Workplace Relations Update – A Perspective on Government Changes


Once the outcome of the 2017 General Election became clear, we were not surprised to see a number of workplace related changes were included in the new Government’s 100-Day Plan. These included:

  • extending Paid Parental Leave

  • lifting the Minimum Wage and Starting Out/Training Wages, and announcing the intention to review the Starting Out/Training Wages within 12 months. We note the advice Treasury gave the new Government about this - www.stuff.co.nz/business/101746361/labour-warned-if-economy-turns-minimum-wage-plans-will-hit-the-young-and-unskilled; and

  • withdrawing the previous Government’s Pay Equity legislation and reconvening the Joint Working Group on Pay Equity Principles to make recommendations to Ministers by the end of February 2018 about a new approach to Pay Equity, which is likely to lead to the introduction of further legislation shortly thereafter.

In late January the Minister of Workplace Relations and Safety announced a more comprehensive raft of workplace relations changes – www.beehive.govt.nz/release/legislation-fairer-workplaces-announced.

Many of the changes were, of course, signalled in the run up to last year’s General Election. There were, however, a few surprises, such as the retention of 90-day trial periods for businesses with fewer than 20 employees, which was a reminder of the realities of governing in a coalition environment.

The Minister has stated that these changes will ensure the Government meets its commitment to “creating a high-performing economy that delivers good jobs, decent work conditions and fair wages”; acts on the “fundamental value of the Labour-led Government of making life better for working New Zealanders”; and “restores [the] balance between employers and workers ” with a view to ensuring “working New Zealanders do not miss out on the benefits of economic growth under the current employment relations system”.

The release of the Employment Relations Amendment Bill earlier in February www.parliament.nz/en/pb/bills-and-laws/bills-proposed-laws/document/BILL_76257/employment-relations-amendment-bill provided the details of what is being proposed to achieve these goals.

In short the Bill proposes changes to both the collective bargaining provisions of the Act with the intention of “lifting wages through collective bargaining”, and changes to minimum standards and protections to employers. These proposed changes would roll-back the amendments the 2008-17 National-led Governments made to the Employment Relations Act 2000, and take the law further in a number of areas – many of which are intended to promote union membership and strengthen collective bargaining. Submissions on the Employment Relations Amendment Bill are due by 30 March 2018.

Looking ahead the Government has also announced that it will progress the creation of a framework for establishing Fair Pay Agreements in the coming year.

These agreements are likely to provide core minimum conditions of employment for specific occupations in any given industry or industries. The Government has stated this does not represent a return to industry awards, which disappeared with the passage of the Employment Relations Act 1991, but they appear to bear many of the hallmarks of awards – including a likely restriction on strike action to achieve settlement and a requirement to instead use compulsory arbitration to settle agreements. This would signal a significant move away from the parties involved in bargaining coming to their own agreements, which has been a hallmark of workplace relations in New Zealand since 1991, and a move back to centralised determination of industry-wide terms and conditions of employment.

There is, of course, also significant consideration being given to implementation and /or encouragement of a Living Wage; and a review of the workplace provisions dealing with sexual harassment, including the potential establishment of a public service register of alleged sexual misconduct - www.stuff.co.nz/business/101113650/government-to-start-tracking-sexual-misconduct-in-the-workplace.

Taken together, there is plenty for all employers to keep an eye on in the coming months. Many of the proposed changes represent a move back to the way things were when the Employment Relations Act was enacted in 2000, while others look to break new ground and could potentially have significant consequences for workplaces in New Zealand.

Our advice to clients is to stay up-to-date with the changes that are being proposed, and understand what they could mean for your organisation. Seek information and advice if it is required, so you can prepare for the changes before they happen.

Be aware of the nature of your industry or sector – the more unionised it is the more the changes are likely to have an impact – but some of the changes will affect every workplace.

Fundamentally, an ongoing focus on running your organisation as well as you can and maintaining an engaged and focused workforce with productive workplace relationships is the best approach you can take.