Contractors “disappointed” with amendments

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Media Release – for Immediate Release

30 October 2012

Building Services Contractors “disappointed” with planned Part 6A amendments

Building Services Contractors New Zealand (BSC) has described planned changes to Part 6A of the Employment Relations Act as “disappointing” and likely to make cleaning workers even more vulnerable.

BSC represents New Zealand’s building services contractors who provide a diverse range of cleaning, maintenance and other services. It has lobbied strongly for Part 6A to be revised.

Part 6A aims to prevent groups of low paid workers from being replaced by cheaper contractors or having their pay and conditions reduced for the same job, when a contract is re-tendered or a company changes hands.

However, BSC President Patrick Lee-Lo said that while the amendments announced today by Labour Minister Kate Wilkinson, addressed some of the major problems created by the “unworkable” law, they needed to go further.

In particular, BSC is concerned that one of the proposed changes, to exempt small and medium businesses, with fewer than 20 employees, from the provisions of Part 6A when they take over a contract, will create a loophole for a number of franchise cleaning companies. It is also not clear whether the changes apply to 20 full time employees or to 20 part-time staff.

“Potentially, franchisors could state that a franchise owner is an independent operator and, if an operator or site has fewer than 20 employees, they could be exempt from the law,” said Mr Lee-Lo. “Is that what the Minister wants?

“Some franchise operators win a contract and then parcel that out to several franchisees. So, if they gain a major contract employing 30 staff none of the new employers will have any obligation to those staff.

“This will play into irresponsible operators’ hands and make cleaning staff even more vulnerable, which works against what the legislation was designed to do.”

Mr Lee-Lo said that BSC welcomed some of the changes.

“Some key elements are covered including transfer of funds for transferring entitlements but other areas are left pending.

“This really does not address the significant problems for building services contractors and workers which have been created by Part 6A and the changes could, potentially, be damaging for reputable companies across the sector.

“This review appears to be two steps forward and one back! The BSC is looking forward to its scheduled meeting with the Minister in November to put these questions to her directly.”

ENDS

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