No matter the outcome of the pending election, it seems inevitable that there will be changes in the area of employment and workplace relations.
Here, we provide a snapshot of what can be expected from Labour and National, bearing in mind that in the current climate neither is likely to hold a clear majority, but whoever holds the balance of power will inevitably make changes to the status quo.
The Employment Relations Act 2000, brought in by the Labour government, reflects Labour's general policy in this area. Labour has been working hard to pass as much legislation as possible to give effect to its policies. Further to those recent changes noted above, the Employment Relations Amendment Bill (No. 3) has just been introduced to the House and deals with the following:
- In an attempt to provide stronger protection for casual and fixed term employees, the Bill extends the power of Labour Inspectors to determine the status of employment relationships where an employee's status comes into question.
- In doing so, the Bill requires the following factors be considered in determining the nature of an employment arrangement. These are:
- Whether the employment agreement purporting to be a fixed term agreement complies with section 66 of the Employment Relations Act 2000.
- Work patterns of the employee.
- Whether the employee only works when the work is available.
- Whether the employer uses a roster system to allocate work.
- Whether the employer has expectations that an employee will be available for work on request.
- Other relevant factors.
- The Employment Relations Authority will retain its ability to make such determinations and Labour Inspectors' decisions will be open to review by the Authority.
- The Bill also deals with 'triangular employment relationships'. This is where an employee's services are contracted out to a third party who effectively has control over that employee's work. The Bill attempts to strengthen the rights of these employees by doing the following:
- Allowing employees who are union members to have consistent terms and conditions with those contained in any collective agreement between the same union and the controlling third party when the employee is performing work for that controlling third party.
- An employee will be able to apply to the Authority or Employment Court to join the controlling third party as a party to a personal grievance action.
- The government has established a working group to review the introduction of compulsory redundancy compensation. This has only been mooted. No further action has been taken.
National's Employment and Workplace Relations policy
One of the most significant changes National proposes is in relation to the manner in which the dispute resolution process will take place. The proposal is for:
- Retention of the mediation service, ensuring it is resourced with properly qualified mediators.
- A requirement that the Employment Relations Authority act judicially in accordance with the principles of natural justice (including the right to be heard and the right to cross-examine).
- Injunctions and important questions of law to be heard in the first instance in the Employment Court (as opposed to the Employment Court having jurisdiction simply in relation to strikes and lockouts).
- Right to appeal to the Court of Appeal on matters of fact and law.
The result of these changes would see the Employment Relations Authority operating in a more adversarial manner, like the rest of the civil system, as opposed to the current inquisitorial system. Further, the proposal sees more involvement of the Employment Court and Court of Appeal. The current law in New Zealand provides for trial periods in a limited sense, but National proposes a 90 day trial period for organisations with less than 20 staff. This would mean that:
- If an employee and employer agree to the provision of a 90 day trial period at the outset of the relationship:
- Then an employee could not raise a personal grievance for an unjustified dismissal (or action) if dismissal occurs during the trial period. Access to mediation would still be available.
- The National Party has said that good faith provisions, the Holidays Act and Health and Safety in Employment provisions would still apply, as would the principles of natural justice and Human Rights legislation.
The other proposed changes are as follows:
Unions and collective bargaining
- Unions will be allowed continued access to workplaces with employer's consent, with restoration of worker's rights to bargain collectively without belonging to a union.
- Four weeks' entitlement to remain with the ability to request a trade of the fourth week for cash. Presumably employees will be prepared to trade the extra week's paid leave for working that week if they receive payment at a higher rate such as double payment for one week.
- A working group is to be appointed to review the Holidays Act, in particular around the definition of 'relevant daily pay' which has consistently brought complaint from employers because of the difficulty to calculate and reach a clear and unequivocal agreement on the amount to be paid.
National's stance on the KiwiSaver legislation is not completely clear. It is expected that further announcements will be made closer to the election. However, at this stage the National Party has said it will retain the legislation and support the government's contribution of $1,000 and grants to first-home buyers, but it may review the compulsory employer contributions.
Whilst it does not currently form part of the policy, National have alluded to an ACC scheme that is open to competition.