Phil Smith, Editor: The House

Parliament has kicked off a three-week sitting block this week, and the first legislative business was initial debates and votes on three new bills. Two are contentious, including a bill to amend current Employment Relations law.

Among its measures, it would restrict or even rule out grievance claims, make it harder for contractors to argue they are employees, and remove various rules relating to new employees.

The minister in charge of both the bills is ACT MP Brooke van Velden. She described the intent of the Employment Relations Amendment Bill using a variety of common euphemisms (rebalancing, flexible labour markets, greater certainty, competitive business settings), but also described the proposed changes. Below are the major changes, as described by the minister herself, along with comments by opposition MPs.

Hindering contractors from being declared employees by the courts

"Currently a contractor can challenge their employment status in law despite being a contractor … To give greater weight to the intention of the contracting parties, the bill establishes a gateway test establishing an exclusion from the definition of 'employee' in the Employment Relations Act." - Brooke van Velden (ACT)

"At the moment, there is a test of the real nature of the job … 'is this actually an employment relationship or is it a contracting relationship?' That's what our judges can do at the moment. This bill takes that away. It says if you have the word 'contractor' written in a document, then you're a contractor. Well, this is against all the international examples, this [is] totally different to the common law that applies in many other countries that we compare ourselves to, and is an absolutely disgusting, unprecedented attack on workers' rights." - Camilla Belich (Labour)

Changes to personal grievance 'remedy' settings

"I'm introducing a suite of changes to address this imbalance, which are: removing eligibility for any remedies for employees whose behaviour amounts to serious misconduct; removing eligibility for reinstatement into a role and compensation for employees who contribute to the situation that led to the personal grievance; clarifying that the Employment Relations Authority and Employment Court have the full spectrum of remedy reductions - up to 100 percent - available to them; requiring the Authority and Court to consider if the employee's behaviour obstructed the employer's ability to meet their obligations to act as fair and reasonable employers; and increasing the threshold for procedural error to shift the focus solely to whether any errors in the employer's process resulted in the employee being treated unfairly." - Brooke van Velden (ACT)

"In an employment relationship, often there is a situation where an employee may do something that is not 100 percent perfect; an employer might do something which is not 100 percent perfect. The situation that they're bringing in says if the employee is anything less than perfect, they can't get their remedies." - Camilla Belich (Labour)

"It's going to heighten the workers' vulnerability to be unjustifiably dismissed. And it's great if you have employers that are good, but, unfortunately, this opens the doors, as it does for many situations, for those worst-practising businesses and employers. That's why employees' rights were put in place in the first place. …This gives the employers more power. When you're in a climate where there isn't a heck of a lot of work, that then creates an opportunity for employers to exploit the most vulnerable." - Debbie Ngarewa-Packer (Te Pāti Māori)

No personal grievance option for the well-paid

"This bill introduces an income threshold of $180,000 per annum, above which a personal grievance for unjustified dismissal cannot be pursued. … By making it easier to remove poorly performing managers and executives while giving new talent a chance, I expect to help improve management capability and thereby lift economic performance across New Zealand." - Brooke van Velden (ACT)

"The first thing that they're doing is actually making it so anyone earning over $180,000 in New Zealand can be fired at will." - Camilla Belich (Labour)

Employer obligations to new staff

"Currently, if an employer is party to a collective agreement that covers the work of the new employee, an employee's individual employment agreement terms must reflect the terms of the collective agreement for the first 30 days of their employment. This is known as the '30-day rule'. …The bill removes the requirement that the terms of a new employee's employment agreement should reflect the terms of the applicable collective agreement for the first 30 days of employment. …The employer would still need to inform an employee that a collective agreement exists." - Brooke van Velden (ACT)

"The 30-day rule acts as a lifeline. It gives kaimahi time to consider union membership before being pressured into an individual agreement. Without this rule, employers could use the divide and rule tactics, which is real - the peer pressure to keep Māori kaimahi, to keep Pasifika kaimahi, to keep those who are not savvy on what their rights are, on weaker contracts from day one. And that's a really tough position to claw back from. It allows employers to opt out of collective conditions on day one, and it creates a race to the bottom." - Debbie Ngarewa-Packer (Te Pāti Māori)

Union sign-up

The minister in charge of the bill, Brooke van Velden did not mention this aspect of the 30-day rule: that the new law removes any obligation of employers to inform new staff of the option of joining a union, or facilitating that option.

"It removes the obligation to provide an active choice in which the employer asks the employee whether they want to join their relevant union and receive that advocacy." - Ginny Andersen (Labour)

A note on international obligations

"We have a regulatory impact statement where all of the information in relation to international obligations is redacted. And why is this? Because we have free-trade agreements with lots of different countries that state that our employment situation should not decrease - and I bet you that that's exactly what it says in this regulatory impact statement. They won't share it with the House." - Camilla Belich (Labour)

The Employment Relations Amendment Bill will be considered by the Education and Workforce Committee, which will be asking for public feedback on the bill.

*RNZ's The House, with insights into Parliament, legislation and issues, is made with funding from Parliament's Office of the Clerk. Enjoy our articles or podcast at RNZ.

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