National’s Employment Relations Policy

October 28th, 2011 at 9:20 am by David Farrar

I suspect we will hear from a lot of unions today. Amazingly not a single union commented on Labour’s superannuation policy yesterday, despite their decades of opposition to compulsory superannuation and raising the age of eligibility.

But National has just released their employment relations policy, and I think the unions will rediscover their voices. The policy takes a number of good steps in the right direction, and is in total contrast to Labour’s desire to return to the 1970s.

First of all there is a partial victory on the issue of the minimum wage for teenagers, which has resulted in such massively high youth unemployment.

There will be a “Starting-Out Wage” set at 80% of the adult minimum wage. At present the current law has this also, but it only applies for the first 200 hours of employment, which can be as little as five weeks. National is extending this to:

  1. 16 and 17 year olds for their first six months with an employer
  2. 18 and 19 year olds if they have been on a benefit for more than six months prior, for their first six months of employment
  3. 16 to 19 year olds doing at least 40 credits of industry training a year (was 60)

This doesn’t go as far as I would go, which would be to simply not have the minimum wage law apply to those aged under 18 (rather than under 16), but it should give young job seekers a better opportunity to get their first job, and gain that all important experience.

National is also making it easier for employees to request flexible working arrangements:

Many workplaces already have flexible working arrangements, either formally or informally. But at the moment, the formal request mechanism applies only to those with caring responsibilities.

National will extend the right to request flexible working hours to all workers, and raise the profile of flexible working arrangements. We want to see more workers and employers benefiting from flexible working arrangements.

And also they wind back some compulsory lite unionism:

Remove the requirement that non-union members are employed under a collective agreement for their first 30-days.

The current law effectively forces you to join the union, and means you can only withdraw and go on an individual contract after 30 days. National allows an employee to decide for themselves from day one whether or not they wish to join a union.

Apply partial pay reductions for partial strikes or situations of low-level industrial action.

Currently, employees can engage in partial strike action, such as refusing to answer email or do any paper work, while continuing to receive full pay.

Partial pay for partial work.

I am really pleased to see some movement on the issue of pay rates for teenagers with no work experience who need a first job. Our youth unemployment rate is far too high.

Hands up if you are surprised?

October 21st, 2011 at 3:01 pm by David Farrar

Derek Cheng at the Herald reports:

The Labour Party’s vision for the future of work and wages is virtually identical to a unions’ wishlist outlined at the party’s annual conference a year ago, prompting questions about their influence.

Of course it is identical. Labour is effectively the parliamentary wing of the unions.

It is incredible to consider that Phil Goff who supported so many of the reforms of the 1980s, is now pushing a return to the 1970s.

What other new policies will Labour announce? Maybe ..

  • No Sunday trading, to give workers a break
  • A retail pricing commission which sets maximum retail prices to stop consumers from being ripped off
  • A rent freeze

What other 1970s policies should Labour resurrect?

Labour’s Marty McFly policy

October 21st, 2011 at 12:29 pm by David Farrar

I devote my Herald column to Labour’s work and wages policy. Many of my Herald columns are reasonably reflective. In this one, I call a spade a spade.

And it is 3/3 against

October 20th, 2011 at 2:00 pm by David Farrar

All three major newspaper editorials have come out slamming Labour’s 1970s workplace policy. The Herald says:

It will not be easy to take the Labour Party seriously at this election if it comes up with any more policy like the one announced on Tuesday. To lift the level of wages in this country it proposes industry-wide wage orders.

Can you imagine it. The struggling corner dairy may suddenly be told that it has to pay its staff the same as the massive supermarket around the corner, even though it will force them to close.

The Labour Party would surely hesitate to propose this if there was much prospect of the party winning the election and having to put the policy into effect. Like one or two other planks in the party’s platform this year – notably the removal of GST on fresh fruit and vegetables – the policy is mainly interesting for what it says about Labour’s condition at present and how much younger members of the caucus have to learn.

Helen Clark would have never come out with such an unelectable policy. I agree with the Herald that the push for this has come from the newer MPs.

A strong economy needs to let employers prosper wherever they can and compete for the employees they need. Wages grow when employers need more people with valuable skills. A policy for productivity encourages more investment in productive activities, and better education to equip workers with adaptive skills. It does not put industries back in a straitjacket for unions’ sake. The country has been there.

It really is the Marty McFly policy.

Dom Post on Labour’s 1970 workplaces policy

October 20th, 2011 at 11:00 am by David Farrar

A second editorial pouring scorn:

If wishes were horses, beggars would ride.

If living standards were determined by government decree, Labour’s new industrial relations policy would be a breakthrough contribution to an age-old debate.

Sadly for the low-paid workers Phil Goff’s party is trying to woo, wishful thinking has nothing to do with living standards.

The consequence of hiking the minimum wage from $13 to $15 an hour, as Labour is proposing to do, will be to deny more unskilled young job seekers the opportunity to get a foot on the job ladder. The consequence of telling international film producers it is our way or the highway will be for them to pack their bags. And the consequence of requiring all employers in an industry to offer the same minimum set of terms and conditions will be to ship more jobs off overseas.

It is arguably the great job destruction policy we have ever seen.

The only winners from Labour’s work and wages policy, unveiled on Tuesday, will be unions, which can expect a temporary increase in members and influence.

These are the same union that not only fund the Labour Party, but actually are members of it, and have significant voting rights with it?

Circumstances vary from workplace to workplace. To succeed in the global market, businesses have to be flexible. Rewards should be shared fairly, but the way that is done should be a matter for shareholders, managers and employees to work out, not bureaucrats in the new Workplace Commission that Labour proposes to create.

Oh it won’t be bureaucrats on the Workplace Commission. It will be full of former or future Labour MPs.

The Press on Labour’s 1970s workplace policy

October 20th, 2011 at 8:25 am by David Farrar

The Press editorial:

The Labour Party claims its work and wages policy, which it released this week, will boost the country’s economic performance and generally provide a better future for workers. That is very unlikely. The policy’s strange mish-mash of bureaucratic centralised wage-setting, legislated higher minimum pay and repeal of some of the present Government’s liberalising workplace reforms has gruesome echoes of the unlovely 1970s. Far from being a forward-looking policy, as the Labour leader, Phil Goff, has declared it to be, it recalls policies long thought dead and buried.

The policy has been welcomed by unions, as well it might be. It could well have been written by them.

I shudder at the thought of a union being able to go to a group of mates appointed by Labour and get them to set terms and conditions for an entire industry. Employers, no matter what their size or location or profitability, will suddenly have to comply with the dictates of this new commission.

According to Goff, the policy would help stem the flow of people to Australia. Given that the effect of much of it would be to price some jobs out of existence, quite how it would do this is unclear. Labour still does not appear to understand that it cannot legislate its way to prosperity.

It’s a basic concept, but one which seems alien to them.

Middle Earth under Labour’s new workplace policy

October 19th, 2011 at 8:29 pm by David Farrar

Whale shows us what Middle Earth would look like under Labour’s industrial relations policy. Enjoy and share.

In line or out of line?

October 19th, 2011 at 9:05 am by David Farrar

Danya Levy at Stuff reports:

Labour says its plans to overhaul employment laws will bring New Zealand in line with other developed countries and claims it is a return to 1970s-style industrial relations are scaremongering.

No scaremongering at all. But let us look at the claims it will bring NZ in line with other developed countries.

Take the 90 day probation period. We are almost the only country in the OECD that didn’t have one. Australia has 90 days, Canada 6 months, UK 12 months and Ireland 12 months. Germany is 6 months. The only OECD country without a legal probationary period is Denmark. So don’t believe the crap that this brings us in line with other countries.

Now take the plan to price more people out of the workforce by making it illegal for an employee to work for less than $15 an hour, even an unskilled 16 year old. Wikipedia has a list of minimum wages by country and what percentage they are of GDP/capita. This allows a comparison. Under Labour’s policy NZ would go from 62% to 72%. Here’s other OECD countries:

  • Australia 52%
  • Austria 37%
  • Belgium 53%
  • Canada 44%
  • Denmark 66%
  • France 53%
  • Ireland 49%
  • Netherlands 48%
  • Switzerland 38%
  • UK 66%
  • US 33%

So again not bringing us in line with other OECD countries, but in fact increasing the gap between us and other OECD countries.

Labour’s Industrial Relations Policy

October 18th, 2011 at 3:43 pm by David Farrar

This policy is so backwards, so appalling and so one-sided I don’t even know where to start. It is clear that the unions have written this, because they have got everything they could think of.  The policy is here.

It includes:

  • A 15.3% increase in the minimum wage, including for youth.
  • Labour will appoint those union bosses who fail to make their caucus to a new Workplace Commission that will have the power to determine Industry Standard Agreements for entire industries – unionised or not. This is all but a return to the days of national awards. No employer and employee will be able to agree to terms less than those set out by the Workplace Commission
  • The Workplace Commission will be able to set a standard for an industry for “union rights”. This could mean anything, from employers forced to fund unions themselves directly to guaranteed access to any workplace at anytime for recruitment purposes.
  • The Government will fund unions (“provide resources”) s they can better understand the new law and “build capacity for negotiations”. This means hire more staff. The same staff who come election time turn out en masse for Labour putting up their hoardings, using union vehicles etc etc. This is Labour’s backdoor funding of itself.
  • Workers who are not in unions will be “provided with information and advice about joining the relevant unions”
  • Will repeal the 90 days laws, despite the evidence that 40% of those hired under it would not have had job offers without it
  • Labour will legislate to allow contractors to collectively bargain, as the Australian actors union demanded. Goodbye Wellington and NZ film industry. They really are Hobbit haters.
  • State agencies will be told to blacklist companies who tender for work if they are seen as anti-union (‘not respecting the right of their employees to join a union”)

This is their worst policy, by far. The unions are getting their payback for their many donations to Labour – not just money, but especially of personnel and buildings and vehicles. Remember many of the unions are actual affiliate members of Labour, so the more employees they push into union membership the more money Labour gets from those unions in membership subs. This policy is all about appeasing the union masters.

I never thought I would see the day that a party (other than Mana) would effectively propose a return to national awards. Here’s what those good old days looked like:

The only good thing about the policy, is it should send Labour down in the polls further. The Roy Morgan poll out today has just had them drop to 28%.