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Workers Must Be Protected When Firms Are Sold

6 May 2002

Workers Must Be Protected When Firms Are Sold Or Work Transferred - CTU

The Council of Trade Unions supports greater protection for workers when their employer sells the firm, or part of it, or work is contracted out.

“Many workers are placed in an extremely vulnerable position when a firm is sold or work is contracted out,” CTU president Ross Wilson said in response to today’s release of the Second Ministerial Advisory Group Report on Contracting Out, Sale and Transfer of Business.

“Many other countries have legislative protections that cover this situation and New Zealand workers also deserve protection,” he said.

The CTU had two representatives on the Advisory Group and in the course of the many meetings with employer and other groups, the CTU modified its proposals.

“In essence we found that most employers supported protection for workers when a firm is sold,” said Ross Wilson.

“Many firms said that in such a situation a worker would either continue on their same terms and conditions with no loss of service, or be paid redundancy compensation.”

However Ross Wilson said that some employers oppose this approach.

“The CTU proposal is for the immediate drafting of legislative protection for certain groups of vulnerable workers, a regulation to apply to state sector employers, a requirement for redundancy compensation to be a negotiated part of collective bargaining, and further policy work on more general protection for workers when a firm is sold, or work is contracted out,” he said.


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