Strikes and Lockouts

June 19th, 2013 at 12:00 pm by David Farrar

As reported last week, Jami-Lee Ross has a bill which will remove the prohibition on temporary labour during a strike or lockout.

Now I don’t have a problem with employers being able to use temporary labour to remain operating during a strike. Without that ability, a union can cripple an employer.

However I do have a concern over the possibility than an employer would lock out current staff, and use temps to force them onto a new contract.

Personally I dislike both strikes and lockouts. I think it is incredibly hard to have a harmonious workplace if either side resorts to the ultimate action of a strike or lockout. I am happy to say I may even dislike lockouts a little bit more, as I don’t like employers trying to force current staff onto a new contract. A shift from a current contract should be one that is mutually agreed to.

There’s even part of me that wonders if employers should have the ability to do a lockout? But as unions have the right to strike, I guess you need an equivalent power for an employer.

But how often do we have strikes and lockouts?

The average numbers of strikes every year since 1986 has been 66. The average number of lockouts is 2. So very very few employers ever resort to a lockout, as it should be.

The average hides the dramatic change over time as this graph shows.



You can see the impact of the Employment Contracts Act in 1991. It brought to an end the era of three strikes a week. The 4th Labour Government say 176 strikes a year. 4th National Government saw it drop to 52. 5th Labour Government was 35 average and the first term of 5th National was just 19 a year, or one every three weeks or so. It’s good we have fewer strikes that in the past, but just a few years ago there were 60 in one year under Labour.

Anyway the number of lockouts is extremely low. For the last decade an average of only one a year. So any claims of employers locking staff out should be read in that context.

However if the bill gets through a first reading, and makes it to select committee a possible option to be considered is to remove the prohibition on temporary labour for strikes, but not for lockouts? I’d be interested to hear debate on the pros and cons of that.

To my mind, that could be a good compromise as it would discourage both strikes and lockouts. If an employer can use temporary staff, then a union is less likely to resort to a strike, which is good. Strikes should be a last resort. Once you’ve had a strike it is very difficult to have a trusting employment relationship.

However if you allow employers to use temporary labour for lockouts, that could encourage some employers (not many I am sure) to do a lockout – and I view that as undesirable also.

So repealing the ban on temporary labour for strikes, but not lockouts, would seem to be a good compromise.

Another POAL strike

February 9th, 2012 at 4:00 pm by David Farrar

Hayden Donnell at NZ Herald reports:

Ports of Auckland workers are set to strike for a full week in a new escalation of their long running employment dispute.

The just-announced strike action is set to start at 7am on February 24.

It is in addition to a partial strike set to take place from February 15 to 22.

So basically, they will be on strike for two weeks continuously.

How long until all the customers have gone to Tauranga?

Auckland loses out

December 6th, 2011 at 2:29 pm by David Farrar

Stuff reports:

The possibility of further strikes at Ports of Auckland has forced major shipping line Maersk to shift one of its services to the Port of Tauranga, leaving the Auckland port company $20 million out of pocket.


”Maersk have explained to us that the possibility of further industrial unrest has been central to their decision to shift the service to Tauranga.”

The port company will lose 52 ship calls, 82,500 containers, and nearly $20m in revenue annually.

I guess that may mean fewer jobs. Funny how the real world operates.


Compulsory arbitration for health workers?

October 21st, 2010 at 10:00 am by David Farrar

The NZ Herald editorial:

A call by district health boards for the Government to review the right of health workers to strike is, therefore, most timely. They made it clear yesterday that they have had enough of patient safety being compromised.

The chief medical officers of all 20 boards have written to the Health Minister, Tony Ryall, urging him to make disputes over pay or conditions in the health system subject to compulsory arbitration, as is the case with other public safety workforces, such as the police.

The freedom to withdraw labour should never be eliminated lightly. But, whatever the rights and wrongs of the present strike, there is good reason to believe the time has come for compulsory independent arbitration in the sector.

Hospitals provide an essential service. They are the only port of call for the ill. There is no alternative supplier of their services. As it is, sick people must wait impotently as disputes wind their way to a conclusion.

What I find interesting with the current compulsory arbitration for the Police is that the arbitrator can  not choose a compromise. He or she must choose the employer offering or choose the union request.

So what does this do? It encourages reasonableness. The more extravagant or unfair your demands/offer and the less chance there is of it being selected. So you often get the two parties quite close to each other.

During the junior doctors’ strike of 2008, the Medical Council suggested the time to move to compulsory arbitration had come. Unsurprisingly, a Labour Government was unmoved.

Now, the push by district health boards has substantially raised the ante. So, too, has health workers’ increasing penchant for industrial action. If the Government acts, as it should, there will surely be no complaints from the public.

I think there is a case for considering hospitals an essential service akin to the Police.

The boy who cried wolf

July 16th, 2010 at 9:12 am by David Farrar

The Herald reports:

The Government is planning to allow all companies to have 90-day trials for new workers and wants to give employers the power to keep unions out of the workplace.

Unions say the proposals are outrageous and an attack on workers’ rights.

The present scheme – restricted to firms with 20 staff or fewer – lets bosses take on workers on trial for up to 90 days.

The unions of course predicted all sorts of massive abuses when the scheme came in for smaller employers. Since then, a total silence. Where are the scores and scores of examples of terrible abuses? Sure the scheme has been used (that is why it was introduced), but have there been any cases of bosses sacking new workers because they wouldn’t sleep with the boss etc – as predicted by the unions?

Grievance free trial periods are common in OECD countries, and they encourage employment – especially of employees whose backgrounds may make it harder to be given a go.

One News reported last night that the Government plans to extend the scheme to all companies. It is also looking to let employers deny unions access to the workplace on reasonable grounds – a plan that appals Labour and the unions.

Union leaders vowed to fight the changes and Labour leader Phil Goff promised to scrap the 90-day scheme altogether if Labour regained power.

What the Herald doesn’t mention regarding the access to workplaces, is it was explicit 2008 election policy for National.

UPDATE: My bad. The Herald did in fact state that in the article. I just didn’t see it.

A lock out

June 22nd, 2010 at 1:00 pm by David Farrar

Darien Fenton blogs at Red Alert:

Today I went to support the locked out staff at Auckland’s 4.5 star hotel, the Rendezvous – that’s the staff who keep the hotel clean and help provide an enjoyable stay for hotel guests.

I have to say I don’t like employers locking out staff as a way to solve a pay dispute, just as I think strike action over pay disputes should be a last resort also.

From an employers point of view, there is even less reason to do a lock out. If one can’t settle a pay dispute, then the existing terms and conditions carry on. So locking staff out has a certain bullying factor to it.

This trans-national hotel chain is offering a measly pay increase of 1.5% from now (no backdating) for two years until 2012.

1.5% over two years isn’t a lot. However would have been useful for Darien to specify what their current rates are, so one can judge in context. Also of interest is how profitable that hotel is. If the hotel is losing money, then that might explain it.

The last pay increase was in January 2008 so the workers have already been 18 months without a pay increase. And there’s a catch. The employer wants the workers to give back one day’s sick-leave, to increase the costs of staff parking and remove a subsidy for health insurance.  The Rendezvous says this is the final offer and the workers have been locked out from their jobs until they accept it.

As I said earlier, I don’t like employers who lock out staff to try and force them into accepting a pay offer. Again it would be useful to have more precise details of the “claw backs” such as how much sick leave is there currently, what is the current cost of staff parking and the current health insurance subsidy.

Look at these workers.  Are they militants?  Are they highly paid?  I don’t think so.  One housekeeper told me that she is expected to clean 18 rooms a day – an increase in 4 rooms since the Rendezvous took over the former Carlton Hotel.  Isn’t this a productivity increase?  Isn’t this supposed to deliver better wages?

I agree – greater productivity is what should lead to higher wages. Again, would be useful to have some stats on whether 18 rooms a day (I presume an eight hour day) is standard for the hospitality industry.

And the winners are

February 23rd, 2010 at 12:27 pm by David Farrar
  1. Employment Relations (Workers’ Secret Ballot for Strikes) Amendment Bill – Tau Henare
  2. Smart Meters (Consumer Choice) Bill – David Clendon
  3. Minimum Wage (Mitigation of Youth Unemployment) Amendment Bill – Sir Roger Douglas

Tau’s bill requires all votes on strike action to be secret ballots. In theory almost all unions do this anyway, but there has been some dispute on the West Coast recently about whether this does always happen, so it will be good to have it a legal, not a voluntary, requirement to prevent intimidation.

David Clendon’s bill is inherited from Jeanette and regulates the use of smart meters. Not sure of all the details, but it looks to be worth supporting at first reading anyway so a select committee can look into pros and cons.

Sir Roger’s bill will allow the Government to set a different level of minimum wage for younger workers. I welcome it as there is pretty clear evidence that the huge increase in youth unemployment is bext explained by the scrapping of the youth rate for the minimum wage. National will be nervous about being seen to be “cutting wages” but I hope they will support it to select committee, so arguments can be heard about the linkage.

Rather than cut the minimum wage for any current workers, what I would do if I was the Government is just use it to increase the youth minimum wage more slowly than the adult minimum wage.

O’Reilly predicts public service strife

December 27th, 2009 at 10:50 am by David Farrar

The SST reports:

BUSINESS BOSS Phil O’Reilly is predicting 2010 will be a year of industrial strife and an “ugly” budget that will bump up the GST rate.

O’Reilly, the chief executive of Business NZ, said he expected “fireworks” from public sector unions as the government tightened the screws on spending, and Finance Minister Bill English has said total government spending cannot increase more than $1.1 billion in the May budget, a difficult task considering that public hospitals alone have been soaking up an extra $700 million a year in recent budgets. English has warned public servants such as teachers and nurses not to expect pay increases that are “out of line with realistic expectations”.

More than 50,000 primary and secondary teachers will negotiate a new pay deal with the government when their current agreement expires at the end of June.

“I think we will see quite a few sparks fly,” O’Reilly said. “Government departments are being told how much they can spend so you’re going to see an ugly budget from the perspective of government spending and that will impact people like the state sector unions, the teacher unions and so on. I wouldn’t be at all surprised if some of that was turned into industrial action.”

NZ Council of Trade Unions president Helen Kelly said O’Reilly was being “hysterical” but warned that public sector workers would not tolerate zero pay increases or cuts in services.

“We are ready for that kind of a year but we hope commonsense will prevail.

I am all for common sense. Common sense is that the economy has grown only 0.4% in the last six months, so pay increases greater than the rate of economic growth are not common sense. Likewise borrowing more money to fund pay increases is not common sense when you are borrowing $240 million every week just to pay for current salaries.

Bus drivers turn down 12% pay rise

November 5th, 2009 at 4:00 pm by David Farrar

The Herald reports:

Auckland bus drivers turned their back on a $500 sweetener from the region’s public transport agency when they rejected advice from union leaders yesterday to accept a new company pay offer.

Emotions ran high at Alexandra Park racecourse after about 55 per cent of almost 650 drivers and cleaners voted by secret ballot to reject the offer from Infratil subsidiary NZ Bus of pay rises amounting to $2 an hour by the final stage of a three-year deal.

That would have lifted the top hourly wage for drivers with nine months’ service or more to $17.45 now, $18.15 next year, and $18.75 in February 2012.

Putting aside the $500, that is a 12% increase over three years. A full time salary of $39,100 for driving a bus.

At a time of low inflation and rising unemployment, their decision is regrettable. They even went against their own unions’ recommendation to accept.

If they think they can do better than $39,000 elsewhere, maybe they should offer their services to another company.

Union rejects ERA recommendation

October 17th, 2009 at 10:12 am by David Farrar

I have not followed the bus dispute in Auckland very closely, but find this story interesting:

The Employment Relations Authority has made public its recommendations to settle the pay dispute between NZ Bus and Auckland drivers.

The ERA suggested a wage increase of 4.2 per cent for the first 16 months, back-paid to July this year, then 3.9 per cent for the next 14 months from November next year.

Both increases amounted to 70 cents an hour.

The collective agreement would expire on December 31, 2011 after the Rugby World Cup, ERA recommended.

NZ Bus agreed to the recommendations and requested they should be released to the public.

So the employer is willing to accept the ERA recommendation, but it is the union that is not.

I note inflation is now running at 1.2%.