Employment Law Election Special
New Zealand Political Parties’ Employment Policies
New Zealand General Election 2023
Retiring MPs have given their valedictorian speeches, Parliament has been dissolved and the political parties are on their campaign trails ahead of this year’s General Election. With the final day of voting on 14 October, we have summarised the major parties’ policy proposals regarding employment and workplace-related issues. Below we outline key policies ACT, the Green Party, Labour, National, New Zealand First and Te Pāti Māori have published which relate directly to employment law. This list is not exhaustive.
ACT New Zealand
The Employment Relations Authority
ACT says the current process of resolving personal grievances between employers and employees through the Employment Relations Authority (ERA) is slow, costly and open to abuse. It also says that if a dispute has reached the ERA, chances are, the employment relationship is irreparable.
ACT therefore proposes:[1]
- The ERA be required to deliver all decisions within a month of the conclusion of the investigation meeting. Any ERA Members who fail to meet this Key Performance Indicator (KPI) will be dismissed following a fair performance management process. ACT’s view is that other jurisdictions i.e. District Courts issue decisions quicker than the ERA while still dealing with issues of equal or increased complexity.
- An employee who raises a personal grievance(s) and whose behaviour is at fault will be ineligible for any remedies to ‘rebalance the playing field so both employer and employee behaviour are treated equally.’
- The ERA would no longer be able to ‘unilaterally’ reinstate an employee. Remedies that the ERA can award would still include lost wages and compensation, but reinstatement needs to be the employer’s decision.
Contractor Agreements
ACT proposes an amendment to the Employment Relations Act 2000 which would explicitly exclude independent contractors from the definition of employee and prevent independent contractors from challenging their status under the Employment Relations Act 2000 if the below criteria are satisfied:[2]
- There is a written agreement where the person is specified as an independent contractor and will not have access to the rights and entitlements of an employee;
- The independent contractor was given sufficient information and an adequate opportunity to seek advice before entering the contractor agreement;
- The contractor agreement does not restrict the person from performing services or work for other businesses (including competitors), except for when the contractor commences a specified task provided by the business or undertaking until that task is completed;
- The business/principal cannot terminate the contract of the person for not accepting a specific task; and
- The business/principal has kept sufficient records to demonstrate that it has complied with minimum entitlement provisions.
Minimum Entitlements
ACT is also proposing a three-year freeze on minimum wage increases.[3] Previously ACT has stated it will reduce sick leave entitlements from 10 days back to five and remove a public holiday, but it is not clear if this is still part of ACT’s policies.[4]
Comment
The current timeframe Authority Members must deliver determinations is within three months of the conclusion of the investigation meeting or the last day on which the Authority received evidence about the dispute. This timeframe is stated in the Employment Relations Act 2000 (the Act).[5] Determinations can only be issued outside of that timeframe if the Chief of the Authority decides exceptional circumstances exist.[6] We note in practice this statutory deadline is often missed.
Parties can and do challenge well-reasoned determinations of the Employment Relations Authority in the Employment Court currently. However, an Authority Member’s determination that is rushed through or not well-reasoned due to pressure to meet shorter deadlines for releasing decisions may increase challenges to Authority determinations and increase costs to the parties in pursuing further litigation.
The Act already states the Authority must consider the behaviour of the employee and how much their actions may have contributed to the situation that gave rise to the personal grievance, when deciding the type and amount of any remedies the Authority would ordinarily award, including when considering reinstatement as a remedy.[7]
Green Party of Aotearoa New Zealand
The Green Party’s manifesto contains the following key policies:[8]
- Membership with a union will be the default when a person starts a new job as an employee, which they can opt out of after.
- Implement stronger protections for independent contractors and ensure they can be covered by Fair Pay Agreements and join other industry-specific collective bargaining.
- Strengthen collective bargaining frameworks for employees.
- Provide all working people with a right to redundancy compensation.
- Guaranteed increases in the minimum wage, at least in line with inflation.
- Increased resources across the Labour Inspectorate, WorkSafe, and the ERA to ensure all working people can uphold their workplace rights.
- Phasing in five weeks of annual leave, implementing the Holidays Act Taskforce recommendations, and ensuring bereavement leave entitlements are culturally appropriate for all New Zealanders (acknowledging the significance of tangihanga for Māori).
Comment
Currently, employees must opt-in to union membership. Depending on the sector and employer, sometimes application forms for a union will be provided to an employee when they accept/sign their individual employment agreement. Unions are notified of new employees unless employees opt-out of this notification.
Independent contractors are generally not able to engage in collective bargaining as this can be seen as anti-competitive behaviour prohibited by the Commerce Act.[9] Independent contractors are currently not included in the Fair Pay Agreements framework, but the current Government has previously signalled this could change.
It is important to note the distinction between a Collective Employment Agreement (CEA) and a Fair Pay Agreement (FPA). A CEA is the operative document governing the employment relationship between an employer and all the employees a union bargained on behalf of when reaching a CEA. CEAs, like any employment agreement, cover all minimum entitlements and the negotiated terms and conditions those employees will work under.
An FPA is limited in duration (three to five years), and narrower in focus. FPAs have been designed to outline the normal hours of work, minimum base wage rates, overtime, penalty rates, any superannuation and the process for varying an FPA. The parties must discuss but are not obliged to include topics like redundancy and flexible working. Currently, no FPAs are in force, as the Fair Pay Agreements Act 2022 only came into force on 1 December 2022.
As to redundancy, there is no current statutory requirement for employers to pay employees redundancy compensation. However, it may be covered by either an IEA or CEA.
Labour Party
Parental Leave
Labour proposes for partners of primary caregivers to receive four weeks of paid leave which could be taken either concurrently or consecutively with their partner. This leave would be additional to the current statutory entitlement of two weeks of unpaid leave. In terms of rolling out this policy, Labour says it would start as two weeks of paid partner leave on 1 July 2024, increasing to three weeks by July 2025 and four weeks by July 2026.
Labour also proposes while people are on parental leave, the government will pay a matching KiwiSaver ‘employer’ contribution to paid parental leave recipients, provided they continue to make their own KiwiSaver payments. This is designed to address the impact the unpaid nature of childcare and child-rearing can have on an individual’s retirement savings.
National Party
Fair Pay Agreements
National proposes to repeal the Fair Pay Agreements Act 2022 as it says this is adding further costs to businesses and adding to inflationary pressures. National has not indicated what will happen to FPAs where bargaining is currently underway.[10]
Parental Leave
National proposes the rules around the taking of parental leave be changed to allow parents more flexibility on when and how they choose to take leave. Currently, a birth parent can transfer part of their leave entitlement to their partner, but they are not allowed to take that leave concurrently. The party would change this so that the parents/caregivers could choose how they want to spend the leave.[11]
Seasonal Workers
The Recognised Seasonal Employer scheme allows the horticulture and viticulture industries to recruit workers from overseas for seasonal work when there are not enough workers already in New Zealand. The current cap in place is 19,000. National proposes to double the worker cap over five years to 38,000 per year.
National also proposes changes to Accredited Employer Work Visas for agriculture. It would remove the existing median wage requirement of $30 per hour while also creating a path to residency for those working under the scheme.[12]
Trial Periods
National proposes to fully reinstate 90-day trial periods to cover all businesses regardless of the number of employees. Currently, 90-day trial periods can only be used by businesses with 19 or fewer employees.
New Zealand First
MP Pay Rises
NZ First proposes that the planned pay rise for Members of Parliament should be delayed until all ‘essential frontline workers have been adequately compensated with their own pay rises first’. No mechanism has been provided for enacting these pay rises, or exactly which roles would fall under the classification of an essential frontline worker. However, the press release does mention police, doctors, nurses, paramedics, midwives, correction officers, and teachers.[13]
Covid-19 Vaccine Mandate
NZ First proposes that anyone who was dismissed because they chose not to be vaccinated in accordance with the COVID-19 vaccine mandates be reinstated to the position they were dismissed from and compensated. Details on the quantum of compensation or considerations of the suitability of reinstatement have not yet been provided. [14]
Te Pāti Māori
Minimum Wage
Te Pāti Māori proposes the minimum wage be immediately increased to $25 per hour and legislate an annual increase to reflect cost of living increases. They also propose the ‘starting out’ and ‘training’ wages be disestablished.[15] The current minimum wage is $22.70 per hour, while the starting-out and training wages both sit at $18.16 per hour.
Pay Equity & Collective Bargaining
Te Pāti Māori propose to legislate to ensure contractors can participate in multi-employer collective bargaining and collective bargaining.
The party is concerned that the current Government have not progressed with negotiations to ensure Māori nurses achieve pay equity. It would progress with the negotiations and guarantees procurement policies adequately fund Māori health providers to ensure pay equity is achievable. They also promise pay equity for Māori teachers and support staff.[16]
Assistance
If you have any questions about the potential implications that these policies could have on yourself or your business, or need advice on a specific situation, our lawyers are here and happy to assist you. Talk to a member of the Dyhrberg Drayton Employment Law team today!
Will McMaster, Lawyer and Annah Casey-Solly, Associate
[1] ‘Reducing the Costs of Personal Grievances’ (Undated), accessed through: Reducing Cost of Personal Grievances – ACT New Zealand on 11 September 2023.
[2] ‘Protecting choice and freedom to contract’ (Undated). Accessed 11 September 2023 through: Protecting choice and freedom to contract – ACT New Zealand.
[3] ‘Minimum Wage Hikes and Handouts: Sounds Like Labour’ (Undated). Accessed 12 September 2023 through: Minimum Wage Hikes and Handouts: Sounds Like Labour – ACT New Zealand.
[4] ‘ACT’s pledge to reverse sick leave, pause minimum wage hikes, scrap extra public holiday and benefit boost’ (30 March 2022). Accessed 12 September 2023 through: https://www.newshub.co.nz/home/politics/2022/03/act-s-pledge-to-reverse-sick-leave-pause-minimum-wage-hikes-scrap-extra-public-holiday-and-benefit-boost.html.
[5] Employment Relations Act 2000, s 174C(3).
[6] Employment Relations Act 2000, s 174C(4).
[7] Employment Relations Act 2000, s 124.
[8] Source: ‘Green Party Manifesto 2023’ (PDF). Accessed 11 September 2023 through: 2023 Manifesto – Green Party of Aotearoa New Zealand (greens.org.nz).
[9] Report of Beth Goodwin, Advice on contractors in the Fair Pay Agreements system (Ministry for Business, Innovation and Employment, 4 December 2020) at p 3.
[10] Source: ‘Dealing with inflation’ accessed on 11 September 2023 through: Dealing with inflation (national.org.nz).
[11] Source: ‘Flexible Use of Parental Leave’ accessed on 11 September 2023 through: Flexible Use of Paid Parental Leave (national.org.nz).
[12] Source: ‘Getting back to farming’ accessed on 11 September 2023 through: Getting back to farming (national.org.nz).
[13] Source: ‘Glenfield Policy Announcement’ accessed on 11 September 2023 through: Glenfield Policy Announcement – New Zealand First (nzfirst.nz).
[14] Source: ‘Give Whangarei And Northland A Fair Go’ accessed on 11 September 2023 through: Give Whangarei And Northland A Fair Go – New Zealand First (nzfirst.nz).
[15] Source: ‘Income’ accessed on 12 September 2023 through: Income (maoriparty.org.nz).
[16] Source: ‘Income’ accessed on 12 September 2023 through: Income (maoriparty.org.nz).
