Labour's election Promises - A new tide in employment relations

During the election, the Labour party campaigned on the basis that, if elected, it would make a number of policy changes in New Zealand's employment law sphere once in government.

To read this article in New Zealand Construction News, click here

 Traditionally, employment relations have always been an area of difference between National and Labour so it comes as no surprise that this is going to be a major focus area for the new government.

These policies can affect the landscape for both employers and employee alike, so ordinary New Zealanders will need to understand how Labour's employment relations policies could impact them.

90 day trial period

Labour's policy will allow employees to challenge the decision to dismiss them during the trial period.  Labour also wants to create a new 'referee' service to hear claims of unjustified dismissal during trial periods.  The main difference offered by the new referee service is that lawyers will not be able to represent the employer or employee.

Minimum wage increase

Labour has promised to increase the minimum wage from $15.75 to $16.50 per hour within the first 100 days in office. $16.50 will then act as the base minimum wage for future increases. Over time, Labour wants to lift the minimum wage to two thirds of the average wage as economic conditions allow.

Living wage for state sector

Labour wants to pay all workers in the core public service at least the living wage ($20.20).  Over time, this would be extended to core public sector contractors. 

Abolish youth rates

Labour has promised to abolish the 'youth' wage rate. 

Paid parental leave

Labour will extend the parental leave payment to 26 weeks.  This is to be phased-in over 3 years – 22 weeks from 2018 and 26 weeks from 2020.  This will be 8 weeks longer than the current parental leave payment of 18 weeks.

Restore breaks at work

Labour wishes to restore the previous rest and meal breaks regime.

Restore reinstatement as the primary remedy when a worker is unjustifiably dismissed

Labour intends to restore reinstatement as the primary remedy when a worker is found to be unjustifiably dismissed. As the law currently stands, reinstatement is just one of the remedies, and the Authority can order reinstatement where it is practicable and reasonable to do so.

Improve redundancy protection for workers affected by restructuring

Labour has proposed to consult on improving the minimum redundancy protection for workers affected by redundancy, taking into account the recommendations of the Advisory Group on redundancy in 2008. 

Strengthening unions

A large number of Labour's policies, are aimed at strengthening unions. In particular, Labour has promised to:

  • restore the union's ability to initiate collective bargaining before employers
  • restore the duty on parties who are in collective bargaining to reach an agreement, unless there is a genuine reason not to
  • create a system of establishing “Fair Pay Agreements”.  This would serve as a mechanism for unions and businesses within an industry to negotiate and set standards for pay and other terms and conditions for all employers and employees within the industry
  • remove the ability for employers to deduct pay from workers taking strike action
  • restore the right for new workers to be employed on the same terms and conditions as provided by an existing collective agreement covering their workplace. This is intended to reverse a change made by the National government – so that new workers who perform work that is covered by a collective agreement must be offered the terms of the collective agreement
  • restore the former regime, which allowed union representatives to gain access to workplaces, without an express requirement to seek consent in advance
  • ensure elected union workplace representatives are given reasonable time within the workplace or work unit to carry out their representative role. If enacted, union delegates or employee representatives will presumably have certain entitlements, including paid time, to perform tasks associated with the role

Pay equity

Labour has promised to implement changes to the Equal Pay Act as recommended in the report from the Joint Working Group.

The Employment (Pay Equity and Equal Pay) Bill was introduced to Parliament prior to the election and following a report from the Joint Working Group. The Pay Equity Bill provides for a bargaining approach to deal with pay equity claims. 

Pay equity claims need to be raised with employers in the first instance.  The employer has obligations to notify other potentially eligible employees (30 days) and to respond with a decision about whether the claim is accepted to have merit (90 days).  If a claim was accepted as having 'merit', good faith bargaining would be required. 



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