New Zealand
Journal of
Employment
RelationsFebruary 2006 • Volume 31 Number 1

NZJER, 31(1) – Content Overview
Rupert Tipples

A Note from the Editor

1aNicky Murray

Knowledge and skill ‘down on the
farm’: Skill formation in New
Zealand’s agriculture sector

2

Improving employment relationships– Findings from learninginterventions in farm employment

17

Meat Industry Unions, Industry
Restructuring, and Employment
Relations Change in New Zealandand Australia

37

Getting produce from the New
Zealand paddock to the European
plate – reducing supply chain
vulnerability through the
management of employment
Relations critical control points

60

Chronicle

76

Ruth Nettle, Mark Paine, andJohn Petheram

Marjorie Jerrard

Rupert Tipples and Sandra Martin

Colin Ross and Erling Rasmussen

NZJER, 31(2) – Content Overview
Gay Simpkin

Putting Regulation Theory to Workin Industrial Relations

1

A Critique of Probationary
Employment Periods

17

Not a Typical Union but a Union all
the Same: New Unions Under the
Employment Relations Act 2000

31

Minimum Wages in the Asia PacificRegion46

Hani Abdi Jelle, Pauline Guerin& Suzette Dyer

Somali Women’s Experiences inPaid Employment in New Zealand61

Rosaria Burchielli, Phillip
Pearson, & P. Rani Thanacoody

Research Note: Exploring Work
Intensification in Teaching: A
Research Agenda

71

Chronicle

82

Mark Harcourt & Geoffrey WoodJohn Murrie

Michael Barry & Peter Brosnan

Colin Ross and Erling Rasmussen

NZJER, 30(3) – Content Overview
Introduction to the Special Issue

I
1Michael Barry & Nick Wailes

Revisiting the Australia-New
Zealand Comparison

Chris Briggs

Strikes and Lockouts in the
Antipodes: Neo-Liberal
Convergence in Australia
and New Zealand

18

Casual Employment andCasualisation in Australia and New
Zealand33

Union Revitalisation in Australia
and New Zealand

47

Industrial Relations in the Context
of Workfare: Comparing Australia
and New Zealand64

Leda Blackwood, Goldie
Feinberg-Danieli & George
Lafferty

Union and Union Membership in
New Zealand: Annual Review for
2004

78

Barry Foster

Book Review: Rasmussen, E. (ed.),Employment Relationships: New
Zealand’s Employment Relations
Act. Auckland University Press,
Auckland90

Chronicle

92

Iain Campbell & Peter Brosnan

Rae Cooper & Robyn May

Gaby Ramia

Colin Ross & Erling Rasmussen

NZJER 31(2):1-16, Regulation Theory, G. Simpkin

Putting Regulation Theory to Work in Industrial RelationsGAY SIMPKIN*

Abstract
The main theme of the paper is that regulation theory is a valuable methodology forextending insights gained from studies in industrial relations to a richer understandingof complex societal change. The utility of the regulation approach is demonstrated
through the use of a case study to highlight the changing role of the New Zealandstate during restructuring in the 1980s. The specific case study is a series of industrial
negotiations in the secondary school sector during 1987-1989 when state sector,
industrial relations and education legislation changed radically. The analysis is thenextended to encompass and elucidate some trends in education industrial relations at
the present time. It is argued that regulation theory then serves to connect industrial
relations to a wider social science research programme.

Introduction
Between 1987 and 1989 was a time of great change in the role of the state in New
Zealand as a consequence of the Fourth Labour Government initiating wide-ranging
economic and social policy reforms. A case study highlighting the complex industrial
relations that occurred within the state sector during this time was selected foranalysis (Simpkin, 1992) and will be reported in this article. The case study focuses
on a series of negotiations between the State Services Commission (SSC) and the Post
Primary Teachers’ Association (PPTA) during the period 1987-1989. The
negotiations were concerned primarily about education restructuring, which in turn
was as a subset of both state sector restructuring and industrial relations restructuring.
These waves of restructuring involved a shift in the governance structures of the state.
Walsh (1990) had earlier analysed these negotiations as well as those of the primaryteachers’ union, the NZEI (New Zealand Educational Institute) and noted that:
The negotiations for the primary and secondary teachers’ awards in 1989,
and their aftermath, were tortuous affairs, which ranged over a wide arrayof issues. The negotiations themselves unfolded in complex and halting
patterns, punctuated by bursts of industrial action, offers of compromise,sometimes later retracted, and, above all, long and numbing bargaining
sessions. They were marked by acrimony, by accusations of bad faith andon many occasions by a sense of genuine outrage on both sides that is notoften found among professional industrial negotiators. (Walsh, 1990:8)*

Gay Simpkin was Director, Centre for Labour Studies, University of Auckland for three years and also
worked at the Centre for Labour and Trade Union Studies, University of Waikato. Thanks are due toProfessor Bob Jessop and the Sociology Department, University of Lancaster for a Visiting Fellowshipin 2004 during which this paper was written.

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NZJER 31(2):1-16, Regulation Theory, G. Simpkin

In order to provide a sufficient account of the negotiations, the analysis needed to
first, encompass discussion of the role of the state and a description of the process bywhich this shift occurred. Second, the analysis needed to explain the intricate
interweave of industrial relations, state sector and education restructurings thatthreaded through the negotiations within the context of economic, political and socialchange. Third, during the negotiations, two separate economic and social discourses
came into conflict across the bargaining table; one was a neo-liberal discourse and theother was the Keynesian Welfare National State (KWNS), (which was in the processof being replaced). The analysis, therefore, needed to encompass these discursive
differences in some way. Fourth, as a group secondary teachers were opposed to therestructurings and thus the outcome of the negotiations meant that those teachers who
were opposed to the reforms exhibited an entrenchment of values. Hence, the analysis
also needed to be able to deal with agency. The combination of these requirements foranalytical complexity proved a challenge for the efficacy of conventional approaches
to industrial relations.
To portray the negotiations in greater depth, a theoretical tool was needed that could
integrate a discussion of the economy and society and their change in a particular timeand place. To analyse the institutional setting, to which the reforms were impacting
on, the tool also needed to be able to take into consideration a longer timeframe thanjust the negotiations themselves. Some of the positions adopted at the table could
only be explained by their evolution over time within a professional setting. The tool
also needed to be able to consider value or belief systems. The final measure of
success of the tool would be that it possessed some predictive power past the eventsof the case study themselves.
In the event, the application of the principles of French Regulation Theory to the casestudy provides a powerful tool for teasing out the complexities and allowing theinterweave of different levels of analysis to arrive at a necessary and robust
explanation of events at that time. Regulation theory provides an approach thatemphasised the mutual interdependence of the economic, political and social changes.
This meant that none took precedence and the case study demonstrated change as acomplex matter involving agency that produces different outcomes in different placesand different times.

Regulation Theory and Concepts
French Regulation Theory evolved from Aglietta’s 1976 seminal work, A Theory of
Capitalist Regulation: The U.S. Experience. It developed as a reaction against
Althusserian Marxism. Althusserian structuralism rejected all idea of the subjectivityof individuals who could, through consciousness, reason and free will, affect social
development. Although Althusser also rejected economic determinism, he substituted
for it the concept of a complex structured whole that took causal priority over its
economic, political and ideological parts. Individuals were simply passive supports
for self-reproducing social relations (Althusser, 1971, 1996). French regulationists
found Althusserian Marxism deficient in that economic structures were analysed as
self-sustaining without effective social agency (Jessop, 1990).
Early regulation theorists engaged with economics from a neo-Marxist position but
were mindful of the social processes that secure capitalist expansion within any
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NZJER 31(2):1-16, Regulation Theory, G. Simpkin

specific society. That is, there is not ‘one’ capitalism that needs explaining; rather
there are capitalisms whose development “… is always mediated through historicallyand culturally specific institutional forms, regulatory institutions and norms of
conduct” (Jessop, 1990:309). The close connection and the interaction of theeconomic, political and social dynamics within traditional Marxism is retained but theregulationist concepts of accumulation regimes and modes of regulation are produced
by struggle and do not determine outcomes. Nor is there a simple correspondence
between the economic and the institutions that exist alongside it. Institutions are
created out of past, present and future struggles. In other words, the regulation
approach tracks continuities and discontinuities embedded in this complex, dynamic
interplay of the economic, political and social.
Jessop has applied the work of the regulationists to the state (1990) and to public
policy and governance (1994; 1995). He rejects essentialist notions of the state (thestate is an ideal collective capitalist) and also avoids treating the state as a simple
instrument and/or an autonomous subject of capitalism. He argues that theories thatview the state as managing the tensions and contradictions in regulation can be
reductionist. Also, theories that describe the state as having to manage the tension
and contradictions in order for capitalism to proceed can be functionalist. In his view,
the state is part of the mode of regulation and must itself form an object of study.
Boyer (1990) discusses the method by which concepts of the regulation approach canbe put to use in empirical situations. He suggests examining the social relations that
display continuity and fall within the logic of existing forms and contrasting themwith the discontinuities that comprise the constitution of new institutional forms inorder to explore the possible transition between two regimes of accumulation.
Boyer’s institutional forms act in three ways. First, through laws, rules, andregulations. Second, through reaching a compromise, after negotiations, and third,
through the existence of a common value system or at least common representationsof reality.
These principles proved useful in analysing the PPTA case study, in which Dale
(1990) has reproduced the different levels of analysis in a diagram. The figure is anattempt not only to separate out conceptually the different levels of analysis which theregulation approach can give rise to, but it also attempts to place the study ofeducation within each of the levels of analysis. Dale argues that little is known about
the interconnection between the economy and regulation of it and education policy
and the regulation of it. This gives rise to questions, such as how does change in one
bring about change in the other? Why should institutional change tend to be all in thesame direction? The state provides one explanation of a unifying factor. However, as
the case study demonstrates, the state itself is not always coherent. At the end of thenegotiations, the teachers who were part of the state remained committed to thevalues of the KWNS which were more entrenched as a result of their fighting to takeissue with the reforms.

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NZJER 31(2):1-16, Regulation Theory, G. Simpkin

Figure 1: Levels of Analysis
A. The World

A1. World
economy.
A2. International
system of state.
A3. ‘Carriers’,Multi-National
Corporations:Internationalorganisations.
A4. Regimes ofaccumulation.

B. National
Economic &SocialFormation
B1. Modes ofregulation.
B2. Historic
bloc.

C. National Politics

D. The Politics
of Education

E. Education
politics

C1. The politicalsettlement:(a) The entitlement/
provision balance.
(b) Constitutional
forms.
(c) Modes of interest
representation.
(d) Modes of politicalrationality.
C2. The role of thestate.

D1. The sourcesof education
policyD2. Education
as a mode ofregulation(socialfoundation of
economic
power).
D3. The scopeof education.

E1. Thecontradictions ofeducation policy.
E2. The patternof education
policy.

ABC: The terrain of the state.
BC:
The national settlement.
CD:
The education settlement.
Source: Dale, 1990:34

Some explanation of the terms “the regime of accumulation” and “the mode ofregulation” is necessary as these concepts are not necessarily mutually exclusive. For
example, “the regime of accumulation” and “the mode of regulation” can be regarded
as different lenses through which to view the complex interaction of the economic,
political and social. Three excerpts from prominent users of the terms are included
here to provide an overview of the terms.
Harvey (1989:121) succinctly portrays the interrelationship between the conceptsof regime of accumulation and mode of regulation, as well as the comprehensive
sweep of their scrutiny.
A regime of accumulation describes the stabilization over a long period of
the allocation of the net product between consumption and accumulation;
it implies some correspondence between the transformation of both theconditions of production and the conditions of reproduction of wage
earners. A particular system of accumulation can exist because its schemaof reproduction is coherent. The problem, however, is to bring the
behaviours of all kinds of individuals – capitalists, workers, state
employees, financiers, and all manner of other political-economic agents– into some kind of configuration that will keep the regime ofaccumulation functioning. There must exist, therefore, a materializationof the regime of accumulation taking the form of norms, habits, laws,
regulating networks and so on that ensure the unity of the process, i.e. theappropriate consistency of individual behaviours with the schema of
reproduction. This body of interiorised rules and social processes iscalled the mode of regulation.

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NZJER 31(2):1-16, Regulation Theory, G. Simpkin

Boyer (1990:35) defines “a regime of accumulation” as the set of regularities that
ensure the general and relatively coherent progress of capital accumulation. The
mode of regulation exists alongside the regime of accumulation and includes
processes and individual and collective behaviours that serve to complement theregime. There is nothing determined about the mode of regulation, but for any regimeof accumulation to exist, the historical institutional forms of the mode of regulationmust be compatible, otherwise the forces of social interaction would not allow asystem to become stable.
Amin (1994:8) uses less abstract terms in discussing the regime of accumulation andthe mode of regulation.
[The regime of accumulation] includes norms pertaining to theorganization of production and work (the labour process), relationships
and forms of exchange between branches of the economy, common rulesof industrial and commercial management, principles of income sharing
between wages, profits and taxes, norms of consumption and patterns ofdemand in the marketplace, and other aspects of the macro economy. …
[The mode of regulation] refers to institutions and conventions which‘regulate’ and reproduce a given accumulation regime through application
across a wide range of areas, including the law, state policy, politicalpractices, industrial codes, governance philosophies, rules of negotiation
and bargaining, cultures of consumption and social expectations.

Analysing the Case Study
Teachers† confronted a situation of considerable complexity, structured by legislation
in a context of the rapidly changing landscape of public policy under the FourthLabour Government. Legislation followed the publication of proposed policy changes
to the framework under which the pay and conditions of state servants werenegotiated (Rodger, 1986). In education, the Picot Report (Taskforce to review
educational administration, 1988) and the Tomorrow’s Schools policy document(Lange, 1988) led into legislated changes to the administrative framework of schools
which altered the positioning of teachers in relation to the state. Each fresh piece oflegislation forced teachers to negotiate radical changes to the environment in which
they worked and to their pay and conditions. These negotiations lay at the centre ofinteraction of old and new ideas about the practice of education as part of the state
project. Through the application of regulation theory to the case study, the process ofchange and the encounter of two different approaches to the proper involvement of
the state in governance of the political economy are made transparent.
The PPTA experienced a number of industrial successes through the years 1984 to
1987, in the closing days of an education system located within the KeynesianWelfare National State (KWNS). The confidence these successes gave the union andthe structures put in place to achieve them were then turned strategically into
defensive industrial positions in the face of radical restructuring by the Government.
†

The term teacher will be used to denote secondary teacher throughout the paper. This is in theinterests of brevity and is not intended to subsume primary teachers as well. A similar analysis could
be undertaken of the New Zealand Education Institute (NZEI) negotiations of the same period.

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NZJER 31(2):1-16, Regulation Theory, G. Simpkin

The series of negotiations in 1987-1989 between the SSC and the PPTA wereassociated with the discontinuity of legislation for new personnel and industrial
relations regimes. The SSC was not only legislatively responsible for negotiatingwith the PPTA on the Government's behalf, but it was also responsible forrestructuring the state sector in support of neo-liberal goals.
The particular case study was chosen because it possessed some distinctive features.
First, it provided the opportunity to consider the response made by a group of
professionals to a radical programme of state restructuring, underpinned by a neoliberal agenda. Second, the PPTA opposed much of the policy reform from a
discourse situated firmly from within that of the KWNS. It was outspoken in this
opposition and either protested or mounted industrial action against many of the
proposals. The initiating reforms were contested and the result was the outcome of arebellious struggle rather than the imposition of an ideology on passive recipients.
Third, the case study entails a number of separate negotiations where the difference
between two discourses was evident. The bargaining table in industrial negotiations
is always the site of struggle between differing interests but those in this case study
saw the negotiation and struggle in a material sense over the vision of education thatwould prevail in the future. The negotiations were a conflict over the education
principles of the KWNS as expressed by teachers through their negotiators andsupported by industrial action, and new principles of education as contained within
the discourse of neo-liberalism, expressed by the SSC, the government's negotiating
body. The bargaining table, therefore, became a means of deconstructing thediscourse of each other. Because of the PPTA's opposition, the bargaining table
served to highlight the magnitude of the differences between the old and the newperspectives.
Fourth, the case study was situated within the state and the process by which change
occurred could be observed. All of these features could be drawn upon to address thequestion of how change could be achieved within the New Zealand state in support ofa new project when, a short time previously, the project lay within the principles of
the KWNS.
The analysis of the industrial relations environment did not mount an ideologicalcritique of the negotiations. Rather, the process was observed in order to establish key
continuities and discontinuities with the past. The reforms were not viewed as asudden break with the past. That is, the teachers carried aspects of the past with themwhen confronting the reforms resulting in a different outcome from the intent of thereforms because of that interaction. The real differences between the interacting
discourses, however, were not analysed, especially as the parties themselves did not
resolve them.
There was a strong partnership in education between the Department of Education,
the PPTA, and sometimes the Minister of Education at the beginning of the period.
This was regarded as a positive part of education in the KWNS. The theory behindthe policy reforms labelled this partnership as “provider capture”, the result of selfseeking behaviour on the part of bureaucrats and teacher practitioners‡. Theinteraction of the two opposing views produced a shift in the form that education was‡

For a comprehensive analysis of provider capture, see Bertram (1988)

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NZJER 31(2):1-16, Regulation Theory, G. Simpkin

to take from that point on. Although the teachers did maintain theoretical andpractical opposition to the changes and retained significant material ground in termsof pay and conditions as a result of the struggle, the outcome still represented arepositioning of teachers from central and influential players in education policy, tohaving only a marginal influence over education solely as employees of individual
Boards of Trustees, with views confined to the classroom.
Figure 2: Structural Adjustment in New Zealand

Education
Restructuring
A

AB

Industrial Relations
Restructuring
B

ABC
AC

BC

State Sector
Restructuring
C

Economic Restructuring

Figure 2 represents the interweave of analysis in which the three overlapping areas, A,
B, and C, (the spheres of influence in the case study) are also represented in Figure 1.
Each sphere contributed to the events of the case study and the analysis traced thehistorical development of each sphere of influence. The rules for conduct of thenegotiations, the respective roles of the parties and their rights and responsibilities
were all changed. Almost no aspect of previous structures and processes of the sites
were left unchanged.
All the areas containing A represent the education area in which the PPTA had been
influential and was regarded as its proper sphere of influence. The intent of thegovernment's policy proposals was to confine the PPTA to a union role only in the
AB area and ABC area, the overlapping part of education and industrial relations.
After the State Sector Act, 1988 had taken effect, the only relationship the PPTA
could have with the rest of the state was in its role as a union and only over industrial
relations matters. It is in the central point of intersection, ABC, that the fullcomplexity of the case study is observed.

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NZJER 31(2):1-16, Regulation Theory, G. Simpkin

The Ideological Component
Boyer identified the need for a common value system as a requisite for stability. Thiswas borne out in the analysis of the case study, which soon identified
ideology/discourse as important elements in a number of ways. One way was thevery strong theoretical justification for the reforms, initiated by the Treasury, whichgave rise to policy documents from 1984 that displayed a neo-liberal discourse
towards economic and social analysis that had not previously been part of official
policy papers (Treasury, 1984, 1987). As noted above, the discourse of teachers was
situated within the values of the KWNS. The interaction of these two discourses atthe bargaining table was palpable and was more instrumental than pay and conditions
considerations in determining the difficulty of arriving at negotiated outcomes. Thus,
the institutional change in this case study was as influenced by discursive interaction
as it was by the material practice involved in industrial relations. The greatest
continuity through the case study was the continued commitment of teachers to theeducational values of the KWNS. The cause of discontinuities arose from thechanged discourse of official government bodies that enabled previously concealedtensions within education under the KWNS to become transparent and develop.
The KWNS is used here as a summary adjective for the discourse of teachers thatpertained throughout the duration of the KWNS. For New Zealanders, the values of
education in the KWNS have repeatedly been related to the well-known words ofPeter Fraser, who, as Minister of Education, made his annual report to Parliament in
1939.
The Government’s objective, broadly expressed, is that every person,
whatever his level of academic ability, whether he be rich or poor, whether
he live in town or country, has a right as a citizen, to a free education of
the kind for which he is best fitted, and to the fullest extent of his powers.
So far is this from being a mere pious platitude that the full acceptance ofthe principle will involve the reorientation of the education system.§International research and literature in education, particularly those of the UK and theUS, overlay this part of the discourse that arose from within the society itself. The
major trends of educational discourse worldwide opposed the neo-liberal approach toeducation and were available to New Zealand teachers.
Thus, while a consideration of discourse was an essential supplement to the tools
normally associated with the regulation approach, once embarked upon, itsconsideration worked well with the regulation approach and seemed to arise naturally
from it. This pre-dated the use of the term cultural political economy by Jessop(2004).

§New Zealand Parliament. House of Representatives Appendices to the Journals, E1, pp. 2–3, 1939.
Cited in Alcorn, 1999.

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NZJER 31(2):1-16, Regulation Theory, G. Simpkin

State Sector vs Private Sector Industrial Relations
The regulation approach, particularly in the treatment of the state, also elucidated thefactors that make state sector industrial relations different from private sector
industrial relations. State sector industrial relations treats public servants asconceptually outside the state in their employment relationship. This has acted to
obscure their very real participation in the project of the state.
The application of collective bargaining to state servants involves pretence at
conflicting interests of employer and employees. While this may be true over pay
and conditions, it is counterproductive for the two to be in conflict over the project of
the state. This plays out in a different way in the core state sector than it does in thelarger education and health enterprises. Teachers are at an extra remove from theiremployer than are those in the core state sector. Since the 1980’s, it has been possible
for the bargaining representative of government to engage with the collective
bargaining representative of teachers without explicit regard for the state project inwhich teachers are involved. The state is therefore in continual conflict overeducation because of the ‘fictitious’ employer status conferred on one part against thevery employees that are entrusted to interpret and put into practice the state
educational project. As a result of confining teacher input into education within theindustrial relations arena since 1989, the New Zealand state has imposed on itself acontinuing conflictual relationship between the government and teachers that is notcapable of resolution.
The term ‘fictitious’ is used in a similar sense to the way in which it is used by Jessop(2002) to describe labour power as a ‘fictitious’ commodity. Labour power cannot be
separated from the human to whom it is attached and as such cannot be a realcommodity in the way this is commonly understood. Similarly, an employer in thestate sector can be a ‘fictitious’ employer only. The employer in the private sector isa corporate entity. Only one of the functions of the firm is that of employment. The
firm’s raison d’etre is to define its product, to balance its accounts taking into
consideration all the costs of production and to create a profit. One of the costs ofproduction is the wages bill. The employer in the state sector does not deliver a profit
or, if it does so, can only do so within prescribed boundaries. Therefore, employees
are not employed out of the profits of the organisation, nor does the realisation ofvalue and its relative distribution apply to a state sector employer.
The case study highlighted the fact that teachers experienced bargaining as both aconcentration of the pressures for change and the only forum in which they could
express their outrage at the assault on the values they had previously assumed insupport of the state project in education. The investigation examined changes ininstitutional forms during the period 1984–1989. It was particularly illuminating
within the regulationist framework of Boyer and his categorisation of the three ways
in which institutional forms work. Here we had a situation in which governmentchanged laws, rules, and regulations in state sector industrial relations, in educationindustrial relations, and in the project of education itself. First, the State Sector Act,
1988 introduced the principles of managerialism to the state sector. It also made allstate servants subject to the same pay fixing legislation as workers in the private
sector, the Labour Relations Act, 1987. Later, the Tomorrow’s Schools changes tolegislation defined teachers as employees of the local Board of Trustees. Some of the9

NZJER 31(2):1-16, Regulation Theory, G. Simpkin

components of the Tomorrow’s Schools changes became items for negotiation, andalso affected the context in which that bargaining occurred.
While Boyer did not intend the use of the term “negotiation” in the restricted sense of
bargaining, this formal bargaining process provided an opportunity to viewcontestation in a tangible sense. During this bargaining, exchanges across the tabledemonstrated that two different and opposing value systems were operating, often
resulting in industrial conflict. That it did so should not be surprising when thecompromise of the KWNS was disintegrating.
While the negotiations during this period involved an ideological dimension, it was
the negotiations of 1989 where the ideological battle culminated. The bargaining
involved only four issues discussed over 34 days of formal negotiation. The matter of
fixed-term contracts of employment for principals became non-negotiable for both the
SSC and the PPTA because agreement could not be reached – the SSC supported it
and PPTA opposed it. After this claim and the associated claim for flexibility of pay
were removed from the table at the end of Stage 1, the PPTA was adamant that asmuch as possible of the previous system relating to teacher competence and discipline
would be retained in their Award. These related to their professional project
developed over thirty years. The SSC was equally adamant that as little as possible
would be retained. That it was those four particular issues that became the focus was
not accidental. For both parties, they were symbolically and materially representativeof a different point of view towards education as a state activity. The SSC point ofview stemmed from the principles of neo-liberalism. These assumptions were theself-interested nature of the individual and the need for incentives and sanctions to
produce high performance. Also, teachers were defined as middle class capturers of
the resources of the state. The PPTA point of view had been developed in the
education settlement of the KWNS, with assumptions and principles stemming from
that. The emphasis for them was on societal integration of workers into the total state
project, with education as a societal good as much as an individual good.
The exhaustive and exhausting nature of the encounter demonstrated the utter
incompatibility of the two approaches. The PPTA was prepared to forgo the usual
rewards of bargaining in terms of pay and conditions in order to defend an approachto education fundamentally at odds with the one it had known. The two parties
struggled to find some ground for compromise that is usually the stuff of bargaining.
The fact that they failed provides evidence that the approach to the operations of thestate implemented by the Fourth Labour Government was radically different from theone that went before. While this has been acknowledged from the beginning of thechange, the 1989 negotiations between the SSC and PPTA provides an opportunity toappreciate the scale of the incompatibility and to look at the implications. At theconclusion of the negotiations, the Government legislated across the outcome of theproperly concluded negotiations and introduced fixed term contracts for principals
anyway.
Although this was a bitter blow to the PPTA, the values of secondary teachers wereleft intact. They positioned themselves to continue to fight against proposals that they
believed would be detrimental to secondary school education as they knew it. In sodoing, they not only opposed the new ideas, but also refused to reach any
accommodation with them. By the end of the negotiations, the KWNS educational
settlement was at an end along with the legislation and regulations that had supported
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NZJER 31(2):1-16, Regulation Theory, G. Simpkin

it. But the values of the settlement were not forgotten and entered the structures ofTomorrow’s Schools with the teachers. While change was occurring in both theregime of accumulation and the mode of regulation, by the end of 1989, (the time
period of this case study), stability was still a long way off.
The regulationist analysis arrived at a level of explanation that portrayed thecomplexity of events. The negotiation of pay and conditions was not a focus. The
regulatory framework was. The outcome was not predictable. The shift wascontested. Secondary teachers asserted their values through their professionalorganisation, the PPTA. The values that were expressed partly reflected those of the
KWNS in which education had operated, and in part reflected the relative autonomyof the classroom from state interference. The tensions inherent in education wereexacerbated by the project of the Fourth Labour Government. The result was not predetermined. In this case, teachers encountered in industrial negotiations a proposed
regulatory framework that had not yet become the future. They met it with theeducational and social values of their present and past.
The implication of this for the development and shaping of a binding ideology forschooling was profound. Schools education, as part of the mode of regulation, wasafter 1989 cut off from regular contact with the new ideology that informed manyother parts of the state. While the central agencies of the new educational structures
were operating according to the principles of neo-liberalism, policy implementation
was in the hands of school Boards of Trustees which of necessity relied on guidancefrom the principal and teachers. Teachers, with their different values, were not forced
into “negotiation” initially with the new ideas on a daily basis. This meant that
schools education for a time remained outside the alignment and mutually reinforcing
coherency of the policy application elsewhere in the state.
In this particular case, the loyalty of the teachers was still towards the KWNS state
project in education. The usefulness of this had been superseded by another regime
and state regulation of it. The answer to the question of how does change occur in thestate must be, in this instance, not all at once, it takes time, and the change may not bein the direction that was intended. For schools in New Zealand, the Fraser mythcontinued into the new regime, one that made it difficult for the myth to change due tothe isolation of teachers in their new positioning.
Extending the Analysis
There has been continued turmoil and instability in industrial relations in the schools
sector since 1989. Treating teachers as though they are outside the state and not partof the creation of the state project for education is problematic. In education this,combined with the creation of a ‘fictitious’ employer in a form distinct from the restof the state sector, has produced a sector that is evolving away from the intent of theState Sector Act, 1988. While the ultimate destination is not yet clear, analysis ofrecent developments in the schools sector bears out this argument.
At the time the State Sector Act, 1988 was introduced into Parliament, there was little
if any debate in the union movement over the desirability or otherwise of placing state
sector workers under the same legislative framework as private sector workers. This
aspect of the State Sector Act was not contested, (although the politicisation of the
public service was), despite the need for the State Sector Act to define what the11

NZJER 31(2):1-16, Regulation Theory, G. Simpkin

market proxy would be. Finding suitable market proxies by which the legislatively
determined employer and union can enter into bargaining has been a focus for state
sector industrial relations in New Zealand since free wage bargaining was introduced.
The State Services Conditions of Employment Act, 1977 used relativity with theprivate sector as the market proxy. Arguably, this, combined with the KWNS
partnership between the Department of Education, the PPTA and the Minister of
Education, was better suited to the state project for education than the present. This is
not to say that the previous system had no faults or tensions. It did have tensions, notleast the exclusion of parents from education. For the bulk of the state sector under theState Sector Act, the market proxy used has been that of Departmental budgets.
For Departments, the employer was defined as the Chief Executive Officer (CEO). In
health, separate Health Boards were split off from each other under the employer,
again the Chief Executive Officer. The government of the day gives the CEO of a
Department the task of managing one of the services of the state within a budget
amount decided by Government. The wages bill of employees must be one of theallocations against this budget line. The case of schools education was very different
due to the devolution of control over schools to the level of individual Boards ofTrustees, the delay in devolving teacher salary budgets to the level of individual
schools, and the resultant continuation of national collective employment agreements
for teachers.
As argued earlier, the ‘fictitious’ employer in schools has proved particularly difficult
because the structures of education differ from those of other parts of the state.
Schools did not become a bargaining unit, partly because teacher salary budgets were
not devolved to individual schools. Bargaining over wages and conditions hasremained national. The Government’s bargaining agent for the national collective
agreement was the SSC for the larger part of the 1990s. It then shifted to the Ministryof Education in the late 1990s. Bargaining occurred under the provisions of the
Employment Contracts Act, 1991 through the 1990s. Unlike other unions in New
Zealand at this time, the harsh nature of that Act had less effect on bargaining than did
the exclusion of teachers from the education project of the state. During this period,
comprehensive changes to the national curriculum and assessment took place.
Teacher input to these policy changes was excluded. Policy development was the
exclusive preserve of the Minister and his central agencies. There was only one
forum therefore in which teachers could make their influence felt and that was incollective bargaining. Their ‘fictitious’ employer was either the SSC or the Ministryof Education, the central agency that coordinated other agencies over educational
policy. Difficult and equally or more abrasive negotiations to those of 1989 havebeen a feature through the 1990s and the early part of the 2000s.
The last set of negotiations in 2004 for the renewal of the Secondary Teachers’
Collective Employment Agreement demonstrated that the Government was ready torecognise that an industrial relations regime for schools that excluded teachers did notwork. The provisions that were being negotiated were related to educational issues
and education policy makers were present at the table. While this is not yet a sign thatthe structures will be changed to allow for teacher input into the state project forschool education, it is a sign of recognition that there may be advantages in bringing
the state project momentarily into the industrial relations forum. The round wastherefore appreciably more peaceful than it had been for over fifteen years.

12

NZJER 31(2):1-16, Regulation Theory, G. Simpkin

There is an additional ‘fictitious’ employer in schools – namely the Board of Trustees.
The local Board of Trustees was defined in the Education Act, 1991 as the employer
for teachers in areas relating to hiring and firing, disciplining and performance, andimplementation of some, particularly non-financial, aspects of the national Collective
Employment Agreement. However, they currently do not have control over staff
budgets except for those of support staff. For support staff, the constraint of theoperational budget supplied by central government acts as for other departments as amarket proxy. For teachers, the powers of the Board of Trustees are limited topersonnel management.
However, even those employer powers that the Boards of Trustees currently have areshowing signs of erosion. The separate and increasing powers of the Teachers’
Council (TC), the New Zealand Qualifications Authority (NZQA), and the Education
Review Office (ERO), combined with the increasing frequency of dismissal of Boardsof Trustees by the Minister are undermining the employer powers that Boards ofTrustees currently possess.
The NZQA has powers of recognition of all qualifications. Although the Teachers’
Council decides whether individual teachers shall receive provisional registration inorder to enter teaching, the NZQA exerts control over the level at which particularqualifications are recognised and thus, whether they qualify the individual for
consideration for registration. This particularly applies to the entry of those people
with overseas qualifications. Boards of Trustees are therefore constrained as to whothey can employ as a teacher as it is the NZQA who decides whether qualifications
are at a suitable level. The TC then combines this with other factors in a decision as
to whether or not to award provisional registration. Boards of Trustees may employ
those who are provisionally registered only, except in circumstances that the TC may
approve.
The Education Review Office (ERO) also exerts powers of control over quality
standards in schools. The quality of teaching, the standard of what is taught andBoard compliance with Governmental policies are all monitored and assessed by
ERO. ERO can be asked to assist the Minister and Ministry of Education in reportingon standards before a decision is made as to whether a Board of Trustees should
continue in control or not. This occurred in the recent case of Cambridge HighSchool.
The Ministry of Education, however, still has primary responsibility for theinterpretation and the administration of a large number of clauses in the Collective
Employment Agreement. While nominally Boards have certain powers, for example,
over approving leave for individual teachers, the Ministry still constrains these powers
via administrative control over the relief teacher budget. Even in matters relating toperformance, the professional standards criteria in use were decided and negotiated by
the Ministry of Education.
The Teachers’ Council has been the central agency that has made the biggest inroadsof all into circumscribing the powers of the Boards of Trustees to hire and fire. Thisis surprising, given that the Council is funded and nominally run on behalf ofteachers. However, recent legislation has given wide-ranging powers to the TC toinvestigate and decide on disciplinary offences and competency matters, even if a
Board of Trustees has dealt with the matter before. Thus, via the ultimate sanction of13

NZJER 31(2):1-16, Regulation Theory, G. Simpkin

deregistration, the TC, which stands outside the current Teachers’ Collective
Employment Agreements, can effectively dismiss teachers. The TC can override a
decision by a Board, arguably the closest and most effective decision-maker over the
behaviour and performance of teachers.
Thus, the ‘fictitious’ employer structure at schools’ level seems to be in the process of
being eroded. To claim back the powers originally devolved to the Boards of Trustees
would require more political will on their part than they have ever exerted. To
diminish the powers of the central agencies of NZQA, ERO, the Ministry of
Education, and the Teachers’ Councils would take political will on the part of a
Minister of Education almost equivalent to the original restructuring. At the level ofbargaining, the way seems to have been opened for the national collective
employment agreement negotiations to be used as a forum for more than pay andconditions. However, here it would only take a determined Minister of Education to
return to an environment where teachers are again excluded from discussing anything
but pay and conditions. This would, however, mean a return to difficult bargaining
rounds.
Conclusion
It has been argued that regulation theory was both a valuable and necessary tool inteasing out the consequences of the 1980s changes to the governance of education inschools through an industrial relations site. In particular, it drew attention to an
ongoing instability in schools and associated industrial relations caused by teachers’
ongoing commitment to the values of the KWNS and their exclusion from input into
the state project for education. This is useful in analysing trends in the sector. The
instability has resulted in strains on the structures set up by the State Sector Act, 1988
and the Education Act, 1989 and these have begun to undermine the employer powersof Boards of Trustees. The consequences for secondary education and industrial
relations in the schools sector are still not clear.
Regulation theory was not only a useful tool in analysing this set of negotiations, but
it also served to connect disparate political, social and economic influences with theindustrial relations setting. The players in the negotiations were seen as embedded inpolitical and educational contexts. The SSC was an arm of the reforming government
intent on implementing a new discourse about public policy, including education.
The PPTA’s membership was committed to preserving the best in educational
principles as they saw them. One was intent in effecting a rupture with the past, theother in defending education as they knew it. The specific set of negotiations was
only one aspect of a more significant whole. Thus, the industrial relations event could
be used to interpret other occurrences in society at the time, rather than just the event
itself.
Applying the regulation theory sheds a different light on industrial relations. That is,rather than foreclosing on the case study and analysing just the players, events, issues
and outcomes, it is possible to take a longer view of case studies and adopt a
perspective whereby each case study has a history and a future embedded in the social
relations to which the case study contributes. This is not to dismiss traditional
industrial relations analyses but rather to indicate the potential for more complex
analyses as opportunity arises. Regulation theory provides a tool for exploiting thisand works two ways. One is that industrial relations can draw on and include insights
14

NZJER 31(2):1-16, Regulation Theory, G. Simpkin

gained in other disciplines more directly. The other way is that other disciplines canbenefit more directly by embedding industrial relations events in a broader social
context.
In traditional industrial relations, levels of analysis are often artificially truncated inorder to keep the field of focus narrowed. Using regulation theory, each level has its
own richness of understanding which, if collapsed, loses that richness. If closure is
the desired outcome, then obviously the regulation approach tool would prove
unnecessary. The regulation approach does not negate other approaches, but canenrich them. In addition, although this particular case study was about education
within the wider state sector, potential exists for its application to the private sector.
While space does not permit a comprehensive discussion of possible criticisms ofregulation theory, it is important to acknowledge that this approach is not without its
critics. One criticism that has been mounted is that the approach is a description, not atheory (Boyer, 1990). For this author, however, the theory provided a method ofanalysis that allowed for considerable complexity and layers and also provided a toolwith some predictive power as well.

REFERENCES
Aglietta, M. (1979). The theory of capitalist regulation: The American experience. London:
New Left Books.
Alcorn, N. (1999). ‘To the fullest extent of his powers’: C.E. Beeby’s life in education.
Wellington: Victoria University Press.
Althusser, L. (1971). Lenin and philosophy and other essays. London: New Left Books.
Althusser, L. (1996). Translated by Ben Brewster. For Marx. London, Verso.
Amin, A. (1994). Post-Fordism: A reader. Oxford: Blackwell.
Bertram, G. (1988). Middle class capture: A brief survey. In The April Report: Future
Directions, Vol. III, Part Two (pp. 110–170). Wellington: The Royal Commission on Social
Policy.
Boyer, R. (1990). The regulation school: A critical introduction. New York: Columbia
University Press.
Dale, R. (1990). Regulation theory, settlements and education policy. In L. Gordon & J.
Codd, Education policy and the changing role of the state (pp. 33–44). Proceedings of
the New Zealand Association for Research in Education Seminar on Education Policy.
Palmerston North: Delta, Department of Education, Massey University.
Harvey, D. (1989). The condition of postmodernity: An enquiry into the origins ofcultural change. Oxford: Basil Blackwell.
Jessop, B. (1990). State theory: Putting the capitalist state in its place. Cambridge: Polity.

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Jessop, B. (1994). The transition to post-Fordism and the Schumpeterian workfare state. In R.
Burrows & B. Loader (eds), Towards a post-Fordist welfare state (pp. 13–37). London:
Routledge.
Jessop, B. (1995). The regulation approach, governance and post-Fordism. Economy andSociety, 24(3), 307–333.
Jessop, B. (2002). The future of the capitalist state. Cambridge: Polity.
Jessop, B. (2004). Critical semiotic analysis and cultural political economy.
Discourse Studies, 1(2) 159-174.

CriticalLange, D. (1988). Tomorrow’s schools: The reform of education administration in New
Zealand. Wellington: Government Printer.
Rodger, S. (1986). Pay fixing in the state sector: A review of principles and procedures in the
fixing of pay and associated conditions in the New Zealand state sector. Wellington:
Government Printer.
Simpkin, G. (2002). Moments of rupture: Changing the state project for teachers: A
regulation approach study in education industrial relations. Unpublished Doctoral thesis,
Victoria University of Wellington, Wellington.
Taskforce to Review Education Administration. (1988). Administering for excellence.
Wellington: Government Printer.
Treasury. (1984). Economic management. Wellington: Government Printer.
Treasury. (1987). Government management: Brief to the incoming government 1987. Volumes
I & II. Wellington: Government Printer.
Walsh, P. (1990, August). Conditions of employment in Tomorrow’s Schools: Industrial
relations and personnel policies in the education sector. Paper presented to the Second
Research into Education Policy Conference, New Zealand Council for Educational Research,
Wellington.

1631(2): 17-30, Probationary Employment, M. Harcourt & G. Wood

A Critique of Probationary Employment Periods
MARK HARCOURT* AND GEOFFREY WOOD**
Abstract
In November, 2006, a private member's bill to introduce a 90 day probationary employment
period, which would have allowed employers to dismiss employees for any or no reason andwithout having to follow a disciplinary procedure, was defeated. A future National
government might still introduce probationary employment; other countries have it already.
Such reforms represent an important component of a broader neo-liberal agenda to deregulate
the labour market. We therefore critically examine arguments made in support ofprobationary employment, specifically focusing on the New Zealand Bill, and also moregenerally discuss the potential adverse consequences of probationary employment. In
particular, we question whether probationary employment would alleviate the unemploymentof so-called high-risk, high unemployment groups. We also maintain that probationary
employment would have all kinds of adverse repercussions for employees and even
employers. We conclude by exploring alternative, more active mechanisms for enhancing
employment within different areas of the New Zealand economy.

Probationary Employment
Since its election in 1999, the New Zealand Labour Government has enacted employment
laws to strengthen and extend worker and trade union rights, in an effort to undo some of themore extreme effects of the neo-liberal 1991 Employment Contracts Act. These legal
developments in New Zealand have paralleled, though not always mirrored, those in the
United Kingdom under New Labour. Most of the more important changes were introduced
through the 2000 Employment Relations Act, which established restrictions on the form andcontent of employment contracts, improved union access rights, provided unions with theexclusive right to bargain collectively, established a union registration system, facilitatedmulti-union and multi-employer bargaining, provided greater institutional support tomediation, and established mutual, good faith obligations with respect to, for example,
collective bargaining, redundancy, and the sale/ transfer of an employer’s business. Further* Professor Mark Harcourt, Department of Strategy and Human Resource Management, Waikato Management
School, University of Waikato, Hamilton, New Zealand** Professor, Geoffrey Wood Department of HRM and OB, Management School, University of Sheffield, 9Mappin St, Sheffield, United Kingdom
Acknowledgements: We would like to thank Cathy Horrocks, the Waikato Management School Knowledge
Manager, for providing research assistance.

1731(2): 17-30, Probationary Employment, M. Harcourt & G. Woodreforms were enacted with the 2004 Employment Relations Amendment Act, which
introduced so-called bargaining fees, effectively an agency shop, for non-union employees
covered by a collective agreement, extended good faith obligations, and strengthened
employee dismissal rights, especially during the sale or transfer of a business.
Labour’s reforms have prompted a business backlash, with more and more vociferous calls
for deregulation. Business lobby groups like Business New Zealand and the New ZealandBusiness RoundTable have heavily criticised the government for imposing high legislativecompliance costs on their constituencies. Since 2003, Business New Zealand has surveyed
its membership for their views of these compliance costs. Survey results suggest thatcompliance costs are high, approximately $3,000 per person in smaller firms and $500 inlarger ones (Business New Zealand, 2006). Moreover, employment law complianceconsistently accounts for in excess of 20% of total compliance costs, second only to tax law(Business NZ and KPMG, 2006: 21-22). Chief among these employment law complianceissues is employee dismissal (Business NZ and KPMG, 2006: 29-31), with the complexities
of dismissal procedure seen as a costly burden, especially if employers fail to ‘get it right’
and then have to pay compensation to employees (Business NZ and KPMG, 2006).
Against this backdrop, National Party MP Wayne Mapp in early 2006 sponsored a Private
Members’ Bill, the Employment Relations (Probationary Employment) Amendment Bill, tointroduce probationary employment. Although the Bill was defeated in November, 2006,
National’s attempt to introduce such a law while in Opposition indicates what it intends to do
if and when it becomes the government. As a result, far from being a dead issue, probationary
employment and its potentially negative consequences remain a highly topical issue both in
New Zealand and in other countries where it is already the law.
Had the Bill passed, it would have introduced a 90-day probation period, or a lesser period if
agreed by the parties, for all new employees. Probationary employment would have
immediately preceded employment under either an individual agreement or collective
agreement, as regulated under the Employment Relations Act. It would have given
employers the right to dismiss employees during or at the end of the 90-day period for any or
no reason. As a result, probationary employees would have had no right to file for a personal
grievance for unjust dismissal or to seek redress through any other dispute resolution
mechanism, including Department of Labour mediation. An exception would have been madefor discrimination and sexual and racial harassment cases under the Human Rights Act.
Probationary employees would still have had the right to compensation for these causes ofaction. The Bill would also have allowed actions for breach of contract at the probationary
stage.
Even though the Bill would have partially relieved employers of one of their greatest
compliance cost headaches, its official purpose, as described in the Bill’s Explanatory Note,focused on providing employment for disadvantaged groups. The Note claimed thatprobationary employment encourages employers to “... take a chance with new employees,
without facing the risk of expensive and protracted personal grievance procedures...”enabling “...people who have not had previous work experience to find their first job andmake (sic) it easier for people re-entering the workforce.” In the same vein, Business NZ
Chief Executive Phil O'Reilly claimed that “...employers can be reluctant to employ people1831(2): 17-30, Probationary Employment, M. Harcourt & G. Wood

without a previous positive employment record, and the proposed legislation would help
overcome the risks of doing so.” He saw probationary employment particularly benefiting
teenagers, new migrants, and “other groups whose unemployment rates exceed the average”(O’Reilly, 2006).

Critique of Probationary Employment
This paper critiques probationary employment, especially in the proposed form of Wayne
Mapp’s Bill. We begin our critique by arguing that the alleged job-creating benefits ofprobationary employment are based on erroneous assumptions about why somedisadvantaged groups have stubbornly high unemployment. We next maintain that there isno evidence to suggest that probationary employment actually reduces unemployment orcreates jobs. We extend our critique by arguing that probationary employment could have allkinds of negative impacts on employees and even employers. In particular, probationary
employment could undermine employees’ statutory employment rights, including their rightto bargain collectively for a collective agreement. In addition, it could increase
discrimination against disadvantaged groups it is supposed to help. More problematic, itwould allow employers to dismiss perfectly good employees for any or no reason. “Scapegoating” probationary employees would be relatively easy, discouraging some managers
from investigating and correcting more systemic causes of poor performance or bad
behaviour (e.g., inadequate training programmes). Finally, the evidence suggests
probationary employment would increase feelings of job insecurity, with adverse
implications for commitment to the employer, labour turnover, and job performance.

Wrong Assumptions about Why the Disadvantaged are Unemployed
Supporters of probationary employment like Wayne Mapp assume that the higher than
average unemployment rates of youth, minority groups, predominantly female re-entrants,
migrants, and others can be primarily attributed to an information problem. The essential
idea here is that employers do not have accurate, good quality information about the
productivity characteristics (e.g., skills, abilities, motivations) of these workers, in theabsence of any work experience (e.g., youth), recent work experience (e.g., predominantly
female re-entrants), or easily verifiable work experience and/or qualifications (e.g., theforeign work experience and qualifications of migrants/ immigrants). It follows that
employers are naturally reluctant to hire such workers unless permitted to hire them on aprobationary basis.
It is true that some New Zealand employers are unsure how to evaluate certain foreign
qualifications and work experiences (Bennett, 2006). Facing such uncertainty, they can be
unwilling to hire such people for professional and managerial roles. However, a probationary
period would do little to overcome this reluctance for several reasons. First, if mistakes
caused by a skilled worker were costly, difficult, or impossible to correct, an employer would
still not risk hiring an immigrant whose work experiences or qualifications were hard toverify. To take an extreme example, an airport would obviously not hire an air traffic
controller, even on probation, whose overseas work experience and training could not be19

31(2): 17-30, Probationary Employment, M. Harcourt & G. Woodconfirmed. Second, if task complexity or long cycle times made an employee's performancedifficult to assess within the short time-frame of a probationary period, employers would still
not risk hiring someone they were unsure about. For instance, a university would want to be
confident about a lecturer’s research and teaching ability prior to hiring, because the long
cycle times, especially for completing research, would make performance evaluation virtually
impossible within a short, probationary period. Third, if an employee is expensive to recruit,select, and bring to New Zealand, an employer would also want to be reasonably sure thatthat person had the requisite skills and abilities before commencing employment. No one
would spend $20,000 to bring an Irish engineer to New Zealand on a trial basis.
In reality, informational asymmetries like those described above are not the main cause ofhigh unemployment among disadvantaged groups. More important factors include
discrimination, a lack of education, and a lack of work experience among others. Many
immigrants are the targets of discrimination. For instance, half of Christchurch’s Muslim
workers have had major difficulties finding employment, despite having qualifications andwork experience in shortage fields like information technology (Bennett, 2006: 2). Others
have had problems getting their qualifications recognised at all, or at an appropriate level, bytrades or professional bodies or the New Zealand Qualifications Authority (Anonymous,
2006: 2). Still others have lacked the English proficiency to obtain employment where
English communication skills are valued.
Many Maori and Pacific people are jobless because they lack qualifications. For youth, theproblem obtaining employment is often their lack of relevant work experience.
Unemployment rates for Maori, Pacific peoples, and youth are highly pro-cyclical (see, forexample, Chapple and Rea, 1998; Te Puni Kokiri, 2000: 23), just as they are for blacks,
Hispanics, and youth in the USA. For instance, Clark and Summers (1990: 80) report that a
one percent fall in prime-age male unemployment in the US is associated with a four percent
increase in teenage employment and, more specifically, a six-and-a-half percent increase inblack teenage employment.
What accounts for this extreme pro-cyclicality inunemployment rates? Maori, Pacific peoples, and youth are less skilled than their older
and/or Pakeha (European) counterparts. Maori and Pacific peoples generally have lower
levels of schooling (Maani, 2004; Te Puni Kokiri, 2000; Winkelmann and Winkelmann,
1997) and are less likely to receive employer training (Gibson and Watane, 2001). Evidenceof occupational segregation by race (Easton, 1994; Herzog, 1997) also suggests that Maori
and Pacific peoples are more likely to be the victims of discrimination, even when they dohave the appropriate schooling and/or work experience. Young people may have the formal
education, but lack the work experience which would provide job skills (Isengard, 2003;
Russell and O’Connor, 2001). The evidence suggests that all three groups are therefore lesspreferred as employees: the last to be hired and first to be fired (dismissed) (LIFO) (Gibson
and Watane, 2001; Grimmond, 1993; Winkelmann and Winkelmann, 1997). If jobs areavailable, they are ordinarily offered first to prime-age people with better education and/or
more work experience (Gibson and Watane, 2001; Winkelmann and Winkelmann, 1997).
Employers generally consider hiring inexperienced and/or less educated people only whenmore preferred people are in short supply (Clark and Summers, 1990). If Maori, Pacificpeople, and young people do obtain employment, it is more likely to be in the less desirable
secondary labour markets of the small business, service sector, where there are more limited20

31(2): 17-30, Probationary Employment, M. Harcourt & G. Woodprospects for promotion, pay increases, and training and development (see, for example,
Easton, 1994).
The pattern of high youth unemployment is similar in most European Union countries(Russell and O’Connor, 2001: 3). In general, youth unemployment rates are at least twice ashigh as those for prime-age adults (Isengard, 2003: 360; Russell and O’Connor, 2001: 3).
However, a major exception is Germany, where youth and prime-age adult unemployment
rates have historically been virtually identical. Much of this success is attributed to theGerman apprenticeship system, which enables younger workers to work in their chosen fieldas they study. As a result, younger workers emerge from their training having already had
work-related experience, and so are not less preferred like their counterparts elsewhere(Isengard, 2003).

Failure to Lower Unemployment and Create Jobs
Is there any evidence to suggest that probationary periods reduce the relatively highunemployment rates of disadvantaged groups? The short answer is 'no'. Unscientificcomparisons across countries also suggest that the answer is 'no'. Britain has a one-year
probationary period, similar in most respects, except length, to the one proposed for New
Zealand. The USA has the equivalent of an indefinite probationary system called
employment-at-will, which allows employers to dismiss private-sector, non-union workers
for any or no reason. However, neither Britain nor the USA can claim to have an obviously
superior record in reducing the unemployment of, for example, younger or minority workers.
In 2003, New Zealand’s unemployment rate was 4.7%, but 10% for Maori, 7% for Pacificpeoples, 7% for other groups (mainly Asian), and 14% for 16-19 year olds (Statistics New
Zealand, 2004: 64-65). In 2001, the USA’s unemployment rate was 4.7%, the same as New
Zealand’s two years later, but 9% for blacks, 6% for Hispanics, and 14% for 16 to 19 year
olds (Bureau of Labor Statistics, 2006). In 2003, Britain’s unemployment rate was 5.0%, justabove New Zealand’s in the same year, but 7% for Indians, 15% for Pakistanis, 13% forblacks (Trades Union Congress, 2006: 2), and 15% for 16-19 year olds (London
Development Agency, 2006: 145). If anything, New Zealand’s record appears slightly worse
than the US’s and slightly better than Britain’s, given a similar average unemployment rate.
The US’s so-called success may reflect its incarceration of more than two million people,
many of whom are young and/or black (Wood, 2004).
Some idea of the potential employment or unemployment effects of probationary periods isapparent in the fixed-term contracting research. In some respects, probationary periods
resemble fixed-term contract periods, in that workers can be dismissed for any or no reason.
With fixed-term contracting, this is only permitted at the end of a particular period - e.g., one
or two years. With probation, this can be during or at the end of a particular period - e.g., one
year in the UK. Some economists have examined the effects of allowing fixed-term
contracting in France (Blanchard and Landier, 2002), Germany, (Hunt, 2000; Hagen, 2002),
and Spain (Dolado, Garcia-Serrano, and Jimeno, 2002). In general, they have not foundstrong evidence of either increased job creation or unemployment reduction (Blanchard andLandier, 2002; Dolado, Garcia-Serrano, and Jimeno, 2002). Ironically, frictional
unemployment has actually risen, since fixed-term contracting typically involves more spells21

31(2): 17-30, Probationary Employment, M. Harcourt & G. Woodof unemployment, as workers often finish one job and become unemployed prior to taking up
a new job (Blanchard and Landier, 2002; Dolado, Garcia-Serrano, and Jimeno, 2002: F282;
Hagen, 2002: 701). Employment has become more precarious, as many employers haveswitched from open-ended to fixed-term employment relationships (Blanchard and Landier,
2002; Dolado, Garcia-Serrano, and Jimeno, 2002). Fixed-term relationships also generally
appear to be associated with lower wages, 13% lower in Britain (Brown and Sessions, 2003:504), approximately 10% lower in Spain (Dolado, Garcia-Serrano, and Jimeno, 2002: F284),
and approximately 20% lower in France (Blanchard and Landier, 2002: F240) and Germany(Hagen, 2002: 667). The reduced duration of employment relationships has discouraged
employers from offering training and opportunities for advancement as well (Dolado, GarciaSerrano, and Jimeno, 2002: F284).

Denial of Probationary Employees’ Statutory Rights
In principle, probationary employees would ordinarily have the same or similar rights asother employees with respect to, for example, holidays, health and safety, and minimum
wages. In practice, probationary employees who exercised such rights could be lawfully
victimised by their employer, in the absence of a right to file a personal grievance forunjustified dismissal or disadvantage. To take just one example, probationary employees
who complained about employer health and safety violations could be dismissed for doing so.
Likewise, a probationary employee who accompanied an inspector on a workplaceinspection, provided evidence relevant to a health and safety investigation, or acted as aworkplace health and safety representative or committee member could be dismissed. If fears
of victimisation discouraged probationary employees from exercising their statutory rights,
there would be a corresponding decline in enforcement activity and rise in undetectedviolations. A study of bullying in the British higher education sector (Simpson and Cohen,
2004) confirms that probation is generally disempowering, and so would leave employees
more open to unlawful and/or unethical management behaviour.
Failure to protect probationary employees from victimisation could have far-reaching effects
on the legality and/or ethicality of employer actions. Some workplaces employ workers for
only a few months, perhaps because of the seasonality of their industry or perhaps because
their pay and conditions are too unattractive to retain staff. If most workers were
probationary, most might also be reluctant to complain of unlawful mistreatment by theemployer. Even non-probationary employees might feel apprehensive about exercising theirrights, if they felt unsupported or even undermined by their more numerous and more
compliant probationary colleagues. In a worst case scenario, a general climate of fear could
allow employers of mainly probationary labour to openly and extensively flout the law.
Paying workers less than the minimum wage and requiring them to work on public holidays
could become routine in some companies. Such unlawful behaviour has now becomecommonplace in the Philippines, following the introduction of a six-month probationary
period (Skene, 2002: 495).
Denial of Probationary Employees’ Freedom of Association22

31(2): 17-30, Probationary Employment, M. Harcourt & G. Wood

In some cases, probationary employees have been openly denied their statutory rights. For
example, in the Philippines, probationary employees, unlike others with longer tenure, haveno right to receive a thirteenth month of pay, overtime pay, social security, and retirement
benefits, and no right to join a union (Lloyd and Salter, 1999: 7-8). In New Zealand, theProbationary Employment Bill would have deprived probationary employees the right tobargain collectively for their terms and conditions of employment through a union. Had theBill been passed, it would have directly contravened international conventions concerning
freedom of association which New Zealand officially supports. Article 20 of the United
Nations’ Universal Declaration of Human Rights states that: “(1) Everyone has the right tofreedom of peaceful assembly and association; and (2) No one may be compelled to belong toan association.” Similarly, the International Labour Organisation’s Convention 87 states
that: “Workers and employers, without distinction whatsoever, shall have the right toestablish, and subject only to the rules of the organization concerned, to join organizations of
their own choosing.”
Council of Trade Unions President Ross Wilson argues that up to 200,000 workers would
have been negatively affected (Huggard, 2006). In other words, approximately 10% of New
Zealand employees would have been denied the right to be covered by a collective agreement
every year. For New Zealand unions, this would have translated into a loss of as many as 3040,000 members, given membership levels of 340,000 (May, Walsh, and Otto, 2004: 85).
In some workplaces, prohibiting probationary employees from bargaining collectively would
have caused a collapse in union membership levels. The problem would have been
particularly acute in workplaces with relatively high turnover and relatively low union
density. If, for example, a union had represented only 25% of employees in a supermarket,
not allowing probationary employees the right to bargain collectively could have prompted
such a large drop in membership as to make continued collective bargaining and union
representation untenable. Declining membership and financial resources could have sosapped a union’s powerbase that it became totally unattractive as a bargaining agent, even to
the most committed unionists among non-probationary employees. Firms presently
organized by the National Distribution Union and Service and Food Workers Union might
have proven especially vulnerable to this sort of collapse.
Some employers could have avoided unionization altogether by continually hiring people forno longer than the probationary period. This form of rotational hiring has become
widespread in the Philippines, following the enactment of a six-month probationary period(Skene, 2002: 495).
More Discrimination against Disadvantaged Workers
A probationary employment period is supposed to encourage employers to take a chance on
employing so-called high risk applicants. However, a probationary period would probably
have the opposite effect, if the only protections provided probationary employees, as in the
Probationary Employment Bill, were for discrimination or sexual/ racial harassment. New
Zealand evidence suggests that women, older people, new immigrants, and people withdisabilities are the most likely to file a complaint for discrimination or sexual/ racial
harassment under the Human Rights Act (Human Rights Commission, 1999: 17 and 36). It23

31(2): 17-30, Probationary Employment, M. Harcourt & G. Wood

would be reasonable to expect that among probationary employees these groups would also
be the most likely to file a complaint, no doubt for genuine reasons. By contrast, nondisabled, white males in their 30s would be much less likely to feel discriminated against or
harassed and thus much less likely to file a complaint. In this scenario, probationary
employee legal cases would be dominated by gender, age, nationality, and disability issues tothe virtual exclusion of anything else. Even if there were few cases, their media salience
could convince employers that women, immigrants, the disabled, and those over 50 werelikely to be litigious. Given this belief, employers might develop a stronger preference forhiring seemingly easy to dismiss, 30-something-year-old, white men. Some commentators
argue that this is precisely what has happened in the USA with the anti-discrimination
exception to employment-at-will (Roehling, 2003).

The Dismissal of Competent Probationary Employees
Probationary employment would allow managers to dismiss any probationary employee forany or no reason. Incompetent, aggressive, or moody managers could resort to firing
probationary subordinates for the most minor reasons. Disagreements over trivial issues
could lead to instant dismissal for subordinates who are too competent, outspoken, or
ambitious in the eyes of some managers. Sadistic managers might even enjoy firing workers.
Impatient managers might also rush to dismiss probationary employees, whose poor
performance had little or nothing to do with a lack of skills, abilities, knowledge, or
motivation. Poor performance could reflect any number of other factors, including
ambiguous instructions, ambivalent staff in supporting roles, malfunctioning machinery andequipment, and inadequate or nonexistent training.
The experience of employment-at-will in the USA suggests that good probationary
employees could, and almost certainly would, be sacked, if probationary employment ever
became law in New Zealand. In the USA, “an estimated 150,000 to 200,000 employees are
dismissed annually who could assert legitimate claims under the good cause standard,” if itwere available to them (Barber, 1993: 193). Such unjustified dismissals would be both
unfair to affected probationary employees and wasteful and inefficient for the economy.
Furthermore, frequent spells of probationary employment, interspersed with periods of
unemployment, could be unjustifiably stigmatizing for some workers, permanently confining
them to low-paying, dead-end jobs. However, there is presently no evidence for or against
such a link. Some research does suggest that casualisation, more generally, can trap
employees in dead-end jobs (Silver, Shields, and Wilson, 2005). Other research suggests thatthe majority of casual workers do eventually enter more permanent employment (Gaston andTimcke, 1999; Green and Leeves, 2004).

Early Career Employer Opportunism
Probationary periods would facilitate what Schwab (1993) refers to as early career employer
opportunism. Early career employer opportunism is a special case of unjustifiably dismissing24

31(2): 17-30, Probationary Employment, M. Harcourt & G. Wood

good probationary employees. The idea here is that probation would encourage employers to
be non-committal in their hiring. Some earlier applicants might be hired for their immediate
availability rather than job suitability, and then replaced before the end of probation with
better (e.g., more able or skilled) or cheaper (e.g., lower salaried), later applicants. This
practice could have severe negative effects on earlier applicants. In the extreme, some mightend up among the long-term unemployed, especially if older than 50, having relinquished asecure and well-paying position to take up a perhaps better paying, but more insecure,probationary one. Others might find alternative employment relatively quickly, but still face
major costs in moving, selling their house, transferring a spouse's job, and settling children in
a new school. No doubt, early expenditures on training or induction would discourage such
employer opportunism. However, the case law under employment-at-will in the USA (seeSchwab, 1993: 39-40) suggests that it would still happen in New Zealand.
The New Zealand Council of Trade Unions (2006) has suggested that fears of such employer
opportunism could discourage a lot of desirable labour mobility, which would otherwise
benefit employees, employers, and New Zealand society as a whole. For instance, somepeople might be less interested in re-training for shortage occupations, knowing that theirinitial employment was going to be probationary. Similarly, insecurity of employment might
dissuade many from accepting lucrative job offers in other regions with lower
unemployment. In the extreme, probationary employment might discourage many potential
highly skilled migrants from coming to work in New Zealand.

The Use of Exit Rather than Voice to Address Poor Performance or Misconduct
Many poor performance and misconduct problems are potentially rectifiable. For instance,
misconduct may be prompted by alcoholism (e.g., gross negligence in driving while drunk),
exhaustion from overwork (e.g., failure to follow safety rules), anger at the unfairness ofmanagement decisions (e.g., disobedience), or retaliation for being ignored or mistreated(e.g., theft). That is why unjust dismissal law presently requires employers to use ‘voice’(Hirschman, 1970) in managing poor performance or misconduct. More specifically, theemployer cannot simply dismiss without first finding out what happened and why byinterviewing witnesses and those accused of any misconduct or poor performance. As such,
unjust dismissal procedures are very much an essential part of a problem-solving approachbased on ‘voice’.
In contrast, probationary employment would allow employers to use ‘exit’ (Hirschman,1970) by instantly dismissing a poor performer or wrongdoer, without first investigating
whether and to what extent this may be justified. As against ‘voice’, early, unjust ‘exit’ of
probationary employees would have two main disadvantages. First, it would help to maskorganisational performance and discipline issues. For example, unjustly dismissing poorly
trained employees might conceal or suppress, but would not remedy, major, ongoing
deficiencies in training programmes. Second, ‘exit’ would enable firms to pass along theirso-called problem probationary employees, one to the next, in an endless game of ‘pass theparcel’, without ever taking responsibility for rectifying employee shortcomings. For
example, unjustly dismissing cantankerous or belligerent probationary employees, not guiltyof any misconduct, might be cheaper and easier than providing counseling. However, in the25

31(2): 17-30, Probationary Employment, M. Harcourt & G. Woodabsence of corrective action, such employees could end up permanently less productive,
resulting in an efficiency loss to the economy. More seriously, the stigmatisation of ongoing
dismissal could render them permanently unemployable and a major drain on social security
and social services.

The Negative Effects of Job Insecurity for Employers
Even employers could suffer under a probationary employment regime. Probationary
employment would increase actual, and perceived, job insecurity, at least for the probationary
period. Workers worried about the security of their jobs tend to focus more on preparations toleave than on making their employers productive or profitable. Research evidence suggeststhat higher job insecurity would lower commitment (Adkins et al., 2001; Ashford et al. 1989;
Bishop, 2002; Buitendach and de Witte, 2005; Davy et al, 1997; de Witte and Naswall, 2003;
Yousef, 1998), including commitment to change (Chawla and Kelloway, 2004; Pate et al.,
2000; Preuss and Lautsch, 2002; Rosenblatt and Ruvio, 1996), lower performance(Rosenblatt and Ruvio, 1996; Yousef, 1998), and raise intentions to quit (Ashford et al. 1989;
Rosenblatt and Ruvio, 1996).

Implications
General, market-oriented policies like probationary employment are inappropriate foraddressing the specific unemployment needs of disadvantaged groups. More focused stateinterventions are needed. For instance, if skill deficits really are a major unemployment issue
for Maori, Pacific peoples, and youth, these deficits should be addressed directly. The
government should provide more support for apprenticeships and other training programmes
likely to get younger workers, in particular, into jobs. More support for training could mean astudent allowance for shortage occupations or help with re-payment of students’ loans,following programme completion. However, the success of any apprenticeship initiative
would be contingent on suitable institutional and contextual support. In the absence of anactive state and union role, via effective and relevant tripartite forums, in defining the scopeand nature of apprenticeships, employers may be tempted to use apprentices simply as asource of cheap, short-term labour rather than as the basis for building an industry-specificskill base for long-term competitive advantage (Hall and Soskice, 2001; Wood and James,
2006).
The government could also provide support to bridging, work-study programmes, similar to
those in Germany, which help polytechnic or university students obtain career-related work
experience while still studying. This would help to ensure that the broader skills acquired atuniversities remain relevant to employers requiring industry-specific skills. If employers do
not know how to value immigrants’ or migrants’ qualifications and work experiences, thisproblem should also be addressed directly. The New Zealand Qualifications Authority could
reduce the hiring risks by publishing more information on the quality of foreign credentials.
Industry associations could do the same for foreign work experience, especially if associatedwith larger and better known organisations overseas.
26

31(2): 17-30, Probationary Employment, M. Harcourt & G. Wood

Should anything be done to alleviate employer concerns about dismissal compliance costs?
This is certainly a political problem, regardless of whether or not it is a serious economic
one. Failure to tackle employer concerns is likely to prompt a future National government toenact probationary employment, whatever its negative impacts. If firing incompetents orwrongdoers is so difficult in the New Zealand workplace, and it is not clear that it is, thisshould be addressed directly through specific changes to existing dismissal law rather thanindirectly and only partially through probationary employment. At present, ambiguities andinconsistencies in the common law rules that necessarily emerge from the many decisions of
the Employment Court and Employment Relations Authority can create confusion anduncertainty for employers, adding unnecessarily to their compliance costs. In future, greater
clarity could be achieved by placing explicit, default dismissal procedures for poor
performance, misconduct, and redundancy in a new schedule in the Employment Relations
Act. Codified procedures could also be used to instigate a harsher disciplinary regime,
which would allow employers to summarily dismiss employees for major offences and after
just one warning for minor offences (or poor performance). The quid pro quo could be muchharsher penalties for employers who failed to adhere to dismissal procedures in the schedule.
Clearer legal, guidelines would make it less necessary for both parties to litigate to enforce
their rights. If litigation were pursued, clearer guidelines would make the process morepredictable and thus less financially risky to those who used it. Employees might also gain
by knowing more precisely where they stood.

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30

31(2): 31-45, New Unions Under the ERA, J. Murrie

Not a Typical Union but a Union all the Same: New Unions
Under the Employment Relations Act 2000

JOHN MURRIE*

Abstract
This paper reports on a small exploratory study of factors significant to the formation,and rapid proliferation of new predominantly workplace-based unions, or New Unions,
under the Employment Relations Act 2000. Specifically, it examines the motivations
and interests of workers who decided to form and join those unions and the role of otherparties, notably employers, in that decision. Workers’ dissatisfaction with and mistrustof existing unions were factors significant to their decision to form New Unions, while
the role of employers was found to be less influential and less dominant than previously
thought. Overall, this paper argues that New Unions may be a predominantly employee,
not an employer, driven phenomenon.

Introduction
This paper reports on the formation and growth in New Zealand of new union
organisations under the Employment Relations Act 2000 (ERA). To date, researchers
have placed great emphasis on describing these newly formed unions and on comparing
their structure, activities and character against that of older more established union
organisations. Overall, newly formed unions have compared unfavourably to older
unions leading some researchers to question the formers status as ‘genuine’ union
organisations. A key element in these arguments are findings that suggest that New
Unions as a group are incapable of operating at arms length from employers and are an
employer-driven, not an employee-driven, phenomenon.
Researchers have focussed critically on (a) how New Unions operate, (b) the role ofemployers in their formation and operation, and (c) comparing their structure andactivities against that of older more established unions. However, researchers havetended to overlook why those unions formed. Specifically, few researchers haveaddressed the motivations and interests of workers who formed New Unions and theprocess by which that decision was made. Some have linked workers’ dissatisfaction
with and possible opposition to the wider union movement to workers’ decision to form
New Unions (e.g., Barry & May, 2002). But beyond this, no direct or definitive
examination has been provided on why workers choose to form, and subsequently joinorganisations that are, according to researchers, ineffective and unable to operate
independently (e.g., Barry, 2004).
This paper addresses these and other questions by examining a small group of New
Unions formed from 2000-2004 and the attitudes and experiences of employers and Old
Union representatives who bargain with and operate alongside New Unions. It
questions in particular why New Unions formed, the motivations and interests of* School of Aviation, Massey University, Palmerston North31

31(2): 31-45, New Unions Under the ERA, J. Murrie

workers who formed them, and challenges existing assumptions that they may not begenuine (or effective) union organisations. Existing research findings relevant to thesequestions are presented first, followed by a discussion of relevant results, points of
convergence and divergence from prior research, and finally the implications of thepaper’s findings for future research are discussed.

The ERA and New Union formation
From 2000 – 2004, approximately 100 New Unions representing some 10,000 workers(see Table 1) were formed and registered under the ERA (Barry, 2004; Barry & May,
2002; Harbridge & Thickett, 2003; May, 2003b). The rapid growth and proliferation ofthis large number of new, predominantly small, unions diverged from international
trends toward union decline, and the creation, by merger, of large conglomerate unionbodies (Buchanan, 2003; Chaison & Rose, 1991; Freeman, 1989; Hose & Rimmer,
2002; Kuruvilla, Das, Kwon & Kwon, 2002). By 1st March 2004, New Unions madeup approximately half of all registered unions in New Zealand but their membershiprepresented only 2% of total union membership (Employment Relations Service (ERS),
2004). Despite their small size, the overall contribution of New Unions to union
membership growth during this period was significant; approximately one third of all
new union members registered under the ERA belonged to New Unions (ERS, 2004).
Although described as an unexpected consequence of the ERA (Barry, 2004) theformation of New Unions attracted only a modest degree of interest from researchers(Anderson, 2004; Barry, 2004; Barry & May, 2002; Barry & Reveley, 2001). The
primary focus of this body of research has been on:•••

the structure and activities of New Unions and on their possible impact on theexisting union movement (Barry, 2004; Barry & May, 2002);
their legitimacy or independence as organisations (Anderson, 2004); andthe possible involvement of employers in their formation (Anderson, 2004;
Barry & Reveley, 2001).

However, this same research has provided a paucity of data on why these organisations
formed, workers’ motivations for forming them, and the process by which the decision
to form those unions was made. Rather, researchers paid greater attention to thequestion of whether New Unions were, or were capable of becoming, a genuine form ofunion representation (Barry & May, 2002), and to comparing them against existing
definitions and empirical descriptions of the term ‘union’ and union character (e.g.,
Blackburn, 1967; Nicholson, Blyton & Turnbull, 1981; Webb & Webb, 1907). Key
characteristics said to differentiate newly formed unions from these concepts were their:••••

Non-affiliation with the New Zealand Council of Trade Unions (NZCTU).
Enterprise-based membership (See Table 2).
Lower membership fees.
Enterprise-based bargaining agenda (Barry, 2004; Barry & May, 2002; May,
2003a & 2003b).

32

31(2): 31-45, New Unions Under the ERA, J. Murrie

Table 1: Registration history & membership of unions in NZ as at 1st March 2003
Classification

Old Unions

New Unions

Registration

Number ofdateunionsPrior to January
2000
January 2000–
March 2002
TOTALS% ofMembership of unions

registeredregistered during

unionsperiod% of union
membership

83

47.4

324,892

97.2

92

52.6

9,152

2.7

175

100.0

334,044

100.0

Source: Employment Relations Service, Department of Labour

Based on these and other differences, New Unions as a group have been broadly definedas small, poorly financed organisations that are something less than a genuine form of
employee representation (Barry, 2004; Barry & May, 2002).
More specifically,
researchers have voiced concern that New Unions fail the critical test of being a genuine
union (Anderson, 2004; Barry, 2004; Barry & May, 2002), including the ability to act
independently of an employer (Blackburn, 1967; Blackburn & Prandy, 1965; Prandy,
Stewart & Blackburn, 1974). This implied lack of independence has been of significant
interest to researchers, as has the role of employers in both the formation and operationof New Unions.
Table 2: Distribution of New Unions by membership rules as at 1st March 2003
Membership criteria

Restricted toOpen to employees

single employer

of any firm

Total

Restricted by occupation or position

20

9

29

Open to any occupation within a firm

41

20

61

TOTAL

61

29

90

Source: New Zealand Companies Office

New Unions and Employers
Doubts over the independence of New Unions as organisations has led researchers toargue that employers may sponsor or promote New Union formation as part of a wider
decollectivist strategy (e.g., Peetz, 2002a & 2002b), possibly based on a New Zealandversion of the company union phenomenon seen elsewhere (e.g., Jenkins & Sherman,
1979; Kaufman, 2000; Nissen, 1999). But outside of a few, possibly extreme,
examples† (Anderson, 2004; Barry, 2004; Barry & May, 2001; May, 2003a & 2003b),
little definitive evidence has been produced to show that this is a widespread
phenomenon. Nevertheless, as argument it is one that has not been significantly
challenged.
†

Typically the Te Kuiti Beef-workers Union and the Warehouse People’s Union3331(2): 31-45, New Unions Under the ERA, J. Murrie

The key problem for this study is that none of the research addresses clearly thequestion why an employer would sponsor the formation of a New Union? Morespecifically, why would New Zealand employers consider it necessary and/or
advantageous to do so? Undermining the collective bargaining efforts of moreestablished or Old Unions is mooted as one reason (Barry, 2004; Barry & May, 2002;
Barry & Reveley, 2001). But whether employers are deliberately pursuing this type ofstrategy is unclear. Research also suggests that in the previous legislative environmentthat was detrimental to unions, New Zealand employers are likely to forgo formal
attempts at decollectivisation and rely instead on the legislative climate to achieve
similar outcomes (Wright, 1997). While the restrictive legislative conditions to whichthese findings relate no longer apply, key aspects of the current legislative environment
could be argued to have a similar decollectivising influence. Relevant factors include
the proliferation of standardised employment agreements, and the passing on of unionnegotiated conditions to non-union workers, the absence of continued or sustained
growth in union membership (Employment Relations Service, 2004; Waldegrave et al,2003). In particular, the use of standardised employment agreements is a key facet ofinclusive and exclusivist decollectivist strategies (Peetz, 2002a & 2002b) and many
New Zealand firms would appear to routinely adopt such methods (Waldegrave et al,2003). If this is the case, why then would New Zealand employers pursue the formationof company unions when other less overt forms of decollectivist strategy appear to be
more effective under the ERA?

Workers and the formation of New Unions
The most significant omission from recent research has been an analysis of the motives
and interests of workers who formed New Unions. Few writers - with Anderson (2004)
being one exception - have questioned why workers would ‘freely’ choose to form, join
and remain in organisations that could not and did not effectively represent theirinterests. Fewer still have questioned why workers would form, join and remain inorganisations that lacked the ability to act independently of their employers. Empiricalresearch into workers’ unionisation decisions has consistently found that workers join
and remain in unions in order to gain some advantage, typically an economic one (e.g.,Freeman & Rogers, 1999; Tolich & Harcourt, 1999; Waddington & Whitston, 1997). If
a union is incapable or unable (because of employer involvement) to offer such anadvantage, why workers would choose to form, join and remain in New Unions is an
important, but largely unanswered question. The only identified motives for workers’
decisions to form New Unions are argued to be their dissatisfaction with the existing
union movement or a desire for a cheaper form of union membership (Barry & May,
2002; May, 2003a & 2003b). But as catalysts of New Union formation, these factors
have not been extensively examined by researchers. Consequently, empirical research
has offered few, if any, explanations of why workers choose to form New Unions or of
how that decision was reached. This is surprising given the impact New Unions aresupposed to have on the union movement as a whole and the operation of the ERA(Barry, 2004; Barry & May, 2002; May, 2003a & 2003b).

34

31(2): 31-45, New Unions Under the ERA, J. Murrie

Methodology
Focus of the Study
In examining the decision to form a New Union and the questions raised by the relevant
literature, this paper sought to re-examine the phenomenon of New Union formation
and asked “Why do New Unions form in New Zealand?” From this question, a sub-setof questions where examined• Why do workers reject membership in other unions in favour of forming theirown union?
• What role did employers’ play in the workers’ decision to form a union?
• What are the characteristics and definition of a genuine union?
• Are New Unions genuine?
DesignThe study used a qualitative methodology based upon semi-structured interviews with asmall, deliberately selected sample of representatives from three stakeholder groups.
Those groups were:• New Unions formed under the ERA.
• Employers whose workforces were partially covered by one or more New
Unions.
• Existing, or Old Unions, that operated alongside one or more New Unions.

New Union Participants
New Union participants were deliberately selected from 92 such organisations
registered with the Department of Labour as at 1st March 2004. Representatives of nine
New Unions were interviewed, and, in a small departure from previous examinations of
New Unions (Barry, 2004; Barry & May, 2002), participants actual level ofinvolvement in the formation of their unions was identified. The research focussed onparticipants who were identified as either a founding member, or ‘the’ founding
member of a particular union. Six participants were identified as founding members of
their unions in this fashion.
Other Participants
Employers were identified by examination of the rules of registered New Unions, while
Old Unions were identified by New Union participants who frequently detailed theother union organisations operating within their place of work. Representatives of three
employers, whose workforces were partially represented by New and Old Unions, andthree Old Unions, who operated alongside one or more New Unions, were interviewed
by the study.
Limitations of the Study
A key limitation of this study was the small number of New Union participantsinterviewed and its ability to provide results comparable to the work of Barry (2004)
and Barry & May (2002) that provided the only previous direct examinations of New
Union formation. Barry & May (2002), for example, identified 64 of 158 unions
registered as at 2nd October 2001 as New Unions, and interviewed 18 or 28% of35

31(2): 31-45, New Unions Under the ERA, J. Murrie

registered New Unions using a structured telephone survey. The current study
interviewed a smaller proportion of both New Unions and registered unions in general.
Only 12 out of the 174 unions registered as at 1st March 2004 were interviewed,
including 9 of the 92 New Unions. The sample of 9 New Unions represented 9.8% of
the all New Unions registered at that time. However, the study’s small sample isconsidered defensible on the grounds that small samples are frequently used inqualitative research (Silverman, 2001), and are justifiable where they provide sufficient
information to allow themes within the research to be fully developed (Fossey, Harvey,
McDermott & Davidson, 2002). While the proportion of New Unions interviewed by
the study was small, particularly in comparison to prior research (notably Barry & May,
2002), it is balanced by the:•••Use of semi-structured rather than survey-based interview methods.
Depth of data generated by the interview process.
Inclusion of other stakeholder groups.

A final limitation of the study was the deliberately selection of participants which would
make it difficult to argue that its findings are applicable to New Unions as a whole.
However, the study was able to balance the deliberate selection of participants against
the need for a representative sample by including participants:••

From a wide range of industry classifications, including both the public andprivate sector.
That varied considerably in size, in terms of employee and membershipnumbers.

In regard to New Union participants, the sample included organisations that werebroadly comparable to New Unions as whole in terms of: size, membership rules, dateof formation and industry distribution.
Results
Why did workers reject membership in existing unions in favour of forming theirown?
Why workers join unions is a question New Zealand researchers have not examined as
extensively as those internationally. A single New Zealand examination2 of thedecision to join a union (Tolich & Harcourt, 1999) compares rather unfavourably to theplethora of similar studies available elsewhere (e.g., Gani, 1996; Lahuis & Mellor,
2001; Waddington & Kerr, 2002; Wheeler & McClendon, 1991). New Zealandresearchers have also avoided direct examination of why workers reject membership ofparticular unions and/or leave them. The closest comparable evidence comes from
Australia where Peetz (1998) examined workers’ decisions to join, stay in and exit
unions in that country.
This paper found that the option of joining an established union was actively, anddemocratically, considered prior to workers’ decision to form a New Union. In each
instance workers choose to reject membership in another, principally older moreestablished union because of their personal and shared experiences with those unions.
More specifically, workers were found to be dissatisfied with the actions, attitudes andbehaviour of the members, officials and other representatives of those unions.
Responses typical of participants were:36

31(2): 31-45, New Unions Under the ERA, J. Murrie“They weren’t happy with the union reps they had, and if they had a reallyserious problem they found it could take a week to get someone who had any
real teeth to actually deal with things.”“I was 49 years old, I’d been unemployed for six months and two guys hopped
on my bus the first week and said ‘come and join this union so we’ve got
solidarity and with solidarity we can smash the firm’, and I said ‘well this firms
given me a job at 49 years old why would I want to smash them?’ And that was
their approach, and I will never, never join [that] union.”
Key characteristics with which workers were dissatisfied were: Old Unions’ aggressive
organising and bargaining tactics, poor service delivery, and perceived unwillingness
and inability to represent their interests. Significantly, in rejecting membership in otherunions, workers did not reject the idea or concept of collectivism, only membership ofspecific unions. Participants considered collective representation to be beneficial, but
saw little or no benefit in belonging to existing organisations.
What role did employers’ play in the workers’ decision to form a union?
Employer responses to, and involvement in, New Union formation was described
differently by each group of participants. The majority of New Unions in the study
believed that their employer supported, but did not assist with, their decision to form.
Employers indicated that they only accepted that decision, and their involvement was amatter of legislative compliance. Old Unions were contradictory, indicating both astrong belief in employer involvement in New Union formation, and a desire to believethat such involvement existed where it did not. Responses typical of these wide
variations were:
From New Unions“They actually suggested I think they encouraged it…”
From Employers“…we took a view that there was little point in prevailing against them, saying
they shouldn’t do this [as] it was their legal right to do so.”
From Old Unions“I don’t think that employers are involved, even though that’s what we’d like tothink, it’s just, I know that’s what people are thinking…”
Overall, employers were found to play a limited role in the formation of New Unions inthe study. Employer involvement with these New Unions was found to more likely
reflect an acceptance of workers’ legal rights to form unions under the ERA, not adeliberate attempt to form a tame union or to undermine existing union organisations.
Only in one or possibly two instances were such actions identified, with employers’
following a pattern of behaviour described by existing research. Yet, evidence of actual
or widespread attempts to form a tame in-house union with the intent of undermining
existing union organisations was limited, as was evidence of New Unions gaining any
form of advantageous relationship with their employer.

37

31(2): 31-45, New Unions Under the ERA, J. Murrie

What are the characteristics and definition of a genuine union?
Participants defined a union as a collective organisation whose primary purpose was therepresentation of workers’ employment interests; a definition broadly similar to that ofWebb and Webb (1907). Participants did not provide a consistent definition or
description of a genuine union. Rather, they identified characteristics critical to thecharacter of the typical New Zealand union and how their unions and New Unions ingeneral did or did not adhere to those characteristics. The typical New Zealand union
was identified as an older organisation formed prior to the ERA, that:••••

Represented workers across an industry or the country as a whole.
Pursued interests that frequently diverged from those of employers.
Pursued those interests through collective bargaining and other non-bargaining
activities.
Was affiliated with the NZCTU.

Of these factors, the pursuit of collective bargaining, independence from employers, andwillingness to engage in militant or industrial action appeared most significant toparticipants’ descriptions.
A number of additional characteristics were also attributed by New Unions andemployers to the behaviour of the typical New Zealand union. The specific terms used
to describe Old Unions were:•••

Confrontational or positional.
Untrustworthy.
Antagonistic.

Responses typical of these descriptions included:
From New Unions“I see unions as pommy _______ who stand up and shout. That’s the vision ofme growing up in New Zealand, that feeling that unions were anti the bosses.”
From Employers“They [the New Union] have a very different approach to their relationship withthe company than the other unions. What is different? They don’t appear to be
driven by any kind of national or CTU agenda.”“It’s the trade off mentality or a positional mentality.”
Consequently, participants’ descriptions of the typical New Zealand union were broadly
comparable to the concept of union character used by previous research into New Union
formation (Barry & May, 2002), as well as to existing definitions of the term union.
Are New Unions genuine?
Despite each participant group sharing a common definition of the typical New Zealandunion, the question of whether their unions (in the case of New Union participants) or
New Unions in general were genuine was more difficult to answer. Participants seemed
to describe New Unions in the same way, but differed on whether they were, in fact,
genuine unions. New Unions were described in a similar fashion to existing research3831(2): 31-45, New Unions Under the ERA, J. Murrie(e.g., Barry, 2004; Barry & May, 2002) with participants in the study noting features
such as their enterprise-based membership, and narrower bargaining agenda. However,when describing New Unions, participants gave greater weight to describing how they
operated rather than what they did and how they were structured. In relation to theconcept of union character, participant responses gave weight to previous claims thatthe concept had little application to New Unions (Barry, 2004). Key facets of unioncharacter that New Unions were not found to adhere to were:•••

The willingness to engage in militant action.
Affiliation with the NZCTU.
A willingness to declare themselves to be a union.

Participants also identified a strong divergence between New Unions and theirdefinition of the typical New Zealand union. Significantly, how they did so also
appeared more significant to participants than New Unions’ adherence or non-adherence
to the academic concept of union character. Key factors said to differentiate New
Unions from the typical New Zealand union were argued to be their:
•
•
•
•
•

Pursuit of enterprise rather than industry and national level collective
bargaining.
Unwillingness or inability to engage in militant action.
Unwillingness and inability to pursue activities outside of collective bargaining.
Unwillingness and possible inability to pursue interests that diverged from thoseof their employer.
Pragmatic and cooperative rather than confrontational relationships with
employers.

Responses typical of these descriptions included:
From New Unions”I see us [the New Union] as a group of people working together rather than agroup of people with our fists out fighting together.”“Well I don’t think we do a hell of a lot that’s different but we do communicate
perhaps a little better.”
From Employers“In many ways they have more of a partnership relationship with the businessthan a positional or adversarial relationship.”
From Old Unions“I don’t see them as a reputable union. We see them as just basicallybargaining agents they don’t do the things that proper unions do. They’re there
to negotiate the agreement then they’re gone basically.”
On the basis of these findings, the New Unions identified in this study would appear not
to be genuine unions as they do not adhere to either the concept of union character orparticipants’ descriptions of the typical New Zealand union. Conversely, however,when asked whether those unions were genuine, both New Unions and their employers
stated that they were. Only participants representing Old Unions argued against defining
New Unions (particularly those with whom they had contact) as genuine, placing
significant emphasis on two key characteristics attributed to those organisations:3931(2): 31-45, New Unions Under the ERA, J. Murrie••

The presumed lack of independence, andThe pursuit of a purely enterprise-based agenda.

The first characteristic was argued to be derived from New Unions’ reliance upon freeriding to secure a collective agreement, and their inability to pursue a confrontational
relationship with employers. Old Unions regarded both as indicative of New Unions’dependence upon employers for their long-term survival. In describing the second, Old
Unions did not dispute that many New Unions bargained collectively, which is a key
facet of union character (Blackburn, 1967). They argued, however, that this did not
make them genuine unions as how they bargained was not sustainable and an ineffective
method of representing workers.
New Unions and employers, however, placed less emphasis on the level at which theybargained and operated, and focused more strongly on the basic purpose of thoseorganisations. This was defined by both groups as the simple representation of workers’
employment interests, a definition similar to Webb and Webb (1907) and anorganisational objective that does not differ from that of other unions. Overall, New
Unions argued that they were genuine but distinctly different to organisations typical of
the New Zealand union movement. These differences, while significant, did not prevent
those unions from being regarded or from operating as genuine independent union
organisations.
Responses typical of these descriptions included:
From Employers“The only thing we struggle with its like having two children, the eldest [TheOld Union] and the youngest [the New Union] child.”“The histories of the two are very different.
We have a lot lessmisunderstanding and contention between the firm and them [the New Union]
because they are a bit more mature, more responsible, and less prone to being
opportunistic in their approach.”
From Old Unions“The members say don’t call them a union, the members hate them, they hate
the idea that they are calling themselves a union – the membership hate thembecause they are users you see.”Findings of this study also suggested that the attitude of Old Unions toward New
Unions may be determined, not by the character of the New Unions, but whether they
compete with them for members. All three groups of participants highlighted thesignificance of competition for members to the type of inter-union relationships theyexperienced. In workplaces where New Unions and Old Unions represented, andtherefore competed for, the same group of workers, these relationships werepredominantly confrontational and at times openly hostile. Where relationships were
hostile participants were more likely to argue that New Unions were not genuine unions.
In workplaces where New Unions and Old Unions did not compete for members, interunion relationships were predominantly neutral with minimal contact between eachgroup. In these circumstances, there appeared to be less opposition by representativesof Old Unions toward the newly formed organisations.

4031(2): 31-45, New Unions Under the ERA, J. Murrie

Discussion and Conclusion
This paper found that New Unions formed to represent the specific collective
employment interests of small groups of workers, typically employed within a single
workplace, through the process of collective bargaining. Workers’ decisions to form a
New Union, rather than join an existing union, represented a deliberate decision to
reject membership in the established union movement. That decision resulted fromworkers’ personal and shared experiences, and strong dissatisfaction with, the behaviour
and attitudes associated with Old Unions, their officials and members. In general, thestudied New Unions formed because workers desired membership in a collective
organisation that would not repeat their personal experiences with other unions.
Employer’s role in the formation of New Unions in the study was less active andsignificant than was expected from prior research (Anderson, 2004; Barry, 2004; Barry& May, 2002; Barry & Reveley, 2001). Specifically, no evidence was found ofwidespread attempts by employers to sponsor or create a tame or company-type union.
Evidence was found, however, of possibly isolated incidents, similar to those reported
in existing research. Overall, this study found that employer support for New Unions
could be more appropriately described as an acceptance of workers’ legal right toorganise. It was probably also influenced by an employer preference for the type andstyle of bargaining that New Unions was expected to pursue.
The question of whether New Unions were genuine was harder to resolve. Each groupof participants provided a broadly similar description of the typical New Zealand unionand of the characteristics of the typical New Union. Participants differed however, on
whether New Unions as a group were genuine. What was more evident was thatparticipants saw strong differences between how new and old unions operated, if nottheir central purpose or character as organisations. This study, like previous research(e.g., Barry, 2004), did find that the concept of union character was not applicable to
New Unions. However, this study’s findings suggest that this did not prevent many
participants, and significantly the workers who formed and joined New Unions, fromviewing New Unions as anything other than genuine union or more accurately collective
organisations. Findings also suggest that inter-union competition for members may be
more significant to how participants defined New Unions, than the actual character of
those organisations.
Overall, if we assume that these findings are applicable to New Unions as a whole, andnot solely representative of this small group, then these findings have some practical
implications for a number of stakeholders, the New Zealand union movement and older
more established unions in particular. For these organisations, the deliberate and freechoice by collectively-minded workers to reject them is a sign of the problems they facein rebuilding under the ERA. Slow union membership growth and poor membershipretention rates will not be helped by suggestions that in some workplaces unions’ own
organising efforts, officials and members have served to deter people from joining theunion movement. Amongst employers with similar attitudes to those in this study, Old
Unions’ efforts at building constructive partnerships with employers and at multiemployer collective bargaining may be hampered by suggestions that they are seen as
antagonistic, overly militant and untrustworthy. Both situations suggest that unions
need to take greater care in how they build and maintain relationships within New
Zealand organisations.

4131(2): 31-45, New Unions Under the ERA, J. Murrie

For researchers, this study, while small in scope, suggests strongly that New Unions andunion membership may have been an under-explored phenomenon in this country. Why
workers join unions, what they believe unions are, and how they choose between unions
are questions critical to any understanding of union membership trends. It is surprising,
therefore, that these questions are often left unexplored or are given less attention than
the wider examination of unions as organisations. The findings of this study suggestthat the unionisation decisions of New Zealand workers need to be examined in moredetail, and perhaps a side by side comparison of the motivations and interests of themembers (rather than the secretaries) of Old Unions and New Unions provided.
The great weight given to comparing New Unions against organisations that have
evolved over several decades also highlights the inadequacies of existing definitions of
the genuine union. The concept of union character used, in part, to separate New
Unions and Old Unions is in itself incapable of stating that an organisation is or is not aunion (Gall, 1997). Yet this is the very manner in which researchers appear to haveused the concept when examining New Unions. Perhaps a more appropriate method
would have been to compare the character of New Unions against that of Old Unions ofa similar age - in other words, to the character of Old Unions when they first formed.
These findings also suggest that more needs to be done to identify how workers, rather
than academics, identify, describe and define unions. They raise the question of what
type of organisations workers believed they were forming when they created a New
Union. The results show that some workers believed they were forming something
distinctly different to the typical union. However, given the small number of New
Union members interviewed, it is difficult to state this as a certainty, particularly as
participants frequently saw little or no difference between what their organisations wereformed to do, and why other unions formed.
Finally, academics may have been too quick to judge the character of New Unions.
While they have argued that some are genuine forms of workplace representation, they
have been strong in their general criticism of these unions and in accepting existing
research findings. These have predominantly implied that New Unions are an
employer-driven phenomenon, or at the very least incapable of becoming effective
unions. That workers in this study do not seem to think so, and that employer support
may only exist in a few isolated cases, questions previous findings (notably Barry, 2004
and Barry & May, 2002) and argues for additional research into New Unions andfurther examination of employers’ attitudes toward and response to unions under the
ERA. More importantly, it would be of some benefit to see whether the findings of thisstudy could be replicated among a larger group of similar participants.
Notes*
Information based upon personal communications with representatives of theRegistrar of Unions, November – December 2003.
2
Subsequent to the completion of this study several articles have added to thisparticular body of research in New Zealand. The work of Haynes, Boxall & Macky(2004 & 2006) and more recently Boxall, Haynes & Macky (2007) stand out for their
examination of workers motivations for union membership and the factors that havecontributed to union decline in this country. Of key interest are their identification of astrong untapped demand for union membership in New Zealand (Boxall et al, 2004) andthe implications of this demand for New Zealand unions organising efforts.

42

31(2): 31-45, New Unions Under the ERA, J. Murrie

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31(2): 46-60, Minimum Wages, M. Barry & P. Brosnan

Minimum Wages in the Asia Pacific Region
Michael Barry* and Peter Brosnan**
Abstract
Modern minimum wage systems have operated for more than a century. Some Pacificcountries were among the pioneers in establishing minimum wages. Minimum wage
systems are used to achieve many aims, some of which conflict. These aims include
promoting social justice, alleviating poverty, promoting economic development, setting
benchmarks for other wages and social security payments, and controlling inflation. The
Asia Pacific region has only a small number of countries with adequate minimum wage
systems. There are many deficiencies in the various systems. They often do not cover all
workers, are often set at unrealistically low levels, or are enforced inadequately.
Introduction
Minimum wage laws are a common feature of industrial relations systems in many
countries. The main ILO convention on minimum wages, ILO Convention 26, has one of
the highest ratifications by national governments. When this convention was adopted in
1928, the ILO’s concern was to provide ‘fair wages’ and ensure that global trade was notbased on cheap labour. These are still key reasons for being concerned with maintaining
adequate minimum wage systems, but other concerns have been addressed throughminimum wage machinery too. These aims sometimes come into conflict with one
another, which puts minimum wage systems in most countries under strain. The forces ofglobalization put further pressure on the minimum wage systems in both the developing
countries and the advanced countries.
This paper examines some of these issues within the context of the Asia Pacific region.
The main sections of the paper deal in turn with the history of minimum wage systems,
the position of minimum wage systems within international law, the different objectives
loaded onto minimum wage systems, the different forms of minimum wage system inpractice, and a brief overview of minimum wages in the Asia Pacific region. The longest
section of the paper addresses the problems of implementing effective systems: the issuesof coverage, level, compliance, the pressures of globalization, and the role of the social
actors, particularly government.

*Dr Michael Barry, Senior Lecturer, Griffith University** Prof Peter Brosnan, Griffith University46

31(2): 46-60, Minimum Wages, M. Barry & P. Brosnan

Origins and Early History
The concept of a fair wage or a minimum rate for particular occupations is not new.
Mesopotamia’s Hammurabi Code of 2000 BC (Starr, 1981) is probably the earliest
intervention of this kind. The Statute of Apprentices introduced a system of minimum
wages in England in 1563 and the guilds which operated in China, Korea and Europe also
set wages in earlier periods. Modern laws providing for systems of minimum wages werefirst enacted in New Zealand in1894 when the Industrial Conciliation and Arbitration Act
provided for the system of industrial and occupational awards that set minimum rates of
pay and bound all employers in the relevant industries. Similar systems were set up in
Australia shortly afterwards.
Other Pacific-rim countries were pioneers in minimum wage fixing too. The state of
Massachusetts introduced a statutory minimum in 1912. This legislation gave protection
to minors and females. Nine other US states followed suit over the next decade, as did
most of the Canadian provinces. A federal minimum wage was introduced in the USA in
1938, although overage was limited initially. European countries introduced minimum
wage legislation in the first decades of the twentieth century, mainly to protect
homeworkers (Starr, 1981). These experiments, in common with the systems establishedin New Zealand and Australia, guaranteed minimum wages for the workers covered, but
fell short of being national systems of minimum wages. Minimum wage laws with broad
coverage were implemented much later. For example, New Zealand did not introduce anational minimum wage until 1945, 51 years after it had introduced industrial andoccupational minima.Although European countries were notably active in legislating forminimum wages, a remarkable spread of other countries acted. Australia still has anincomplete coverage; there is no federal universal minimum wage, but all the states
except NSW and Tasmania legislated in the last decade or so to guarantee minimum rates
of pay. European colonies in Africa and the Caribbean had minimum wage laws
introduced by the colonial powers. Latin American countries, influenced at least in partby papal pronouncements on the rights of working people (Starr, 1981), were among thefirst to legislate for a statutory minimum wage. Peru introduced minimum wage
legislation in 1916 and Mexico introduced a statutory minimum wage in 1937 to reflect aguarantee of the 1917 Constitutionprovide state-wide guaranteed minimums.
Australia still has an incomplete coverage; there is no federal universal minimum wage,
but all the states except NSW and Tasmania legislated in the last decade or so toguarantee minimum rates of pay. Today about 180 countries have some form of
minimum wage. A minimum wage tends to be a correlate of economic development.
Minimum wage systems are less common in very small countries such as the micro statesof Oceania and in less developed regions. Minimum wage legislation is most common in
Africa where 48 out of the 57 countries have a minimum wage. Europe also has a large
proportion of countries with minimum wages, but countries such as Italy, Germany and
Norway have no statutory minima. Instead they have extensive collective bargaining anda system whereby collective agreements are automatically extended to other firms in thesame sector, thus most workers have a guaranteed legal minimum despite their being no
general minimum system in place.

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Minimum Wages and International Law
The obligation on governments to provide for a system of minimum wages is rooted ininternational law. The Universal Declaration of Human Rights (1948) asserts ‘the rightto just and favourable remuneration’ (Article 32(2)) as does the UN’s International
Covenant on Economic Social and Cultural Rights (1966) (Article 7). The Declarationof Philadelphia (1944) which redefined the aim and purpose of the International Labour
Organization (ILO) identified the guarantee of adequate wages as a task of government.
ILO Conventions 26 (1928)1, 99 (1951)2 and 131 (1970)3 relate to minimum wages.
Convention 26 obliges governments to create minimum wage fixing machinery where ‘noarrangements exist for the effective regulation of wages … and wages are exceptionallylow’ (Article 1, para 1). Convention 99 covers minimum wages in agriculture.
Convention 131 is focussed on the ‘needs of developing countries’. While theConventions do not specify the level at which minimum wages should be set,
Recommendation 30, which is intended to be a guide to Convention 26, states thatminimum wages should be set according to ‘the general level of wages in the country’(Section III). Convention 131 states that the level of the minimum wages should be‘appropriate in relation to national practice’ and include ‘(a) the needs of workers andtheir families, taking into account the general level of wages in the country, the cost ofliving, social security benefits, and the relative living standards of other social groups; (b)economic factors, including the requirements of economic development, levels of
productivity and the desirability of attaining and maintaining a high level of employment’(Article 3).
Minimum Wage Systems in Operation
ILO Convention 26 was adopted only nine years after the ILO had been founded. The
aim of the convention was twofold: one the one hand, to provide wages that were fair tothe worker and which reduced the risk of poverty, and on the other hand, to makeinternational trade fair by preventing economic dumping whereby a country used low
wages to gain a cost advantage in trade. Today minimum wages play many and different
roles in different countries. These different roles frequently conflict, and as we shallargue below, constitute one of the critical weaknesses of minimum wage systems.
Minimum wage can be called upon to fill at least six different roles (a) to reduce poverty,(b) to improve equity, (c) to stimulate economic development, (d) to regulate wages ingeneral, (e) to set rates for social security benefits, and (f) to fight inflation.
Combating Poverty
It is axiomatic that a higher minimum wage will mean less poverty. This was the
motivation behind the Indonesian Government’s decision to introduce a minimum wage
in the 1970s. The government, employers and unions had agreed that a minimum wage
was needed to prevent a deterioration of the lowest wage level and to improve thestandard of living (Ghellab, 1998)
Despite the unsurprising finding that that low pay is less common where there areminimum wage laws (Ioakimoglou and Soumeli, 2002) some argue that a minimum wage48

31(2): 46-60, Minimum Wages, M. Barry & P. Brosnan

does little to relieve poverty since many of the poor are not in regular employment (e.g.
Johnston and Stark, 1991; Standing, 1999), or that some of the lower paid belong to welloff households. This latter observation, however, is not a reason to permit low pay. It isa consequence of low pay. One of the main reasons the US minimum wage is relatively
ineffective in reducing poverty is just that it is set so low (Pollin and Luce, 1998).
It is true of course that a decent minimum wage is not the only way alleviate poverty.
The effectiveness of a minimum wage in alleviating poverty will depend on the tax
system and the availability of additional social security benefits. This implies that aminimum wage is more important in developing countries where low income families areless likely to have additional sources of income such as social security payments (Lustig
and McLeod, 1997). Moreover, given the distribution of income, more workers are likely
to benefit from an increase in the minimum wage in developing countries than indeveloped countries (Saget, 2001).
Promoting Justice
Low pay is a consequence of the way that labour markets are structured. Some jobs aresocially constructed as deserving relatively low pay. At the same time, some categories
of workers are less preferred by employers, or are in circumstances which prevent them
applying for the better jobs. Thus, the preferred categories of worker get the better-paidjobs while the others have to compete for the jobs that are left – the poorer-paid jobs.
Consequently ‘workers with … equal skills and abilities are available at widely different
prices’ (Wilkinson, 1984, p.422). The categories of worker who are less preferred tend tobe women, racial or religious minorities, people with less education (even if education isirrelevant for the tasks to be performed) and other ‘socially disadvantaged’ groups.
Foreign workers are particularly vulnerable; they are often driven to migrate on accountof the low pay and high unemployment in their home country and are prepared to ‘work
cheap’ in their new location. Their situation highlights the need for decent systems ofminimum wages in all countries, so that people are not forced to migrate for economic
reasons, and should they choose to migrate, they will receive an adequate wage in their
new country.
These arrangements are clearly unjust in that many workers have to accept low wages.
But it is also unjust in that the better paid within the same labour market benefit from thecheap labour of the low-paid. They benefit from cheaper services where they employ the
low-paid directly. They also benefit if products or services they buy are ‘subsidized’ by
low pay. Workers and other consumers in the advanced countries benefit too from thelow pay of workers in the developing countries whose wages are much lower than theirs
and whose products are priced correspondingly lower. Thus minimum wages are
essential to reducing inequities within and between countries.
It has been suggested (Brosnan and Wilkinson, 1989) that groups that are most likely to
be low-paid will be the principal beneficiaries from the introduction of a minimum wage
or any increase in an established minimum. Thus improving minimum wages would
assist in attaining equal pay for work of equal value. It changes the income of a49

31(2): 46-60, Minimum Wages, M. Barry & P. Brosnan

substantial proportion of women each time the minimum wage is increased. A realistic
minimum wage should therefore be an integral part of any campaign for equal pay.
Stimulating the Economy
The advantages of a minimum wage system to the economy have been posited for at leasta century (e.g. Webb and Webb, 1920). Wilkinson (1984) has argued that a realistic
minimum wage alters the terms of trade between different productive systems, andmaking it more difficult for disadvantaged firms to rely on disadvantaged labour, thus
forcing firms to become more efficient, by investing in better equipment, better methods
and in the training of their workforces (Cahuc and Michel, 1996). At the international
level, countries with higher minimum wages will have fewer inefficient firms andtherefore be able to compete.
The other benefit is that the higher minimum boosts consumption spending. Workers on
the minimum wage are likely to spend all of their wage (Borooah and Sharpe, 1986), andspend more of it on domestically produced products (Borooah, 1988). Thus an increasein the minimum wage would add more to domestic demand than an increase in pay atother points in the income distribution.4 This strategy was followed by the Mexican
government in the period before 1976 but, as we shall see below, the approach fell foul ofother policy objectives (Grimshaw and Miozzo, 2002).
Setting Social Welfare Levels
The minimum wage’s role of providing an income that is both fair and sufficient tocombat poverty leads to it being used as a numeraire for social welfare payments. Thusin some countries, again Mexico being an example, the minimum wage is used as basis
for setting pensions. It is also used to set unemployment benefits and dismissal
compensation (Grimshaw and Miozzo, 2002).
Giving a Lead to Other Wages
Our observation above that minimum wages are intended to provide a fair wage leads toemployers using them as a benchmark for fair remuneration. The USA’s minimum wage
being increased so rarely, it provides an opportunity to see how other wages are affectedby an increase in the minimum. In that country a rise in the minimum wage is followed
by further rises in wage rates above the minima as employers reinterpret what they
consider a fair wage. Maloney and Nuñez (2002) report on an even stronger case of thisin Latin America - what they term the ‘numeraire’ effect. They note that in some Latin
American countries some well-paid workers receive an exact number of minimum wages
as their salary. They further note that the effect of an increase in the official minimum
wage translates into wage increases at higher levels, in Latin America - at levels up to
four times the minimum wage. This is considerably higher than the USA where theeffect dies off more quickly.

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Controlling Wages and Reducing Inflation etc
Grimshaw and Miozzo (2002) observe that direct state control of wage fixing has been aconspicuous policy in Latin America. Collective bargaining itself has been controlled
and the growth in the minimum wage has been held back in an attempt to stabilize wages
and prices. As a consequence, most Latin American countries experienced a decline in
the real minimum wage over the 1980s and 1990s (Grimshaw and Miozzo, 2002). Theirdata indicate that of the Latin American countries that border the Pacific, only three Chile, Ecuador and Panama - increased their real minimum wage during the period 19901995. In the last four years however, Guatamala, Honduras, Colombia and Chile haveincreased their minimums by more than 50 percent.
Forms of Minimum Wage Laws
A total of 104 countries have ratified ILO Convention 26. However, the convention
allows for a wide variety of practices and few countries have a minimum wage systemthat applies to every worker. The various arrangements can be grouped into eightcategories:(a) a statutory national minimum wage with full application (e.g. New Zealand),(b) a system of statutory regional minimum wages with full application within eachregion (e.g. Canada, Thailand),(c) a statutory national minimum wage with exemption for certain industries or workers(e.g. South Korea, USA),(d) a system of statutory regional minimum wages with exemption for certain industries
or workers (e.g. Japan),(e) a national minimum wage negotiated through collective bargaining but with full, or
near full, coverage (e.g. Greece, Belgium, Finland),(f) selective intervention with orders that provide for specific legal minima in certain
industries or occupations (e.g. Australia),(g) reliance on collective bargaining but with extensions of collective agreements toother workers (e.g. Germany and Italy),(h) combinations of (a) to (g); e.g. a statutory minimum wage with full application whichacts as a floor, but additional higher minima in certain industries or occupations (e.g.
Mexico), or a national minimum with a higher minima in some regions (e.g. USA).
(i) no official wage but a strong tradition which establishes a going rate (e.g Kiribati)
Some countries also provide higher minima according to a workers experience or
qualifications. A substantial number of countries have lower rates for young workers(e.g. Papua-New Guinea, New Zealand, USA), although these rates have become lesscommon in recent years (OECD Employment outlook 1998)51

31(2): 46-60, Minimum Wages, M. Barry & P. Brosnan

Minimum Wages in the Asia Pacific Region
Table 1 sets out mean hourly minimum wage rates for the Asia Pacific region and the restof the world, converted to New Zealand dollars at the average exchange rates for the 12months up to the end of October 2006. The averages in Table 1 are computed only for
those countries that have a positive minimum wage rate. The average for Asia Pacific, at
NZ$2.31, is only half the world average of NZ$2.64. These average data, however, hide
wide variations within them. Oceania has a higher average of NZ$4.51, Asia’s average is
NZ$1.10, while in the Latin America countries that border the Pacific, the average is only
NZ$1.14. These regional averages also hide variation. If we were to exclude Japan, theAsian average would fall to NZ$0.84, not much more than Latin America’s. The table
includes data for Europe, and we can see the substantial difference between Asia Pacificand Europe: NZ$2.31 compared to NZ$10.78. If we exclude the ‘rich’ countries of Asia
Pacific - Canada, USA, Japan, New Zealand and Australia - the remainder of Asia Pacifichas an average minimum wage of NZ$1.59.
We noted that these data are only for countries that have a positive minimum wage.
Bearing in mind that Asia has a lower proportion of countries with a minimum wage, if
we include the countries without a minimum in the average, the mean for all Asian
Pacific countries reduces to NZ$1.21, less than two-thirds the corresponding average forall countries, which stands at NZ$2.07 .
Table 1: Average Minimum Wage(a) by Region
Minimum Hourly Wage
Rate (NZ$)

RegionMean Asia Pacific

2.31

Mean rest of world

2.81

Mean world

2.64

Mean Western Europe

10.78

Rest of world without Europe

1.67

Asia Pacific without Canada, USA, Japan, New Zealand, Australia

1.59

Source: Database held by second author. Details and primary sources available on
request.
Notes: (a) Data current at 1November 2006.

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31(2): 46-60, Minimum Wages, M. Barry & P. Brosnan

Problems in Implementing Minimum Wage Systems
There are many problems in managing a minimum wage system. To be effective theminimum wage must cover all the labour force, it must be adjusted to a level that ensuresthat no one is low-paid, and it must be enforced. While these requirements pose
problems in their implementation, there are additional features that undermine thesystem: the pressures produced by globalization, lukewarm support from the social
actors, and the conflicting objectives which governments impose on minimum wage
systems.
Coverage
Minimum wage systems can only be effective if they cover the workers who are likely to
be low-paid. Illegal workers usually lie outside the protection of the law. Thus if they
are not entitled to work, they are not entitled to the minimum wage.
The arrangements vary substantially across nations. In some countries the minimum
wage only applies to the private sector. Small firms may be excluded from coverage.
Some countries have different rates for blue-and white-collar workers, some different
rates for qualified and unqualified workers. Some countries have an experience
requirement or different rates for trainees. Some countries exclude particular categories
of worker or grant them a lower rate. Some countries exclude young workers. Regionalvariations within countries are not uncommon; Mexico, Canada and Japan have different
minimum wages for different regions. Australia constitutes an unusual example within
the Asia Pacific region; indeed within the world, in that four of the six states havestatutory minimum wages while the federal territories, Tasmania and the largest state,
New South Wales, have no minimum; instead workers in those regions have to rely on
the extensive, but nonetheless piecemeal, system of awards.
In the developing countries of Asia, the group that most needs a guaranteed minimum
wage is persons employed in the informal sector. Conditions in the informal sector are
difficult to police. Furthermore, informal sector workers may work outside establishedlegal frameworks and may not be entitled to statutory minima. While the informal sector
in the advanced countries employs between 2 and 15% of the labour force (Standing,1999
p.112), the ILO (1997) estimated the share in developing countries at between 30% and
80% of the labour force. It further estimated that the informal sector employs 61% of theurban labour force in Africa and will have generated 93% of new jobs in the 1990s. The
proportion is lower in Asia, at around 40-50%, but ranges from 10% in the mostdeveloped countries of Asia to comparable figures to Africa in India and Bangladesh(ILO, 1997).
Level
Most countries that have a minimum wage have it set at levels that are inadequate formeeting basic consumption needs. Of the 178 countries that have some form of53

31(2): 46-60, Minimum Wages, M. Barry & P. Brosnan

minimum wage, only 52 have a minimum which is greater than NZ$2.00 an hour. Some89 have a minimum of less than NZ$1.00 an hour.
Although the ILO has adopted three conventions on minimum wages, they offer little
guide as to what is a reasonable level. The associated Recommendations do makereference to living standards, prevailing wages etc, but the wording is deliberately vague.
The intention is that minimum wages must meet the cost of living but it is often the casethat the minimum wage comes nowhere close to that objective. As an example, theminimum wage in Nicaragua meets only one third of the cost of living (Tabb, 2002).
A crucial issue is whether or not the minimum wage is adjusted regularly. There aremany different ways that governments adjust their minima:(a)legislation or decision of the Executive (e.g. Canada, New Zealand, USA),(b)government on the recommendation of an independent review body (e.g.
Japan, South Korea),(c)

independent authority (e.g. Australia, Mexico),(d)indexation to the CPI (e.g. France),(e)

indexation to average wages (e.g. Netherlands),(f)other formulae (e.g. Poland).

The minimum wage is unstable in many of the developing Asia-Pacific countries becauseof the irregularity of the review process or the conflation of the needs of the working poor
with other considerations. Some countries in the region have regular review processes inplace, e.g. Costa Rica and Colombia, although the effects on employment and on‘competitiveness’ are often considerations. Consequently, the value of the minimum
wage can fall easily into the range where it fails to meet basic consumption needs. Saget(2001) reports that minimum wages in Latin American countries lost 30% of their value
between 1980 and 1990.
The instability of minimum wages in Latin America result from policy see-saws whereby
the minimum wage is adjusted upwards at one time to combat poverty, and held back atothers to attempt to control inflation. This is particularly noticeable in Mexico whereby
the minimum wage was used as an instrument to redistribute income and stimulate
demand before 1976, but used as a tool to fight inflation in the period that has followed(Grimshaw and Miozzo, 2002). The Mexican minimum wage decreased 45% during the
1980s. On the other hand, it increased in Colombia by about the same percentage (Saget,2001).
Minimum wages fell in some Asian countries too. The Philippines experienced acontinuous decline in the real value of minimum wages in the 1980s and into the 1990s.
On the other hand, Thailand increased its minimum in real terms from the 1980s in to the1990s (Saget, 2001).
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The more advanced countries of the region with more stable economies suffer declines
too, especially when conservative governments choose not to adjust the minimum. The
US minimum wage buys no more than two-thirds what it did in 1968, and it was not
adjusted at all between January 1981 and April 1990. Lee (1999) attributed most of thegrowth in inequality that occurred in the United Sates during the 1980s to the decline in
the real value of the minimum wage during the Reagan years. Similarly in New Zealand,
National Party governments’ neglect of the minimum wage allowed it to decline byalmost a half between 1954 and 1984 (Brosnan and Wilkinson, 1989).
One final consideration in relation to the level of the minimum wage, is the period towhich it applies. Given that minimum wages are usually intended to guarantee minimum
levels of consumption, they are usually set as a minimum per pay period (weekly ormonthly according to country tradition) or as a minimum per hour. The disadvantage ofthis latter approach is that it may not provide for part-time workers (Saget, 2001), whoare becoming an increasing proportion of the labour force in some countries, and who
also need an adequate wage to maintain the consumption levels of their household.
Compliance/enforcement
No matter how high the minimum wage rate is, nor how extensive its coverage, it will beineffective if employers offer wages less than the minimum. Compliance is a serious
problem in all countries. Possibly no country has a large enough inspectorate to enforce
the minimum wage, and many countries have no inspectorate at all, relying on complaints
from workers or trade unions. The problem of enforcement is compounded where
unionism is banned or severely curtailed. The pressures of globalization, which wehighlight below, are another factor that weakens unionism and potentially reduces thedegree of compliance.
There are regimes that are unwilling, or incapable of enforcing workers’ rights, whatever
the law may say. Many countries seem to have a minimum wage which is mere window
dressing; they are unable to provide information about the minimum wage - theproportion of workers covered, the degree of compliance, or its impact on particular
population sub-groups such as youth, women etc.
Even in Colombia, which stands out as a Latin American country where the real
minimum wage has increased in recent decades, 25% of workers are paid less than theminimum (Maloney and Nuñez, 2002). The reason for this is that ‘a high share of newjobs in the developing world are nowadays created in the informal sector where theminimum wage is weakly … enforced’ (Saget, 2001, p.1). Studies indicate high levels of
non-compliance in many Asia Pacific countries: 54% in Guatemala, 9% in Chile, and
15% in Indonesia, with low levels of compliance in the Philippines which has no
penalties for underpayment. Non-compliance is a particular problem in small firms. A
Latin American study quoted by Saget (2001) reports that 63% of workers in ‘microenterprises’ in Costa Rica were paid below the minimum wage. The corresponding
percentages were 46% in Panama, 28% in Chile and, 19% in Mexico and 16% in
Colombia.

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There is a relationship between the level of the minimum wage and degree of compliancein that a lower minimum wage makes compliance more likely (Lustig and McLeod,
1997). For that reason, it may be politic to introduce minimum wages initially at lower
levels then gradually increase them to more realistic levels so that the concept becomes
accepted and then compliance becomes more likely when a realistic level is attained.
Pressures of Gobalization5
Of the many differences between developing and advanced countries, few are as
spectacular as the differences in wages. Even within each of these groups, there are vastdifferences. Labour compensation costs in New Zealand are only a quarter of those in the
US (US Department of Labor, 2002). The wages of a factory worker in Shenzhen is only
half that of a worker in Bangkok (Bende-Nabende, 1997). Hidden behind thesedifferences are further differences in productivity between enterprises, and differences inwages between categories of worker within enterprises.
The minimum wage,
globalization and local labour markets interact differently in the developing countries particularly those in the Asia Pacific region - and the advanced countries.
Lack of Support from the Social Actors
The preceding sections give us some clues as to how the social actors might view
minimum wage systems. Employers tend to be divided over the issue according to theirown position within the pay structure. Employers in labour-intensive workplaces that
rely on cheap labour for their survival and profitability tend to oppose minimum wages ingeneral, and resist any increase in existing minima. On the other hand, employers inmore capital-intensive firms that pay better wages may welcome minimum wage systems
and, furthermore, see them as protection from competition from less efficient firms that
rely on cheap labour.
Trade unions are often supportive of minimum wage systems. The minimum wage
provides a floor for collective bargaining, and it meets the social objective of providing
for workers with limited bargaining power and who are unable to organize. Thus tradeunions generally lobby for minimum wage systems, and argue for higher levels of theminimum where one has been established. However this is not always the case. For
example some trade unions resist the idea of a standard national minimum believing it
undermines collective action.
Whatever the views of employers and unions, the government is the key player in
effective minimum wage systems. Governments, directly or indirectly determine thelevel of the minimum wage, they determine whom it should cover, and they provide theresources for its enforcement. Given the number of ratifications of the ILO conventions
on minimum wages, it could appear that governments in general agree with the concept.
However, some governments whose countries have ratified the conventions, such as Fiji,
have no minimum wage in place. Many have defective minimum wage systems or haveeven abolished minimum wage systems that had been set up. For example, Papua-New
Guinea introduced minimum wage legislation in 1972, scrapped it in 1992, reinstated it
but has kept rates low - currently 37.5 Kina per week (NZ$20). During 2001, the Papua56

31(2): 46-60, Minimum Wages, M. Barry & P. Brosnan

New Guinea Minimum Wage Board recommended a large increase, but the government
blocked it, and no increase was implemented
There are several reasons why governments are reluctant to establish and maintaineffective minimum wage systems: fear of inflation, concerns about the fiscal impact, andthe unease over the possible employment effects, the latter often fuelled by international
agencies. We have argued before that the possibility of general inflation following aminimum wage increase is not strong (Brosnan and Wilkinson, 1988). Inflationary
effects may be offset by increased productivity (Hughes, 1976) or a reduction in profits.
An important factor will be the extent to which higher paid workers successfully restore
differentials disturbed by the higher minimum wage. However labour markets aresegmented such that better paid workers are unlikely to be making comparisons withworkers whose pay is so low to be on the minimum wage (Brosnan and Wilkinson,1988). Perhaps most importantly, the globalization processes described above, haveseverely weakened the ability of trade unions to respond to changing differentials, should
they wish to do so.
Governments are not unaware of the effects of the minimum wage on their fiscal position,
particularly where government employees are on minimum wage rates, or where thegovernment employs contractors who pay minimum wage rates. A further concern iswhere social security benefits or pensions are linked into minimum wages. Concern withsimilar issues underlay the IMF’s threat to Russia, that it would block a scheduled loan if
the minimum wage were increased (Standing, 1999).
A prevailing unease on the part of governments is the relation between the minimum
wage and unemployment. The argument, derived from simplistic economic theories, isthat with higher minimum wage rates, fewer workers will be hired. (for discussion see
Brosnan, 2002). A similar claim is made with respect to youth employment - imposing aminimum wage for youth (or a relatively higher one where one exists already) would leadto lower employment rates for youth to the benefit of non-youth workers. The story is
told most strongly in the US, but has been critiqued even within the economics
establishment (Card and Krueger, 1995). Although these propositions have been tested invarious countries, the results are never conclusive. Regression coefficients are frequently
not significant, or the predicted relationships are found not to exist. Where there does
appear to be a relationship, other factors are frequently responsible (see Ghellab, 1998).
Nonetheless, countries still hold wages down in fear of unemployment.6
Conclusion
Minimum wage systems are not particularly robust in the Asia Pacific region. The
proportion of countries with a minimum wage is slightly below the world average, andthe levels of minimum wages tend to be low as well. There is considerable diversity
within the region, but even some of the ‘rich’ countries that have had a form of minimum
wage for some time have histories of neglecting to adjust the minimum including, as
mentioned, in New Zealand. In common with much of the world, minimum wages in theregion are not well enforced.

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31(2): 46-60, Minimum Wages, M. Barry & P. Brosnan

There are particular problems in the region, the large informal sector in Asia makeenforcement difficult, and provide little incentive for governments to legislate or to set
the minimum wage at a realistic level. Moreover some of the less developed nations in
Asia use low wages as a source of comparative advantage in attracting MNEs. In Latin
America, despite a long history of having a minimum wage in many countries, moregeneral economic problems have caused minimum wage to be put on the back burner.
Even more, minimum wages have been deliberately held down in an attempt to control
inflation. Japan and Australia have the highest minimum wages in the region but inAustralia, coverage has not been universal since almost half the Australian labour force
has had no statutory minimum wage, however many of those without access to a statutory
minimum are covered by awards.
The lack of effective minima impact upon particular groups. These include women,
racial or religious minorities, and migrants. Justice demands that these people haveaccess to a decent income. The nation-state is the only organization currently capable ofregulating wages where collective bargaining is poorly developed. However, as we noted
above, pressures of globalization make governments cautious about, or even hostile toincreases in minimum wages. Unfortunately some national trade union movements are
reluctant to push for better minimum wage systems because they believe they may
undermine collective bargaining and trade union organization. Nonetheless, governments
and trade unions have an interest in there being adequate minimum wage systems in the
countries with whom they trade or compete in trade.
The challenge for many Asia Pacific nations is to set minimum wage at a decent level, todevise ways that it can cover the informal sector, and to enforce it successfully. In somecountries this may be an awesome task for it demands a sophisticated legal system, andmust overcome the objections of employers who fear their ability to compete would beundermined. A sound minimum wage system can be a spur to a more efficient economy,
one that does not rely on cheap labour for its success. A better minimum wage is not afull solution to the problems of poverty, inequality or uneven economic development - a
successful policy on minimum wages must be nested in broader policies of labour
regulation and economic development - nonetheless a sound minimum wage system must
be an essential component of any package of policies to achieve these objectives.
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Brosnan, P. (2003), ‘The Minimum Wage in a Global Context’ in J. Michie (ed.), The Handbookof Globalization. Cheltenham: Edward Elgar (forthcoming).
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*

Chris Houghton provided greatly appreciated research assistance in gathering the data on which
the tables are based. A short version of this paper was presented at the Twelfth Conference on
Labour, Employment and Work on 15 November 2006.

1

Convention Concerning the Creation of Minimum Wage-fixing Machinery

2

Convention Concerning the Creation of Minimum Wage-fixing Machinery in Agriculture.

3

Convention Concerning Minimum Wage-fixing with Special Reference to Developing
Countries.

4

These arguments are spelt out more fully in Brosnan (2002).

5

This section is based on a portion of Brosnan (2003).

6

A further elaboration on this argument is in Brosnan (2003).

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31(2): 61-70, Somali Women’s Experiences, H. Jelle, P. Guerin & S. Dyer

Somali Women’s Experiences in Paid Employment in New Zealand
HANI ABDI JELLE*, PAULINE GUERIN**, AND SUZETTE DYER***

Abstract
There is growing international interest in the employment issues encountered by refugee andmigrant workers. Within the New Zealand context, Somali women migrants experience one of thehighest rates of unemployment, yet some are employed. In this paper we present research that
explores what a small group of Somali women did to find and maintain paid employment.
Interviews were conducted with six Somali women currently engaged in paid employment. These
women reported that their clothing and appearance were significant barriers in their initial job
search. Most attributed gaining paid employment to their having a New Zealand tertiary
qualification and skills recognized by their current employers. Family support and personal time
management skills were deemed important features to maintaining employment. At times, these
women experienced conflict between their identity as Somali Muslim women with organizational
cultures and requirements. We conclude that these barriers can be resolved with sensitivity andcommunication with employers.

Somali Women’s Experiences in Paid Employment in New ZealandIn the past ten years, Somali migration to New Zealand has grown rapidly. Most of the Somali
migrants to New Zealand have come as refugees selected by the United Nations HighCommissioner for Refugees (UNHCR). In 1993, following an international appeal, New Zealandagreed to accept the first group of 92 Somali refugees through the annual quota refugee programme(Somali Friendship Society, 2002). By 2001, 1,971 Somali were living in New Zealand and 492 in
the Waikato Region (Ho, Guerin, Cooper, & Guerin, 2005; Statistics New Zealand, 2002). The
Somali community, and Somali women in particular, have encountered problems gaining access to
paid employment since their arrival to New Zealand (Guerin, Guerin & Elmi, 2006). Indeed, refugee
and migrant employment status has gained considerable international attention over the past 15
years (e.g., Altinkaya, & Omundsen, 1999; Buijs, 1993; Forrest & Johnston, 2000; Holden, 1999;
Montgomery, 1991, 1996; Morokvasic, 1993; North, Trlin, & Singh, 1999; Pernice, Trlin,
Henderson, & North, 2000; Shih, 2002; Schwarzer, Jerusalem, & Hahn, 1994; Waxman, 2001;
Wooden, 1991).

* Hani Abdi Jelle,Waikato Management School, University of Waikato, Hamilton, New Zealand**Pauline Guerin, School of Social Work and Social Policy, Magill Campus, University of South Australia, GPO Box
2471 Adelaide, South Australia 5001, Pauline.guerin@unisa.edu.au*** Suzette Dyer, Waikato Management School, University of Waikato, Hamilton, New ZealandAcknowledgements: This research was conducted as part of a directed study at the University of Waikato under thesupervision of Suzette Dyer. Pauline Guerin was supported by a grant from the Foundation for Research, Science andTechnology (UOWX0203, Strangers in Town: Enhancing Family and Community in a More Diverse New ZealandSociety) during this project. We would like to thank all the women who so generously gave their time to participate in thisresearch.

61

31(2): 61-70, Somali Women’s Experiences, H. Jelle, P. Guerin & S. Dyer

Refugees remain on government welfare-benefits for an average of three years before finding
full-time paid employment in New Zealand (The McKenzie Trust, 2004). This situation isexacerbated for the Somali ethnic group generally, and Somali women specifically. As a group,
Somali experience unemployment rates four to five times higher than the national average (Guerin,
Diiriye, & Guerin, 2004). New Zealand labour force statistics for 2001 reveal that Somali women
have the second highest female unemployment rate at 42.9%, a labour force participation rate of
26.9% (compared to 60.1% for the ‘all women’ category), and 14.8% in paid employment (Guerin,
Ho, & Bedford, 2004). These high unemployment and low labour force participation rates forSomali women have been attributed to structural constraints, language barriers, non-transferable
skills and qualifications (Guerin, Diiriye, & Guerin, 2004), and differences between religion,
culture, and family composition (Guerin, Guerin, Diiriye & Abdi, 2005; Guerin, Guerin, & Elmi,
2006; Kelly, 1989).
Structural constraints affecting refugee employment status have been found to include theresettlement in residential areas removed from industrial or commercial sites, making access toemployment more difficult; fewer employment programmes specifically designed for refugees
compared to the general public; and a lack of English as-second-language programmes (The
McKenzie Trust, 2004). In the 2001 census, 32.2% and 21.4% of Somali women and men
respectively could not speak English; however, over half spoke two or more languages (comparedwith only 5-6% of New Zealanders); a skill that might be transferred to the New Zealandemployment environment (Guerin, Guerin, Diiriye, & Abdi, 2004). Another issue is that the Somali
language was only officially written in 1972 in Latin script, thus adapting to a paper-based society
may be difficult for older Somali (Guerin, Guerin & Elmi, 2006). Traditional Somali businesspractices, involving social networks, negotiation, over-land trade routes, and few bureaucratic orlegal rules, are not always recognized or easily transferable to the New Zealand environment(Guerin, Guerin, Diiriye and Abdi, 2005). Similarly, many Somali migrants (36.6% of the womenand 25.8% of men) have no formal qualifications and very few have degree-level qualifications; apattern that is changing as more Somali youth enroll and complete tertiary education in New
Zealand (Guerin et al., 2005).
In addition to the above barriers to gaining employment, the majority of Somali migrants arepracticing Muslims. The observances of Salat (prayer) and the Fast of Ramadan do not readily
match the rhythm of the New Zealand working day or the Christian holy days, which are codified in
the New Zealand Holidays Act. For example, Salat is to be observed at dawn, noon, mid-afternoon,
sunset and nightfall and preferably in a mosque but prayer is permitted almost anywhere, such as infields, offices, factories and universities (Farah, 1987). The Fast of Ramadan is observed in the ninth
month of the Muslim calendar (falling somewhere between October and December). This holymonth is deemed the time to strengthen family in which fasting during daylight hours is followed byeating small meals in the evening with family (Farah, 1987).
Somali women’s highly visible religious-clothing, prescribed gender interactions and traditionalfamily roles have also been found to influence their employment status. As with poor language
skills, their long headscarf is sometimes perceived as a communication barrier and a health andsafety hazard in the employment environment (McGowan, 1999). Women wearing headscarves
have reported resistance and discrimination in the workplace, and some view wearing them as themain factor for their unemployment (Guerin et al., 2004). Western practices of hugging, kissing,touching, shaking hands, and flirting between men and women is strictly prohibited in Muslim
teachings; practices that can restrict the type of work environment deemed acceptable to some
Somali migrants.

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31(2): 61-70, Somali Women’s Experiences, H. Jelle, P. Guerin & S. Dyer

The assigned gendered role for Somali women requires them to be responsible for childcare and thehousehold (Abdullahi, 2001). However, educated Somali women are expected to find work andmaintain these traditional household duties (Jenkinson, 1999). These values have been transferred to
New Zealand (Ahmed, 1999). With an average of five children (that can range between 1 and 15
children), coupled with a relatively young population (half are under 16-years of age) Somali
women in New Zealand have high family demands and responsibilities affecting their employment
status (Guerin, et al, 2004). According to Somali cultural practices, once the eldest child reaches
their youth, they too share these family responsibilities as part of their preparation for adulthood.
Even though Somali women record the second-highest unemployment and lowest labour force
participation rates in New Zealand, some are employed. Our interest is in exploring the factors
identified by Somali women that contribute to their ability to gain and maintain paid employment in
New Zealand. We begin by reviewing the position of Somali women in the New Zealand labour
market and the factors that have been attributed to their marginalized employment status. The‘talk-around’ method (Pe-Pau, 1980) was used to frame the interviews conducted with six Somali
women currently in paid employment. These women identified a number of individual,organisational, and family responses that enabled them to accommodate their multiple
responsibilities and obligations to family, Islam, work and community.
This review of existing research guided our development of a thematic questionnaire (Gillingham,
2000) to explore Somali women’s experiences in finding and maintaining employment in New
Zealand. Our first theme was to explore whether barriers were encountered in the job-search
process. Our second theme was to understand how Somali women accommodated their religious,family and community commitments with their paid employment obligations. Finally, we aimed todetermine strategies the women used to help maintain their paid employment. The actual method
used is described in the following section.

MethodInterviews were conducted with six Somali women in paid employment in 2005. The aim was not to
obtain a representative sample, but rather to obtain stories from women in diverse circumstances tohelp understand the range of factors influencing acquisition and maintenance of employment.
Therefore, the women interviewed included three married and three unmarried women, with andwithout children, and in full- and part-time employment. The interviews were conducted by aSomali woman (the first author) tape recorded and notes were taken. The “talk around” method wasused in which questions are asked in a natural conversational context so participants did not feel they
were being interrogated. This method was recommended by Pe-Pua (1989) for indigenous Filipino
research, based on Pagtatanung-tanong or “asking around” and has since been used in research with
Somali. The questionnaire sheet was translated into Somali but, because many do not read or write
the language, the interviews were all conducted orally, in Somali, and translated into English fortranscripts.
Four interviews took place at the participant’s house, and two interviews were conducted at theuniversity library. The participants chose the locations based on convenience and comfort.
Interviews were conducted over a two week period in August 2005 and each interview wasapproximately one to two hours long. Transcripts of all interviews were typed and were checked byparticipants for recording accuracy. The transcripts were analyzed for key themes. Names used inthis report have been changed to maintain confidentiality of participants and some personal details
that could reveal participants’ identity have been slightly modified.

63

31(2): 61-70, Somali Women’s Experiences, H. Jelle, P. Guerin & S. Dyer

Limitations
Due to time limitations and the limited scope of the project, only six women in paid employment
were interviewed from one city in New Zealand. Therefore, while these findings are notgeneralizsable they do provide valuable insight that may form the basis of future research.
Participants
Maggie arrived in New Zealand in 1996 at age 17, and was 26-years old at the time of the interview.
She is studying towards a tertiary-level qualification and has two part-time jobs. In one job she
works eight-hours per week as a coordinator in an agricultural industry. For the second job, sheworks 12-hours per week as a Somali support-worker in a local NGO (non-governmentorganization) providing assistance to new migrants and refugees. She is unmarried, has no children
and lives with her family. As the eldest child, her family responsibilities include helping her mother,
who does not speak English or understand the New Zealand culture, and caring for younger siblings.
Prior to coming to New Zealand, Maggie was not employed, partly because she was young when
she left Somalia and had been in high school, but she did volunteer with the UNHCR while in a
refugee camp.
Anny arrived in New Zealand in 1993 at age 11, and was 23-years old at the time of the interview.
She recently graduated with a Bachelors degree from a New Zealand university and currently works
100-hours per fortnight as a laboratory technician. She has gained various working experiences
while growing up in New Zealand, and is conversant with the language and culture. Anny isunmarried and has no children; her family responsibilities include helping her grandparents, parents,
younger siblings and extended family.
Mary arrived in New Zealand in 1998, and was 40-years old at the time of the interview, and raises
nine children on her own. She owned various businesses in Somalia and draws on her businessexperiences and skills in her current part-time position in a family clothing store, owned by theSomali community, where she works 14-hours per week. She attends English language courses inthe evenings.
Sally arrived in New Zealand in 1999 at age 16, along with her mother and siblings, and was
23-years old at the time of the interview. She graduated with a Bachelors degree from a New
Zealand university and works full-time as a medical laboratory assistant. She is unmarried, has no
children and lives with her family. She sometimes helps her mother with housework, but her firstpriority is her paid employment.
Kate arrived in New Zealand in the late 1990s and was 30-years old at the time of the interview.
Kate has graduated with a Bachelors degree from a New Zealand tertiary institute and works
full-time in the health sector. In the past, she has worked for refugee agencies in Africa and New
Zealand and is currently involved with the Somali community and other ethnic organizations. She ismarried with three children. Her husband and extended family help with child care and household
duties to enable her to accommodate her multiple family, community and employment roles.
Hannah arrived in New Zealand in 1998 and was 28 years-old at the time of the interview. She has
graduated with both Bachelor and Diploma degrees from a New Zealand tertiary institute, and is aqualified interpreter. She has two part-time jobs in the education sector; combined, these jobs
involve 10-hours per week. She is involved in providing both unpaid and paid interpreting services64

31(2): 61-70, Somali Women’s Experiences, H. Jelle, P. Guerin & S. Dyerfor the Somali community. She is married with no children and is responsible for the household
duties.
Results
These women described various experiences when trying to find paid employment, accommodating
cultural and religious practices with paid employment, ‘being’ a Somali woman in the work
environment, and strategies to help them maintain their paid employment. These themes arepresented below.

Finding Paid Employment
The majority of the women had applied for at least three jobs before gaining their current position.
They reported using typical job-search methods such as newspaper, internet, recruitment agencies,
the government work-placement agency, word-of mouth, and networking. Maggie found her job
through relatives and friends:
Not newspaper or through other things because my friends told me that there is a position
available and that the company needed people and that’s how I got my job.

Sally was the only one to report “no problems finding work” as she explained that she gained her
position as a result of proving herself during work-placement training as a lab technician during her
University studies.
The five other women described various barriers to finding paid employment. All five identified
their clothing and appearance as barriers, Kate, for example, believed that employers were moreinterested in her appearance than her capabilities; a view shared by Hannah:
Even though I matched the skills and qualification required, they said that my application
was not successful. Maybe they did not like me because of the way I dressed.
Four believed their religious practices affected their ability to find work. One perceived her colour
and language-skills as significant barriers in her job-search.

‘Being’ a Somali Woman at Work

These women described a number of negotiations and accommodations made in terms of theircultural and religious identities within the workplace. All of these women identified cultural dress
and prayer time as significant cultural and religious issues that they contended with in theirworkplaces. Most of the women said that they had to change the way they dressed to fit theiremployment situations. Some were told to wear smaller scarves to fulfill safety regulations,however, many felt these requests were less about safety and more about their employer’s arroganceand lack of cultural awareness and understanding. This view was captured by Kate:
Mainly it’s dress code, on how I dress as a Muslim woman, how I think I appear, and myskin color is not of the mainstream New Zealander, so I stood out from the rest.

6531(2): 61-70, Somali Women’s Experiences, H. Jelle, P. Guerin & S. Dyer

Kate described feeling that she frequently had to choose between religious and employment
practices, however, she challenged the dress code and had this to say:
Doing the job that I am required to do at the same time baring in mind and not giving away
my religious and cultural practices, such as praying, wearing my head scarf and long dress
was a difficult move to do. Trying to make the employers understand my religion and finallyconvincing them of the importance in keeping my traditional dress was very challenging anddifficult but I finally overcame it and had to modify their uniform to meet my religious
practices.
Ensuring the observance of prayer while at work was a key issue for all of the women. Hannah
found it challenging to find a suitable time to pray and “squeezed prayer time in with her work
patterns”. Indeed, three women reported praying during their break times and not the prescribed or
obligatory prayer times. Half of the respondents stated that they were provided with a place to pray
at work while the other half prayed at work but there was no prayer room provided.
Hannah also identified her discomfort about ‘workplace-shouts’ as she did not know if the food wasHalal (prepared according to Islamic teachings):
When we are having shared lunch, I don’t want to eat some type of food especially when it’s
not halal and my colleagues always invite me to the food, but I don’t want to make them feel
as if I am not favoring their food. The main reason I don’t feel comfortable eating there isthat I don’t know what type of ingredients are in the food and whether it is halal.
Maggie identified the New Zealand customary practice of shaking hands, particularly with men, as adifficult cultural practice for her to overcome. In contrast, Sally described accommodation within
her workplace as her manager and colleagues were very understanding and aware of her cultural
practices:
The manager is very nice and understanding, they really promote that there is different
cultural needs, and if you have problem, they will help you out and then I feel really
comfortable and look forward to going there every morning because everyone is friendly.
These women all commented that observing the Fast of Ramadan was very seldom an issue thatthey had to accommodate at work. This was partly because they were all used to fasting andworking; and partly because many finished work in time to ‘break fast’ with family. The two women
who, from time to time, worked night-shifts and broke fast at work, felt Ramadan was less of anissue as observing Salat was a greater priority.
Balancing Family and Community Commitments
The three women without children reported that although their families had prioritized theirpaid-employment, they still attended to traditional family commitments. Three of these women had
child care responsibilities, while the other three had extended family commitments and were in fullor part-time study. Yet, most of the women stated that these responsibilities did not interfere with
their employment.
Sally provided the example that she manages her employment and extended family responsibilities
by separating and prioritizing her multiple commitments. She manages this even though she is66

31(2): 61-70, Somali Women’s Experiences, H. Jelle, P. Guerin & S. Dyer

responsible for helping her mother with housework, especially during Ramadan. Maggie has the
responsibility of looking after her mother, brothers and sisters and studying full-time while working:I am the eldest in my family so I have the responsibility of looking after the house. It’s part ofour culture for the eldest in the family to take on the responsibility. I have to take them toschool, take them to hospital when they are sick. My mum can’t drive and she does notunderstand the language so I have to take on these responsibilities. I have to help mymother.
The three women with children described the extensive help from their immediate and extended
families their work obligations. Kate, who has three children, developed strategies of compromise
and accommodation between paid and unpaid work responsibilities, and received help from her
brothers and sisters who cared for her children while she was at work. For Mary, it was the support
from her elder sons that was important:
The fact that my children understand why I am working and the fact that they are Okay withit helps me maintain my work. I am determined to work whether I have other responsibilities
or not.
Strategies for Maintaining Employment
First and foremost, all of the women identified the importance of family support as key tomaintaining employment (as discussed above). The second most common strategy they identified
was to equip themselves with the right skills, training and qualifications needed for their jobs. Thisview was shared by Mary, Kate, Sally, Maggie, and Hannah. For Mary, her experience from owning
her own business in Somalia and dealing with her own culture were invaluable to her current
employment. Hannah noted the importance of continually upgrading skills as key to her maintaining
employment. Sally’s comment is reflective of all their views:
What makes it possible for me to work are the skills and qualifications that I have andwhatever the job requires I am experienced and have the skills and qualification required.
Also, the fact that I have trained there and they know me, so it’s plus point.
Similarly, these women recognised the importance of time management skills and their own ability
to organise, plan, and prioritise their competing commitments in order to maintain their paid
employment. In addition to these shared views, particular individual strategies were described.
Hannah noted her motivation, and willingness to continue learning and improve skills was important
to maintaining her job. For Anny, key features to maintaining her employment included being
productive, punctual, enthusiastic, and the fact that she does not have children to look after. Kate
recognized the importance of managing workplace pressure and controlling work stress, and gaining
adequate sleep:
Having good sleep and making sure that I am fresh when I go to work so I can work to thebest of my abilities. Making sure that I am not stressed; every time I pray and ask God tohelp me so that I don’t do anything wrong that costs me my job.
For Maggie, working as a team, being collaborative, enjoying her job, and having
supportive colleagues and managers were important. Finally, Hannah noted the importanceof being committed, hardworking, reliable, patient, as well as being able to communicate
and interpret between clients and with her co-workers.

6731(2): 61-70, Somali Women’s Experiences, H. Jelle, P. Guerin & S. Dyer

Discussion
Somali women migrants have been marginalized within the New Zealand labour market. Despite
their high family, religious and community commitments a small number have gained andmaintained paid employment in New Zealand. Our interest has been to understand the factors that
Somali women attribute to their ability to participate in the labour market.
Similar to previous findings, these women reported initial difficulty in gaining their current
positions, which they attributed to their visibility in terms of their religious dress and employer
perceptions of their cultural and religious practices (e.g., McKenzie Trust, 2004). However, only
one woman in our sample perceived her language capabilities, lack of recognizable qualifications,and colour as barriers to finding paid employment. This finding reflects that most of these women
have been in New Zealand for a number of years and are proficient English speakers, four have
graduated from New Zealand universities, and one is currently enrolled in tertiary education.
Indeed, having the right skills and qualifications for the job market was deemed essential to gaining
and maintaining paid employment by all these women, and took responsibility for upgrading theirskills to this end. Similarly, these women identified what might be considered typical Western‘work-ethic’ attitudes, for example, being punctual, productive, motivated, and so on, as important
strategies to ensure continued employment.
In previous research, Somali women’s responsibility to their family has been deemed a barrier to
employment. In contrast, these women identified the importance of support received fromimmediate and extended family as key to their ability to maintain employment. Thus, for these
women, responsibility to family is a reciprocal and an accommodating relationship. This relationalfamily support was strengthened by these women’s personal time management skills and theirability to plan, organise and prioritise their multiple commitments.
Accommodation within the work-setting was also deemed important to maintaining employment.
For some, this meant that they had to accommodate important cultural and religious concerns,
specifically Salat and modifying their scarves. Accommodations made by the employers were
either an outcome of existing or newly learned cross-cultural awareness, or as an outcome of thewomen negotiating with their employers. Increased cross-cultural awareness with regard to issues ofcross-gender mixing may further enhance the comfort, accessibility, and indeed, productivity ofSomali women employees.
Conclusion
The women in this study attributed their ability to gain and maintain employment to a combinationof personal, family and organizational accommodations. These women’s diverse stories may inform
policy initiatives to address high unemployment rates of Somali women specifically, and Somali
men and refugee migrants generally, and help relieve labour and skill shortages. These women
supported the need to gain English proficiency, formal qualifications and recognizable skill. These
individual responsibilities may be supported by English-proficiency programmes enabling migrants
to better integrate into their new communities. Small accommodations in the work setting can beachieved at little or no cost to the employer. Overall, this study contributes information and insightabout a not-well understood group in New Zealand. Understanding Somali women, perhaps themost marginalized group in New Zealand, will improve our employment interventions for migrant
and refugee groups more generally. Specifically, appreciation of the diversity within groups, andtherefore the necessary diversity required in interventions, will benefit employment outcomes.

6831(2): 61-70, Somali Women’s Experiences, H. Jelle, P. Guerin & S. Dyer

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31(2):71-81, R. Burchielli, P. Pearson & P. R. Thanacoody, Work Intensification in Teaching

Research Note
Exploring Work Intensification in Teaching: A Research Agenda
ROSARIA BURCHIELLI*, PHILLIP PEARSON** AND P. RANITHANACOODY***
Abstract
This paper looks at work intensification in the Australian public education sector, an industry
sector where the intensification of work has not been fully investigated. Beginning with areview of the literature on work intensification in general, the paper proceeds to examine theliterature on the intensification of work in the education sectors in the UK, the US andAustralia, in order to identify areas that require further research. While there is some evidence
suggesting that teacher’s working hours have increased and that their roles have expanded,
there is nonetheless, a paucity of research on work intensification in this sector. In particular,
the causes and effects of work intensification for teachers and school principals are not wellunderstood and there is little evidence on the roles of key industry stakeholders, such as
unions, in developing supportive systemic responses to the issue of work intensification. This
paper discusses three key areas for further study in Australia: research focussing separately on
causes and effects of work intensification on individual teachers and principals, and research
to examine strategic responses to work intensification from teacher unions.

Introduction
Work intensification is an area of increasing interest in the management and industrial
relations literatures, as it has far reaching effects for individuals and implications forcommunities and organisations. This paper analyses the concept of work intensification in thecontext of the Australian public education sector. This sector is both interesting and complex.
On the one hand, education is touted as underpinning current, national, economic and social
goals. It has undergone profound change philosophically and structurally in recent decades inorder to be properly aligned with these goals. Teaching, as an occupation, has changed
substantially, and it is reported that teachers are victims of work intensification.
Simultaneously, the education sector is one which displays numerous structural and image
problems: there are shortfalls in new recruits, high levels of stress among current workers, andthere are a multitude of micro-issues relating to this occupation, such as lack of career options
and professional standards. Thus, the question arises as to the relationship between work
intensification and the problems plaguing the sector. At the same time, recent research calls*

Dr Rosaria Burchielli, School of Business, La Trobe University, Bundoora, Australia,
r.burchielli@latrobe.edu.au,** Mr Phillip Pearson, School of Business, La Trobe University, Bundoora, Australia.
***

P. Rani Thanacoody, School of Business, La Trobe University, Bundoora, Australia.

7131(2):71-81, R. Burchielli, P. Pearson & P. R. Thanacoodyfor further investigation into specific instances of work intensification, in order to clearlytarget the contributing factors in the attempts at developing solutions. This paper responds tothe call for further research. Our aims are firstly, to examine the manifestations, causes andeffects of work intensification in this sector, and secondly to discuss areas requiring further
research. The paper begins with a general definition of the concept of work intensification
drawn from international literature based on various industries. Following from this, the paper
proceeds to the analysis of specific UK, US and Australian literature on work intensificationin their respective education sectors in order to identify gaps in the literature and to outline
areas of potential for further study.
Work Intensification
Broadly speaking work intensification refers to increases, either in time or in workload withina given job. Having said this, the literature indicates there is some conceptual ambiguity.
Green’s (2001) definition of work intensification distinguishes between ‘extensive work
effort’ (time spent at work) and ‘intensive work effort’ (the rate of physical/mental input towork tasks). However, Green also (2002) represents it as a ‘process of change at workplaces’
stemming from technological and organisational change, including new HR policies (Green,2002). O’Donnell, Peetz and Allan (1998) propose two main dimensions of work
intensification. The first dimension refers to employees “doing more”, or having extra roles orincreased tasks. The second dimension refers to “coping with less staff” in workplaces, either
due to downsizing, staff attrition or not hiring new staff. In another paper, Peetz et al 2002,
look at work intensification in terms of work ‘pressure’ and work ‘changes’.
Beynon, Grimshaw, Rubery and Ward (2002) suggest that while ‘external market conditions’account to some extent for work intensification, organisations play a key role in changes towork. These authors argue that although the organisation is ‘constrained by external
regulatory forces […] the power of the organisation in structuring employment has to berecognised within any account of employment change’ (p. 20). This is because organisations‘determine the terms under which people are employed [and] design what kind of work’ isdone (p. 20). More specifically, Beynon, et al (2002) propose that work intensification resultsfrom three main types of managerial control strategies: firstly by insisting on the‘sovereignty’ or ‘dominance of the customer’; secondly, by the ‘redesign of job tasks’, andthirdly, by implementing ‘new control technologies”, to increase the ‘pace of work and thequality of performance’, including the plethora of HR techniques and complex output
measurements’ (p. 268). Some recent research in the health sector uses Beynon et al’s (2002)
three dimensions of managerial control to explain the intensification of the work of nurses(White & Bray, 2003). White and Bray, (2003) thus suggest that customer-focus (or how
customers become defacto supervisors, exacting greater effort); the redesign of jobs
(especially the widening of responsibilities) and the use of new, auditing and performancemeasures have increased the pace and effort of nurses’ work.
The studies cited above indicate that any ambiguity surrounding the work intensification
construct may be explained by differences in terminology and the perspective taken by the
researchers. While some studies clearly focus on the meaning of work intensification (Green,
2001; O'Donnell, Peetz, & Allan, 1998), others look at the antecedents or drivers of work
intensification (Beynon, Grimshaw, Rubery, & Ward, 2002; Green, 2002; Peetz, Townsend,
Russell, & Allan, 2002). It is reasonable that scholars adopt distinct terms, and focus on
different aspects of the same concept, particularly where the subject of research is still being72

31(2):71-81, R. Burchielli, P. Pearson & P. R. Thanacoody

mapped out. Implicit in all the research, however, are the issues of time and effort spent atwork, or ‘longer working hours and greater work effort’ (White & Bray, 2003).
The twin dimensions of time and effort relate to the meaning and manifestation of work
intensification and are the subject of a number of empirical investigations. As a social andindustrial issue, work intensification appears to have reached epidemic proportions worldwide
for many professionals, craft workers and other occupations (Burchell, Ladipo, & Wilkinson,
2002). It characterised European labour markets during much of the 1990s (Green, 2002), andis increasingly prominent in Australia. Evidence of work intensification is being documented
in multiple sectors and contexts, including health (Allan, 1998; Bray & White, 2002; Willis,
2002); aged care (Allan & Lovell, 2003); finance (Probert, Ewer, & Whiting, 2000), andeducation (Bartlett, 2004, forthcoming; Burchielli & Bartram, 2003; Kyriacou, 2001; Pocock,
Wanrooy, Strazzari, & Bridge, 2001; Probert et al., 2000; Troman, 2000).
O’Donnell, Peetz and Allan (1998) propose two main dimensions of work intensification. The
first dimension refers to employees “doing more”, or having extra roles, increased tasks andbigger workloads. The second dimension refers to “coping with less staff” in workplaces,
either due to downsizing (lay-offs), staff attrition (whereby staff that leave are not replaced) or
not hiring new staff. Clearly, the two dimensions are inter-related since ‘doing more’ implies
the allocation of a greater number of tasks to a fixed (no growth) or reduced number of
employees. Similarly, a frequent outcome reported for the “survivors” of downsizing, or forthe remaining employees in workplaces shrinking in size due to attrition, is an increased
workload (O'Donnell et al., 1998). Existing literature suggests there is support for these twodimensions. Examples from the health sector indicate a link between downsizing, cost
reduction and increased workloads for employees, whereby nurses are treating significantly
more patients, at a lower cost. In other words, nurses report doing more, with less staff (Bray& White, 2002).
The literature identifies numerous antecedents for work intensification, in particular, changes
to work (Beynon et al., 2002), and especially the shifts in philosophy underpinning thedevelopment and use of management technologies, such as Human Resource Management(HRM) practices and ‘high performance systems’ (Godard & Delaney, 2000) which exertpressure for greater flexibility, productivity and efficiency (Allan, 1998; Willis, 2002). This
has resulted in different manifestations of work intensification, such as changed work designand skills requirements (Appelbaum, Bailey, Berg, & Kalleberg, 2000); technological andorganisational change (Green, 2002); the reduction in trade union powers, job insecurity, andmore highly trained managers (Burchell et al., 2002). The myriad changes observed to thenature of work are explained by two contending theories. Professionalization suggests thatwork changes are resulting in occupations becoming more complex, more skilled and moresatisfying, eg (Appelbaum et al., 2000). On the other hand intensification ‘is broadly derived
from Marxist theories of the labour process’(Hargreaves, 1992), and describes a trend towards
the degradation of work and working conditions.
Work intensification is frequently discussed in terms of longer working hours, and in recent
years, much has been written about the long and extended hours worked by the labour forcesin both the UK (Green, 2001; Green, 2002) and the USA (Godard & Delaney, 2000). In
Australia too, there is mounting evidence of a general trend towards longer working hours forfull time employees (Watson, Buchanan, Campbell, & Briggs, 2003) and there appears to be a
general movement away from the long-term trend of reducing working hours (Peetz,
Townsend, Russell, & Houghton, 2003). There is some complexity surrounding working time,7331(2):71-81, R. Burchielli, P. Pearson & P. R. Thanacoodysince the longer working hours only affect certain types of employees. Green’s (2001)
research suggests that while there has been an increase in working hours for some workers,
there has been a concurrent increase in households with no work at all. Similarly Beynon etal (2002) suggest that the extended hours of some employees are occurring simultaneouslywith the increase of a range of non-standard working arrangements, and should be seen in the
broader context of the ‘fragmentation of contractual statuses’ (p. 18) and deliberate,
managerial changes to the employment relationship (pp 203-207). Given the prevalence of
employee flexibility, job expansion or job broadening (Allan, O'Donnell, & Peetz, 1999),
there is mounting evidence to suggest that full-time employees are being given more tasks toundertake with inadequate time resources and that extended working hours are resulting inwork overload.
The reported negative effects of work intensification include the decline of workers’ healthand well-being (Allan, 1998; Willis, 2002), job stress (Watson et al., 2003) and burnout(Guglielmi & Tatrow, 1998; Pocock et al., 2001), as well as low staff morale. In turn, this hascorresponding costs to organisations due to increases in staff counselling, incident reports,
workers’ compensation claims and quit rates (Allan, 1998). The literature also suggests there
are negative flow-on effects for the community, including high medical costs, social
fragmentation, and work-family imbalance (Burchell et al., 2002; Pocock et al., 2001; Watson
et al., 2003).
The literature on work and family issues suggests that achieving a balance is still very
difficult (Boyar, Maertz Jr, Pearson, & Keough, 2003; Carlson, Derr, & Wadsworth, 2003;
Kinnunen & Mauno, 1998). Work and family balance has been defined as being the extent towhich a person can at the same time ‘balance the temporal, emotional and behaviouraldemands of both paid work and family responsibilities’ (Hill, Hawkins, Ferris, & Weitzman,2001). Certain studies have indicated that good work-life balance practices are meant tobenefit both employers and employees (Churchill, Williamson, & Grady, 1997; Drago et al.,
2001; Siegwarth, Mukerjee, & Sestero, 2001) and to have a direct impact on the financial
benefits of the company, including increased productivity and performance (Grover &Crooker, 1995). However, it is also suggested that work and family benefits will only be
helpful to employees if organisational culture is supportive for employees to use thesebenefits (Thompson, Beauvais, & Lyness, 1999) .
Work intensification is associated with negative effects on individuals, relationships, family
life, parenting, leisure, and the extended family (Pocock et al, 2001). Some researchers like
(Pleck, Staines, & Lang, 1980) and (Voydanoff, 1988) consider work overload to be among
the most important factor leading to work- family conflict. According to the Scarcity Theory(Goode, 1960), since individuals have a limited amount of energy to perform the various roles(work and family), it is expected that work intensification will lead to role stress. Moreover,work intensification will lead to work spill-over on family roles, which not only creates
emotional, physical, and mental problems, but also negatively affects the family roles. Bothtime-based and strain-based conflicts would make it difficult for employees to fulfil family
responsibilities (Greenhaus & Beutell, 1985). Generally speaking, since women are more
involved in their work and family roles, they are more prone to suffer from health problems(Smith-Major, Klein, & Ehrhart, 2002). Many women find themselves in a position where
they are solely responsible for coordinating childcare and housework responsibilities, making
it harder for them to adjust their work schedules, in comparison to their partners.
Given the different roles and responsibilities that workers have to perform, being involved in
multiple roles is a very common thing. Multiple roles mean a variety of roles outside of an74

31(2):71-81, R. Burchielli, P. Pearson & P. R. Thanacoodyoccupation to which an individual is strongly committed (Ruderman, Ohlott, Panzer, & King,
2002). Holding multiple roles can be rewarding as it may increase self-esteem and levels ofsatisfaction (Danes, 1998). On the other hand, it can deplete individuals of their energy byincreasing their burden. This is expected to result in stress, conflict, health problems, moods
swing and lower levels of satisfaction (Voydanoff, 1988; Williams & Suls, 1991). Therefore,
this trend tends to bring more conflict for women in balancing work and family roles (Wiley,
1987). Despite workplace arrangements, such as the provision of family leave, presumably
designed to support work-family balance, balancing work and family responsibilities is still
difficult. Australian research into the finance and education sectors suggests that, despite‘relatively good entitlements’ in these sectors, ‘employees face continuing difficulties ingaining access to these provisions’ (Probert et al., 2000). This research clearly questions theauthenticity of ‘provisions’ which cannot be accessed.
There is some evidence suggesting that innovations to work and HRM practices can result in
positive outcomes. The literature puts forward that in the instances where innovative
practices lead to greater worker participation, greater responsibility and autonomy, and better
remuneration, such as in high commitment and high performance work systems, there arepositive outcomes for both workers and the business (Appelbaum et al., 2000). The cases
reported indicate that workers in these systems are better paid, have greater trust in their
managers, feel greater motivation and satisfaction at work, and report no impact on stresslevels. For the firm, the benefits are better performance. However, it seems that these results
are highly contextual, and contingent upon numerous, co-existent factors. Firstly, it is notedthat the evidence relates to specific manufacturing industries, and thus it may not apply toother industries, and occupations. It is equally important to note that the best reported
outcomes relate to workplaces where a total constellation of new practices has been adopted,
and where the core of these relates to very high worker control, including high involvement of
the union (Appelbaum et al., 2000). Critics of these systems, however, are sceptical about any
positive results. Some argue that ‘only a minority of firms have comprehensively adopted
these practices’ and that a principal cause is the ‘failure of managers to alter their values andbeliefs’ (Godard & Delaney, 2000). Others propose that autonomy is a myth (Harley, 2000)
and that the likely effect of functional flexibility is work intensification (Allan et al., 1999;
Godard & Delaney, 2000). In fact, it is suggested that work intensification can actually
reverse the benefits of any autonomy, increased motivation or satisfaction, and lead to lower
levels of productivity, efficiency, and effectiveness for organisations, as demonstrated instudies on the survivors of downsizing (Davis, Savage, & Stewart, 2003).
From a cost/benefit perspective, it would seem that work intensification has a greater amountof negative consequences. However, recent literature calls for further research on the issue atthe micro level (Bray & White, 2002). More specifically, it is suggested that research should
focus on the ‘causes and consequences of it, including its relationship to workplace culture
and the regulatory framework’ (Peetz et al., 2002)
Work Intensification in Education
Increased working hours, increases in face-to-face teaching, increased responsibilities or‘expanded job roles’ have been noted to characterise the intensification of work experienced
by teachers in the USA (Bartlett, 2004), the UK (Hargreaves, 1992; Kyriacou, 2001; Troman,2000) and in Australia (Burchielli & Bartram, 2003; Pocock et al., 2001; Probert et al., 2000).
US and UK data indicate that teacher workloads have increased and that the role of theteacher has changed markedly in the past two decades (Bartlett, 2004), so that “classroom75

31(2):71-81, R. Burchielli, P. Pearson & P. R. Thanacoodyteaching now constitutes only part of the teachers’ work” (Troman, 2000). The concept of the“expanded role” for teachers is based on teachers’ numerous responsibilities outside theclassroom, including the following:‘leadership responsibilities and involvement in reform-oriented activity beyond theclassroom. Teachers steward many aspects of the school including responsibilities like theschool’s assessment systems, pedagogical practices, and curriculum development. They
work collaboratively and seek to coordinate student experience across theschool.’(Bartlett, 2004)
Bartlett (2004) dismisses the popular, but superficial notions of the teaching occupation as“easy and congenial work”, or work that is “attractive to women”. Instead, she suggests thatthese are urban myths, too narrowly based on certain, widely known award conditions (suchas teachers’ holidays), which ignore the harsher realities depicted in ‘virtually all in-depth
portraits of teachers’ work [which] show it to be difficult, complex and emotionally draining
work entailing long out-of-classroom hours’ (Bartlett, 2004).
Work intensification for teachers in the US and UK is attributed to the pressures of‘managerialism’, including the bureaucratic/government impetus to increase reporting
mechanisms (Bartlett, 2004; Hargreaves, 1992; Troman, 2000; Woods, 1995). It is reported tohave a range of negative effects including loss of collegiality and staff fragmentation;
personal stress, burn-out, negative self-image and decreased levels of satisfaction (Kyriacou,
2001) and flow-on effects for teachers’ families and communities. Bartlett (2004) questions
why women, as the over-represented gender in this occupation, continue to tolerate theexcessive demands of their profession and the punishing effects of their workloads. With thesmall number of exceptions that analyse the meaning of, and the causes and effects of work
intensification in the education sector, the international literature indicates that further,
context specific research is required.
Intensification in the Australian education sector and areas for further research
There is very little literature that examines work intensification in the Australian educational
context. For example, a review of the Australian Education Journal since the year 2000
renders no titles on this topic. In the most part, it is noted that the issue of work intensificationin Australia is discussed within a number of related contexts; among these, teacher stress(Burchielli & Bartram, 2003) and work-family balance (Probert et al., 2000; Thomas, Clarke,& Lavery, 2003). A notable exception to this is the work of Pocock, et al (2001). In spite of
the paucity of evidence, it is possible to draw some general conclusions from the researchalready cited. This suggests that Australian teachers’ workloads have increased due to task
expansion, the introduction of new responsibilities and new, time-consuming activities. A
central concern for teachers relates to long working hours which are not reflected incontractual (award) arrangements. One study reports that full-time teachers are working over48 hours a week, with secondary school teachers averaging an hour a week more than primaryschool teachers (Probert et al, 2000). According to the State of our Schools Survey (ACTU,
2003) the average teacher hours per week is 56.4 hrs per week.
Teachers report that they spend far longer hours at work, as well as bringing work home, andthey attribute their longer working hours to increased workloads and responsibilities(Burchielli & Bartram, 2003; Pocock et al., 2001; Probert et al., 2000). The literature76

31(2):71-81, R. Burchielli, P. Pearson & P. R. Thanacoodysuggests that the increased workloads are evidenced by numerous factors. Firstly, increased
teaching related activities, such as preparation, marking, large class numbers, increased faceto-face teaching and behaviour management (Burchielli & Bartram, 2003; Pocock et al., 2001;
Probert et al., 2000). Secondly, changes to curriculum (Probert et al., 2000) requiring changes
in daily practices and increasing the need for training. Thirdly, increases in demands relating
to reporting and accountability, such as preparing student and whole-school reports ofoutcomes (Burchielli & Bartram, 2003; Pocock et al., 2001; Probert et al., 2000). Fourthly,
management and communication tasks such as parent/teacher nights, on-going training,
various meetings with staff, parents and students (Burchielli & Bartram, 2003; Pocock et al.,2001). Fifthly, broader education related tasks that fall outside the classroom, and teachers’
usual job description, such as activities linking schools with the wider community, fostering aschool community outside the classroom environment, providing extra activities for students,
improving quality of teaching programs, and extending assistance to students with special
needs (Burchielli & Bartram, 2003; Pocock et al., 2001). Sixth, increases in needs for ongoing professional development training (Burchielli & Bartram, 2003; Pocock et al., 2001).
There is mounting evidence suggesting that the role of school teachers has changed fromessentially a teaching/educational role to encompass a much wider range of responsibilities,
including counselling, welfare, social work, procurement of funding, reporting, government
lobbying and community liaison. In other words, it appears that workloads have increased.
However, since most of this evidence comes from the literature related to stress, which
represents work intensification as a cause of stress, it does little to elucidate the causes ofwork intensification. While work intensification may share some of the antecedents of stress,
we suggest that currently, there is only a partial picture of the causes of work intensification
for teachers, which requires analysis. Numerous questions arise with regards to expanded
teacher workloads; in particular, it seems important to identify the major sources of pressure
for workload expansion and reasons for teachers’ acceptance of these, and to explore ways ofproviding support to teachers. Anecdotal evidence implicates the profound ideological andbureaucratic changes which have affected education in the past two decades (Townsend,1998). In any case, understanding the major causes of work intensification for teachers has
important ramifications for policy development at all levels.
A similarly partial picture emerges in relation to the effects of work intensification forAustralian teachers. Available evidence suggests that the effects of work intensification are
far reaching and multi-layered. On a personal level, teachers are absorbing their increased
responsibilities, and increasing their own work expectations (Probert et al., 2000). Thissuggests that teacher behaviours are contributing to work intensification. In addition, it issuggested that the expectation of completing an excessive range of tasks may result in
reduced quality of teaching as teachers report not having the time to prepare and develop
engaging material (Probert et al, 2000). Internalised pressure from overwork is also
manifesting in self-questioning and crises of professional confidence (Burchielli & Bartram,2003), as well as stress, physical illness and pressure on families (Pocock et al., 2001).
According to a study carried out among Australian teachers, the old ways of working are notsuitable to meet the current demands due to work intensity, long working hours, adopting newwork methods and pressures to complete the tasks on time (Churchill et al., 1997). Therefore
balancing work and family roles becomes very difficult for teachers. There is the additional
danger that teachers may experience a degree of work overload that exhausts their enthusiasm
and erodes their commitment. Management literature clearly links work satisfaction,
employee motivation and commitment with both turnover and recruitment of employees.
Currently, there is evidence to suggest an undersupply of teachers into schools (ACTU, 2003).

7731(2):71-81, R. Burchielli, P. Pearson & P. R. Thanacoody

However, the relationship of work intensification to teacher satisfaction, motivation andcommitment, and to turnover and recruitment can only be guessed at. This leads us toconclude that an important area requiring the attention of researchers relates to the causes andeffects of work intensification for teachers.
A second area for further research relates to school principals. The burden of increased
responsibilities and workloads does not only affect teachers, as school principals are reporting
similar issues (ACTU, 2003). School principals share parallels with “middle managers” inindustry, since they supervise a group of workers, but have limited authority, and areanswerable to a higher form of governance. In addition, a common problem among “middle
managers”, who have an interface with both workers and (governing) executives, but arealienated from both, is that they often bear the brunt of much organisational change(McConville & Holden, 1999). It may be argued that principals are the proverbial ‘meat in
the sandwich’ in education, bearing the burden of increased pressure from overworked
teachers, on the one hand, and a demanding bureaucracy, on the other. Since school principals
are a key form of social support for teachers (Sarros & Sarros, 1992), this raises questions
around the issue of support and alienation for all staff in the school context. Given their own
increased workloads, are principals really in a position to support their staff? Who supports
the principal? Moreover, local and overseas evidence suggests ‘a widespread problem withprincipal recruitment’ and points to ‘reform policies’ as the major culprit (Gronn & RawlingsSanaei, 2003). Limited research evidence clearly suggests that Australian teachers andprincipals are certainly “doing more” and with fewer resources. At the same time, it is clearthat further research must focus on work intensification and its effects on principals, so thatspecific strategies can be developed to address the limitations in their crucial role in the
education system.
A third area which requires greater understanding relates to the development of systemic
responses to the issue of work intensification. While the discussion above suggests a need fordeveloping a (supportive) response at a bureaucratic level, there is some evidence to suggestthat teacher unions, and union strategy, may contribute both to overwork and its solutions. For
example, Probert, et al (2000) hold teacher unions partly responsible for work intensification
because of their role in bringing about award restructuring and enterprise bargaining. Theseauthors challenge the unions to ‘rethink’ their strategies. Additionally, if there is indeed any
truth to the claim that Enterprise Agreement provisions are not being accessed (Probert et al.,2000), then one would expect that teacher unions would have an interest in identifying andeliminating the barriers to access. Thus, agreements in this sector lend themselves to being
critically analysed. Recent industrial action undertaken by the Australian Education Union(AEU) has focused on workloads, reflecting the currency of these issues in the school sector,
and also suggesting that this is a strategic policy area for teacher unions. Anecdotal evidence
suggests that the occupation requires attention to issues such as greater career pathing,training and remuneration, and that these factors may alleviate the intensification of work inthis sector. Clearly, further research is required to analyse union responses and strategies withregards to work intensification in education. Although the industrial climate is generally
hostile, especially after the re-election of the conservative Howard government in 2004, with
its aggressive industrial relations reform agenda, the current under-supply of teachers may
provide a favourable environment for teacher unions to make some gains.

78

31(2):71-81, R. Burchielli, P. Pearson & P. R. Thanacoody

Conclusion
This paper concludes that work intensification in the Australian public education sector
results in many negative consequences for which there are as yet, no clearly articulated,systemic solutions. The review of the literature however, strongly suggests the need forfurther research. Three specific areas are highlighted. Firstly, we call for further research
focussing on the individual teacher, in particular to examine the causes and consequences ofwork intensification but also to examine the relationship between work intensification andteacher compliance. Secondly, within a management context, further research is indicatedanalysing the causes and effects of work intensification on school principals, as middle
managers. Finally, within an industrial relations context, there is scope for analysing teaching
agreements, and union strategies to address work intensification. We suggest that research inthese three areas can result in positive practical implications for teachers.
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8131(2): 81-91, Chronicle, February 2006-May 2006

CHRONICLE
February 2006
During February, a number of media reports highlighted the issue of low paying jobs
and sectors. This included a Bill to abolish youth pay rates - ‘the Minimum Wage
(Abolition of Age Discrimination) Amendment Bill’ - promoted by the Green Party
MP Sue Bradford and the “Super Size My Pay” campaign calling for the minimum
wage to be increased to $12 an hour. Bradford’s Bill proposes to end youth rates for
16 and 17-year-olds and ensure that the adult minimum wage would apply to all
workers. She told a rally in front of Parliament that youth pay rates were “totally
unjustified”.
The Unite union staged a rally in Auckland as part of a campaign to raise theminimum wage for thousands of workers in the fast-food industry. Unite wasnegotiating with fast-food employers McDonald’s and Restaurant Brands New
Zealand. An NBR article commented that Unite was a ‘new union’ that has been
ramping up militant action at precisely the time when older unions are starting toresemble part of the establishment. The Dominion Post and the Press reported thatafter fast-food outlets, Unite will focus its sights on hotels, petrol stations, callcentres, commercial cleaning and car park companies. The union run by former
Alliance Party leader Matt McCarten is one of the first to successfully try to unionise
low-paid casual workers.
The flow-on from the nurse’s pay rise in 2005 continued with other groups in thehealth sector arguing for pay parity. Plunket nurses, Community Karitane andKaiawhina Maori community health workers were offered a 13% pay increase in three
installments by their employers. The Nurses Organisation said the offer was the firststep in achieving pay parity between primary healthcare nurses and district healthboard nurses. In another development, the Dominion Post reported of a potential
staffing crisis in the primary health providers unless nurses working for General
Practitioners were paid the same as their hospital counterparts. The Nurses
Organisation was negotiating with more than 650 primary health providers to seek apay increase for 3,000 primary healthcare nurses.
The Press reported that the dispute between bank workers and Westpac ended after
staff agreed to an offer which included a 5.2% increase in pay as well as thedevelopment of a new pay progression system. Before Christmas 2006, the dispute
had escalated into strike action by 1,700 union members (see December Chronicle).
The Dominion Post reported that the kindergarten teachers’ union reached a “stopgap” contract settlement with the Education Ministry. This followed strike action in
December 2006 when employers announced plans to increase the hours of contact
time (see December Chronicle). The settlement included a working party which willdeal with the issues of contact hours and term breaks. The settlement stated that theemployers must consult fully before changing their opening hours.
Over 750 meat inspectors, members of the Public Service Association (PSA), took
industrial action by only fulfilling mandatory meat inspection duties in support of a82

31(2): 81-91, Chronicle, February 2006-May 2006

5% pay increase. The PSA said the action was being taken in response to an
employer pay offer that was not good enough.
The saga at Air New Zealand continued with the focus of media attention being on avote rejecting a proposal by the union representing maintenance engineers at
Christchurch (see January Chronicle). In January, the airline had accepted a counterproposal from the Engineering, Printing and Manufacturing Union (EPMU) and theAviation and Marine Engineering Association. The Christchurch based members
rejected the restructuring proposal by the airline and the EPMU by a narrow majority.
The national airline vowed to return to a plan that would see them outsource widebody aircraft heavy maintenance and this would result in 507 job losses, on top of 110
cuts announced in December. However, a fresh ballot of members of the Aviation andMarine Engineers' Association (AMEA) resulted in a different outcome when the
majority of engineers supported the proposal.
In another development, the Press reported that Air New Zealand’s 122 aircraft
cleaners were taking legal action to prevent the airline from contracting out their jobs.
The airline said it planned to hire a commercial contractor to manage the cleaning ofaircraft cabins between flights in Auckland, Wellington and Christchurch. This was
expected to result in saving of over $1.5 million. The current aircraft cleaners would
be given the opportunity to transfer to the new cleaning services provider or takeredundancy.
The NBR reported on the Court of Appeal decision that two women dismissed by the
Inland Revenue Department (IRD) in July 2003 for accessing the tax files of family
members, should remain dismissed (see December 2005 Chronicle). The court foundthat the employees had the code of confidentiality drawn to their attention andreceived training on it. They were under an obligation, therefore, to acquaintthemselves with the requirements and to comply with it.
The political storm over the TVNZ Board entered the employment arena when theformer chief executive Ian Fraser threatened to take TVNZ to the Employment
Relations Authority if the board did not respond to his satisfaction. The issue arose
after the board removed Fraser from his role as chief Executive Officer because ofevidence he gave to Parliament’s finance and expenditure select committee during its
inquiry into TVNZ in December 2005.
The case of the Lord of the Rings model-maker James Bryson remained in the media
spotlight after the Dominion Post reported that Mr Bryson lost his bid to take apersonal grievance against film company Three Foot Six, because he did not bring thepersonal grievance within 90 days of the grievance happening. The Employment
Relations Authority was not satisfied that Mr Bryson’s evidence satisfied therequirement that he had taken “a positive step” to put his employer on notice of his
grievance and he did not put anything in writing.
In another case, the Press reported that the Employment Relations Authority alloweda policewoman who claimed that she was given improper and intrusive internal
medical examination during a police medical could apply to have her case heard
despite its historic nature. The officer was sent for a recruitment medical in 198983

31(2): 81-91, Chronicle, February 2006-May 2006

which allegedly included breast, vaginal and rectal examinations. When talking tofellow officers, she found her examination had been far more intrusive than theirs.

March 2006
The NZ Herald reported that a Bill allowing employers to freely dismiss workers in
the first three months of their employment – ‘The Employment Relations(Probationary Employment) Amendment Bill’ - passed its first parliamentary obstacleby 63 to 58 votes after support from the Maori Party. The Bill, sponsored by the
National Party’s Spokesperson on Employment Relations Wayne Mapp, aimed atgiving employers a 90-day trial period during which they can dismiss employees
without a personal grievance claim being taken against them.
A further amendment to the Employment Relations Act 2000 was introduced into
Parliament by the Government. The amendment intended to give greater protection tovulnerable employees (such as those engaged in food catering and cleaning and inorderly, caretaking and laundry services) in the event of a restructuring. The
amendment was designed to cover the gap exposed by the Employment Court of socalled “second generation contracting” which can occur when an organisation has
contracted out part of its business/operations to one contractor and then subsequently
the contract moves to a new contractor.
Both the Press and the Dominion Post reported Government plans to rewrite the 1958
Police Act which will include changing long-standing police disciplinary procedures
which were now recognised as being draconian. The existing employment conditions
required Police to be suspended from duty and face a lengthy hearing and disciplinary
process, which was out of step with modern employment relations legislation andapproaches.
The Equal Employment Opportunities Commissioner, Dr Judy McGregor was
reported in the NZ Herald as saying that the right to have flexible working hours
should be available to all men and women who want to find a balance between workand family interests. Dr McGregor made a submission to the Parliamentary
subcommittee on the proposed legislation (“the Employment Relations (Flexible
Working Hours) Amendment Bill”). She stated that the legislation, which would giveparents the right to ask for a change of work hours, was too narrowly focused:“Currently only parents of children under five and parents of disabled children under
18 are covered by the Bill. But what about parents of primary-school age children or
dependent adult disabled children, or workers who care for their elderly parents?
Their need for flexible arrangements can be just as great.”
The NZ Herald reported that the Government has dropped plans to exempt firms withup to five employees from having to offer the KiwiSaver workplace savings scheme
to employees. As originally designed, the scheme would not have applied to “micro”
businesses, which represent about 86% of all firms and 23% of employees.
The NBR reported on the impending implementation of the Workplace Relations Act(also called “Work Choices”) in Australia with its detailed restrictions on trade union
activity and workplace agreements. The regulations spell out prohibited content in84

31(2): 81-91, Chronicle, February 2006-May 2006

workplace agreements including restrictions on the use of independent contractors,
provisions for unfair dismissal procedures and a wide range of conditions that support
the activities of trade unions. Australian Labor leader Kim Beazley has condemned
the changes as “regulations of infamy”.
The Dominion Post reported that Plunket nurses voted overwhelmingly in favour of a
13% pay rise, which would bring their salaries in line with those of public hospitalnurses. The rise will take the salary of a fourth-year Plunket nurse working a 38-hour
week from $47,430 to $53,860.
Inmate employment instructors at the Department of Corrections went on anationwide 24-hour stop work strike. The President of the Corrections Association
New Zealand (CANZ) said that members had been negotiating for an increase in pay
for more than two years. Union members were asking for the same pay rates thedepartment was paying eight non-union instructors.
Warnings of industrial action by junior doctors were raised during March. The
Resident Doctors Association (RDA) tabled 19 demands including increased pay andlimits on working hours as it sought to renew a national collective agreement, which
had expired in January. The RDA claimed that pay rates for junior doctors had notincreased for four years and the sector faced recruitment and retention problems witha number of junior doctors opting to take locum positions.
The Manawatu Standard reported on the reinstatement of a Palmerston North man
who was dismissed for playing golf during working hours. The Employment
Relations Authority determined that the man should be reinstated as a technical sales
representative and be awarded back pay and costs. The company claimed that theemployee was dismissed for “theft of company time”, playing golf while he was
supposed to be working. However, the employee argued golf was part of his job andthat he always worked more than the required 40 hours a week, and the job was not 9
to 5 position.
The Press reported that the Government employment agency, the Community
Employment Group, which was disbanded because of loose spending on community
grants, had cost taxpayers an additional $3.4 million to disestablish after two-thirds ofthe staff opted to take redundancy payouts. The Government disbanded theCommunity Employment Group in 2004 and transferred its $23m budget to the
Ministry of Social Development after a string of controversial grants to community
organisations had featured in media reports.
The Dominion Post reported on threats by the Labour Department to prosecuteretailers at a Lower Hutt shopping mall unless they improved staff facilities. Staff at
the mall complained that mall policy meant they were unable to sit down during shifts
and could not use the toilet if it meant leaving a shop unattended. Others staff
complained of having to eat lunch in their cars because the shopping mall had no mealroom facilities.
Lincoln University researchers claimed that once-a-day milking for farmers andsharemilkers would have a positive effect on the quality of life of both employers andemployees on farms. Their research had found that employers doing once-a-day85

31(2): 81-91, Chronicle, February 2006-May 2006

milking had less staff turnover, sick leave and absenteeism. The researchers had alsointerviewed employees who said the shorter working hours enhanced their family life.
Project leader Dr Rupert Tipples said in the Dominion Post that if once-a-day milking
became more widely accepted it was possible that New Zealand may become a world
leader and this might help sustain the industry’s advantage.
The alleged eavesdropping by newspaper executives into private staff conversations
prompted the President of the International Federation of Journalists to voice hisconcern. Chris Warren voiced his “deep concern” at reports that management at APN
newspaper Hawke’s Bay Today had listened in on conference calls between theEngineering, Printing and Manufacturing Union (EPMU) and staff delegates duringcollective agreement negotiations. The EPMU laid a complaint with Hastings police
claiming that “the caller or callers intentionally and unlawfully intercepted private
communications” after they discovered evidence of this kind of behaviour from phonerecords.

April 2006
The debate over the National Party probationary employment Bill continued during
April (see March Chronicle). One commentator writing in the Dominion Post called
it disingenuous, claiming that the Bill was a complete removal of any employment
rights for the first 90 days and that employers would be able to dismiss an employee
for any reason they chose no matter how well an employee was performing. It wasclaimed that if the Bill became law it would be ‘the thin end of the wedge’. However,supporters of the Bill pointed out in the Press that, amongst developed nations, New
Zealand was in a small minority that did not have a probation period of the typeproposed by the Bill. The Press also reported on the polarisation of opinion amongst
business groups and unions. Business groups claimed that the existing employment
relation’s provisions for probation periods were ineffective and urged the National
Party to proceed with the Bill. The country’s largest trade union the Engineering,
Printing and Manufacturing Union (EPMU) threatened mass industrial action if theBill was not withdrawn.
The Dominion Post reported on employer warnings to health sector workers to berealistic with their pay expectations, as health boards were struggling to balance
budgets without cutting services (see March Chronicle). The warning came ahead of
the renegotiation of collective employment agreements for two major groups: the2,500 junior doctors and the 2,600 senior doctors. Other workers, including 250
radiation therapists, about 1,600 public and private lab workers, and medical radiation
technologists, were also pushing for pay rises. It was reported that the largely
Government-funded nurses’ pay settlement had raised pay expectations throughout
the health sector.
Further action in the health sector included a 14-hour nationwide strike by radiation
therapists which disrupted treatment for nearly 500 cancer patients. The union’s main
demands concerned cost-of-living pay rises, contribution to superannuation and longwait lists (up to 20 months) while the employers had offered no across-the-board pay
rises as they preferred to rely on individual merit pay rises.

8631(2): 81-91, Chronicle, February 2006-May 2006

During the month, concerns of a national strike by junior doctors mounted as talks
with their district health board employers broke down. The Resident Doctors
Association claimed a substantial pay increase and the health boards responded with
an offer of 2.92%. The employers proposed a “memorandum of understanding” aspart of their claim, which suggested a committee made up of health board and union
staff should make joint decisions on employment conditions. One source claimed that
this was a “red rag to a bull” and was almost guaranteed to provoke a hostile union
response.
Patients could be charged more to see their family doctor unless the Government
helped meet a $22 million pay claim from nurses in the primary health care sector.
Nurses Organisation’ representatives told Parliament's health select committee
yesterday that registered nurses working in GP clinics would earn $195 a week lessthan their hospital counterparts from July 2006. The pay gap was driving nurses outof the community sector, and could threaten the success of the Government's primary
health strategy.
Air New Zealand’s Chief Executive Rob Fyfe was quoted in the Press as saying thatengineers will have to make further work practice and productivity improvements tohold onto key aircraft contracts (see February Chronicle). He also claimed that there
would need to be continual improvements in productivity, processes, and turnaroundtime to meet the company’s budget targets.
The Dominion Post reported on the Airline pilots’ union efforts in the Court ofAppeal over its interpretation of public holiday entitlements recognised. The Holidays
Act 2003 has spawned a number of cases over how seven-day-a-week industries treat
public holiday entitlements. The airline claimed that pilots were given 11 extra days'
leave in lieu of designated public holidays, and that even though they would be
unlikely to be roistered to work all 11 public holidays, the airline was content to givethem more days off than necessary in return for not having to pay half as much again
to have them work public holidays.
A security guard was awarded $4,000 by the Employment Relations Authority after it
determined that the company he worked for had an “unsafe work system”. The guard
had been kidnapped and robbed at gunpoint and was so traumatised by the robberythat he could not return to work. He suffered post-traumatic stress disorder after therobbery and told his employer through a lawyer that he could not keep working forthe firm. The Authority found that his employer had not given him training on how tocope with the after-effects of an armed robbery, or proper support and counselling.
The very unusual case of an employee of Sky TV with bad body odour culminated ina hearing before the Employment Relations Authority. It began with a petition passed
between workmates, complaining about the “smorgasbord of female smells” that had
been bothering staff for months. Sky TV had the air conditioning checked and thefilters changed. A fragrance-emitting unit and a fresh-air vent were moved for
optimum air circulation. With complaints continuing, a female employee was calledin to speak to the woman about personal hygiene. The woman resigned and claimed
that she was simply victimised and harassed. The Authority found in favour of Sky
TV but the NZ Herald reported that employment experts who read the Authority8731(2): 81-91, Chronicle, February 2006-May 2006

decision were critical of it, some saying that the odour allegations could have been a
psychological bullying tactic.
The NBR commented on the Employment Court's decision in Jesudhass v Just Hotel
Ltd that changed the law on confidentiality in employment mediation. The previous
position was that any communication for the purposes of mediation was sacrosanct.
This was overturned, resulting in what some commentators regarded as a new andmore flexible interpretation of section 148 of the Employment Relations Act 2000.
This section confirms that, without the consent of the parties, a person taking part inmediation through the Department of Labour must keep confidential any statement,
admission, or document created or made for the purposes of mediation and any
information, for the purposes of mediation, disclosed orally in the course of themediation. The Jesudhass case involved an employee alleging in the course of
mediation that his employer, through the mediator, had relayed to him that he would
not be permitted to return to work and he would be dismissed immediately after
mediation. The employer denied having done this, but the employee was subsequently
dismissed after the mediation. In making the decision, the court recognised injustices
may result. However, the court found section 148 did not give it any choice. The
court held: “Parliament has rejected [a] balanced approach and has opted for an
absolute maintenance of mediation integrity at the expense of achieving justice, albeit
in rare and exceptional cases.”
The Southland Times reported on the launch of a new resource kit to help dairy
farmers improve employment relations in the workplace. Funded by Dairy InSight
and developed in consultation with the dairy industry, the employment healthassessment kit allowed farmers to measure and, if necessary, improve theirperformance as employers. Based around 15 key questions, the assessment was
designed to get employers thinking about the 10 main factors that affected people onfarms, including recruitment, communication, performance management, working
environment, remuneration and retention. ATR Solutions managing director Shaun
Wilson said the kit was a first for the industry and that “the challenge for the industry
was to come to grips with its employment image”.
The NZ Herald reported on the new face of unionism who will be appearing at the
May Day celebrations. The article commented that along with the ageing rump of amovement that once held governments in its sway there would be strikingly young
people: casual workers in fast-food outlets, school children, ‘God-fearing’ PacificIslanders, militant students, and anarchists. Leader of the Unite union Matt McCarten
said that “you'll have all the old codgers, the old warriors, and you'll have the newblood”. The article reflected that the increase in union membership had risen since
the Employment Relations Act restored union access to worksites in 1999, however
had barely kept pace with the growth in the workforce. In the private sector, theunionised workforce had slipped to about 12% and in the large retail, wholesale,
restaurant and hotels sector, which employs a quarter of the workforce, union
membership was only 4% in 2004.

88

31(2): 81-91, Chronicle, February 2006-May 2006

May 2006
The Bill proposing a probation period for all new workers continued to receive media
publicity. A writer in the Dominion Post claimed that some employees were missingout on employment opportunities because employers were not prepared to take achance on them. The writer claimed that a whole range of people needed employers to
be able to take a chance on them, including people with overseas qualifications, newimmigrants, those with no recent work experience, as well as those wanting to step up
in their careers or change their career path. Yet another commentator in the NZ
Herald claimed that the proposed Bill was a complete removal of any employment
rights for the first 90 days, not a genuine, agreed probationary period between an
employer and employee, which the Employment Relations Act already provided.
The NZ Herald highlighted a meat industry report that claimed that sick leave hadrisen by 39% in the year to March 2005. This amounted to an increase to 81,400 sickdays from the 58,600 sick days reported in the previous 12 months. Business New
Zealand’s Chief Executive Phil O’Reilly claimed that similar trends were visible inother industries. Interestingly, Minister of Labour Ruth Dyson urged employers to
use provisions in the Holidays Act to combat workers exploiting the Act’s sick leave
provisions.
A claim by The Engineering, Printing and Manufacturing Union (EPMU) for a 7%
pay rise for workers covered by the metals collective employment agreement was
dismissed as ‘crazy’ by the manufacturing sector. The EPMU, (that was behind the‘Five in ‘05 campaign’ in 2005), began the lead up to this year's negotiations with astop work meetings in Auckland, Christchurch and Wellington.
Yet again health workers were warned to be realistic with their pay expectations, as
health boards struggled to balance budgets without cutting services. It was estimatedthat renegotiating collective employment agreements for 2,500 junior doctors and2,600 senior doctors could cost millions of dollars. The Dominion Post reported that
other workers, including 250 radiation therapists, about 1600 public and private lab
workers, and medical radiation technologists were also pushing for pay rises. The
radiation therapists’ union threatened further industrial action if district health boards
did not improve their zero pay offer. Members of the Apex union were seeking a 5
per cent pay rise and its National Secretary Deborah Powell stated that if employers
did not budge, a strike notice would be issued.
The decision by junior doctors to strike received widespread media coverage. With
their district health board employers, the doctors had been negotiating a new contract
for about six months. Resident Doctors Association’s General Secretary Deborah
Powell said that an official notice of industrial action had not yet been issued to
district health boards and she could not say whether a strike would go ahead or for
how long. Dr Powell said junior doctors have not had a pay rise in four years andwere leaving their $21-an-hour jobs to work as locums for $75 to $100 an hour.
Health boards had offered a 2.9 per cent pay increase, which had been rejected by theunion.
The Dominion Post reported that the Meatworkers Union and AFFCO had reached anagreement on a collective employment agreement that covered 3,000 workers at89

31(2): 81-91, Chronicle, February 2006-May 2006

AFFCO’s plants. National Secretary of the Meatworkers Union Dave Eastlake
commented that the negotiations had been delayed by issues surrounding AFFCO’s
new Awarua plant. However, the union was happy with the revised deal put before
them, but would not disclose what this included.
Around 200 caregivers at 11 former Salvation Army aged care homes around thecountry gave their union a near-unanimous mandate to call a strike in support of a pay
rise. The Salvation Army had sold the homes to the Australian corporate Elder Carein 2005 and the current negotiations between the Service and Food Workers Union
and Eldercare had stalled as staff had resisted cuts in their pay and conditions. At
stake were: a $100-a-year shoe allowance, cuts to 10-minute handover meetings
between shifts, and a 50c-an-hour pay reduction for new caregivers.
Both the Press and the Dominion Post reported that a group of Ukrainian fishermenon the boat Malakhov Kurgan locked themselves in a cabin and went a hunger strike.
Four of the eight crewmen remaining on the boat at Lyttelton Port were protesting
about work conditions and they had not been paid wages owed to them.
A Barman was awarded more than $45,000 after he was dismissed following three
armed robberies at the pub where he worked. It was claimed that the barman wentfrom a “happy-go-lucky” man to being “fearful in many aspects of his day-to-day
life” after three robberies in three months at Richardson’s Tavern, Auckland. In one
robbery, a shotgun was thrust in his face. The ruling by the Employment Court
criticised the Portage Licensing Trust for poor security measures against robberies at
the tavern, and not doing enough to support the employee after the robberies. A stressdisorder “was materially caused by the trust’s breaches”.
The Independent reported on a Waitoa tannery worker who absconded from his
employer after being overpaid $3,500 in his salary. The employee mistakenly
recorded his hourly rate at $201.08 instead of his usual $13. The employee reached anagreement with his foreman that he would repay the money at $75 a week and signed
an authority permitting the deductions to be made. However, before the first payment
could be made pursuant to the deduction authority, the employee abandoned his job.
The Employment Relations Authority ordered the employee to repay $3,542.79 to his
employer to reimburse it for overpaid wages and also ordered him to pay his former
bosses $500 in costs. There was no appearance, nor any word from the employee.
The Waikato Students Union was ordered by the Employment Relations Authority to
pay a former employee $10,000 for “hurt and humiliation” inflicted by the student
union President. According to Waikato Times, the compensation was one of thehighest sums awarded by the Authority for a grievance relating to “failure to provide asafe workplace”. The Authority said that the stress suffered by the employee was at alevel more serious than seen before. The employee had her employment agreement
revoked when she was elected to a position on the student union executive. She wasdismissed by the President of the Students Union, only for the executive to reinstate
her. In September 2003, the employee took stress leave; during this period she wasadvised that because of financial difficulties the union was reviewing all staffing
requirements. The employee was duly made redundant which she claimed was asham but she had since accepted it was necessary. In her application to the Authority
in June 2004, her grievances included feeling “unsafe in the current working90

31(2): 81-91, Chronicle, February 2006-May 2006environment of the WSU” and having suffered “prejudicial and discriminatory”
treatment from the President of the student union, including “violence in his looks”.

Colin Ross and Erling Rasmussen
The University of Auckland

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