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Armstrong on Nat’s attack on wages

Written By: - Date published: 8:01 am, October 12th, 2013 - 30 comments
Categories: welfare, workers' rights - Tags: ,

John Armstrong has a good column on National’s attack on Kiwi workers today. Covering off David Cunliffe’s speech to the CTU, Armstrong talks about the way the Nats have been playing small target on their raft of small employment changes that add up to a serious attack on the wages and rights of all of New Zealand’s workers:

The bill – now before a parliamentary select committee – claims in its explanatory note that it will “help create an environment where employers can grow their business while ensuring the rights of employees are well protected”.

The first part of that statement may be valid. The second is on a par with the double-speak in George Orwell’s 1984.

The bill will enable employers to walk away from collective contract negotiations at whim, thereby putting pressure on workers to sign individual contracts if they are to get any kind of pay rise. Employers will similarly be able to opt out of multi-employer contracts that set minimum conditions for the likes of the nursing profession.

The bill also removes the requirement that the pay and conditions for new staff is in line with any prevailing collective contract for the first 30 days of their employment.

Employers will be able to institute partial pay cuts for limited industrial action. Employers will effectively be able to dictate the timing of meal breaks and rest periods.

The verdict of presumably politically neutral officials in the old Department of Labour, since merged into the Ministry of Business, Innovation and Employment, was that the proposed changes would increase “choice” for employers and reduce it for unions and employees.

The officials further warned that the proposed changes in the industrial relations regime might expose New Zealand to “critical international scrutiny” over meeting its obligations to workers’ rights in international treaties to which it is party.

But these changes aren’t just about unions. As Irish has previously noted:

…the thing is, union deals drag everyone’s wages up. It’s not just the hundreds of thousands of non-union members on union sites that get to enjoy union-cut deals either – the reason people get paid what they do at (non-union) TV3 is because they’re have to stay competitive with (unionised) TVNZ in the wage market. The reason people get paid what they do at non-union mills and factories is because they need to keep their wages close to the wages paid at union mills and factories. And middle-class people with degrees get paid what they do because public sector unions make sure those qualifications maintain their value. Unionised Kiwi workers are constantly pulling other Kiwi workers up with them.

I’d add to that the fact that the Government’s welfare changes are pushing people off benefits without a job to go to. Aside from the human misery this is causing, that creates a pool of desperate workers who will take any job they can get at any price and places further downward pressure across the employment market.

And while this is going on National’s Labour Minister, Simon Bridges, is refusing to be interviewed about the changes at all – let’s hope the media start calling him out on that.

Armstrong claims that the left has “dropped the ball” on this attack on workers. I’d argue that the media has ignored the warnings and protests of the left about the changes. That said, work rights and wage policy is now getting the attention it deserves and will be a battleground issue going into the 2014 election. About bloody time.


30 comments on “Armstrong on Nat’s attack on wages”

  1. GregJ 1

    Goo post Eddie – the raft of changes National has made or is proposing to Industrial Law make a mockery of the claims I’ve seen some on the right make that some sort of bi-partisan consensus been reached on Industrial relations because National have retained the Employment Relations Act rather than replacing it. Sure they’ve kept the title on the surface but the tinkering under the hood is dramatic. Another case of pretending to be “steady as she goes” when in reality this is a government that is seeking to make fundamental transformations to New Zealand society (and not for the better).

    P.S. your second sentence doesn’t quite read properly – a missing word or additional word in the wrong place?

    Eddie: Thanks. Fixed.

    • Murray Olsen 1.1

      Take a look at Queensland to see what NAct would like to do, besides the obvious huge holes in the ground. The State Attorney General, in the interests of workplace safety, is requiring “militant union thugs” to give 24 hours notice before entering a work site. The police have been ordered to pull over all “bikies” for intelligence gathering purposes, whether they are breaking any laws or not. “Bikies” are automatically denied bail for absolutely anything the police feel like charging them with.

      Perhaps the worst of all is that the SAG, Jarrod Bleckie, accepts that many of his laws will be overturned by the courts. In an approach that would make Key proud, he says something like “We’ll just write new ones.”

      Maybe Armstrong has had a look across the ditch and realises that not even he wants to wake up inside a WhaleSpew wet dream. I hope more follow him, because I refuse to believe that a majority of Kiwis actively want the sort of society Key and his banksters are designing for us. The danger is that we’ll get it by omission, by not actively fighting against it.

      The election of Cunliffe gives me some hope, not because he is a socialist super hero, but because issues have been put back on the agenda and are being discussed in a way they haven’t for years. People are realising that choosing to eat and live with dignity are more important than choosing your brand of light bulb, and about bloody time.

      • miravox 1.1.1

        “In an approach that would make Key proud, he says something like “We’ll just write new ones.””

        Anyone would thing they have each other’s phone numbers.

        I really hope you’re right about most Kiwis not wanting the the society Key and the Banksters are creating. I keep reading the comments on controversial stuff (like the fact the poor people exist /sarc) to look for changing attitudes and I feel people are realising that the government is creating more difficulties rather than solutions.

        I also think that is the importance of the Cunliffe leadership change is the debate that has been enabled about what sort of society we want to live in. No-one in leadership on the Left has been able to inspire this for quite some time. It’s not just Cunliffe, but also a growing realisation the NAct way is not delivering a place that fits the values that are important to New Zealanders.

  2. karol 2

    It does look like an extraordinary shift by Armstrong. No backhanders amidst the support for Cunliffe and his policy proposals.

    Good to see mention of the relationship between strong employment laws for workers and unemployment benefits/social security. I’m still hoping for something more explicit on social security from team Cunliffe.

    And, just an aside: it seems no-one is immune from being victim of the 90 day fire at will legislation, no matter what one’s past successes. In an article on Georgina Beyer’s current health problems, this:

    At one point she got a retail job in Masterton but was quickly shown the door by her boss when a story about her plan to run for the Masterton mayoralty in 2010 was splashed in the local paper.

    “He essentially said, ‘well, we’ll let you go now’. I was a victim of the 90-day fire-at-will law,” says Beyer.

  3. Te Reo Putake 3

    One of the changes actually removes the right to strike over collective bargaining, which is the most likely breach of the ILO commitments Armstrong refers to in his article. The effect is to bring back the Contract Act by stealth.

  4. Sosoo 4

    Seems to me that journalists are increasingly seeing the writing on the wall. It sounds weird, but I’m starting to get the feeling that Cunliffe is going to get a much easier ride from the media than people might think. Some of it might be down to his habit of actually answering their questions.

    • tc 4.1

      Yes journalism driven by opinion polls and self interest rather than facts and objective reasoning, no change there.

      Grandad wants to keep his place at the trough.

      • Anne 4.1.1

        I actually think it was more to do with them being so ‘up themselves’ they couldn’t see the real Cunliffe for love nor money. They were too engrossed in interviewing their own – and each others – typewriters. And since Cunliffe’s elevation to the leadership they are acting almost with surprise and wonder.

        Well, the members and affiliates could have told them 2/3 years ago, but they couldn’t stoop to listening to the proletariat could they!

  5. Disraeli Gladstone 5

    “The bill will enable employers to walk away from collective contract negotiations at whim.”

    That’s simply incorrect journalism. Employers cannot walk away at a whim under the amended Employment Relations Act. They require the Employment Authority under a new s50K to conclude that negotiations have reached a point where they are finished. Under s50K, the Employment Authority would not rule that negotiations are over unless mediation and facilitation have been undertaken. Any attempts to obstruct the negotiation or simply ignore the unions and twiddle their thumbs through facilitation until the Employment Authority can make their ruling would be a breach of s 4 and s 33 of the Act and therefore would lead to the Authority possibly making a binding determination on the collective agreement under s 50J.

    The level of misinformation and scaremongering about this one proposed amendment has been staggering.

    Especially when there’s far worse amendments being passed. The ability to opt-out of multi-employer collective agreement has no s 50K safeguard. That’s concerning. Also, even more concerning, the requirement for an employer to disclose information to an employee when making a decision is being severely, perhaps fatally, undermined. Those are the attacks on the employee’s rights.

    But when you or Armstrong make misinformed comments about other amendments, credibility is lost.

    • Colonial Viper 5.1

      That’s simply incorrect journalism. Employers cannot walk away at a whim under the amended Employment Relations Act. They require the Employment Authority under a new s50K to conclude that negotiations have reached a point where they are finished. Under s50K, the Employment Authority would not rule that negotiations are over unless mediation and facilitation have been undertaken.

      Please quote the relevant section of the Bill which enacts the bolded statement above.

      • Disraeli Gladstone 5.1.1

        Clause 12 of the Employment Relations Amendment Bill. Clause 12 of the Bill inserts a new s 50K into the Employment Relations Act. Bargaining does not end until the Employment Authority has determined that bargaining has concluded.

        Furthermore, from cl 12 “The Authority must not make a determination unless satisfied that the parties have attempted to resolve the difficulties in concluding a collective agreement by way of mediation and, if applicable, facilitation under the Act.”

      • Tracey 5.1.2


        Disraeli, isnt it for the employment authority to determine IF bargaining has finished, and parties can stop bargaining until it has decided (up to 3 months)?

        and further

        “Clause 12 inserts new section 50K, which enables a party bargaining for a collective agreement to apply to the Employment Relations Authority (the Authority) for a determination as to whether the bargaining has concluded. The Authority must not make a determination under new section 50K unless satisfied that the parties have attempted to resolve the difficulties in concluding a collective agreement by way of mediation and, if applicable, facilitation under the Act, that those attempts have failed, and that further attempts are unlikely to be successful. New section 50K(3) to (5) enable the Authority to determine that—

        bargaining has concluded, in which case the Authority may make a declaration to that effect; or

        bargaining has not concluded, in which case the Authority may either make a recommendation to the parties as to the process they should follow to resolve the difficulties or decide not to make a recommendation.

        In cases where the Authority determines that the bargaining has concluded, none of the parties to the bargaining may initiate further bargaining earlier than 60 days after the date of the declaration, unless the other parties agree. In cases where the Authority determines that bargaining has not concluded, none of the parties may make another application under new section 50K(1) until the recommended process has been followed or (if no recommendation has been made) until 60 days after the Authority’s determination, unless the other parties agree.”

    • Te Reo Putake 5.2

      You’re dreaming, pal. The ERA will rule based on what they see as Parliament’s intent in making the changes. And that intent is to make collective bargaining optional for the boss.

      • Disraeli Gladstone 5.2.1

        Thank you for that insightful legal opinion built on your own intuition rather than academic research. It’s appreciated. Fascinating to read.

        • Colonial Viper

          Uhhhhh…apart from being stuck up an Ivory Tower, please explain how you can you do academic research on ERA rulings which haven’t occurred yet, and legislation which hasn’t passed yet?

          What’s your academic background in employment law?

          Regardless, I trust that Labour will be giving the ERA far more teeth in their first 100 days in power.

    • Aspasia 5.3

      I know this is a late response but I simply cannot allow this misinformation to stand.

      “Any attempts to obstruct the negotiation or simply ignore the unions and twiddle their thumbs through facilitation until the Employment Authority can make their ruling would be a breach of s 4 and s 33 of the Act…”

      The most fundamental change proposed is to COMPLETELY REVERSE reverse the current s33 ERA 2000. If the clause is enacted there will be NO requirement to conclude bargaining. Therefore the general good faith duties in s4 and especially the current good faith duties in s33 would no longer apply to concluding bargaining. So there would be no protection against a surface bargaining approach to mediation or facilitation in this situation

      “..therefore would lead to the Authority possibly making a binding determination on the collective agreement under s 50J.” The power to make a binding determination has never been exercised by the Authority because the threshold to enable this to happen is so incredibly high.

      The paragraph beginning “Especially…”does not seem to have any meaningful information about the current statute or the proposed amendments.

      Clause 12 of the Bill has not been correctly cited.The “must” applies to the requirement for the Authority to “consider” whether the parties have attempted to resolve their difficulties by mediation and facilitation, if applicable. The threshold for facilitation is not as high as for determination unders50J but does not apply to every situation. The “must” also applies to a requirement to “direct that mediation, further mediation, or facilitation (as the case may require) be used…”unless the Authority considers it won’t help. This in fact leaves considerable discretion with the Authority and also would require that the appropriate threshold for facilitation was met before the Authority would direct the parties to facilitation. So although it is not possible to second guess how the Authority would respond to a particular situation, it has considerably more discretion than the incorrect citing of the Bill’s wording indicates. TRP is correct in so far as the meaning of all legislation must be “ascertained from its text and in light of its purpose” s5(1) Interpretation Act 1999.

      One reason why the reversal of s33 coupled with the power to declare bargaining at an end is so concerning is that currently refusal to negotiate for a collective agreement and instead insist on individual agreements is a breach of good faith. In the case of New Zealand Dairy Workers’ Union v Open Country Cheese Company Ltd [2009] ERNZ 275 an employer was refusing to do anything else but offer individual contracts. Good faith was breached under s33 because currently this is not a good reason based on reasonable grounds to not reach agreement. If there is no onus to reach a collective agreement, as will be the situation if the amendment is enacted, then there is no onus on an employer to do anything else but offer individual agreements.

      And, of course, as we all know from the Ports of Auckland dispute, where there is no requirement to reach agreement and the employer sucessfully applies to have bargaining declared at an end, then strikes or lockouts come to an end for 60 days. In that 60 day period of no industrial action there would then be no protection under s97 (as there was potentially found to be by Judge Travis last year)against the union members’ work being contracted out.

  6. Tracey 6

    And many dont get that even if you dont belong to a union and need them around a dismissal they let you pay the joining fee and they represent you so they service a broader range than just current members.

  7. Olwyn 7

    This is the sentence that struck me in Armstrong’s article: “Taken individually, the bill’s parts do not mean the end of the world for organised labour. Taken as a whole, they all add up to a very different story.” This is Key’s modus operandi in a nutshell. Everything he’s done has taken something like that form, which allows him to sell himself as centrist while running a cruel, one-sided government. Unfortunately for him, as more and more people are harmed by the reality of the policies, his soothing centrist presentation of them starts to fall on deaf ears.

    • Rogue Trooper 8.1

      stomach-churning scrunch by Watkins, sticking to the menu.

    • Paul 8.2

      From the Watkins’ paeon to neo-liberal orthodoxy in the Dom Post.
      “But the size and scale of Labour’s economic “activism” is yet to be unveiled and Labour’s big problem at the moment is that the current economic prescription seems to be doing pretty well.”

      “The current economic prescription seems to be doing pretty well.”

      She is kidding , right?
      Doing pretty well for whom,Tracy?
      The people who pay for bills, the owners of Fairfax?

      • Colonial Viper 8.2.1

        I think Tracy Watkin’s attitude is that the unemployed and the poor should eat pavlova.

  8. RedBaronCV 10

    Salami tactics – a little slice here a little slice there. So there need to be some big bang changes from the left but maybe a large dose of smaller slices too.

    Personally I have at least one fantasy, that the proposed power buying authority buys enough to give each ordinary home “base power” at a reasonable rate and then tells the state power companies to keep their profits up so 50 downlights and a heated pool suddenly gets very expensive.

    Millband should do something like that in the UK – why have price controls for the owners of large mansions FFS

    • tc 10.1

      Excellent idea, encourages efficiency and lower consumption with enough to live coming at a reasonable cost. User pays for the rest, watch the neo libs go spastic.

      • RedBaronCV 10.1.1

        Trickle down tc as it was meant to be and yes if the neolibs go into orbit just remind them of that

      • I thought that was essentially the Greens’ policy?

        • aerobubble

          Make public transport free (even for a month each year to get a better view of demand) and carbon pollution, congestion and oil use will drop.

          Thirty years ago, reports dropped on the desks of western governments showing thirty years of ever cheap high density fuel. So not for nothing the governments of the western world loosened finance, in the hopes that we’d all get richer, active in using the oil growth to progress society. But wait, there was one faction who wanted more, instead of wages rising debt would, and they would corral the wealth for the few (them, or so they thought, turns out only so many can be part of the 1%). In order to achieve their goal they created think tanks, who needed to put a blossom on the turd, they came up with ‘trickle down’, yes you could get a share of the wealth despite the reality that government legislation and regulation had been hijacked to push debt up and build the great spiral staircase of leveraging that even now has not begun to unwind.
          To much paper is in existence, debts and claims on it, there is not enough real value in the world for all the money (claims on value).

          Its not the first time we’ve been here, governments had to go left and write the new deal, and the rich weren’t having it and triggered two successive world wars.

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