New Zealand: Strikes And Pickets - The New Zealand Employer Perspective

Recent media reports in New Zealand of high profile industrial disputes - picket lines in the Mainland Stevedoring dispute, the MAF vets strike and others - would seem to indicate that New Zealand’s employment relations are heading back to the strike-torn days of the 1970s and early 1980s.

This is perhaps an exaggerated view, but last year’s Employment Relations Act (ERA) has sharpened employer and union views alike in this area.

Under the Act, union members covered by existing collective employment contracts can vote for their existing collective employment contract to expire on 1 July 2001. Not surprisingly, industry commentators have suggested that the union movement will be focusing considerable attention on this area, with a consequential increase in industrial activity.

What has already become apparent is just how industrial disputes like those mentioned above highlight the limits to good faith negotiations and mediation. Parties may resort to economic muscle or the courts to resolve issues in a situation where their respective positions are simply too far apart.

And yet the ERA expressly recognises that the duty of good faith does not preclude lawful strikes and lockouts. The Chief Judge of the Employment Court recently commented that minor defects in a union's notice of intention to strike could be remedied by the employer in good faith asking for clarification.

So what can you as an employer expect from a lawful strike or picket? And what can you do can do in the face of unlawful industrial action? Read on …

To be lawful, a strike either must relate to bargaining for a collective agreement, or occur where there are reasonable grounds for believing that the strike is justified for health or safety reasons. Strikes may not relate to personal grievances, disputes, or to the freedom of association provisions in the ERA.

Employees cannot lawfully strike where a collective employment contract or collective agreement is still in force. Further, at least 40 days must have passed since beginning the bargaining for a new collective agreement, to allow the parties a reasonable time to negotiate a new agreement.

Strict notice requirements are provided in relation to essential services and road and rail passenger services, although the Chief Judge has indicated in the MAF Vets case that technical arguments will not be looked upon favourably.

Picketing, like strike actions, can take many forms but will be lawful as long as it remains within certain limits (some imposed by criminal law). The general rights to freedom of expression and assembly provided by the NZ Bill of Rights tend to prevail where the picket has an "information" or protest focus.

However, these rights are subject to reasonable limits - and they don’t apply to breaches of the criminal law like disorderly behaviour, unlawful assembly, breaching the peace, intimidation, rioting or obstructing a road.

The essential test, subject to the over-arching provisions of the NZ Bill of Rights, is that picketing is lawful as long as it does not diminish the rights of others. This test may well not be satisfied where the picketing goes beyond peaceful protest, and results in actual disruption to an employer’s business.

Aside from calling in the police (if strikers or picketers are breaking the law), what else can an employer do in this situation?

Firstly, if your employees strike while under a collective agreement, you can seek an injunction or compliance order, and pursue any losses that are caused by the unlawful strike.

Employers can also use the breach as grounds for applying for penalty payments. These can be up to $5,000 for individuals and up to $10,000 for a union. And, if an unlawful strike is threatened, employers can seek an injunction from the Employment Court restraining the breach in advance.

Injunctions can work once again if a picket line goes beyond peaceful protesting, as long as the picket is related to a strike or a lockout. Again, the Employment Court has exclusive jurisdiction here.

Where an unlawful strike or picket interferes with an employer’s business, several different legal proceedings may be available. These include claims for:

• Conspiracy
• Inducement of breach of contract
• Intimidation
• Interference by unlawful means with trade.

The Employment Court will have jurisdiction if these claims relate to a strike or lockout. However, where there is no employment relationship - for example, one union picketing a business that does not employ any of its members - the claim will need to be brought in the High Court.

Successful employer may be able to recover compensation and exemplary damages against the employees’ and/or the unions’ actions. But proving actual loss is a major, practical difficulty in many of these situations.

Accordingly, smart employers who know of their employees’ plans beforehand will seek an injunction to restrain the unlawful action before it begins. The employer will simply have to show that there is an arguable case that unlawful action will occur, and that the balance of convenience favours the grant of the injunction.

Although the law on unlawful strikes is largely unchanged from the days of the Employment Contracts Act, the current environment makes it even more important for employers to understand their rights, particularly when good faith proves insufficient in the employment relations process.

It also pays to be informed about the range of remedies which may be available. This article has briefly discussed some of these, but if your business is heading for a strike or picket situation, you should contact your lawyer - without delay - for a fuller explanation of the measures outlined above. By acting today, you can save your business from the costs incurred through tomorrow’s unlawful strike or picket.