Gordon Campbell | Parliament TV | Parliament Today | Video | Questions Of the Day | Search


Employment Law: A Key To Prosperity

Employment Law: A Key To Prosperity

Richard Prebble
Wednesday, 20 July 2005
Speeches - Employment

Address to Quigg Partners - Employment Seminar Election Special; The Bayleys Building, 28 Brandon St, Wellington; Wednesday, 20 July 2005, 5pm.

Employment laws are a key to investment, growth, jobs and prosperity.

Lower taxes, the rule of law and a business friendly environment are all-important to creating prosperity, laws that encourage employment are vital.

There are still 75,000 able-bodied adults on the unemployment benefit. There are another 112,000 able-bodied adults on other benefits. A further 100,000 adults are doing sub-degree marginal value courses, to quote the Minister of Education.

We still have a third of a million people out of work. There are two reasons. First, massive welfare abuse costing over a billion dollars a year - but that's another speech. Second, employment laws that increase the cost and risk of employing our fellow citizens. The cost of employing the remaining 300,000 adults is high even before the employment laws. There are single mothers who need time off for their children, adults with poor or non-existent work records and former drug addicts and alcoholics.

It is easy to prove that employing such people is not worth the risk. Since 1974 the numbers on the DPB has grown from 16,000 to 108,000 and the sickness and invalids benefit numbers have risen from 17,000 in 1974 to 135,000 today. Most of the beneficiaries are not sick; they are on the benefit because they are not worth the cost of employing.

The Employment Contract Act did promote employment, jobs and growth. The Labour Department's figures show that real wages also grow faster than inflation. The Treasury reports that growth hit 5% a year 10 years ago. Since Labour was elected growth has stalled. It is partly due to extra taxes, but employment laws are a factor.

But ACT has always been a critic of the Employment Contracts Act because it did not go far enough and the law invited employment grievance cases. In the most recent amendment to the Employment Relations Act, to outrageously benefit unions, I noticed how many lawyers appeared in front of the committee, how many lawyers came from firms claiming to specialise in employment law. I asked the Law Society how many lawyers they thought now earn most of their income from employment cases and how many lawyers were employed before the Employment Contracts Act. The answer was that before the Employment Contracts Act there might have been half a dozen lawyers who specialised in industrial law in private practice and today the Law Society believes that there are approximately 1,000 lawyers who say that most or a significant part of their income comes from employment law.

While I don't expect this observations to win me any votes from our hosts I predicted at the time that this would happen and urged Bill Birch to abolish all the specialist employment courts and tribunals. Employment is just another contract and any breech should be taken to the general courts. I don't doubt that there are genuine employment cases but also have no doubt that most of the 1,000 lawyers will have to find something more productive to do.

Just to show I am not picking on you, ACT has a little list of people who could be more productive. Since Labour was elected in 1999 there has been a 25% increase in the people working in the public sector, at a cost of over $1 billion.

Labour says the dire predictions regarding the Employment Relations Act have not come true. What they fail to mention is the law that was passed was not the bill drafted by Margaret Wilson with the CTU. Provisions like the one declaring all the self-employed who have only one customer to be employees were dropped as a result of the opposition from parties like ACT. The measure was aimed at the owner-driver who unionists hate. It would have bankrupted thousands and also would have made over 100,000 self-employed, like real estate agents, employees with disastrous tax consequences for them. Labour did not ask the self employed whether they wanted to be employees. It is still on their agenda.

Here is what ACT would do:

ACT would pass a Freedom to Contract Act, freeing employers and employees to contract between themselves. Laws and regulations, which are anti-employment, would be scrapped or modified. Employment laws will aid rather than hamper economic growth and higher standards of living.

ACT's goals:

- Restore freedom of association in the private sector. The public sector should be forbidden to discriminate, except on merit.

- Restore freedom of contract in both public and private sectors.

- Lower taxes and reform welfare to help people to shift from welfare to work.

- Help employers create more jobs by reducing tax and regulatory barriers.


- Foster prosperity generally by reducing taxes, crippling regulations and welfare dependency.

- Repeal the Employment Relations Act 2001.

- Abolish all specialist employment authorities, tribunals and courts.

- Restore the common law freedom of contract between employers and employees.

- Restore common law freedoms of association and of speech in hiring labour and in communicating with staff.

- Review other regulations affecting employment with a view to replacing regulation by common law remedies.

ACT's policy outcomes:

- Higher rates of employment, growth in labour productivity and resultant wage growth.

- Higher economic growth and standards of living.

In employment law, ACT is offering a clear alternative to all the other parties.


© Scoop Media

Parliament Headlines | Politics Headlines | Regional Headlines

Gordon Campbell: On The Peters/Ardern Triumph

There are a lot of good reasons to feel joyful about this outcome. It is what so many young voters – the best hope for the country’s future – wanted.

Far more important than the implications for the Economy Gods ( is the dollar up or down? ) last night’s outcome will also mean many, many vulnerable New Zealanders will have a better life over the next three years at least.

Yet the desire for change was in the majority, across the country..>>>More


Labour on its agreement |Peters: Post-Election Announcement Speech | Greenpeace “cautiously hopeful” about new Government | ACT - Madman on the loose | E tū ecstatic | Chamber welcomes the outcome | Greens on their joining Govt | EDS welcomes new govt | Immigrant groups worry | Feds ready to engage new coalition government | Labour Ministers of the Crown announced


Climate: Increasing Greenhouse Emissions Hit NZ

New Zealand is seeing impacts of excess greenhouse gas emissions in our climate and oceans, according to the latest national report from the Ministry for the Environment and Stats NZ about the state of the atmosphere and climate…More>>


Wellington.Scoop: Arrests At Blockade Of "Weapons Expo"

“We encourage people in Wellington to get down to the Westpac Stadium now for a day of awesome peace action. There will be plenty of food, music and activities to keep us sustained through the day.” More>>


Rorschach Restructuring: PSA Taking Inland Revenue To Court Over Psychometrics

The Public Service Association will be seeing Inland Revenue in Employment Court over its intention to psychometrically test employees reapplying for their roles at the department as part of its controversial Business Transformation restructuring plan. More>>


Nuclear Disarmament: Nobel Peace Prize 2017 Awarded To ICAN

Congratulations from iCAN Aotearoa New Zealand to international iCAN, the other iCAN national campaigns and partner organisations, and the countless organisations and individuals who have worked so hard for a nuclear weapons-free world since 1945. More>>


Expenses: Waikato DHB CEO Resigns

An independent inquiry has identified that Dr Murray had spent more than the agreed $25K allocated for relocation costs, and other unauthorized expenses involving potential financial breaches of the chief executive’s obligations. More>>


Wellington.Scoop: Sad About The Trolley Buses?

The Regional Council’s MetLink is today spending money to tell us that it really loves Wellington’s trolley buses, even though they’re all being taken off our roads by the end of this month. More>>


Post-Election: Preliminary Coalition Talks Begin

New Zealand First will hold post-election preliminary discussions in Wellington with the National Party tomorrow morning and the Labour Party tomorrow afternoon. More>>




Featured InfoPages

Opening the Election