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Research uncovers surprising industrial trends

Research uncovers surprising industrial relations trends

The Government's employment law changes have not fundamentally changed the bargaining environment created by the now repealed Employment Contracts Act 1991, research by Victoria University's Industrial Relations Centre has found.

But the research has also found the Employment Relations Act 2000 has heralded new public sector dominance over collective bargaining in New Zealand.

Centre Director, Professor Pat Walsh, said results of the annual survey of collective bargaining trends would be presented to practitioners at a series of seminars around the country starting this week. The research has found a number of trends emerging since the establishment of the ERA, possibly not all as the Government would have intended.

"First, there has been no significant restoration of working conditions lost during the period of the ECA, nor has there been any evidence of a wages boom. Contrary to the fears expressed by some employers and employer groups, prior the introduction of the ERA, the legislation has presided over a fairly steady state environment, despite tight labour markets and wages pressure in some areas."

Professor Walsh said a more surprising trend, given the ERA’s clear intention to promote collective bargaining was that bargaining rates have dropped quite considerably since the Act’s introduction.

"In part this is due to the Act's formal requirements that state that only registered unions can negotiate collective agreements and only union members and workers in their first 30 days of employment are covered by those agreements. These requirements mean that our survey is no longer able to capture the ‘reach’ of collective bargaining, that is the extent to which union-negotiated conditions are flowed on to non-union workers, although we know anecdotally that this practise is widespread. The survey also notes however a drop in the number of employer parties covered by collective agreements."

Professor Walsh said the dominance of the public sector in bargaining statistics was becoming increasingly pronounced.

"We find that employees in the public sector are over five times more likely to be collectivised than their private sector counterparts. These trends are backed up by Victoria University's research on trade union membership, which has found that slightly over half of all trade union members are employed in the public sector. Further, public sector employees are more likely to be covered by a multi-employer collective agreement than they were in the past."

Professor Walsh said the research has shown a slow but steady increase in union membership since the Employment Relations Act was passed. "The increase of 10.7 percent in the three years since December 1999 has just outpaced growth in the labour force, leaving union density of wage and salary earners at 21.7%, up from 21.4% in 1999. This is perhaps the most predictable of the trends that have emerged."

Greater detail will be presented at the Employment Agreements: Bargaining Trends and Employment Law update seminars, held in Hamilton on 17 July; Auckland on 18 July; Dunedin on 24 July; Christchurch on 25 July; and Wellington on 1 August.

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