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Written By: - Date published: 6:12 pm, October 31st, 2008 - 32 comments
Categories: election 2008, labour, national, workers' rights - Tags:

I see the media are now comparing the ‘redundancy’ packages on offer with all of the horse race vigour they applied to the tax cuts. That’s understandable as the media like quantifiable measures so they can make simple graphs and X is greater or less than Y soundbite statements. But what they have forgotten is that neither package is better than a decent redundancy clause and of the major parties only Labour is offering one of those.

I don’t expect it’ll be great but let’s have a look at what redundancy means:

A standard redundancy (at the low end) is 4+2* capped at 20 years.

That means someone who has worked for 5 years in the same job who is made redundant at a time they are taking home $500 a week in the hand will get fourteen weeks of pay or $7000 dollars.

If they have worked 20 years they get 44 weeks of pay or $22,000. Compared to the ‘assistance’ the two parties are offering that’s a lot of cash to use to cover your mortgage and look after your family.

Sounds too good to be true? Well, 80% of union negotiated employment agreements have redundancy clauses and 4+2 is on the low end – many are 6+2 or 8+2.

When you consider Labour’s policy is to protect workers’ rights and introduce a minimum redundancy, while National won’t commit to such a policy and wants to make it harder for unions to negotiate, it’s pretty clear which party is really looking out for workers who lose their jobs.

The media frenzy over these assistance packages is a side-show in comparison.

[*This means a redundancy formula of four weeks’ pay on signing up and two weeks for every year of service.]


32 comments on “Side-show”

  1. randal 1

    why dont they do somehting about guyan epsinners colmar brunton poll on TV! asking new zealanders stupid questions about who should form the next government.
    I mean they could make it plain instead of allowing epsinner to pretend he has something valid to say about the constitutional process

  2. Monty 2

    Awwww – you guys are just sour that National has outsmarted you yet again with the very well thought out redundancy package released today by the guy who will be PM in 9 days time.

    The problem with redundancy packages that you are suggesting is that during a difficult time when a business is needed to make cutbacks in order to survive, the redundancy packages the leftards (who are economically illiterate) promote is that such a law could force the employer into bankruptcy – and then everyone loses their job.

    [Tane: Na, I think National’s package has some good points and more than anything I’m pleased to see workers’ rights as a major issue in the campaign. I just think any analysis that ignores redundancy is missing the point. And don’t give me that crap about redundancy packages destroying business – I’ve heard it all before and never seen any evidence.]

  3. Alexandra 3

    I cant help thinking the Nats are using this site to their advantage. What better source to gage the needs of workers and respond to any flaws of newly announced labour policy.

  4. tsmithfield 4

    Around 95% of people are employed in companies of 5 or less (or similar figures). The point is, that most people are employed in small businesses in NZ. Big corporates and government departments might be able to afford the type of redundancy packages you mention. Small business would not, however. If anyone here disagrees with me, then I suggest they try starting up their own business and find out how difficult and financially demanding it can be.

    I run a local small business here. We employ 8 people. My house is mortgaged up to the hilt to fund the business. There is no way we could afford the sort of redundancy packages you are talking about here. It would be fantasy land for most small employees, who employ the majority of people in NZ. We are generally mum and dad employers who are taking a huge risk to go into business.

    Having said that, we have done what we can. We have a small redundancy provision in our contracts. Our employees are entitled to four weeks notice plus four weeks redundancy pay. This gives them eight weeks to find a job in the event of redundancy. Realistically, we could not afford more than that. We would probably close up the business if some draconian redundancy requirement was brought in.

  5. tsmithfield 5

    Have any of you here actually tried running a small business?

    I run a business that employees eight people. My house is mortgaged to the hilt ot help fund the business. It is businesses of our size and less that accounts for over 95% of employment in NZ. Big corporates might be able to afford the level of redundancy you talk about here. However, there is absolutely no way the average small business could.

    Having said that, we have a small redundancy provision in our contracts. Employees get four weeks notice plus four weeks redundancy pay. This gives them eight weeks of full pay to find another job should they be made redundant. That is about as far as we could possibly go.

    Mandatory redundancy at an unrealistic level would simply put most people off from going into business or from growing their business to the detriment of the economy.

  6. Dan 6

    Hey guys, Centrebet odds are dropping. Lots of people are out to make a killing. Clark was $5:00 ,but has now shortened to $3.25. That is huge. It is a bit like the Hamilton taxi driver who has predicted the red crew; he has always been correct. The big advert in the Herald was a businessman who has thrived under Labour. It is a pity it was hidden away in the business pages after Granny Herald’s biased reporting.
    Go Helen: we don’t want a weasel!

  7. burt 7


    I see the media are now comparing the “redundancy’ packages on offer with all of the horse race vigour they applied to the tax cuts.

    Steve P. did the best horse race vigor on tax cuts.


  8. Good comment Tane

    The nats are trying to make the election into a consumerist commodity battle. Party A’s specials this week are slightly better than Party B’s, therefore A should win. It is a shame that in the medium term Party A will do its best to destroy the Union movement and Party B’s offering plus support for the trade union movement would mean that ordinary people will be far better off in the future.

    I have this nagging doubt that Party A’s fine print could eventually result in a false advertising claim but by then it will be too late …Irene vadrick

  9. burt 9


    You are right about party A party B stuff, just yesterday Tane said this of the Labour’s redundancy offering.

    Still, overall this is good, sensible, vote-winning stuff.

    I’m not as partisan as you so I don’t think it’s only the ‘nats’ doing it.

  10. Felix 10

    Of course you’re not, burt.

    You’re just partisan enough to trot out your “Labour bad, ACT good” ill thought out infantile pap and boring, moronic attempts at humour every day on several different blogs for what is it now, 2 years? 2 and a half?

    But that’s not partisan is it burt, as long as you can retrospectively rewrite the dictionary.

  11. burt 11

    Been researching me Felix, I’m flattered. I guess the best thing about researching an online identity is you don’t need to fly to their city to do it. Saves the Labour party money I guess.

  12. Oh no Burt – Felix ain’t the researcher of the crazy right. I am. So… anyway… how’s it all going for you pal?

    Oh and why have you stopped posting at Cameron’s site?

  13. “Around 95% of people are employed in companies of 5 or less (or similar figures). The point is, that most people are employed in small businesses in NZ.”

    “It is businesses of our size and less that accounts for over 95% of employment in NZ”

    No, SME’s account for around 99% of businesses, but only 60% of empolyment.

    I mean think about it, work force of some where between 2 and 3 million (I actually have no idea), with 95% working in SME’s, you’d be looking at only 100,000-150,000 people to run the entire public service, 5 major banks, 7 universities, 5 main petrol station chains, 5 big fast food chains, numerous different retail chains you get the idea, 95% is just not plausible.

  14. Felix 14

    Yeah that’s right burt, I’d have to be doing some pretty intensive research to notice your goonish presence on the blogs.

    Is this really how your little mind works, burt?

    You post the same shit everywhere you go, every day and because I notice you’ve been doing it a while I must be “researching” you.

    It’s just amazing what enough alcohol and meth will do to a tiny, semi-functioning, retarded brain like yours.

    [lprent: That is probably getting over the top. ]

  15. lprent 15


    Have any of you here actually tried running a small business?

    Yes. But really the question is how much of the risk should be carried by the employees of the company rather than the owner. The reason that you have redundancy in your contract is to reduce risk to them. Therefore you can employ people who more risk-adverse than you are.

    Redundancy in the contract or in legislation reduces the impact on the employees, but is also good for the directors because it clarifies the risk to them. Redundancy payments count as a liability in the books, and therefore part of the directors duties. At present that risk is carried largely by the employees without a corresponding potential benefit. That is iniquitous.

    The problem of a lack of investment capital probably has far more effect on being able to grow businesses. In NZ it is very bad and shows a classic market failure because almost every small business is under-funded. This is also why a mandatory redundancy regime is more important because under-funded businesses tend to fail abruptly because they have no reserves to fail in a more orderly manner.

  16. Felix 16

    Sorry Lynn, I withdraw and apologise.

  17. Monty 17

    Problem is now that Key has gained back the initiative and got the momentum in this election. And it has been a very bad week for Labour and her association with Winston. So the Champagne remains on ice and nicely chilled with a landslide victory. Clark called the election on Trust. Thank you Helen – we can trust John Key to bring out sensible and well thought out policy (Out Labour Labour on this policy rather than policy on the hoof as Labour have clearly done.

    Labour are now running in a blind panic.

    And given the revelations in the paper this week, Winston is gone for all money. Clark’s biggest problem will be unshackling herself from that tired and corrupt Bully. But Clark made this election about trust – so now after reading the Dom Post this morning, who would trust Winston – or anyone associated with him.

  18. Concerned of Tawa 18

    The Dom Post this morning has dealt the death blow to this government.
    H1 and H2 could learn a lesson or two on how to release a real neutron bomb.

    Everything else is now a sideshow.

    Will it be corruption or economic mismanagement that is now Clark’s legacy?

  19. Carol 19

    Hmmm. Well it could go either way. It certainly doesn’t look good for Peters. But this morning’s allegation is actually linked to Peters’ assocaition with the National Party – ie ex Nat MP Neurant, and in 1999, at a time when Peters was in coalition with National.

    It’s interesting all these funding irregularity allegations most directly implicate National people or ex Nats. Also interesting there’s been no direct allegations of funding irregularities for Labour or Labour people.

    Some righties talked about Peters knowing where the Labour “bodies are buried”. But he definitely has indicated that he knows where ther National bodies are buried with respect to funding for policies. If he gets cornered, do you think he won’t play that one up?

  20. Concerned of Tawa 20

    Nice try Carol.
    You’ll have more success pinning someone elses signature on John Key 20 years ago than wiping Peters off Labour and onto National.

    The stench of Peters is inextricably linked to Clark now, and she has protected him like no other.

    This is all the public will see…

  21. Carol 21

    How can she have protected him, if she knew nothing about this latest allegation?

    Back at ya with the nice try.

  22. Monty 22

    Carol – Clark knows everything that goes on – Parliament is rife with rumour – these allegations have been swirling in Wellington for months – I knew 3 months ago that Meurant was squealing like a pig. Concerned of tawa id right – everything else is a sideshow. Clark and Peters are joined at the hip and she would have taken a very close interest in these matters.

    Clark’s association with Peters and her protection of him must have a reason.

    I think todays revelations are the last nail in the coffin of this desperate government.

  23. Tim Ellis 23


    There appears to be clear evidence that NZ First advocated policy that was specifically designed to help the Vela family. There have long been rumours of why Peters pushed so hard for changes to the fishing and racing laws. Helen Clark personally approved Winston Peters keeping the $40,000 donation from the Velas to pay off his legal bills. This is very, very murky.

  24. Concerned of Tawa 24

    “How can she have protected him, if she knew nothing about this latest allegation?”

    Everyone knew about it months ago. She has had plenty of time to show leadership and some morals. Ah maybe not.

    Instead she packs Mike Williams off to Aussy and gets the research unit on overtime to try and relight her fizzer.

    Not a good look Carol which ever way you spin it…

  25. IrishBill 25

    I wouldn’t get too excited boys, it certainly looks bad for Peters and I’d be happy to see him go (apart from the fact it would give you lot so much joy) but I doubt it will be seen as Labour’s fault despite the right’s desperate attempts to tie the two together.

  26. bill brown 26

    Do you really think that people that were going to vote for Peters yesterday won’t today because of that article?

    I heard one “oh poor old Winston” this morning.

    And I just turned the page because I wouldn’t vote for him anyway and I’m bored with the whole thing.

    But I’m sure Espiner will share a stiffy with you tonight, Monty, if you can hold on that long.

  27. higherstandard 27

    Bill’s quite right of course a large proportion of NZers will vote for the same party/person they have before regardless of not having any rational reason for doing so.

  28. randal 28

    I agree hs. the new zealand voter is dumbed down to the max.
    all they can think about is buying amotorbike and making a loud noise to piss their neighbours off
    thinking about reducing workers rights, privatising ACC, gutting kiwisaver and weakening the RMA and the ETS is just too hard for vibrant solipsistic postmodern nitwits.

  29. higherstandard 29

    Isn’t you and me agreeing one of the portents of the apocalypse ?

  30. randal 30

    I dont know..is it?

  31. Bill 31

    FFS. Since when did it become ‘dodgy’ for a politician to elevate business concerns above all others? They are where they are to LOOK AFTER BUSINESS!

    Receiving OBVIOUS kickbacks and getting pinged is, of course, bad form….makes the others look bad.

    Meanwhile, both major parties are willing to throw our money at the banks. Not read too much in the way of outrage on that front. I take it that if the banks offered an obvious kick-back to politicians there would be an uproar? But since they do not need to bribe to get their way it’s all a- ok?

    Their kick-back is endorsement…endorsement of a career in so-called representative politics where the real interests being represented beneath the veneer of universal suffrage are those of business.

    Meanwhile, the likes of the Greens are ridiculed and ignored at every turn because, (for the time being at least), they don’t quite dance to the tune of business that (so far) successfully sells that which is good for them as unquestionably good for us.

    On the same vein, is there any point in decrying lack of individual journalistic integrity when we live in a society that rewards the commissar and simultaneously ensures the marginalisation of the journalist and journalism?

    Ahh. That feels better.

  32. randal 32

    all that and more
    what I really object to is the crassness
    talking of sideshows the local ibetrianzl party just went past in some heap of crap honda with a microphone blaring out his mealy mouth demonisation of Helen C.
    back on topic
    no class
    to much tv
    too much drink
    too much hitech
    too much everything
    must be something in the water
    new zealand is locked in some antipodean teutonic bore boer boor boer bore society
    no joy
    no fun
    one track
    one dimensional
    deadly dull
    over and out

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