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Margaret Wilson Speech: PSA Delegates Seminar

Margaret Wilson Speech: PSA Delegates Seminar

Thank you for inviting me here today to talk about some of the achievements and proposed legislative developments in the employment area. I have been asked to specifically cover the Employment Relations Act and its review, proposed changes to the Holidays Act and Pay Equity.

I would also like to briefly discuss the amendments to the Health and Safety in Employment Act, which were passed in December and come into force on 5 May.

Along with the improvements the amendment brings in terms of coverage issues, employee involvement and more effective enforcement, what we really need is a change of culture in our workplaces. A culture which recognises employees as assets worthy of investment and the benefits of good employment relationships and healthy and safe workplaces. Those benefits include more productive, innovative and committed staff.

The Occupational Safety and Health Service of the Department of Labour has launched an information campaign to ensure all employees and employers are aware of their roles in making workplaces safe. This campaign will be similar to the one used to promote awareness and best practice under the Employment Relations Act. Fact sheets and publications are currently being developed. A dedicated website, "workinfo", and an infoline have been established to deal with inquiries. A series of nationwide seminars will also take place throughout the country in March.

ERA and Review

The Government's new initiatives and directions build on the successes of the past three years. We promised a more balanced approach to employment law and that is what we have delivered through the Employment Relations Act. This changed the focus of the employment relationship from one based on purely contractual principles to one where human relationships are at the forefront.

Important elements in redressing the imbalance of power are the emphasis on collective bargaining and the right of unions to bargain collectively on behalf of their members. These legislative measures have been successful in growing both the number of collective employment agreements and union members.

Underpinning the promotion of collective bargaining as well as all other aspects of the employment relationship is the requirement that all parties - employers, unions and employees - must deal with each other in good faith. This requirement protects all parties against unfair bargaining tactics as well as applying when employers consider proposals that may affect employees or involve redundancies. It applies when unions consult their members, hold secret ballots or seek to visit a workplace.

The emphasis on good faith and collective bargaining was a significant culture change for some organisations and some people. It requires a change in attitudes and a sound understanding of how the Act affects employment relationships.

For that reason, the Act provides for paid employment relations education leave, enabling employees covered by a collective agreement to attend training courses. The Government also made $5 million in funding available over the first three years of the Employment Relations Act to help the development and delivery of employment related education programmes, with ongoing funding of $2 million a year to assist unions, employees and employers. The enactment of the Employment Relations Act is only the start of the journey. There is still a long road ahead, which is why the Government is committed to reviewing the Employment Relations Act. The objective of the review is to identify any fine-tuning needed in the Act, its application or its administration. One of the main areas this review will look at is to what extent the ERA is achieving its objective of promoting, as opposed to permitting collective bargaining. I will be interested to hear your views as you have a unique vantage point from which to assess this issue.

Other issues that will also be considered in the review include:

Whether more administrative support needs to be given to facilitate multi-employer collective bargaining, particularly where the size of employer units in particular sectors makes enterprise bargaining inefficient and ineffective; The adequacy of provisions in the Act to discourage and prevent the undermining and avoidance of collective bargaining; The extent to which the intent of the Act and, in particular, the principles of good faith bargaining are given sufficient weight in the application of the Act; and Whether compliance costs associated with the bargaining process can be reduced.

An "issues and options" approach will be taken to the review of the ERA and this is expected to result in policy decisions in the first quarter of 2003. Contracting Out

As you will also be aware the protection of employee's employment in situations of sale or transfer of business, and contracting out are a priority for this Government.

I am concerned the lack of protection for employees in contracting out or sale or transfer of business situations can force some employees to agree to less favourable terms and conditions, in order to ensure they are employed by the new owner of the business or holder of the contract.

I am currently considering a range of legislative measures to provide thorough employment protection to employees affected by contracting out, in keeping with the Government's commitment announced in last year's Speech from the Throne. Any measures undertaken by the Government will be tailored to ensure there is protection of employment conditions and continuity of employment in contracting out situations. It is important that any protections provide employees with the right to choose to transfer along with their jobs to the new owner, on the same terms and conditions. Holidays Bill

The work on the Holidays Bill is also close to completion. When timing on the legislative programme permits, a new Holidays Bill will be introduced into the House. This Bill was drafted in consultation with the New Zealand Council of Trade Unions and Business New Zealand, following on from the reports of an advisory group on this issue. The achievement of the Advisory Group is not to be underestimated. It is yet another example of how productive tripartite consultation can be. The Holidays Act is a complex and difficult area of employment law and the Advisory Group was able to provide recommendations to make the legislation easier to understand and less complicated. During the year to 31 December 2002, the Department of Labour's Employment Relations Infoline responded to about 62,000 enquiries related to the Holidays Act.

By simplifying the law we hope to reduce the uncertainty, stress and costs that arise from the current legislation. The new holidays legislation will create a regime that is much easier to understand and apply. Like our other legislative reforms, there will be a public information campaign before a new Holidays Act comes into force. People will also be able to get practical advice from the Department of Labour's Employment Relations Infoline.

Pay Equity

The Government is committed to the introduction of measures to address the gender pay gap. In New Zealand, women currently earn 84.3 per cent of the average hourly earnings of males. Lower incomes over a lifetime create barriers to women achieving their economic aspirations and continue to represent systemic discrimination.

Research has identified several factors that go some way to explaining the gender pay gap. Between 40 and 80 per cent of the gender pay gap can be explained by three factors:

Education: Past work experience; and Occupation and industry of employment.

The remaining 20 to 60 per cent of the gender pay gap cannot be explained by statistical analysis. Many commentators attribute this unexplained element to the presence of discrimination in the setting of wages.

This does not mean we should not act now to address the known factors that influence the gender pay gap. The Government has already started to act through the appointment of an Equal Employment Opportunities Commissioner and the introduction of paid parental leave, which I will also discuss in brief shortly. The Ministry of Women's Affairs also recently released a discussion document "Next Steps Toward Pay Equity" for public comment. Submissions on the document closed at the end of November, and the process is currently underway to consider the constructive suggestions in the 90 submissions received. Now this initial stage of consultation has been completed, we are looking at how these ideas can be turned into practical policy options.

I think it will be important to bear in mind that a range of solutions may need to be considered, to reflect the range of reasons why there is a gender pay gap. As part of this project, the Department of Labour is researching pay equity policies in overseas countries to inform the development of options to reduce the gender gap in New Zealand.

Paid Parental Leave

One of the successes of the Labour-led government has been the introduction in 1 July last year of government-funded parental leave payments of up to $325 per week. To date more than 7000 parents have successfully applied for paid parental leave.

It helps to minimise the adverse income effects that time away from work due to childbirth and parenting can have on a woman's income. By providing this assistance, women have a wider choice of jobs and hours of work than they would have previously.

The paid parental leave scheme will be comprehensively reviewed after it has been in operation for a year. This review will include an evaluation of the possibility of extending eligibility for parental leave, including:

To the self employed; Providing separate paid leave entitlements for both parents, and Extending eligibility to cover those employees who have had more than one employer in the preceding 12 months.

Work-Life Balance

Complementary to the planned legislative measures, the Government will be promoting work-life balance in recognition that work is but one dimension of living and should not be allowed to crowd out and distort family life, recreation and personal development. One of the ways this will be promoted is through the Future of Work programme. A Future of Work Advisory Panel has already been established, which includes representatives from unions, business, Government and other experts.

The promotion of work life balance has begun with the recent launch by the Department of Labour of a Future of Work website. The site contains information on work-life balance practices and policies, including a general discussion of work-life balance, why it is an important issue, how specific work-life balance provisions can be established successfully, and how Government policy supports work-life balance. The site also provides links to other websites that offer practical advice and information, including the CTU website.

I look forward to the work-life balance initiatives gaining momentum and a greater acceptance of these programmes in workplaces.


Thank you again for the invitation to speak to you today and I look forward to your views and input into the process of developing these new initiatives.

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