imposing a condition on the supervisor that requires a third party (the exempt person) to carry an identification card. We also question whether it is practicable to require any person who might help a certified person under these exemptions to be notified to the Board before doing any work, or for that notification to be annual.

It is unclear how either of these requirements would apply to casual workers or property owners helping a qualified person with a particular job. They appear to have been developed with only a particular group of workers in mind – those who work in the industry and whom the Board used to regulate through limited certificates. In our view, there is a risk that, by imposing such controls through the supervision requirements, the New Zealand Gazette notice may narrow the scope of the exemption too much.

Our concerns are strengthened by the Licensing Policy Statement, in which the Board explains its regulatory approach. That document includes a number of statements that suggest that the Board is in effect attempting to regulate people working under these exemptions. For example, it states that "In practice, exempt persons are governed by the Registrar under delegated authority from the Board", and that "to ensure the competence of exempt persons, the Board needs to know which persons are working under an exemption and have some means of regulating them".

We discussed these concerns with the Board and the Department of Building and Housing. The Board provided us with its legal advice, which confirmed that it was not regulating the exempt person, but was regulating the certifying person who supervised the exempt person. It had done this by imposing conditions on the licences of certifiers who supervised such exempt people. It maintained that these conditions were necessary if the Board was to give adequate effect to the public safety purposes of the Act.

We recognise that the Act is unhelpfully written and sends conflicting messages. Although it sets out exemptions that exist as a matter of fact and need no application or approval, it also in section 26 appears to give a power to cancel all kinds of exemptions, including those available under these provisions. The Board reasons that, if it has the power to cancel the application of an exemption to a particular person, it should know who is working under such exemptions. As noted, we also accept that the Board has some capacity to control the work done under these exemptions through conditions on the person supervising the work.

Overall, however, we remain concerned that it appears as if the Board is purporting to still regulate a group of workers directly, when the 2006 Act took away that capacity. The Board may regard this as a deficiency in the Act, and consider that it is necessary in the interests of public safety to continue to control the work of this group. We caution it against taking this approach too far. If there is a gap in the Act, as opposed to a deliberate change in approach, then it should work with the Department of Building and Housing to address that gap directly by amending the legislation. From our research into the background to the Act, we have been unable to establish conclusively whether this was a deliberate change or an accidental omission.

It may be possible to go some distance towards addressing the issue by focusing on the responsible supervisor, but the Board needs to carefully consider the limits of this approach. It needs to keep any conditions and fees for people working under sections 19, 21, and 25 squarely related to the certifying person who is supervising such people and that certifying person's licence. It also needs to ensure that all of its communication explains the requirements in these terms. At present, the way the Licensing Policy Statement is drafted makes it look as if the Board is directly regulating exempt people working under sections 19, 21, and 25. The Board told us that it appreciates that it cannot directly regulate such people and that it will review the relevant sections of the Licensing Policy Statement.

Other issues with the Board's policy on exemptions

We identified several other detailed issues, which the Board has accepted require further work.

The Licensing Policy Statement states that, if a trainee plumber, gasfitter, or drainlayer who holds a limited certificate ceases instruction or training, their limited certificate is automatically revoked. It is not clear to us that the Board has the power to deem a limited certificate to be automatically revoked in such circumstances. We note that it does have the power to cancel a limited certificate. However, this requires a positive act by the Board and needs to be accompanied by some kind of process to ensure that natural justice requirements are met before action is taken. We raised this issue with the Board, and it told us that it will consider the issue further.

The Licensing Policy Statement sets out that people holding exemptions under section 18 (exemption for an unregistered person to install and maintain particular plumbing equipment) are subject to terms and conditions that the Board has set. There does not appear to be any power in the 2006 Act for the Board to apply such terms and conditions. The Licensing Policy Statement also sets out that such an exemption lasts for only one year, but the 2006 Act does not explicitly set any time limit on exemptions under section 18. The Board told us that it is carrying out work on this issue.

The Licensing Policy Statement sets out that exemptions under section 24 (Board-granted exemption to allow a gasfitter to fix water heaters) are for only one year, but section 24 does not set any time limit on such exemptions. It may be that the Board has a legal basis for imposing such a requirement, but this is not explained in the Licensing Policy Statement.

The Board has the power to grant exemptions under section 24 if the Board is satisfied by examination or otherwise that the gasfitter is competent to fix water heaters. The Licensing Policy Statement does not contain any information about how the Board will assess competence before granting an exemption, nor on whether competence will be reassessed from time to time. The policy statement on section 24 is not yet developed enough to explain to people what they need to do to qualify for this exemption.

We note that the Board has not issued any guidance in its Licensing Policy Statement about how it interprets the definition of supervision contained in the 2006 Act. Because the Board has the power to take disciplinary action or to refuse to renew a licence where there was no supervision, or where supervision did not meet the requirements of the 2006 Act, it would be helpful for the Board to advise plumbers, gasfitters, and drainlayers what it considers "supervision" means in practice. The Board told us that it has added this to its work programme.

Overall comment

Overall, we are satisfied that the type of inconsistency that we identified under the 1976 Act is unlikely to recur. The Board has worked hard to prepare clear policies alongside the legal requirements it has been putting in place. It has also consulted on those policies and published them on its website. The 2006 Act also generally gives it a much clearer basis for its actions and resolves some of our previous legal concerns.

The Board needs to develop its policies further because there are some matters that are not yet covered. As we have noted, it has accepted the need for further work on a range of matters that we raised with it during the inquiry.

We still have concerns about the Board's approach to its legal mandate and its readiness to rely on the purpose of the 2006 Act as a basis for a broad interpretation of its regulatory authority. We note that the principles in the Act are wider than public safety and also include not unnecessarily restricting registration and licensing, and not imposing undue costs on those being regulated. We have already commented that, in our view, it is preferable for a regulatory authority to take a reasonably conservative approach to legal issues of this kind.

Recommendation 1
We recommend that the Plumbers, Gasfitters, and Drainlayers Board review its Licensing Policy Statement to ensure that it complies with the Plumbers, Gasfitters, and Drainlayers Act 2006 and administrative law principles.
Recommendation 2
We recommend that the Plumbers, Gasfitters, and Drainlayers Board discuss with the Department of Building and Housing whether mechanisms under the Plumbers, Gasfitters, and Drainlayers Act 2006 are clear and appropriate for controlling the work of exempt people carrying out plumbing, gasfitting, or drainlaying work.
Recommendation 3
We recommend that the Plumbers, Gasfitters, and Drainlayers Board revise its Licensing Policy Statement to include a discussion of how it defines "supervision".

6: Rather than completing an apprenticeship, under certain circumstances people could become registered as a plumber, gasfitter, or drainlayer after working in the industry under certain conditions and for a certain amount of time. This was called the "time served" path.

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