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Compulsory Bargaining Won’t Be Missed Says EMA

The Employers and Manufacturers Association (EMA) says most employers will welcome today’s Government announcement that they will be moving with urgency to repeal Fair Pay Agreement (FPA) legislation this week.

EMA Head of Advocacy Alan McDonald says the misnamed "Fair Pay Agreement" legislation won’t be missed by employers because it represented a step backwards to the compulsory bargaining industrial framework of the 1970s.

"Today’s announcement means an end to the protracted bargaining process that has struggled to get off the ground for the seven FPA claims that have been approved by MBIE," explains McDonald.

"The EMA is representing members in four of the seven approved claims. While we have always operated in good faith, working with our members to ensure they are complying with all the requirements of the legislation, and will continue to do so until repeal of the legislation takes effect, we have experienced firsthand the complex and protracted processes involved that has resulted in us not even reaching the bargaining table.

"Worse, many small employers in some of New Zealand’s largest sectors probably had little idea that negotiations, which would have had a profound impact on their business, were even underway.

"That was always a major problem with fair pay agreements. How can a small employer in provincial New Zealand have any influence, or cope with agreements made, at bargaining tables in Wellington with the country’s largest employers who have the time and resources to take part?

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"Was it ever fair that a corner grocer or a rural café would have the same conditions and pay rates forced on them as large-scale employers in an Auckland supermarket or the casino hospitality complexes?"

McDonald says a return to compulsory bargaining across multiple sectors had been viewed by the EMA, Business NZ, MBIE and other business associations and employers as a sledgehammer approach to cracking a walnut.

"MBIE’s advice to the previous Government was that it would be better to identify sectors where there may be potential issues, which there may have been 2-3, and then look at how to improve conditions on a case-by-case basis.

"For example, the often-cited bus drivers’ case could have been fixed by simply changing Government’s procurement rules (and the previous government added $60 million to the sector earlier this year), while many in the cleaning sector are exempt from FPAs.

"I’m sure both our members, and employers in general, will welcome a return to working with their staff to set the terms and conditions suitable to the individual workplace environment. The reality is that most employers are good people who know and value the staff they work with. They don’t need a third party to force changes on their workplace."

McDonald says with the end of FPAs, the EMA expected more emphasis on larger scale Multiple Employment Collective Agreements (MECAs) with attempts to make some of those agreements national in scale.

Our bargaining teams (legal and consultants) have already noted more emphasis on MECAs and are continuing to help our members and others with those negotiations too."

McDonald says the EMA also welcomes the Government’s announcement today that they will be introducing legislation this week to return 90-day trials for all businesses.

"Ninety-day trials can support those on the verge of the employment market into work because they provide an employer with increased confidence to take a chance on someone who might have the attitude but not the skills or background for a role," says McDonald.

"These trials are exactly the type of tool needed if we want to bring down our NEET population, reduce our long-term benefit numbers and support those with criminal convictions into work.

"This is especially the case for smaller businesses who don’t have significant HR and recruiting resources but can provide employment to those who want to get into work.

"The trials were never about creating more jobs, and many well-resourced, large-scale employers choose not to use them anyway. But our smaller members tell us they use them to give people opportunities in circumstances where they may not otherwise be as willing to take a chance on someone."

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