Woke legislation - really!
- David Burton
- Blog
Workers should feel threatened. The National led government is planning to continue its programme of reducing employment protections for workers this year. It follows a direction by the government last year of requiring public service departments to identify savings of between 6.5 to 7.5 percent. Workers bore the brunt of those cuts.
It would seem that the new Trump administration is following a similar approach. On becoming President, Donald Trump set up a new advisory body creatively named the Department of Government Efficiency (DOGE) tasked with cutting US government jobs and other spending. It seems to be fronted by the world's richest man, Elon Musk, as he seeks to weed out what he considers to be taxpayers' money being wasted.
It is understood that almost all federal employees were offered a “deferred resignation” proposal in exchange for financial incentives, such as months of paid leave, for employees who chose to leave their jobs in February. Although this was then stopped by a federal judge, the Office of Personnel Management confirmed that about 75,000 federal employees had already accepted the offer.
There have also been wide-ranging layoffs of almost all probationary employees (those generally in their job for less than a year). According to the Office of Personnel Management about 220,000 federal employees had been in their job less than a year.
More recently, federal government employees have been receiving emails, sent from the Office of Personnel Management asking employees to send approximately five bullet points listing what they accomplished during the week, and to copy in their managers. The email requested that employees not send any classified information, links or attachments and to respond by a deadline.
On social media platform X owned by Musk, he wrote “Consistent with President @realDonaldTrump’s instructions, all federal employees will shortly receive an email requesting to understand what they got done last week. Failure to respond will be taken as a resignation.” Finally, a few hours before the midnight deadline, the Office of Personnel Management confirmed that federal workers would not be fired if they did not respond.
RNZ calculates that 9520 roles have been cut from the New Zealand public service (based on figures from statement released by Ministries and the PSA). Some of those job cuts have been from roles that had not been filled.
In addition to those job cuts, last year the government reintroduced a trial period for all employers enabling them to dismiss a worker within 90 days for no reason, without the worker being able to challenge that dismissal. It also proposed a new “gateway” test which will enable employers to classify workers as “contractors” more easily. Those “contractors” will not be able to exercise minimum entitlements such as the minimum wage, holiday pay and employment protections such the ability to bring personal grievance claims and the labour inspectorate.
So what are workers in New Zealand likely to face this year? Just before Christmas the Minister for Workplace Relations and Safety, Brooke van Velden, announced that more major announcements were likely and that she expects to progress an Employment Relations Amendment Bill early this year. The Minister revealed some of the changes we should expect to be included in this Bill, including:
The reality is that the Employment Relations Authority already does a pretty good job of assessing any contribution an employee may have made to their dismissal in assessing appropriate remedies.
One could argue that the government’s attack on workers rights and protections is largely symbolic and designed to please their voter base. Or one could argue that it is an attack on those most vulnerable in New Zealand’s workforce, and designed to please the government’s voter base. Oh dear, business likes certainty! What is certain is that like Trump the Minister is creating uncertainty, and like Trump lawsuits will follow. Read more....
Waitangi Day marks the signing of New Zealand's Treaty of Waitangi or Te Tiriti o Waitangi in Māori between the British Crown and Māori chiefs. Now that Waitangi Day has passed for another year, and the celebrations, demonstrations and political grandstanding are over, it may come as a surprise to many New Zealander’s that tikanga Māori (the customary rules which govern Māori life) has quietly gained recognition in employment law in New Zealand.
For years, tikanga Māori has increasingly been recognised by our courts and legislation. The most recent significant case was the Supreme Court decision on whether Peter Ellis, under tikanga, would have a right to clear his name or re-establish his mana, even if dead. In Māoridom, mana and reputation carries on in whakapapa, rather than an individual's life.
There have now been a number of decisions of the Employment Court affirming that tikanga may be an important consideration when an employer is considering dismissing an employee. In Pact Group v Robinson the employee said that as a Māori her mana was being impacted by the disciplinary process the employer was undertaking. In reaching her decision that Ms Robinson was unjustifiably dismissed the Chief Judge said that there was nothing to suggest that these concerns were seriously considered or factored into the way in which the company proceeded. The Judge said that the process was hurried and conducted in a distanced, impersonal way that undermined, rather than maintained, the employee’s mana.
The Judge also referred to Utu, “the action undertaken in reciprocity”, and its link to mana. To show and reciprocate generosity enhances mana and strengthens relationships, whereas the failure to give or receive utu diminishes the mana of both parties to the relationship. The employee gave evidence that she felt as though her treatment by the company failed to reciprocate the care, empathy and consideration she was expected to bring to her own role as a community support worker for the company.
In GF v Comptroller of the New Zealand Customs Service the Employment Court Chief Judge also concluded that the employee was unjustifiably dismissed. In addition to finding the dismissal unjustified, during the hearing the Chief Judge heard submissions on whether tikanga should have relevance in her decision-making process. She found that because Customs had incorporated tikanga and tikanga values into its policies and employment relationships, they were relevant. She said “the tikanga/tikanga values identified in this case seem to me to sit entirely comfortably with an area of law which is relationship-centric, based on mutual obligations of good faith, and focused (where possible) on maintaining and restoring productive employment relationships.”
The Chief Judge also concluded that Customs failed to meet what she referred to as heightened good employer obligations imposed on Customs, as a good public service employer under the Public Service Act “to honour a commitment it has incorporated into its employment relationship with all employees (Māori and non-Māori) to act consistently with applicable tikanga/tikanga values”. That Act requires government departments to operate a “good employer policy” which amongst many things requires the recognition of the aims and aspirations of Māori and the employment requirements of Māori.
The contentious Treaty Principles Bill is an ACT Party policy, to enshrine what it says the Treaty means into law. The Act Party says that the Treaty has been interpreted by the courts, the Waitangi Tribunal and successive governments in a way that has gone beyond its original intent. Many New Zealanders disagree. Thankfully, the Act Party’s coalition partners have already doomed the Treaty Principles Bill. Both the New Zealand First and National Party leaders confirmed that recently during speeches at Rātana. The Treaty Principles Bill is "dead in the water", New Zealand First leader Winston Peters said. The bill is "never going to go past the first reading". Likewise, the Prime Minister again confirmed that "National won't support the bill - it will be voted down and it won't become law."
Unlike the Treaty Principles Bill, the intentions of the Employment Relations Act are well meaning - to build productive employment relationships; to acknowledge and address inherent inequality of power in employment relationships; to protect the integrity of individual choice; and to promote the effective enforcement of employment standards. Read more...
As part of the Government’s drive to cut costs, it has made much of the large contract awarded to multi-national company Compass which leads a consortium to provide cheaper school lunches.
Likewise, multi-national company Uber has been allowed to appeal the Court of Appeal decision confirming an Employment Court declaration that Uber workers are employees. Whatever, the outcome of that appeal the law in New Zealand relating to contractors is likely to have a significant “shake-up”. It is on the National lead government’s agenda this year.
The cost savings made by the Government in the school lunch programme has come at a huge cost to the many vulnerable employees the programme has employed, particularly in smaller rural communities. New Zealand has recognised for years now that further legal protection is needed for particularly vulnerable workers. These workers are often employed in industries such as cleaning or catering where restructuring situations are frequent, usually with the intention of driving down costs and undermining workers terms and conditions.
These “vulnerable employees” are meant to have the right to elect to transfer to the new contract holder on their existing terms and conditions of employment (preventing the new contract holder cutting pay rates and other terms of employment). If the new contract holder then decides to make the “vulnerable employees” redundant it is obliged to honour the vulnerable employees contractual entitlements to their redundancy entitlements, such as notice. If there is no provision for redundancy compensation, the new contract holder is obliged to negotiate in good faith with vulnerable employees.
Until Associate Education Minister Seymour announced that Compass would take over much of the school lunch contract, existing suppliers to the programme were unaware that their contracts were up for tender and were not able to retender for their contracts or give their vulnerable workers advanced warning that their jobs would likely be lost. It is understood that approximately 2,000 employees have now lost their jobs.
Even worse, just prior to Christmas, members of the Compass consortium finally began consulting with the vulnerable employees, providing them with only a few working days notice (given public holidays and Christmas closures) before so called “final decisions” were made on whether they would have jobs when the new school terms commenced again. Most were made redundant.
It is also understood that despite the legal obligation to bargain in good faith for redundancy compensation in situations like this, the Ministry of Education has made no provision for redundancy entitlements for vulnerable workers in the contract awarded to the Compass consortium. It is understood that no redundancy compensation is being offered by Compass. Despite Official Information requests being made, the Ministry is still not providing details of the contract awarded to the Compass consortium.
The use of contractors has also been a common tool to drive down costs. Following the Court of Appeal decision last year that the Uber contractors were in fact employees Workplace Relations and Safety Minister Brooke van Velden last year outlined changes to the law she says will make it easier to clarify whether a worker is an employee or a contractor. She explained that the changes were part of the National and ACT coalition agreement where it agreed that the parties would "maintain the status quo that contractors who have explicitly signed up for a contracting arrangement cannot challenge their employment status in the Employment Court".
This approach harks back to the National government approach when the Employment Contracts Act was enacted in the 1990s. The leading case on the issue concerned the legal status of a courier driver whose contract gave the company extensive control over his operations; but he was obliged to provide a company branded vehicle, he was responsible for his insurances and other associated costs and he was remunerated on a “per trip” basis. The Court of Appeal concluded that the courier was a contractor because his contract said so.
Now the Employment Relations Act requires the Court to consider “the real nature of the relationship” in determining whether a worker is an employee or a contractor. In doing so, the Court must consider “all relevant matters, including any matters that indicate the intention of the persons” and “not to treat as a determining matter any statement by the persons that describes the nature of their relationship”. Put more simply, a statement that the worker is a contractor is not enough to determine the issue.
Until the Uber cases, our most notable court decision on the employee/contractor issue is Bryson v Three Foot Six. Mr Bryson was a model maker and was fully integrated into the workings of the film production. The Supreme Court finally concluded that Mr Bryson was an employee. Famously, the John Key lead National Government then changed the outcome of the Bryson decision for the film industry by enacting the so-called Hobbit law - effectively making workers in that industry contractors.
When the Employment Court determined that the Uber workers were employees in 2022, the Chief Judge commented that “employment status is the gate through which a worker must pass before they can access a suite of legislative minimum employment entitlements, such as the minimum wage, minimum hours of work, rest and meal breaks, holidays, parental leave, domestic violence leave, bereavement leave and the ability to pursue a personal grievance.” Contractors enjoy no such protections.
Last year changes to employment law in Australia came into effect that enable the Fair Work Commission to provide platform or gig economy drivers, food delivery riders and parcel couriers with minimum employment standards; including superannuation, personal injury insurance and a safety net on pay. Likewise, the UK provides protection to some minimum entitlements for a third class of worker – “dependent contractors”.
Unfortunately, the governments planned changes on the employee/contractor issue are likely to further close the gate on vulnerable workers and deny them access to minimum employment entitlements. The industries that employ workers that are vulnerable are likely, like Uber, to simply label their workers “contractors”. Read more....