ERA Seminar: Speech Extract Christchurch 08/09/2000

Friday 8th Sep 2000
Richard Prebble
Media Release -- Economy

Hundreds of workers have already lost their jobs because of the Employment Relations Act. Over the next three weeks before the new law commences, many more will suffer the same fate.

It is almost impossible to dismiss unsatisfactory staff under the new law. So employers are reluctantly forced to dismiss staff now who they believe may prove a liability in the future.

The saddest aspect of the new employment law is that those who are missing out are those who the coalition claims ‘closing the gaps’ will help – the unskilled and those with poor work records.

In the over 50 nationwide seminars ACT has held with hundreds of attendees, we have repeatedly heard from employers the same tale. Staff who have a poor work record, who the employer has had ample legal justification for dismissing but has not done so because no-one likes firing, under the new law have become a threat to the business.

The average cost for a wrongful dismissal today is believed to be $6,000. Under this new Act it will skyrocket because the Authority will reinstate employees as a remedy.

It will be senior managers who will exploit the new law. I was told of a manager, dismissed for unsatisfactory performance, who was reinstated last week by the Employment Tribunal. Her first action was to book herself a first class ticket to an overseas conference that the Board had told her not to attend.

“You can’t dismiss me” she said. “The Tribunal has reinstated me.” It cost the company a $100,000 golden handshake to get her resignation.

When Dr Cullen wonders why the Kiwi dollar is so low and business confidence abysmal, he should look at measures like the anti-business Employment Relations Act for an answer.

ENDS

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