90 day trials – Don’t come Monday

Written By: - Date published: 8:36 am, December 18th, 2023 - 65 comments
Categories: act, national, nz first, same old national, Unions, workers' rights - Tags:

This coming week, under urgency and leading into Xmas, the Coalition government will expand 90-day trials to all workers, in yet another payback to National/ACT/NZ First’s (NAF) business backers. Being able to sack people without rights will encourage employers to “take more risk on someone who doesn’t tick all the boxes” (according to Brooke Van Velden, (ACT) Minister for Workplace Relations).

Heard that a thousand times. Research has shown that 90-day grievance free periods do NOT add to employment, nor bring in workers who employers might give a “chance” to, out of the generosity of their hearts.

This mythology has been around for more than a decade.  Wayne Mapp, National MP way back when, introduced a Members’ Bill when Labour was in government under Helen Clark, Kate Wilkinson, then National’s Minister of Labour drove them through when National came into power and Paula Bennett pushed it on jobseeker beneficiaries. Labour softened it to employers with fewer than 19 workers.  (They should have repealed it completely, but Winston stood in the way with his curmudgeonly handbrake).

NAF and employers talk about “costly grievance procedures”.  Well, they created this.

The deregulation of the Labour Market in the early 1990’s, thanks to Bill Birch and co squashed unions and opened up personal grievances to all comers.  It invited a proliferation of “bargaining agents” or “employment advocates”.

But they forgot any regulation or standards for bargaining agents such as those who advertise “no win” “no fee” services. Many are predators – ambulance chasers – making money from both employers and workers. They tie up our Employment Relations judicial system. Just read some of the judgements. They are cowboys in a Wild West of profit-making at the expense of everyone else.

In our deregulated system, I accept we need advocates.  But I don’t accept they should continue to operate without regulation in a free for all.

Reducing workers’ rights because employers may face “costly grievance procedures” is a rubbish argument. The irony doesn’t escape me that while NAF just repealed Fair Pay Agreements, which were about negotiated standards across industry, they are happy to impose a standard on the whole of the country’s workers without negotiation or select committee processes.

According to the bosses, workers should just be grateful someone else “gives” them a job. If you happen to be pushed to get off Jobseekers Benefit, hard luck. You will be doubly punished if you get fired and the sanctions that will follow.

So employers can say “don’t come Monday”  – no excuses, no exceptions.

PS : join your union.

65 comments on “90 day trials – Don’t come Monday ”

  1. lprent 1

    Good post. Personally I don't accept contracts with 90 day provisions in them. To me that just speaks to incompetent management who are to lazy to do due diligence. I just turn down the contracts at that point. It speaks to me of managers who simply aren't competent to run the kinds of projects I get employed to work on.

    It really isn't any different for any employee. In a lot of ways the main benefit of the 90 day rules is that it defines the kinds of employers you definitely do not want to work for. If they are incompetent enough to require this crutch, then they are probably running their business into the ground as well.

    I liked the point about the National's and in particular Nicola Willis'es complete and arbitrary lack of any consultation about removing the fair pay legislation. It sounds like National only consulted or asked advice from employer organisations.

    Next time Labour gets in, the legislation should be to put it back in exactly the same manner – in the first 100 days. Also that all contracts done will need to be renegotiated within a limited time frame. That should give the legislation time to bed in.

    • Gosman 1.1

      Nicola Willis wouldn't be consulting on the removal of FPA's regardless. She is not the Minister in charge of the repeal of the legislation around this. I think you are meaning Brooke van Velden.

  2. dv 2

    90 DAY apply to politicians as well !!!!

    • Gosman 2.1

      Explain how a 90 day trial would apply to Politicians. Would this only apply to newly elected MP's for their first 90-days? What mechanism would be in place to enable the voting public to fire a sitting MP?

      • dv 2.1.1

        Not my problem, I don't pass the laws.

        • Gosman 2.1.1.1

          You are wanting a particular law to apply to Politicians so you should have some idea about what it is you want to happen. Perhaps you should use your brain a little more before making comments like this.

          • dv 2.1.1.1.1

            Gosman commenting about brains wow1

          • Ghostwhowalks 2.1.1.1.2

            Here goes . As is well known many Mps are appalling mangers of their employees – who work for Parliamentary Services.

            Lest put the Mps on 90 day trails with their staff having the power to walk away and arent replaced by PS …for say another 6 months

            Having to do the work themselves would be a delicious payback learnings

            • dv 2.1.1.1.2.1

              yes​​​​​​​yes​​​​​​​​​​​​​​yes​​​​​​​​​​​​​​yes​​​​​​​​​​​​​​yes​​​​​​​​​​​​​​yes​​​​​​​​​​​​​​yes​​​​​​​​​​​​​​yes​​​​​​​​​​​​​​yes​​​​​​​​​​​​​​yes​​​​​​​​​​​​​​

            • roblogic 2.1.1.1.2.2

              90 days after Luxon forms the weird NAF coalition, can we get a quick referendum and an option to re-do the stuff-ups of 2023?

          • theotherpat 2.1.1.1.3

            if you cannot properly infer what he means it is YOUR brain that is the issue.

      • Tricledrown 2.1.2

        What do you mean sitting politicians they only get 3 yrs each election they have to reapply for the job.

        • roblogic 2.1.2.1

          yeah but they are employees of the NZ public and we ought to be able to turf them out after 90 days of being useless

  3. Mike the Lefty 3

    National has no proof of a "general call" to repeal this legislation. All Contracts already have clauses that allow employers to dismiss useless or hopelessly inadequate employees. Good employers try their best to make things work. The bad ones don't, and this act is purely ideological and designed to make the a…holes happy.

  4. Nat/Act don't really try to hide their contempt for the working class, and they could not win elections on policy or leadership or the character of their candidates– that's why they use hate and fear so much.

    Not really seeing any sign of how NAF plan to lift living standards and make NZ competitive with Australia– I heard someone roll out the old trickle-down theory of "a rising tide lifts all boats" but that's not gonna fly as we stare down the barrel of a deep recession next year, made worse by cuts and austerity– the exact opposite of what any sane economist would recommend

  5. Gosman 5

    The trouble is if the criticism that is stated about 90-Day trials is correct then it applies to ALL 90-day trials. The presvious government thought that 90-Day trials were okay for SME's. Would anyone care to explain that logic if they are so bad?

    • roblogic 5.1

      So you concede that 90 day trials are a shit idea? Because you don't seem to be making any effort to defend them

      • Gosman 5.1.1

        I concede nothing of the sort. I presume the previous government thought 90-day trials provide some benefit hence why they allowed them to be used in certain circumstances. What was that benefit do you know?

        • Ghostwhowalks 5.1.1.1

          Because they have done away with the safeguards

          A valid trial period:

          • must be agreed to in the employment agreement before the employee starts work, or the trial period is invalid
          • must have a valid notice period in the employment contract
          • can be used in any industry and for any job
          • must be agreed by the employer and employee in good faith – an employee can’t be forced into being employed on a trial period. For example, Jennifer’s boss, Omesh tells her that she has the job on Monday, she starts work on Tuesday and she signs her employment agreement on Wednesday. Jennifer’s employment agreement has a trial period for 60 days, but this is invalid because Jennifer didn’t sign the agreement before she started work. Omesh can’t dismiss Jennifer under the trial provision and if he did, she could bring a personal grievance for unjustified dismissal. If Omesh wanted a trial period for Jennifer, he should have made sure that she agreed to it, had a chance to get advice and raise any issues, and signed her employment agreement before she started work.
          • means that the employee can’t bring a personal grievance for unjustified dismissal or other legal proceeding about their dismissal (as long as the employer has given the right amount of notice to the employee)
          • must be in the employment agreement and must state that:
            • from the very start of their employment, the employee will be on a trial for a set period which isn’t more than 90 days (but can be less). The exact time period must be stated, for example, it could be 30 days, or 90 days, or another stated time period; and
            • during the trial, the employer can dismiss the employee, and
            • the employee can’t bring a personal grievance or other legal proceedings about their dismissal.

          Small employers can often not have the resources to handle full background checks and need people 'right away'

          • UncookedSelachimorpha 5.1.1.1.1

            To be fair, that actually illustrates just how out of touch with reality Labour were – no clue about the imbalance of power in many employer / employment relationships.

            must be agreed by the employer and employee in good faith – an employee can’t be forced into being employed on a trial period.

            Which is complete crap – they can be forced. Sign this – or no job. Seen it lots of times, with all kinds of conditions. The only 'safeguard' is the employer can't impose it after the contract is signed – which misses most of the problem.

            Labour lived in the fantasy land of all employers being benevolent and fair, so no need to force them to be. NAct on the other hand are quite open about their desired predator / prey employment model. Both approaches have similar bad outcomes for workers.

        • roblogic 5.1.1.2

          I think it's more important to call out present day government malfeasance than follow you down a rabbit hole.

          • Ghostwhowalks 5.1.1.2.1

            The new government claims the trails are required because they say are needed to benefit mostly small businesses

            They deliberately obscure that under 20 employees- our definition of small- are already allowed and its large business who will get the upper hand

            Small Businesses are 28% of all employees and 25% of GDP ( according to MBIE). For some reason I hear all the time small businesses are 60-70% of all employees. Its a myth

            • Ghostwhowalks 5.1.1.2.1.1

              My mistake . I was going on the Employment NZ which pointed to small employers only

              The current Act says small AND medium employers – which is up to 99 staff

              "This section applies if a small-to-medium-sized employer terminates an employment agreement containing a trial provision under section 67A by giving the employee notice of the termination before the end of the trial period, whether the termination takes effect before, at, or after the end of the trial period."

          • Tipa 5.1.1.2.2

            Here is a short explanation of why Labour kept limited 90 day trials

            https://i.stuff.co.nz/business/industries/100868759/90day-trials-to-be-severely-restricted

            • Ad 5.1.1.2.2.1

              It was a terrible decision by Ardern. She should have fought harder for them.

              • Ghostwhowalks

                Harder ? So it was better for NZF to go with National over that and other dead rats. It was a reasonable compromise

        • KJT 5.1.1.3

          The "benefit" was preventing a lot of employers screaming about being hard done by.

          Noting that the employers I've seen using 90 day trials, were abusing them.

          • Gosman 5.1.1.3.1

            Please give examples of Employers abusing the 90 day trial rules?

            • lprent 5.1.1.3.1.1

              Just one example. Had a friend who was employed as a PA/gofer in a finance company to replace a PA who quit. Rumour was because the employer was a bit of an arsehole manager. Employment agency paid back the commission. My friend got terminated 10 days before the 90 days and commission paid back.

              The same employment agency knows of at least 3 other people from them and other agencies with pretty much the same pattern with the same manager.

              Clearly that employer was just using the agencies to cycle her PAs for her rather than using her time to do due diligence selecting amongst candidates.

              A number of agencies stopped sending people for that company when the 90 day trial was last in force.

              Incidentally, when you start waffling about hearsay, then I'd point out that the 90 day trial that National put in was effectively a gag order because it was effectively fire-at-arbitrary-will. It didn't require a feedback about reason. Didn't require a written notice. Didn't provide grounds to take it to any kind of arbitration. Most of all it didn't provide any feedback to the arseholes who misused it.

              It was specifically designed to not provide a paper trail that could be researched. Which was why there isn't much apart from hearsay to say what positive effects it actually had.

              BTW: my friend left a moderately well-paid and secure job to take up that PA position because she wanted to get into something with more pay an more prospects.

              Because of the 90 day trial firing being on her CV, it took more than 2 months to get another interview and about 4 months to find another full-time job. She couldn't even tell agencies or prospective employers why she was fired – because she didn't know. That casual decision by an arsehole manager moved her from employable to being too big a risk to interview.

            • UncookedSelachimorpha 5.1.1.3.1.2

              I personally know of multiple young people who were let go at exactly 90 days – often being told there was nothing at all wrong with their work, but company policy not to go past 90 days. New hires in exact same job, next day.

              • Gosman

                And the benefit for the business for doing this is what exactly? They still have to pay the same amount and the people they employ will need to be trained up so any new person is going to be less productive than existing staff. That is why I call BS on this.

                • KJT

                  Just a few of many.

                  A relative employed for milking. Sacked on day 89 as the farmer only wanted a short term employee. He left a permanent job for the farm job who, as it turned out, only wanted someone for a few months

                  The local fast food chain. in Keys time. More than a few young people I knew, including one of my children who had just finished school, by the way. Was getting longer term unemployed complete with the wage subsidy. Then when the wage subsidy was nearing it's end pull either the 90 days, cut the workers hours until they had to leave or otherwise get them to go. Rinse and repeat.

                  Another sacked the minute they joined ETU. Of course 90 days allows employers to sack people for insisting on fair contracts or joining a Union without giving that as the reason.

                • UncookedSelachimorpha

                  I'm not saying those businesses are being smart. The benefit these stupid employers think they have, is zero commitment to those workers and an ability to fire at will with no notice.

                  Jobs I have direct knowledge of were all in hospitality, with low training requirements.

                  Not BS at all.

            • Craig H 5.1.1.3.1.3

              Had a family member whose 90 day trial as a farm worker was invoked and their service tenancy also terminated by end of week as the house was required for the replacement worker.

              Not only did they lose their job with limited notice, but they also had to move out at very short notice.

    • Ghostwhowalks 5.2

      Not SME Gosman .
      Small business only ( under 20 employees which is the 'small' cutoff point)

      Also the retention of under 90 days for small businesses was a NZF requirement back in 2017 coalition

    • Ad 5.3

      Yes they should apply to all businesses.

      Labour were wrong. About 80% of businesses employ 20 people or less so it was a massive carveout.

    • lprent 5.4

      The presvious government thought that 90-Day trials were okay for SME's. Would anyone care to explain that logic if they are so bad?

      Not the previous government. It was the one before that from 2017 to 2020 which was a coalition with a illogical NZ First handbrake in it.

      NZ First thought that 90 day trials for small businesses of less than 20 people (nothing medium* in that) was a good idea. The logic was that NZ First wouldn't vote for for getting rid of 90 day trials for the majority of workers

      Which was a completely insane idea characteristic of NZ First. Imagine the court case where an employee on a 90-day trial that was in their contract when the company was 18 people, and got fired on 90 day when the company was 20 employees. That court case would be fun.

      * MBIE: New Zealand is a nation of small and micro business – including self-employed. Defined as those with fewer than 20 employees, there are approximately 546,000 small businesses in New Zealand representing 97% of all firms. They account for 29.3% of employment and contribute over a quarter of New Zealand’s gross domestic product (GDP).

      Small companies may do 30% of GDP, but very very few would ever affect GNP.

      • Ghostwhowalks 5.4.1

        It was only 'small' companies, not small and medium (20-99). So the employee limit was 19 or less.

        The number was set at the day the contract was signed so would apply even though there might be say 23 shortly after.

    • Craig H 5.5

      Originally because NZ First said so. I think Labour should have repealed it entirely in the last term, but they considered that they had more important things to deal with like Covid, health system reform etc.

  6. AB 6

    If there are 90-day trials for employees because employers want to reduce their risk, then there must be reciprocal 90-day trials for employers, so employees can also reduce their risk.

    What employee wants a stain on their CV due to 90-day termination that has to be painfully explained in the next job interview because of a bad employer? What employee wants to walk go onto a job where the actual tasks do not match the job description or the employer turns out to be bullying or abusive – and their only option is outright resignation – which again has to be shown on a CV and explained?

    It would take a bit of thought to work out how such a reciprocal right for employees would work – perhaps monetary compensation of some sort. But the principle remains – that unreciprocated rights over other people tend to be bad social policy. There usually needs to be a solid epistemic justification (based on superior technical knowledge of one party) for such asymmetry.

    The sane alternative seems to be to forget the whole stupid idea.

    • Belladonna 6.1

      You don't need a 90 day trial for employers. An employee can resign at any time (usually with one pay period notice) – inside or outside the 90 day period.

      Unless you are a highly-critical worker – and have a restraint of trade clause in your contract – your previous employer has no control over when you choose to go, and who you choose to work for.

      A simple explanation that the employment at X company turned out to be entirely different to the job I applied and interviewed for – is unlikely to be considered to be a down-check in your next job interview (unless you have a string of problem cases in your employment history).

      Leaving during the 90 day period would be just as 'problematic' (or not) as resigning during the same period – so far as your next job application is concerned.

      • lprent 6.1.1

        An employee can resign at any time (usually with one pay period notice) …

        Ah no. What is in the employee contracts apply.

        Most of my employment contracts have notice periods ranging from 4 weeks to 8 weeks. They are also explicit that taking holiday time during the notice periods is at the discretion of the employer.

        Also I usually get paid weekly or fortnightly because computers and banking transfers make that simple these days. But my notice periods are completely unrelated to pay periods.

        If you go and have a look at restraint of trade clauses in employment contracts you will find them being used to stop fast food workers changing employers, rest home employees in whole urban areas and truckers over the North Island, and even across the whole world.
        https://www.thepost.co.nz/business/350129515/low-paid-workers-are-being-restrained-changing-jobs-parliament-told

        CLCA said some employers in Hawke’s Bay included a 50km geographical restraint so that people could not work in Napier, Hastings or Central Hawkes Bay.

        “Truck companies have tried to apply a North Island wide restraint of trade clause, arguing that the runs may take the driver anywhere in the North Island and therefore the geographical restraint is reasonable.” CLCA said.

        and

        The Dairy Workers Union Te Runanga Wai U, which represents nearly 8500 workers, said restraint of trade clauses were often unreasonable.

        One banned dairy workers from joining a competitor anywhere either in New Zealand or overseas for a year after leaving their job.

        CLCA said many restraint of trade clauses were legally unenforceable, but workers did not know that.

        I'd suggest that your ideas about what employers can do with employment contracts are completely out of date and are unrelated to the real world.

        • Belladonna 6.1.1.1

          Yeah. I guess that I'm mostly dealing with minimum-wage workers (supermarket workers, warehouse employees, retail workers, etc.). Who have very minimal requirements in their contracts. The notice period is usually one pay period (fortnight).

          I've never heard of a Countdown worker having restraint of trade applied to prevent them working for the New World down the road.

          I suggest that the kind of contracts you're negotiating and accepting as a highly paid IT professional are well outside the norm.

  7. Ghostwhowalks 7

    RNZ

    "Research from Motu in 2016, commissioned by Treasury, found "no evidence that the ability to use trial periods significantly increases firms' overall hiring", and "no evidence that the policy increased the probability that a new hire by a firm was a disadvantaged jobseeker".

    Treasury Research based on the earlier Nationals Governments Trial periods

    THE EFFECT OF TRIAL PERIODS IN EMPLOYMENT ON FIRM HIRING BEHAVIOUR

    https://s3.documentcloud.org/documents/2863379/MotuExecSummary.pdf

    • UncookedSelachimorpha 7.1

      Yep, doing things based on evidence, isn't this clown government's strong suit….

  8. Darien Fenton 8

    It's an appealing idea to put MPs on 90 day trials, (though impossible in our election system) because effectively they are on a fixed term contract. The other call I often hear is put MPs on minimum wage. These calls while well intended overlook that 90 day trial periods without due process are a shocking idea for anyone; and the minimum wage is. not enough for most to live on – disregarding the fact that many MPs have private means. So if we want rich politicians in parliament, this would be the way to do it. We should be calling for better standards that apply for everyone, CEOs, politicians, businesses etc ; Bad ideas are bad ideas and 90 day trials are one of them.

    • Belladonna 8.1

      I don't agree with the minimum wage. But there is a strong argument for the 'average' wage for MPs. Within living memory, MPs were paid much the same as teachers.

    • James Thrace 8.2

      I think new MP's that sit on the backbenches should only be paid the average wage of around $55k for their first year, with CPI increases each year of their first term. If they get back in again in the second term, then they get usual backbench salary of $160k, assuming they get more responsibility.

      Exceptions to the above would be if a backbench MP is elevated above their level of competence to a minister or a spokesperson role, in which case the relevant pay rate would apply.

      • Populuxe1 8.2.1

        All that's going to do is make them even more likely to be open to bribery and corruption.

      • Belladonna 8.2.2

        elevated above their level of competence to a minister or a spokesperson role,

        Not sure why we should pay more for incompetence…..

  9. Tricledrown 9

    National always have higher unemployment levels they want to have worker's in a state of anxiety so they can bully them.It just lowers productivity not surprising then National immediately disbanded the productivity commission because many of National policies and actions will lower productivity.Better wages mean happier workers do better and more work. Worker's rights taken away lower wages due to the cancellation of the FPA will encourage more workers to go to Australia where most jobs pay 30 to 50% more plus no nasty union busting rules!

    • Gosman 9.1

      Ummm…. the Productivity commission was set up by a National led government as one of the conditions for the ACT party to support it. The reason it has now been ditched is that most of it's functions will be folded into the new Ministry for Regulation.

  10. Thinker 10

    For a government that sees jobless benefits as a short term solution to getting people into work, this is probably the worst policy to do that.

    It makes coming off the benefit a massive risk, given the difficulty of getting back on if you are terminated inside the 90 day chuck out rule.

    More dog whistle politics.

  11. weka 11

    Wait, someone on the dole can be forced to take a job that includes a 90 day trial and then if there is no job at the end of the 90 days they get stood down from getting a benefit? How long for?

  12. Tiger Mountain 12

    Well put Darien. There will be ongoing fight back to this bunch, including “Knob Head” who is so not a PM.

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