Contents Page: NZJER, 2011, 36(1)NameSylvia Dixon

Title
Temporary Employment andQuality of Temporary Jobs

Page
NumbertheAndrew Patterson & Ian Adjudicator Decisions: Investigating
McAndrew
the Role of Ideology in Grievance
Case Outcomes

1-20
21-34

Philip Gunby

How Bad is the State of Occupational 35-51
Fatalities in New Zealand?

Malcolm Abbott &Ershad Ali

What Happens After Graduation? The 52-64
Market for Economists

Prue Hyman

Pay Equity and Equal Employment 65-75
Opportunity in New
Zealand:Developments
2008/2010
and
Evaluation
76-82
Chronicle: June–September, 2010

Erling Rasmussen &Colin Ross

New Zealand Journal of Employment Relations 36(1): 1-20

Temporary Employment and the Quality of Temporary Jobs
SYLVIA DIXON*
Abstract
This paper discusses some of the insights that can be gained from Statistics New Zealand’s
Survey of Working Life (2008) on the profile of temporary workers, the reasons they give forworking in a temporary job, their pay and conditions. In the March 2008 quarter, 9.4% of
New Zealand employees were working in temporary jobs. The survey results reveal
substantial differences between temporary and permanent employees in indicators of job
quality such as pay, training rates, and working time patterns as well as substantial
differences among the four main types of temporary employee (casual, fixed-term, temporary
employment agency and seasonal). The paper summarises these results and then analyses therole of personal and job characteristics in contributing to the pay and training gaps that exist
between temporary and permanent workers.

Introduction1
This article presents some of the insights into temporary employment that can be gained fromthe 2008 Survey of Working Life (SoWL). The article begins by briefly describing thestatistical profile of temporary employees and then focuses on three main questions. First, aremost temporary workers working in a temporary job by choice or would they prefer apermanent job? Second, how do the pay and employment conditions of temporary employees
compare with those of permanent employees? Three dimensions of pay and conditions are
considered: hourly wages, training rates, and employment at non-standard times of the day orweek. Third, what are the reasons for the differences in pay and conditions between
temporary and permanent employees? To what extent are they due to factors that are notdirectly related to the duration of the employment contract, such as differences in the
distribution of personal and job characteristics?
Past research on temporary work in New Zealand has yielded a picture of diversity, withtemporary work incorporating both skilled, well-paid jobs and unskilled, poorly paid jobs.
After interviewing employment agency temps in Auckland, Alach and Inkson (2003) reported
that most of those interviewed preferred temporary work, felt that their prospects for securingcontinuing work were good, and saw temping as a useful strategy for both personal andprofessional development. The agency temps in their study reported high levels of job
satisfaction in the main. In contrast, when Harris and Harvey (2007) examined working
practices in five industries where casual employment is common (stevedoring, cleaning,home-based aged care, hotels restaurants and cafes, and call-centres), they identified anumber of factors associated with poor job quality, including a lack of training opportunities,
a lack of pathways into permanent work, shift work patterns disruptive to personal and family*

Sylvia Dixon is a Principal Researcher at the New Zealand Department of Labour, P.O. Box 3705, Wellington
6011, Email sylvia.dixon@dol.govt.nz.

New Zealand Journal of Employment Relations 36(1): 1-20
wellbeing, variability in hours or last-minute changes to workers’ shifts or hours, insecurity
regarding future work assignments, and difficulties in accessing sick or bereavement leave.
Previous research into temporary employment in New Zealand has been impeded by a lack ofgood statistical evidence. Prior researchers have either used qualitative methods to study
particular occupations or industries (eg: Alach and Inkson, 2003; Harris and Harvey, 2007) oranalysed evidence from small-scale surveys (eg: McLaren and Dupuis, 2006). Statistics New
Zealand’s Survey of Working Life gathered data on temporary work from a large andrepresentative sample of employed New Zealanders, providing more reliable estimates of thenumbers and characteristics of temporary workers than previously available. The large
sample size allows comparisons to be drawn between different types of temporary work as
well as between temporary and permanent workers. Although the survey did not gather
information on all dimensions of job quality it covered many of the most importantdimensions. The survey was designed to be repeated on a regular basis, at intervals of aroundthree years. The development of the Survey of Working Life has made an important
contribution to the evidence base that future research into temporary employment can drawon.
The paper is structured as follows: essential background information on the survey and theway in which temporary employment was defined and measured. The next section briefly
describes the incidence of each of the main types of temporary and employment and thecharacteristics of temporary workers, followed by the reasons that were given for working in
temporary jobs and whether temporary workers would prefer permanent employment. Thereis, then, a comparison of the wages, training rates and working time patterns of temporary
and permanent workers. This is followed by a discussion of factors that contribute to thelower pay and lower training rate of temporary employees, and assessment of the role ofdifferences in the distribution of other personal and job characteristics. The articles ends witha brief conclusion

The Survey and its Definition of Temporary Employment
The Survey of Working Life is a Statistics New Zealand survey that gathers job-related datafrom a representative sample of employed New Zealanders through a supplement to the
Labour Force Survey. All respondents to the March 2008 quarter Household Labour Force
Survey who were employed in the reference week were asked the SoWL questions.
Responses were obtained from approximately 14,500 individuals. Statistics New Zealandintends to repeat the survey periodically (every few years) so that changes in employment
arrangements and conditions of employment can be monitored.
The concept of temporary work is used in the survey to cover all types of short-term workthat are undertaken by employees, including fixed-term jobs, casual jobs, seasonal jobs, andjobs arranged through temporary employment agencies. A job is defined as temporary if theworker does not have any expectation of continuous long-term employment. A temporary
employee can be an employee who has been hired for a specific time period or until thecompletion of a specific project; someone who is temporarily replacing another worker who
is absent; someone who is filling a seasonal job; or someone who is employed only whenneeded by their employer. This definition includes casual employment and seasonal
employment. Jobs undertaken by people who are self-employed are not included in thedefinition.

New Zealand Journal of Employment Relations 36(1): 1-20

Each employee in the survey was asked if they were employed on a permanent basis(focusing on their main job if they held more than one job). This question was worded asfollows:
A permanent employee is guaranteed continuing work. They can stay in their job until theydecide to leave or their employer makes them redundant. In your job, are you a permanent
employee?
Employees who said that their job was not permanent were then asked a series of additionalquestions designed to identify the nature of their employment relationship so that they could
be classified as a fixed-term employee, a casual worker, a temporary employment agency
worker, or in some other type of employment relationship. 2 All employees, including those
who said that their job was permanent, were also asked whether their job was only available
at certain times of the year, ie: seasonal. People who initially said that their job waspermanent but later indicated that their job was seasonal were classified as temporary becauseseasonal jobs do not provide continuous work throughout the year. The full set of questions
used to identify and classify temporary employees is given in Appendix 1.
Previous qualitative research in New Zealand has shown that many temporary employees do
not have a good understanding of the terms and conditions of their employment or themeaning of terms like ‘casual’.3 The SoWL did not ask respondents to choose between the
different types of temporary work and instead classified them using their responses to more
concrete questions such as ‘were you hired to temporarily replace another worker?’
However, this strategy did not eliminate the potential for confusion, which means there is
likely to be some measurement error in the survey’s estimates of temporary employment
numbers.

Numbers and Characteristics of Temporary Workers
Approximately one in ten, or 9.4%, of employees were working in temporary jobs wheninterviewed in the March 2008 quarter.4 One in twenty (4.9%) were employed on a casualbasis, 2.3% were employed on a fixed-term contract, and 0.7% worked for a temporary
employment agency. The remaining 1.5% could not be classified to a particular type of
temporary job contract using the information collected in the survey. The majority of thislatter group were seasonal employees who initially said they were permanent employees butlater gave a ‘yes’ response when asked if their job was only available at certain times of theyear, ie: seasonal. 5 In total, 2.7% of employees (and 28% of temporary employees) wereidentified as being seasonal workers through the seasonal work question.
The OECD has compiled cross-country data on the percentages of employees who areemployed in temporary jobs. In 2009, the percentage of employees who worked in temporary
jobs was in the 5% to 15% range in the majority of OECD countries (OECD, 2011). This issimilar to the cross-country range identified in earlier work by the OECD (OECD, 2002). The
SoWL estimate of 9.4% puts New Zealand roughly in the middle of the OECD distribution.

New Zealand Journal of Employment Relations 36(1): 1-20
Table 1: The Incidence of Temporary Work: Variations by Demographic Group

Type of temporary work

CasualFixed-term

Temp
agencyworkerOther(mainly All seasonal All temporary
seasonal & employees employees
not further
defined)

Proportion of employees whose main job was temporary
All employees

4.9

2.3

0.7

1.3

2.7

9.4

GenderMale
Female

4.3
5.5

1.7
2.9

0.4
1.0

1.5
1.0

2.9
2.4

8.2
10.7

Age group (years)
15–24
25–34
35–44
45–54
55–64
65+

10.9
2.9
3.4
2.8
4.0
11.6

2.8
2.8
2.2
1.8
1.8
2.4

1.0
0.8
0.5
0.7
S
S

2.1
1.1
0.9
1.3
1.0
S

5.3
1.8
2.1
2.1
2.0
3.6

17.3
7.7
7.1
6.9
7.5
16.6

Gender by age group (years)
Males, 15-24
Males, 25-54
Males, 55+
Females, 15-24
Females, 25-54
Females, 55+

11.4
2.0
5.3
10.3
4.2
5.2

3.0
1.3
1.5
2.5
3.3
2.2

0.7
0.3
S
1.4
1.0
S

3.0
1.1
1.7
1.1
1.1
S

6.5
1.7
3.2
4.1
2.2
1.3

18.4
4.8
9.3
15.9
9.7
8.5

Ethnic group
European onlyāori only
M
European / M
āoriPacific peoples only
Asian only
Other groups

4.7
6.0
4.4
3.7
6.2
5.2

2.4
2.1
S
1.9
2.6
2.4

0.5
1.4
S
2.3
1.1
S

1.2
2.0
2.4
1.8
S
S

2.5
5.2
3.4
3.8
1.1
S

9.0
11.5
8.9
9.7
10.7
10.8

Highest qualification
No qualification
School Certificate/NCEA Level 1
Higher school qualification
Vocational or trade qualification
Degree

6.4
5.8
7.2
3.7
3.9

1.2
1.2
2.4
2.1
4.4

0.9
S
1.0
0.5
0.7

2.4
1.8
1.5
1.0
S

4.6
3.3
3.6
2.0
1.3

11.0
9.4
12.7
7.5
9.4

S = Suppressed due to low sample size.

New Zealand Journal of Employment Relations 36(1): 1-20

The incidence of temporary employment by gender and age group is summarised in table 1.
The numbers indicate that female employees are more likely than male employees to beworking in temporary jobs: their rate was 11% compared with 8% for men. Temporary
employment is substantially more common among young employees than most other age
groups, with the exception of 65 years and over. Seventeen percent of young employees(aged under 25) and 17% employees the 65 plus age group were employed in temporary jobs,
compared with just 7–8% of employees in the 25-64 year age groups.
Although the incidence of temporary employment is similar for men and women in the 15-24
and 55 plus age groups, it diverges substantially in the intervening years. Female employees
in the 25-54 year age range were about twice as likely to be in temporary work as prime-aged
male employees (10% compared with 5%). Detailed analysis of the incidence rates by five
year age group indicated that the gender gap in the likelihood of working in a temporary job
was largest in the 35–39 and 40–44 year age groups, where 3-4% of male employees but 1011% of female employees held temporary jobs.
Māori employees were more slightly likely to be working in temporary jobs than workers ofother ethnic groups (11.5% compared with 9.0% of Europeans and 8.9% of Māori/European).
The results for people with different levels of educational qualification indicate that therelationship between education and the incidence of temporary work is complex. The
proportion in temporary jobs is relatively high among employees with no qualifications but it
is also relatively high among workers with degrees. It is lower for employees at intermediate
educational levels.
The incidence patterns also differ for different types of temporary work. Young adults are
particularly likely to be employed in casual jobs while prime-aged employees are more likely
to be in a fixed-term arrangement. Employees with post-school qualifications are also more
likely to be working in a fixed-term job than those with lower levels of education. The
incidence of fixed-term employment was 4.4% for employees with a degree but only 1.2%
for employees with no qualifications.
The characteristics of temporary employees and their jobs are summarised in Tables 2 and 3.
In 2008, slightly over half of all temporary employees were female. More than one-third wasyouth workers and another one-third was women aged between 25 and 54. Prime-aged men
made up about 17%, and older men and women comprised the remainder, around 15%. Other
analyses of the survey data showed that compared with permanent employees, temporary
employees were significantly younger (by 4 years on average), more likely to be living in aminor urban area or a rural location, less likely to be married or living with a partner, lesslikely to have dependent children, and less likely to hold an educational qualification (Dixon,
2009). Some of these differences were relatively small.

New Zealand Journal of Employment Relations 36(1): 1-20
Table 2: Personal characteristics of temporary and permanent employeesType of temporary work

CasualFixedterm

Temp
agencyworkerOther
All(mainlyseasonal
seasonal & employees
not further
defined)Temporaryemployees

PermanentAllemployees employees

Percentages unless indicated otherwise
GenderMale
Female

45.3
54.7

37.6
62.4

30.3
69.7

61.7
38.3

55.3
44.7

44.4
55.6

51.7
48.3

51.1
48.9

Age
Mean age

34.6

36.5

35.0

36.9

35.1

35.5

39.4

39.0

Age group (years)
15–24
25–34
35–44
45–54
55–64
65+

42.4
12.8
15.8
12.4
10.7
6.0

22.7
26.4
21.6
16.7
10.0
2.6

28.7
24.4
15.8
23.3
S
S

31.5
17.6
15.3
22.3
9.8
S

38.0
14.2
17.9
16.6
9.9
3.5

34.9
17.5
17.0
15.7
10.4
4.5

17.3
21.8
23.1
22.0
13.4
2.4

19.0
21.4
22.5
21.4
13.1
2.6

Gender by age group (years)
Males, 15-24
Males, 25-54
Males, 55+
Females, 15-24
Females, 25-54
Females, 55+

23.2
13.6
8.5
19.2
27.3
8.2

13.1
19.3
5.2
9.7
45.3
7.4

10.7
16.6
S
18.0
46.8
S

23.6
27.9
10.3
7.9
27.3
S

24.0
21.7
9.5
13.9
27.0
3.8

19.5
17.0
7.9
15.4
33.1
7.1

8.9
34.9
7.9
8.4
32.0
7.8

9.9
33.2
7.9
9.1
32.1
7.7

Ethnic group
European onlyāori only
M
European / M
āoriPacific peoples only
Asian only
Other groups

72.3
6.3
4.4
2.8
10.5
3.6

77.7
4.7
S
3.0
9.2
3.5

52.1
10.2
S
12.6
12.8
S

69.8
8.0
8.9
5.3
S
S

71.3
10.1
6.1
5.4
3.3
S

71.9
6.4
4.6
3.9
9.4
3.9

75.0
5.1
4.8
3.7
8.1
3.3

74.7
5.2
4.8
3.7
8.3
3.4

Highest qualification
No qualification
School Certificate/NCEA Level 1
Higher school qualification
Vocational or trade qualification
Degree

22.9
9.5
20.9
24.7
16.9

8.8
4.2
14.5
29.7
39.5

23.1
S
20.5
22.2
21.6

33.1
11.3
16.1
25.7
S

30.3
9.9
19.1
24.7
10.0

20.5
8.0
19.2
26.0
20.9

17.1
7.9
13.6
33.3
20.9

17.5
8.0
14.1
32.5
20.9

Total

100.0

100.0

100.0

100.0

100.0

100.0

100.0

100.0

Sample size
Estimated population size (000s)

600
85.1

280
40.3

90
12.0

180
22.3

370
46.5

1,170
163.6

10,7401,575.2

11,9401,743.2

S = Suppressed due to low sample size.

New Zealand Journal of Employment Relations 36(1): 1-20
Table 3: Job Characteristics of Temporary and Permanent EmployeesType of temporary work

CasualFixed-term

Temp
agencyworkerOther(mainly All seasonal Temporary
seasonal & employees employees
not further
defined)PermanentAllemployees employees

Percentages unless indicated otherwise
Usual hours worked per week (main job)
Mean
0–19
20-39
40-49
50+
Part-time (<30 hours)
Full-time (30 hours+)

22.0
46.6
28.2
16.5
4.2
61.4
33.9

Occupation
Legislators, administrators andmanagers

28.5
30.3
27.7
35.4
2.3
36.9
58.7

34.9
21.0
23.5
40.0
11.9
32.4
64.3

27.4
34.3
27.1
27.8
7.4
47.6
48.9

37.6
11.4
22.1
51.7
14.0
19.9
79.3

36.6
13.5
22.6
49.4
13.4
22.5
76.4

2.2
9.7

7.7

S

S

30.1

16.7

S

S

3.3

13.2

12.3

5.7

14.5

18.0

17.7

10.8
10.7
29.1
11.3
3.7

20.3
17.7
5.5
4.5
4.2

12.0
26.4
14.4
S
S

9.6
S
12.1
22.3
S

11.1
4.9
10.8
27.4
S

13.0
12.5
19.9
10.4
3.8

12.0
14.2
16.7
3.6
9.1

12.1
14.0
17.1
4.3
8.6

7.4
14.8

5.9
4.1

S
14.0

34.5
12.3

26.0
11.4

11.0
11.5

8.2
4.9

8.4
5.6

Employer's business type
Private sector
Central government
Local government
Not for profit sector
Not classified

61.1
13.7
1.8
6.4
17.0

42.5
34.4
4.1
9.6
9.4

70.9
S
S
10.7
10.1

71.5
9.8
S
11.5
7.2

67.5
12.6
S
8.4
10.3

59.0
17.6
2.1
8.2
13.1

67.3
15.7
2.0
6.9
8.0

66.5
15.9
2.0
7.0
8.5

Size of enterprise
1-19 employees
20-99 employees
100-499 employees
500 employees or more
Not classified

41.0
13.9
13.2
14.7
17.1

33.5
18.2
14.3
24.5
9.4

23.4
18.0
31.1
18.9
8.7

37.8
20.5
8.6
25.2
7.8

36.1
18.5
9.7
25.2
10.5

37.4
16.3
14.1
19.1
13.1

39.0
20.8
15.3
16.9
8.0

38.9
20.3
15.2
17.1
8.5

Job tenure
Mean (years)
Median (years)

2.3
0.7

2.5
0.8

1.2
0.4

6.4
3.1

4.1
1.8

2.9
0.9

5.9
3.0

5.6
3.0

Less than 6 months
6 months to less than 1 year
1 to less than 3 years
3 to less than 10 years
10 years or more

46.3
9.5
23.6
15.2
5.4

42.4
14.2
20.5
15.0
7.8

51.2
11.9
25.4
11.6
0.0

21.5
4.0
24.1
28.5
21.6

36.9
4.4
22.4
23.0
13.1

41.7
9.9
23.0
17.0
8.2

13.2
7.9
24.8
34.2
19.7

15.9
8.1
24.7
32.6
18.6

Total

100.0

100.0

100.0

100.0

100.0

100.0

100.0

100.0

Sample size
Estimated population size (000s)

600
85.1

280
40.3

90
12.0

180
22.3

370
46.5

1,170
163.6

10,7401,575.2

11,9401,743.2

Professionals
Technicians and associate
professionals
ClerksService and sales workers
Agriculture and fishery workers
Trades workers
Plant and machine operators andassemblers
Elementary occupations

34.2
18.1
27.2
41.7
12.6
29.4
70.0

S = Suppressed due to low sample size.

32.7
24.3
22.8
38.2
12.3
33.0
64.6

New Zealand Journal of Employment Relations 36(1): 1-20
Roughly half of all temporary employees worked part-time hours compared with only 20% of
permanent employees. This is one of the most striking of the differences between temporary
and permanent employees in job characteristics (see Table 3). Among temporary workers,
casual workers were the subgroup most likely to be employed on a part-time basis: 61% were
working part-time hours. Fixed-term employees were the group most likely to be employedfull-time (70% worked full-time hours).
Although temporary workers were located in all of the main occupational groups, comparedwith permanent employees they were more likely to be working as service and sales workers,
agriculture and fishery workers, plant and machine operators and assemblers, or inelementary occupations. They were less likely to be employed in management or trades
occupations. Only 3% of temporary employees were classified as managers, compared with
13% of permanent employees.
The available data on business type show that 59% of temporary employees were employedby private sector firms, which is substantially lower than the share of permanent employees(68%). Temporary employees were more likely to work for central government or non-profit
organisations. A significant group of employees with fixed-term employment arrangements
work for central government, particularly in the education industry.
Overall, there was little difference between temporary and permanent employees in theirdistribution across firms of different sizes once the higher non-classification rate of
temporary employees is taken into account. However, fixed term and temporary agency
employees were more likely to work in large firms while casual and seasonal employees
more likely to work in small firms.
The survey asked respondents how long they had worked for their employer in their current
main job. The intention of the question was to measure the duration of the employment
relationship rather than the duration of the last episode of work. Most temporary workers said
they had been in their jobs for less than one year (52%), but a significant percentage had
worked for one to three years (23%) or for three or more years (25%). While the majority ofcasual, fixed-term and temporary agency workers had worked for their current employer forless than one year, seasonal workers had a noticeably different tenure pattern. A higher
proportion (36%) had worked for their employer for three or more years. (The equivalent
figure for permanent employees was 54%). These results suggest that a significant proportionof seasonal employees were in long-term relationships with their employer and had worked
for multiple seasons.

Preferences for Temporary Employment
Do people work in temporary jobs because they prefer a temporary employment arrangement
or simply because they are not able to obtain a suitable permanent job? The survey included
two questions that shed some light on this question.
First, temporary employees were asked their reasons for undertaking temporary or seasonal
work. The question was open-ended, and multiple responses were recorded, if given. The
results are summarised in Table 4. The responses were diverse with no single reason
dominating. Thirteen percent indicated that they were working in a temporary job because
they were not able to find a permanent job, or said they hoped or expected their temporary

New Zealand Journal of Employment Relations 36(1): 1-20
job to become permanent. Nine percent indicated that they worked in a temporary job forfamily reasons, for example to manage childcare responsibilities, or because of certain family
obligations or family circumstances. Twenty-four percent said they worked in a temporary
job because they were studying or wanted to gain work experience. Fifteen percent gave
lifestyle reasons, such as only wanting to work for a short period of time, or enjoying thevariety that short-term jobs offer. Nine percent cited financial reasons, such as the money
being better in their temporary job. One percent referred to health limitations as a reason forworking in a temporary job. These results suggest that perhaps 13% of temporary workers
were in temporary jobs on an ‘involuntary’ basis (the first group identified above). The true
percentage could be higher than 13%, however, if some of the people whose responses
couldn’t be classified (34%) were also working in temporary jobs primarily because they
weren’t successful in finding a suitable permanent job.

Table 4: Reasons for doing temporary work and preferences for permanent work
Type of temporary work

CasualFixed-term

Temp
agencyworkerOther(mainly All seasonal Temporary
seasonal & employees employees
not further
defined)

Percentages
Reasons for doing temporary work
Family reasons
Educational reasons
Health limitations
Lifestyle reasons
Financial reasons

9.7
33.0
2.1
13.9
6.9

7.7
14.2
S
13.0
5.8

14.5
26.0
S
17.0
S

6.7
6.7
S
19.5
22.4

7.6
16.9
S
15.5
17.6

9.2
24.1
1.4
14.9
8.5

Involuntary (only type of work
available, hopes job becomespermanent)
Other reasons

12.0
27.7

14.8
41.9

16.4
29.4

8.3
46.5

11.7
38.8

12.6
34.0

49.1
49.6
48.8
39.9
55.0
35.5

47.2
54.4
44.0
46.6
48.5
S

33.5
38.9
25.0
36.7
35.7
S

35.6
37.8
32.9
40.7
35.2
22.7

40.1
39.7
40.4
38.4
47.2
20.5
100.0

Would prefer a job that is permanent/ongoing
36.5
All temporary employees
34.6
Males
38.0
Females37.0
15-24 years
44.2
25-54 years
16.4
55 years and over
Total

100.0

100.0

100.0

100.0

100.0

Sample size
Estimated population size (000s)

600
85.1

280
40.3

90
12.0

180
22.3

370
46.5

S = Suppressed due to low sample size.

1,170
163.6

New Zealand Journal of Employment Relations 36(1): 1-20

Temporary employees were then asked if they would prefer to have a permanent job. Forty
percent responded ‘yes’ to this question; 53% said they would prefer to continue doing
temporary or seasonal work, and approximately 7% did not know or give a response. The
proportion who said they would prefer a permanent job (40%) could be interpreted as analternative measure of ‘involuntary’ temporary work, although this interpretation isdebateable as it is unclear how the question was answered by respondents. Some may havethought about their ideal employment arrangement rather than the one they would actively
seek at present, given their current circumstances.
Overall, similar proportions of men and women in temporary jobs said they would prefer tohave a permanent job and almost half of all fixed-term employees and temporary agency
workers said te same.. The proportion who said they would prefer a permanent job was much
lower among casual and seasonal employees (37% and 36% respectively). In most types of
temporary work, prime-aged adults were more likely than young adults or older adults to saythat they would prefer a permanent job.
A regression model was estimated to identify the personal and job characteristics that are
most strongly associated with the preference to work in a permanent job, holding the effects
of other characteristics constant. The results (not shown in this paper) indicate that age, fulltime hours and job tenure are significant predictors of wanting a permanent job. Teenagers,
those aged 60 or over, those who were working on a part-time basis, and those with longer
tenure in their jobs, were significantly less likely to say they would prefer a permanent job
than employees in the prime age groups, the full-time employed, and those with shorter job
tenure. There were no statistically significant differences between casual, fixed term, agency
and seasonal workers in the likelihood of wanting permanent work, suggesting that the typeof temporary job does not have a major impact once differences in personal characteristics
are held constant.6
In other countries, temporary workers have tended to report a lower level of job satisfaction
than permanent employees (Booth, Francesconi and Mark, 2002; Wooden and Warren,2003).7 In the SoWL, this was also the case, but the differences were too small to beconsequential and were not statistically significant. Eighty-one percent of temporary workers
and 84% of permanent workers said they were satisfied or very satisfied with their job. Six
percent of temporary workers said they were dissatisfied or very dissatisfied, compared with
5% of permanents.
In summary, the results indicate that preferences for temporary work vary strongly by age.
Prime-aged adults (those aged from 25–54 years) were almost equally divided between
preferring temporary work and wanting a permanent job. The vast majority of the older adults(55 years and over) and more than half of the younger adults (15–24 years) who held
temporary jobs said they preferred temporary work.

Pay and Employment Conditions
In this section we discuss the employment outcomes of temporary workers in terms of three
job quality indicators: pay rates, training, and the requirement to work at non-standard timesof the day or week.

New Zealand Journal of Employment Relations 36(1): 1-20
Table 5: Employment outcomes of temporary and permanent employeesType of temporary work

CasualFixed-term

Temp
agencyworkerOther(mainly All seasonal Temporary
seasonal & employees employees
not further
defined)PermanentAllemployees employees

Dollars
Hourly earnings
Mean ($)
Mean - males ($)
Mean - females ($)

16.0
16.0
16.0

23.7
24.0
23.6

21.2
20.2
21.6

18.0
18.6
16.8

16.6
17.4
15.6

18.5
18.4
18.6

23.4
25.6
20.9

22.9
25.0
20.7

Median ($)

13.1

19.5

15.5

17.0

15.0

15.0

19.2

19.0

Percentages
Hourly earnings
Below $15 per hour
$15-<$25 per hour
$25 or more per hour
Earnings not specified

54.6
26.0
8.8
10.7

24.5
36.7
28.7
10.2

35.9
33.9
20.7
9.5

40.6
38.4
9.1
11.9

42.9
36.1
8.0
13.0

43.5
31.2
14.6
10.7

24.3
40.4
27.2
8.1

26.1
39.5
26.0
8.4

Participation in employer-funded education or training during the past 12 months
All
12.5
32.3
9.8
17.0
Males
8.3
22.2
S
13.4
Females
15.9
38.4
S
22.9

13.7
8.8
19.9

18.0
12.1
22.7

31.9
33.1
31.5

30.5
31.3
30.5

Time spent on employer-funded education or training during the past 12 months
1 day or less
3.0
12.2
S
5.7
2 to 5 days
6.4
14.9
S
7.3
6 days or more
3.1
5.2
S
S

5.7
5.2
2.9

5.5
8.7
3.8

6.6
15.0
10.3

6.5
14.4
9.7

Usual working time pattern (all jobs)
Usually works all hours at standard
times of working week

53.6

70.6

75.2

44.8

53.2

58.2

67.1

66.2

Usually works some hours at nonstandard times of working week

42.7

27.3

16.9

54.0

44.7

38.6

31.5

32.2

No usual working time pattern

3.4

S

S

S

2.2

3.1

1.5

1.6

31.7
8.8
5.0
40.3

15.8
S
10.6
30.3

18.3
6.5
30.4
64.4

22.6
11.6
25.7
58.6

30.2
9.5
13.7
49.9

30.1
10.1
14.8
46.4

30.1
10.0
14.7
46.7

48.9

42.6

77.7

70.2

60.3

55.5

55.9

100.0

100.0

100.0

10,7401,575.2

11,9401,743.2

Worked at non-standard times in the last 4 weeks
Evening work (7–11pm)
33.3
Night work (11pm–5am)
8.4
Early morning work (5–7am)
10.1
Weekend work
52.8
Total who worked at a nonstandard time
63.4
Total

100.0

100.0

100.0

100.0

100.0

Sample size
Estimated population size (000s)

600
85.1

280
40.3

90
12.0

180
22.3

370
46.5

1,170
163.6

S = Suppressed due to low sample size.
There is a substantial pay gap between temporary and permanent employees. In the March
2008 quarter, the average hourly earnings of temporary employees were $18.50 per hour,which was just 79% of the average hourly earnings of permanent employees ($23.40).
However, there was considerable variation in earnings across the different types of temporary
work (see Table 5). Casual employees had the lowest mean hourly earnings ($16.00 perhour). Fixed-term employees had the highest mean hourly earnings ($23.70 per hour) andwere on average paid slightly more than permanent employees.
Measures of the proportion of workers with relatively low and relatively high pay are also
shown in Table 5. Forty-four percent of temporary employees earned less than $15 per hour,compared with 24% of permanent employees. Casual workers were the lowest paid group of
temporaries, with 55% earning less than $15 per hour and only 9% earning $25 or more per

New Zealand Journal of Employment Relations 36(1): 1-20
hour. The earnings distribution of fixed-term employees was similar to that of permanent
employees.
Temporary employees were much less likely than permanent employee to have received
training at work. Just 18% of temporary employees, compared with 32% of permanent
employees, said they had undertaken some employer-funded study or training in the lasttwelve months. 8 Among those who had received employer-funded training, temporary
employees were more likely than permanent employees to have trained for one day or less,and less likely to have trained for 6 days or more. Again, there were substantial differences
across the different types of temporary employment. Fixed-term employees were most likely
to have studied or trained: their participation rate was similar to that of permanent employees.
The education and training rate was lowest among casual workers (13%) and temporary
agency workers (10%). Women working in temporary jobs were substantially more likely tohave received employer-funded study or training than men, reflecting differences in age
composition, skills and job mix.
Because training was measured over the extended period of one year, any differences in job
tenure and labour force participation patterns are likely to have caused differences in training
rates. If casual employees were, on average, employed for fewer weeks of the previous year
than other types of employee, for example, this would directly reduce their opportunities toreceive employer-funded training, leading to a lower average training rate.
Turning to working time patterns, the survey results show that casual and seasonal employees
were more likely than permanent employees to say that they usually did at least some of theirwork outside the conventional working week (defined as 7am to 7pm, Monday to Friday).
This was true for 43% of casuals and 45% of seasonal workers. In addition, casual andseasonal workers were more likely than permanent workers to have worked at non-standard
times, on one or more occasions, during the last month.
When specific non-standard times are considered, it appears that casual workers were more
likely than permanent employees to have worked during the evening or on the weekend, andseasonal workers were more likely to have worked in the early morning or on the weekend
during the last four weeks. In contrast, fixed term and temporary agency employees were lesslikely than permanent employees to have worked on the weekend, and they had similar or
lower rates of evening, night and early morning work.
Overall, there are substantial differences between temporary and permanent employees inwage rates, training participation and working time patterns, but also substantial differencesin pay and conditions between the different types of temporary work.

Reasons for the Differences in Pay and Training Outcomes
Although temporary employees have quite different employment outcomes than permanent
employees, it is unclear whether the differences are due to the temporary nature or short-term
duration of the employment relationship. Temporary workers differ from permanent workers
on a variety of other characteristics that are correlated with differences in skills and earnings
potential, such as age, work experience, employment continuity, education, occupational
skills, and hours of work. They also differ in their distribution across different types of jobs
and firms.

New Zealand Journal of Employment Relations 36(1): 1-20

To estimate the wage penalty or wage premium that is associated with temporary
employment, a common approach is to use a statistical model to adjust the actual wage gap
between temporary and permanent employees for the effects of any differences in worker andjob characteristics that might be contributing to the difference in earnings. The ‘residual’
wage gap – that remaining after the effects of differences in employee and job characteristics
have been adjusted for – can then be interpreted as the difference in pay that is due to thetemporary nature of the job. However, due to the fact that temporary and permanent
employees are likely to differ on a number of dimensions that are not normally measured insurveys (and cannot be included in the adjustment), this approach has some significant
limitations.
Recent studies of the earnings and training rates of temporary workers have used longitudinal
data sources containing evidence on the changes in pay that employees experience when they
move between temporary and permanent jobs. These longitudinal data sources offer greater
potential for isolating the effects of temporary employment from the effects of othercorrelated factors than is offered by cross-sectional surveys like the SoWL. If there is a pay
penalty for temporary work, for example, individuals who move from permanent totemporary jobs should on average suffer pay reductions while individuals who move from
temporary to permanent jobs should, on average, experience pay increases. If some types of
temporary jobs offer higher pay rates, it should also be possibly to identify the size of thosewage premiums from the evidence on the pay changes that occur when individuals move
between jobs.
An article by Del Bono and Weber (2008) which examines the wages of seasonal employees
in Austria is a good example of recent research using this analytical strategy. The seasonal
workers in their sample earned 3% less than non-seasonal workers on average. After taking
other factors into account through their longitudinal regression model, however, Del Bonoand Weber estimated that the seasonal workers actually earned an 11% wage premium(relative to what they would have earned in non-seasonal jobs).
The scope for understanding and measuring the factors driving the pay and training gaps
between temporary and permanent workers in New Zealand is limited by the nature of thecurrently available data, but some useful insights can still be gained.
Hourly earnings
The contribution of demographic, educational, and job characteristics to the temporarypermanent gap in average hourly earnings was explored by estimating a series of earnings
regressions. The dependent variable was the log of the individual’s hourly wage rate.
Initially, a regression model was estimated, which included an indicator for temporary job
status (to measure the relationship between temporary employment and earnings), andmeasures of a range of individual characteristics, including age, ethnicity, parental status,
immigrant status, geographical location, and highest educational qualification. Thesevariables were included to adjust for any differences in personal characteristics that mightlead to pay differences in the absence of temporary employment. In a second regression
model, measures of job and firm characteristics were also included as control variables,
including hours of work, occupation defined at one-digit level, industry defined at one-digit
level, business ownership type (defined using indicator variables for public sector and nonprofit organisations), and firm size. Controls for the individual’s job tenure were not included

New Zealand Journal of Employment Relations 36(1): 1-20
because job duration is likely to be determined jointly with temporary job status. Full detailsof the regression models are given in Dixon (2009).
Table 6: Estimates of the wage gap between temporary and permanent employees
Unadjusted
difference inlog wage (temppermanent)

Model 1 - Controls for
personal characteristics

Model 2 - Controls for
personal and job
characteristics

Coefficient

Std Error

Coefficient

Std
Error

Males
All temporary workers-0.301-0.107 ***0.028-0.007

0.022

CasualFixed term
Seasonal-0.414-0.090-0.312-0.159 ***-0.022-0.058

0.039
0.057
0.037

-0.023
0.012
0.032

0.029
0.050
0.033

Females
All temporary workers-0.130-0.072 ***0.018-0.022

0.017

CasualFixed term
Temporary agency
Seasonal-0.2540.114-0.043-0.239-0.143 ***
0.034
0.021
-0.096 ***

0.022
0.035
0.067
0.030

-0.065 ***0.040-0.018-0.029

0.022
0.031
0.067
0.032

* Significant at the 90 percent confidence level. **Significant at the 95 percent confidence level.
***Significant at the 99 percent confidence level.

Table 6 shows the main estimates obtained. 9 The first column of the table shows theunadjusted or ‘raw’ log wage gap between all temporary employees, or a particular subgroupof temporary workers, and permanent employees. The numbers are negative because working
in a temporary job is associated with lower wages. The second column gives the estimatedlog wage difference that is associated with temporary work once the effects of differences inindividual characteristics have been taken into account. Controlling for personal
characteristics dramatically reduces the size of the temporary-permanent gap in log hourly
earnings. For instance, there is a 64% reduction in the wage gap estimated for all male
temporary workers (which declines from 30% to approximately 11%), and a 44% reductionin the wage gap estimated for all female temporaries (which declines from 13% to 7%).
Temporary employees are younger and less qualified than permanent employees on average,
and controlling for these and other differences in personal characteristics reduces the wage
‘penalty’ that is associated with the temporary work indicators in the regression estimates.
The results in the third column of Table 6 show that controlling for job characteristics as wellas personal characteristics further reduces the estimated wage penalty associated withtemporary work. For all temporary and most subgroups of temporary employees, there is nolonger a statistically significant difference between the average wages of temporary andpermanent employees. Female casual workers are the exception to this pattern: they are
estimated to earn approximately 6.5% less than females in permanent jobs after taking theeffects of individual and job characteristics into account.
This analysis indicates that the temporary-permanent gap in average hourly wages can belargely attributed to differences in measured demographic, educational, and job
characteristics. The main exception is that we continue to find that a small wage penalty is
associated with casual work for women. However, our analysis has not been able to takeaccount of a number of other factors that prior research findings suggest may influence theNew Zealand Journal of Employment Relations 36(1): 1-20
casual/non-casual wage differential, such as differences in previous work experience andunmeasured differences in aspirations and skills.
Overall, the results indicate that most temporary workers earn roughly the same amount perhour as ‘similar’ permanent workers (those statistically matched on the basis of their personaland job characteristics). This suggests that temporary workers in New Zealand are not widely
employed at lower rates of pay than permanent employees purely on the basis of their type of
employment relationship. 10
One other interesting question is the importance of each of the different factors in accounting
for the pay gap. Table 7 presents estimates using the standard Blinder-Oaxaca decomposition
method and evaluates the contribution of each characteristic using the returns to thatcharacteristic for permanent employees. The first row reports the unadjusted average wage
gap (30 log points for males and 13 for females). Age is the most important demographic
factor, with the younger ages of temporary employees accounting for about one-third of themale wage gap and one-quarter of the female wage gap. Differences in education and in otherpersonal characteristics each make a fairly small contribution. About 10% of the wage gap,
for both men and women, is due to the fact that temporary workers are far more likely to beworking in part-time jobs. Differences in occupational distribution account for about onethird of the pay differential for both men and women. Differences in industry and firm size
each play a smaller role while private/public sector of employment makes a small negative
contribution (reflecting the fact that temporary employees are slightly more likely to work in
the public sector).
Table 7: The importance of different characteristics in accounting for the permanenttemporary wage gap
Males
Log points%

FemalesLog points%

Unadjusted log wage difference

0.301

0.130

Total difference accounted for by characteristics

0.301

100.0

0.111

85.3

Contribution of specific characteritics:
Age
Qualifications
Other demographic factors
Part-time
Occupation
Industry
SectorFirm size

0.097
0.013
0.020
0.034
0.105
0.029
-0.009
0.012

32.3
4.4
6.8
11.2
34.7
9.6
-3.0
3.9

0.031
-0.003
0.010
0.015
0.049
0.017
-0.015
0.007

27.6
-2.6
9.0
13.6
44.2
15.4
-13.5
6.3

Training
To estimate the effect of working in a temporary job on the probability of receiving
employer-funded training, the probability of having received training in the last year wasmodelled using logistic regressions. The dependent variable in these regressions is anindicator variable that is set to ‘1’ if the individual received employer-funded training during
the last 12 months and to ‘0’ otherwise. Initially, we modelled the training participation
probability of men and women as a function of their measured personal characteristics (age,ethnicity, parental status, immigrant status and years in New Zealand, geographical locationand highest educational qualification) and temporary job status. In a second regression, theNew Zealand Journal of Employment Relations 36(1): 1-20
following job characteristics were added to the explanatory variables: hours of work,
occupation defined at one-digit level, industry defined at one-digit level, size of employer,
and the employer’s business type (private sector, public sector or non-profit sector). We did
not control for variations in job tenure because this is likely to be determined jointly withtemporary job status. In addition, we were unable to control for any differences acrossindividuals in the number of weeks worked during the previous year. Variations in weeks
worked can be expected to have a direct impact on our measure of training rates because
people who worked for fewer weeks would have had less time in which to receive training,
all else being equal.
Table 8: Estimates of the gap in training probabilities between temporary andpermanent employees
Unadjusted
difference intraining rates(temporarypermanent)

Model 1 - Controls Model 2 - Controls
for personal
for personal and job
characteristics
characteristics
Marginal effectMales
All temporary workers-0.210-0.176 ***-0.147 ***Casual-0.247-0.208 ***-0.172 ***Fixed term

-0.110-0.102 **-0.101 **Seasonal-0.243-0.200 ***-0.176 ***All temporary workers-0.089-0.082 ***-0.056 **Casual-0.158-0.134 ***-0.086 **Fixed term

0.068

0.013

-0.014

Temporary agency-0.222-0.201 ***-0.188 ***Seasonal-0.116-0.090 **-0.031

Females* Significant at the 90 percent confidence level. **Significant at the 95 percent confidence
level. ***Significant at the 99 percent confidence level.

Table 8 presents the key results obtained. The first column of the table shows the unadjusted
or raw percentage point gap in training rates between all temporary employees (or a particularsubgroup of temporary employees) and permanent employees. The second column shows ourestimates of the marginal effect of temporary employment on the probability of having
received training, after controlling for differences in the distribution of personal
characteristics. The third column shows our estimates of the marginal effect of temporary
employment on training rates after both personal and job characteristics are included in the
regression model. These ‘marginal effect’ estimates represent the difference between thepredicted training participation rates of temporary and permanent employees, calculated
while holding the effects of other variables constant.11
Most of the marginal effects shown in Table 8 are negative and statistically significant. The
results in the third column indicate that the predicted training probabilities of all male
temporary employees and each sub-group (casual, fixed term and seasonal) remain
substantially lower than those of permanent employees after adjustments for both personaland job characteristics have been made. For example, the training probability for all

New Zealand Journal of Employment Relations 36(1): 1-20
temporary males is estimated to be approximately 15 percentage points lower than that formales in permanent employment. The unadjusted difference was 21 percentage points,
indicating that about one quarter of the gap in training can be explained by differences inpersonal and job characteristics. The predicted training probabilities for males in casual,
fixed-term, and seasonal jobs are also significantly lower that that of males in permanent jobs
even after the adjustments.
Women in temporary jobs face a smaller gap in training rates both before and after
adjustments are made for differences in the distribution of characteristics. In the results fromthe final model with controls for both personal and job characteristics (shown in the thirdcolumn of Table 8), the estimated training probability for all females in temporary work is
5.6 percentage points lower than that for ‘similar’ females in similar but permanent jobs. (Theunadjusted difference was 9 percentage points, indicating that about one-third of the gap canbe explained). Women in casual and temporary agency jobs continue to have significantly
lower training probabilities than women in permanent jobs, but there is no significant
difference for women in fixed-term positions.
As noted previously, temporary and permanent employees are likely to differ in the number
of weeks that they worked during the year, and this variable (which was not measured in thesurvey) can be expected to directly influence training rates due to the fact that the reference
period for measuring training participation was the previous year.
Summarising these results, the temporary-permanent gap in training rates appears to be partly
due to differences in the personal characteristics of temporary and permanent employees. On
average, temporary employees have lower educational attainment than permanent employees
and are more likely to be aged under-25 years, and both these factors are correlated with alower likelihood of receiving employer-funded training. Differences in job characteristics,
including shorter hours, industry and occupation also make a contribution to the temporarypermanent training gap. These factors do not fully account for the lower training rates of
temporary employees, however. It is likely that some of the remaining gap is due to the factthat temporary employees typically worked for fewer weeks in the previous year thanpermanent employees.
The finding that there is a significant association between temporary employment and a lower
probability of having undertaken training is consistent with the hypothesis that employers
offer less training to temporary workers. An alternative explanation is that there areunmeasured differences between temporary and permanent employees along other relevant
dimensions, such as weeks worked during the year or the motivation to undertake training,that are contributing to the gap in participation rates. With only one observation for each
respondent, we are unable to assess the importance of those unmeasured factors or make any
statistical adjustments for their effects.

Conclusion
According to the Survey of Working Life, 9.4% of employees in the March 2008 quarter
were working in a temporary job. By analysing the survey data on reasons and preferences,
we found that most of the older adults and more than half of the young adults who were
employed on a temporary basis indicated that they preferred temporary work. However,prime-aged adults (those aged 25-54) were roughly equally divided between preferring

New Zealand Journal of Employment Relations 36(1): 1-20
temporary work and wanting a permanent job. We also found that there are substantial
differences between temporary and permanent employees in wage rates, training participation
rates and working time patterns, but also substantial differences in pay and conditions
between the different types of temporary work (fixed-term, temporary agency, casual andseasonal).
Our analysis of the permanent/temporary pay gap indicated that the lower average hourly
earnings of temporary employees can be largely attributed to differences in demographic
characteristics and occupations and industries of employment. Temporary workers earn
essentially the same amount per hour as permanent employees with matching demographic
and job characteristics. Demographic characteristics, occupation and industry of employment
also account for some of the gap in training between temporary and permanent employees,
but a significant training rate gap remains unexplained.

Notes
1

Access to the data used in this report was provided by Statistics New Zealand underconditions designed to give effect to the security and confidentiality provisions of theStatistics Act 1975. The results presented in this study are the work of the author, not
Statistics New Zealand.
2

People who gave more than one ‘yes’ response to the sequence of questions on the nature of
their temporary job were classified to one job type using a prioritisation scheme (see Dixon,
2009).
3

WEB Research and Department of Labour (2004) identified this problem when interviewing
informants in case studies of employment in cleaning, labour hire, fish processing and callcentres.
4

People who had two or more jobs were classified according to their main job.

5

It is possible that the proportion of employees who work in temporary jobs is slightly higher
in the March quarter than at other times of the year, because of seasonal jobs that exist onlyin the summer months.
6

Full details are given in Dixon (2009).

7

Wooden and Warren (2003) report that casual employees in Australia are less satisfied with
their jobs than permanent employees, but fixed-term employees are more satisfied.
8

The training question was worded as follows: ‘In the last 12 months, have you undertaken
any training courses or study that was paid for by your employer’? Employees who said ‘yes’
were also asked how long they had spent on the study or training.
9

We do not give estimates for males in temporary agency employment because of small
sample sizes.

New Zealand Journal of Employment Relations 36(1): 1-20

10

The finding that temporary employment is not generally associated with a wage ratepenalty relates only to hourly compensation. Because temporary employees work fewer hours
per week than permanent employees, on average, their weekly and annual earnings are lower.
11

Because the logit model is non-linear the marginal effect of each independent variable is
not constant, as in a linear regression model. Rather, it varies according to the values of all
the other independent variables that are included in the model. In this paper we adopt theconventional approach to reporting the marginal effects of each independent variable byevaluating the probabilities at the sample averages for all other independent variables.

References
Alach, P. and Inkson, K. (2003). Temping: a Study of Temporary Office Workers in
Auckland. Research Report 2003/2. Labour Market Dynamics Research Programme. Massey
University, Auckland.
Booth, A.L., Francesconi, M. and Frank. J. (2002).Temporary Jobs: Stepping Stones or Dead
Ends? The Economic Journal. 112(June): 189-213
Del Bono, E. and Weber, A. (2008). Do Wages Compensate for Anticipated Working Time
Restrictions? Evidence from Seasonal Employment in Austria. Journal of Labor Economics.
26(1): 181-221
Dixon, S. (2009). Temporary Workers and their Employment Outcomes. Department ofLabour Research Report. Retrieved fromhttp://www.dol.govt.nz/publications/research/temporaryworkers/temporary-workers.pdf
Harris, P. and Harvey, O. (2007). Understanding Casual and Temporary Work in New
Zealand. Unpublished Report to the Department of Labour.
McLaren, E. and Dupuis, A. (2006). The Employment Experience of Permanent andTemporary Workers in a New Zealand Study of Young People. Research Report 2006/5.
Labour Market Dynamics Research Programme. Massey University, Auckland.
OECD. (2002). Taking the Measure of Temporary Employment. In OECD Employment
Outlook, July 2002. (pp.127-185). Paris OECD
OECD. (2011).Gender Difference in Employment Outcomes. Unpublished Note. Social
Policy Division, Directorate of Employment, Labour and Social Affair. Retrieved fromwww.oecd.org/dataoecd/30/39/38752777.pdf

New Zealand Journal of Employment Relations 36(1): 1-20

Statistics New Zealand. (2008). Survey of Working Life: March 2008 Quarter. Retrieved
from http://www.stats.govt.nz/browse_for_stats/income-andwork/employment_and_unemployment/SurveyOfWorkingLife_HOTPMar08qtr.aspx
WEB Research and Department of Labour. (2004). Report of Exploratory Case Study
Research into Precarious Employment. Department of Labour Research Report. Retrieved
from http://www.dol.govt.nz/pdfs/precarious-employment.pdf
Wooden, M. and Warren, D. (2003). The Characteristics of Casual and Fixed Term
Employment: Evidence from the HILDA Survey. Melbourne Institute Working Paper no.15/03

New Zealand Journal of Employment Relations 36(1): 21-34

Adjudicator Decisions: Investigating the Role of Ideology in Grievance Case
Outcomes
ANDREW PATTERSON* and IAN MCANDREW**
Abstract
This study examines the relationship between adjudicator ideology and the determination of grievance cases.
Sixty-six senior undergraduate and postgraduate students are asked to read four grievance cases and make adetermination of each. They then indicate their ideological views and answer items for classification.
Correlation analyses suggest that holistic unitarist views are associated with lower and pluralist views
associated with higher, compensation awards over a range of cases, respectively. A number of associations
are found between views on various components of ideology and different case outcomes. Of thosecomponents, views relating to the value of unions in general, their role in handling the interests of workers
and the efficacy of collective bargaining, in particular, feature most prominently in the results.

Key Words:
Ideology, Adjudication, Grievance, Employment Relations, Unions

Introduction
The adjudication of employment grievance cases is a common alternative dispute resolution (ADR)
mechanism employed both in New Zealand and elsewhere. The process and composition vary depending on
jurisdiction, ranging from relatively informal “inquisitorial” approaches to more legalistic “adversarial”
methods, and from individual adjudicators to multiple member panels making decisions. The fundamental
philosophy remains the same. Adjudicators hear arguments from all parties to a grievance, establish facts
and make a decision based on the substantive merits of the case (Spiller, 2007). Personal grievances are themost common type of employment rights dispute in New Zealand and may involve allegations that theemployee has been unjustifiably dismissed or disadvantaged, or unlawfully discriminated against or
harassed in their employment.
While the merits of each case are context-specific and determined with respect to applicable legislative
directives and contractual obligations, differences between the decisions of individual adjudicators in likecases and jurisdictions are sometimes apparent. A significant base of literature has developed in an attempt
to explain these differences. The results are mixed and far from conclusive.
The role of this study is to contribute to the existing literature and investigate more closely any links
between grievance adjudication case outcomes and the ideological beliefs, attitudes and values held by
adjudicators about the nature of workplace relationships. The term “case outcomes” will be used to denote
both the primary decision to find justification for employer actions (win/loss result), and the range ofremedies awarded to grievants (if successful in their grievance claim).

*

Department of Management, University of Otago; andrew.patterson@otago.ac.nz.
Associate Professor, Department of Management, University of Otago; ian.mcandrew@otago.ac.nz.
The authors wish to gratefully acknowledge the comments and suggestions of the Editor and two anonymous reviewers.
**

New Zealand Journal of Employment Relations 36(1): 21-34

The Literature
Ideology
Ideology, as a central focus in the employment relations literature, has a history spanning half a century(Geare, Edgar and McAndrew, 2009). Early writings by the likes of Dunlop (1958), who argued ideology to
be a binding entity that holds together the entire employment relations system, and Fox (1966) who iscredited with the notion that “ideology determines judgment, which in turn determines behavior” (p. 390),
stimulated scholarly interest in the concept and helped cement the central place that ideology holds in theparadigm to this day.
For the purpose of this study, ideology is defined as:
A connected set of beliefs, attitudes and values held by an identifiable social group which refer to a
specific aspect of social reality, which comprise normative, empirical and prescriptive elements andwhich may be at a general or particular level of abstraction (Geare, 1994: 125).
As the definition suggests, an ideology of the employment relationship may relate to views about anormative, perceived ideal situation, an empirical view of the current situation, or prescriptive beliefs about“what should be done to achieve the ideal situation” (Geare, 1994: 124). Further, an ideology may also beheld with respect to general views about society as a whole, or more particularly at an organisational level ofabstraction. Previous research suggests that the same individual may hold different ideologies depending on
the level of abstraction and in relation to different elements (Nichols and Armstrong, 1976; Parkin, 1971).
The present study is focused on adjudicators‟ general empirical ideological persuasions.
The fundamental beliefs, attitudes and values associated with employment relations ideologies are
traditionally viewed in terms of a dichotomy between the unitary and pluralist ideologies first proposed by
Fox (1966). Key tenets of the unitarist ideology are the acceptance of managerial authority and prerogative,
a conviction that loyalty should be bestowed solely upon management and the organisation, and a rejectionof the legitimacy of conflict within the organisation (Fox, 1966; Geare, 1986). Those who adhere to thepluralist ideology accept that there are different sectional groups within an organisation, representing
alternative sources of leadership and loyalty, that those groups have some common and some competinginterests, and that there exists potential for legitimate, even healthy conflict between those groups (Fox,
1966).
Contemporary research has largely explored workplace ideology in terms of this unitarist/pluralist
dichotomy at a holistic level. In this frame, recent studies have examined the role that ideology plays incertain management practices (Geare, Edgar and McAndrew, 2006) and strategy (Dundon, Harney andCullinane, 2010; Ross and Bamber, 2009), the propensity of workers to join collectives (Geare et al., 2009),
and the formation of workplace partnership initiatives (McAndrew, Edgar, Geare and Ballard, 2010). Whileconstructing a holistic view of ideology, this research has also recognised its component parts. The
components of ideology recognised by the present study as combining to constitute holistic ideologicalviews are adopted from the „Geare Ideology Matrix‟ (Geare, 1986), and relate to adjudicators views on:
power, managerial prerogatives, workers‟ source of authority, focus and loyalty, unions, collective
bargaining, teams, organisational conflict, group versus organisational identification, objectives, andinterests.
Grievance Adjudication Decision Making
A wealth of literature has been dedicated to the understanding of factors associated with grievanceadjudication decision making. Studies include attempts at empirically modeling the decision making process(Nelson and Kim, 2008), and examinations of the role that external factors such as the characteristics of theparties and their representatives play (Elkouri and Elkouri, 2003; Harcourt, 2000; McAndrew, 2002).

New Zealand Journal of Employment Relations 36(1): 21-34
Researchers have also focused on the individual characteristics of adjudicators and examined potential
differences in determination propensities as a result of different educational backgrounds (Harcourt, 2000;
McCammon and Cotton, 1990), ages (Thornton and Zirkel, 1990), past or current union experience (Gurdon,
McAndrew and Risak, 2009; Patterson and McAndrew, 2010), and gender (Bemmels, 1988). Of particularinterest to the present research, however, are a collection of studies that have inquired more specifically into
the values and beliefs of adjudicators.
Provoking interest in the area and, indeed generating vigorous denial on behalf of adjudication practitioners(Seitz, 1968), an early study by Gross (1967) argued that adjudicators‟ values around “ethics, man, law,
private property, economics, and so forth” (p. 55) subtly colour the decisions that they make. In a somewhat
similar vein, Giacalone, Reiner and Goodwin (1992) explored the notion that adjudicators‟ personalphilosophies influence their determination of grievance cases. By examining the differences in decisions
between adjudicators who hold authoritarian and liberal personal philosophies, they found that authoritarian
adjudicators were more likely to award outcomes favourable to employers.
Biernat and Malin (2008) found that politically conservative adjudicators tended to award less favourable
outcomes for workers with child-care responsibilities, and that politically liberal adjudicators had apropensity to favour female grievants over males. Cain and Stahl (1983) modelled three adjudicators‟
articulated views on management rights, equity, and stability within the workplace, and found that each of
the three adjudicators was internally consistent in their determinations, and thereby, predictable according totheir views.
Further research has examined the determinations of adjudicators in substance abuse cases in an attempt tohighlight the interplay of adjudicator values and key case facts on decision outcomes. Crow and Logan(1994) found that adjudicators tended to award less favourable outcomes to illegal substance abusers overlegal (alcohol) abusers. The authors concluded that such tendencies reflect value judgments and are, thus,
suggestive of an influence on case outcomes stemming from adjudicator beliefs, attitudes and values.
Hypothesis
Drawing on this earlier research, the present study set out to examine in a New Zealand context therelationship between adjudicators‟ ideological beliefs about the employment relationship and theirdetermination of grievance cases. It was hypothesised that:
Adjudicators who hold a pluralist ideological predisposition are more likely to determine cases
involving employee dishonesty, disloyalty, discrimination for union involvement, and redundancy,
more sympathetically towards the grievant than adjudicators who hold unitarist ideological views.

MethodA quantitative experimental research design was employed to test this hypothesis. Using both electronic andpaper questionnaires, 66 participants read four short grievance scenarios and made a determination on each,
as if they were the adjudicator acting in the case. The research sample comprised senior undergraduate andpostgraduate students from five New Zealand Universities: Otago, Canterbury, Victoria University of
Wellington, Waikato, and Auckland University. To participate in the research students must havecompleted, or be enrolled at the third year level of study or above in a tertiary education paper in
employment relations or employment law.
Previous research has explored the appropriateness of student participants in studies on adjudicator decisionmaking (Bingham and Mesch, 2000; Fleming, 1967; Oswald, 1991). Some authors warn against student
participation (Oswald, 1991), whereas others welcome their participation and report no significant
differences between the decisions of student and practicing adjudicator groups (Bingham and Mesch, 2000;

New Zealand Journal of Employment Relations 36(1): 21-34
Fleming, 1967). A condition of employing students as adjudication research participants is that students
should have a reasonable level of training and knowledge in adjudication decision making. The educational
level of the student participants in the present study is appropriate and consistent with the approach ofsimilar studies (Bingham and Mesch, 2000; Bogumil and Franklin, 1985; Fleming, 1967).
Depending on the particular circumstances of each case, participants were asked to determine if the actionsof the employer were unjustified, and if so, whether reinstatement of the employee to the lost position wasappropriate, the amount of compensation for hurt feelings and loss of dignity that would be a awarded,
whether disciplinary warnings would be removed, and the percentage of contributory conduct to be applied
to the award. It is a requirement in New Zealand employment law that remedies be reduced proportionately
when an employee is found to have been unfairly dismissed or disadvantaged but to have contributed to thesituation in a blameworthy way.
Grievance Case Scenarios
The first case involved a claim of unjustified dismissal for serious misconduct where the grievant had been
instantly dismissed for misappropriating money from bank customers to an off-shore account. The second
involved a claim of discrimination on the grounds of union involvement where the grievant was an active
union member and had not been offered a job promotion despite appearing to be the best candidate. The
third case involved a claim of unjustified disadvantage where the grievant had received two disciplinary
warnings for refusing the employer‟s direction to undertake requested cleaning duties. The final caseinvolved a claim of unjustified dismissal on the grounds of redundancy, where an employer dismissed 10
workers in the name of “business expansion”.
To determine their ideological predispositions, participants were asked to indicate the degree to which theyagreed or disagreed with 20 statements about the employment relationship. The statements were randomly
ordered and covered 10 different components of ideology. Each component was represented by one
statement that expressed a unitarist view and one that expressed a pluralist view. Participants indicated thestrength of their views on a five-point Likert scale. The responses to each statement were then re-coded toindicate a unitarist or pluralist tendency and the strength of that tendency. For instance, a response thatstrongly agreed with a unitarist statement was re-coded as 2 whereas a response that strongly agreed with apluralist statement was re-coded as –2. Similarly, a response that agreed with a unitarist statement was recoded as a 1, a response that agreed with a pluralist statement was re-coded as –1, and a response thatindicated no preference was re-coded as 0.
Overall, holistic ideology scores were determined by calculating the sum of the re-coded responses. A scoreof 40 would indicate a pure unitarist ideological predisposition whereas a score of –40 would indicate a purepluralist ideological predisposition. A score of 0 would indicate a purely neutral standpoint. Ideologicalcomponent scores were determined by calculating responses to the pair of statements relating to eachcomponent. Table 1 presents the ideological components and related statements.
Several approaches to measuring ideology have been undertaken in previous research (see Godard, 1997;
Goll, 1991; Osterman, 1994). This study applies a version of an ideological measure developed by Geare(1986) and later adapted by Geare et al. (2006, 2009) and McAndrew et al. (2010). The original (1986)
measure comprised sets of 24 statements relating to normative, empirical and prescriptive ideological viewsat the general and particular levels of abstraction. Subsequent studies applied shortened versions of 14(Geare et al., 2006, 2009) and 10 (McAndrew et al., 2010) statements, respectively.
Participants in the present study were given the 14 statements relating to their general empirical ideologicalviews as used in Geare et al. (2006, 2009), and a further six questions relating to the three ideologicalcomponents “power”, “managerial prerogatives”, and sources of “authority, focus, and loyalty”. The three
additional components were deemed to be particularly relevant to the four types of grievance cases
examined in the study. The measure is noted to have been “previously tested to ensure it has soundNew Zealand Journal of Employment Relations 36(1): 21-34
psychometric properties and was found to be a reliable and valid measure of employment ideology” (Geareet al., 2006: 1195). The Cronbach alpha coefficient of 0.751 calculated in the present study indicated that themeasure was indeed a reliable indicator of employment ideology.
Sixty-six questionnaires were returned from approximately 250, representing a response rate of 26%.
Descriptive statistics indicated that no pure ideologues were identified and the ideology scores were welldistributed. This is consistent with previous research. Seventy-five percent of participants were pluralist and
25% unitarist. The age of participants ranged from 18-54 and had a mean of 25. Sixty-seven percent ofparticipants were female and 33% male. Participants‟ demographic details were found to be unrelated totheir holistic ideological views. All statistical tests were conducted using the statistical package SPSS 15.0.
Table 1: Statements relating to ideology and associated components
ComponentStatement¹

Power

Power in organisations is: accepted as legitimately resting with management(U); a goal to which all managers, workers, and their organisations aspire (P)Managerial
prerogatives

So-called “managerial prerogatives” (over hiring, dismissals, discipline,
workloads etc) are: legitimate rights of management (U); the objectives, notrights of management – as unions also have control in those areas (P)Authority,
focus,
loyalty&Workers’ source of authority, focus and loyalty rest: solely in management (U);in balance between management and their union (P)UnionsUnions in general are: a liability as they introduce distrust into the work
environment (U); an asset as they protect the interests of workers (P)Collective
bargaining

Collective bargaining: does not win anything for workers they would not have
got from management anyway (U); is probably the best means of settlingdifferences between employees and employers (P)Teams

In the average organisation management and workers: work together as a team(U); sometimes work as a team, sometimes are in conflict (P)The major causes of conflict in the workplace (eg. strikes, etc) are: basically poor
Organisational
communication or trouble-makers (U); the fact that different groups haveconflictdifferent objectives – which sometimes clash (P)Group
vs. Workers in general see themselves as being: an integral part of the organisation inwhich they work (U); members of a group within the organisation in which they
organisation
work (P)identification
Objectives

The principal objectives and interests of management and workers are: more orless similar (U); similar in some areas, but are very different in others (P)Interests

Workers’ interests in general are: looked after adequately by management (U);best looked after by their union/lawyer (P)¹ Agreement with a statement marked “(U)” indicates a unitarist response, whereas agreement with a statement
marked “(P)” indicates a pluralist response.

Results
Case Scenario Outcomes
Preliminary statistics were run on data from the questionnaires to determine if there was any variance in thedetermination propensities of individual participants. In terms of the finding of justification for employer
actions – the primary outcome of grievance cases – almost all participants (98% and 96% respectively)

New Zealand Journal of Employment Relations 36(1): 21-34
determined the employer actions to be unjustified in the first two cases. In the final two cases, however,there was a marked disparity in the outcomes with 36% (case three) and 46% (case four) finding in favour ofthe grievant. With respect to the remedies, in instances where the employers‟ actions were found to beunjustified, there was a wide range of remedies awarded to grievants in each of the four cases, and overall
when combining an adjudicator‟s awards across all four cases. The combined cases measure was included togive an indication of adjudicators‟ decision making, generally, over a range of cases and follows in theapproach of other studies (Cain and Stahl, 1983).
Adjudicator Ideology and Grievance Adjudication Determinations: Correlations
Because all participants responded to identical case scenarios, the variance in their determinations suggested
differences between participants in the ways they viewed the cases. While the preliminary statistics did not
explain what individual differences are associated with this variance, it justified further statisticalexamination. To test whether any relationship existed between the ideological predispositions ofadjudicators and their determination propensities, Pearson product-moment correlation coefficient tests wereconducted.
The first round of correlations tested for any relationships between participants‟ holistic ideologicalpredispositions and the outcomes of each case, and the combined outcomes for all four cases. With the
exception of the primary outcomes (employer actions justified/unjustified) in the first two cases, 18
correlations were run. Of these correlations, no statistically significant relationships were found between
adjudicator ideology and the individual case outcomes. Two statistically significant results were revealed,
however, upon examination of the relationship between ideology and the combined case outcomes. As
illustrated by Table 2, the Pearson product-moment correlation coefficient found statistically significant
negative relationships to exist between ideology and total compensation awards both before and following
the reduction of remedies (r = –0.305, p = 0.018, & r = –0.282, p = 0.029, respectively). The result suggeststhat stronger unitarist views are associated with lower overall compensation awards.
Table 2: Correlations: Combined Case Scenario Outcomes by Ideology
Ideology
r-value–0.305p-value
0.018*
Total compensation (pre-ROR¹)
N
60
r-value–0.282p-value0.029*
Total compensation (post-ROR¹)
N
60* Correlation is significant at the 0.05 level (2-tailed)¹ ROR denotes “reduction of remedies”
As an exploratory exercise, the second round of correlations examined the relationship between participants‟
views on particular components of ideology and the individual case outcomes. In the absence of any
relationships between holistic ideological views and specific case outcomes, these additional analyses enable
the research to isolate views on particular aspects of the employment relationship and further inquire into
whether any significant associations exist. Of the 180 correlations run, 18 statistically significant findings
were revealed. With a single exception (and indeed with a very small sample size, N = 20), all of thesignificant findings were in the expected direction. Unitarist leaning participants were more likely thanpluralists to make awards more favourable to employers; pluralists were more likely than unitarists to award
outcomes more favourable to grievants.
Of the significant results, the most notable relate to participants‟ findings of justification for employer
actions. Correlation analyses of the outcomes of case three – which involved an allegation of unjustified
disadvantage for disciplinary action taken as a result of insubordination – revealed a positive linear

New Zealand Journal of Employment Relations 36(1): 21-34
association between unitarist responses to the “integral-group” ideological component and the decision as towhether the employer‟s actions were justified (r = 0.265, p = 0.035). A similar result was found between
views on the “unions” component and the primary outcome of the final case – involving an allegation ofunjustified dismissal for redundancy (r = 0.259, p = 0.041). In both cases participants who leaned towards
the unitarist end of each component were more likely to determine the case wholly in favour of theemployer.
The remaining significant results were found between views on particular components of ideology and therange of remedies awarded to successful grievants. As Tables 3 through 7 illustrate, participants who leaned
towards pluralist views of the “managerial prerogatives”, “collective bargaining”, and “conflict”
components in the dishonesty case were inclined to determine a number of remedies more sympatheticallytowards the grievant. Similarly, in the discrimination and insubordination cases, stronger pluralist views of
the “interests”, “collective bargaining”, and “power” components were primarily associated with greater
compensation awards to successful grievants. Lastly, those participants who held pluralist views of the“unions”, “interests”, and “collective bargaining” components were significantly more likely to award
higher overall amounts of compensation to successful grievants, over the four cases.
Table 3: Correlations: Case One (dismissal – dishonesty) Outcomes by Ideological Component* Correlation is significant at 0.05 level (2-tailed)
Table 4: Correlations: Case Two (disadvantage – union membership) Outcomes by Ideological
Component* Correlation is significant at the 0.05 level (2-tailed)New Zealand Journal of Employment Relations 36(1): 21-34** Correlation is significant at the 0.01 level (2-tailed)
Table 5: Correlations: Case Three (disadvantage – insubordination) Outcomes by Ideological
Component* Correlation is significant at the 0.05 level (2-tailed)
Table 6: Correlations: Case Four (dismissal – redundancy) Outcomes by Ideological Component* Correlation is significant at the 0.05 level (2-tailed)
Table 7: Correlations: Combined Case Scenario Outcomes by Ideological Component

New Zealand Journal of Employment Relations 36(1): 21-34* Correlation is significant at the 0.05 level (2-tailed)** Correlation is significant at the 0.01 level (2-tailed)

Discussion
This study set out to examine the role that adjudicators‟ ideological views of the employment relationshipplay in the determination of grievance cases. By substituting practising adjudicators for senior undergraduate
and postgraduate students of employment relations and employment law to act as research participants – amethod endorsed in previous research (Bingham and Mesch, 2000; Fleming, 1967) – the first stage ofanalysis looked at whether adjudicators vary in their determinations of four identical cases. It was foundthat, consistent with numerous other studies (Gross, 1997; Gurdon et al., 2009; Heneman and Sandver, 1983;
McAndrew, 2002; Thornton and Zirkel, 1990), indeed, they do. In half of the cases presented to participants
there was a marked disparity of opinion regarding a finding wholly in favour of the employer or grievant.
Moreover, in those instances where the grievant was successful, a wide range of different remedies wereawarded by different decision makers.
Having established grounds to test the hypothesis that adjudicators who hold different ideological views are
inclined to determine grievance cases differently, the next stage of analysis correlated case outcomes with
ideology scale scores. The first outcomes considered were those of the primary “win/loss” result of eachcase relating to a finding of justification for employer actions.
Finding the Employer Actions Justified
In terms of the decision to find the employers‟ actions justified, the present study found no evidence tosuggest any influence stemming from overall holistic adjudicator ideology. However, it did, in a sense,stumble upon two instances where views on particular components of ideology were associated with more(or less) sympathetic outcomes toward the employer (see Tables 5 and 6). Participants who held the viewthat workers see themselves as being members of a group within (as opposed to being an integral part of) an
organisation were more likely to determine the employer actions unjustified in a case involving disciplinary
action for insubordination. Moreover, those who held the view that unions are more of an asset than aliability were more likely to find the actions of an employer unjustified in a redundancy case. In bothinstances, the results suggest that pluralist leaning views of each ideological component are associated witha more favourable outcome for the grievant.
In the New Zealand context, the decision to find justification for employer actions (a win/loss result) isessentially prescribed to adjudicators through statute and an abundance of case law. Compared withdecisions relating to the level of remedies awarded to successful grievants, there is significantly less roomfor discretion in the hands of adjudicators (McAndrew, 2002). The finding that views on some componentsof ideology may be related to a propensity to award certain types of cases wholly in favour of one party are,therefore, notable.
Reinstatement Awards and the Removal of Warnings
The next stage of analysis examined the remedies awarded to successful grievants and began by considering
participants‟ propensity to award reinstatement. While adjudicator ideology, taken holistically, was notshown to be associated with the determination of this remedy, the analysis again revealed a significant
finding when considering the ideological components separately. Those who held the view that the major
causes of conflict are the fact that different groups have different objectives which sometimes clash (asopposed to being a result of poor communication) were more likely to award reinstatement to the grievant in
a dishonesty case (see Table 3). Neither overall ideology nor views on the components of ideology were
found to be associated with the decision to order a removal of any warnings.

New Zealand Journal of Employment Relations 36(1): 21-34
Compensation and the Reduction of Remedies
Taken holistically, attempts at finding a significant association between adjudicator ideology and theamounts of compensation awarded to successful grievants in particular types of cases proved to be
unfruitful. Indeed, only in the amounts of compensation awarded over the four experimental cases was asignificant relationship found between holistic ideological views and compensation awards. A familiar
theme began to emerge, however, in that when exploring the relationship between the components ofideology and the remedies awarded in particular types of case, a small number of significant associations
were revealed. As illustrated by Table 3, participants who held the view that collective bargaining is the bestmeans of settling differences between workers and management were more likely to award higher amountsof compensation to the grievant in an alleged unjustified dismissal case for dishonesty. Participants who held
the view that workers‟ interests are best looked after by their union or lawyer, and that collective bargainingis the best means of settling differences were more likely to award higher amounts of compensation to thegrievant in a case involving an allegation of discrimination due to union involvement (see Table 4).
Moreover, when considering the overall compensation amounts awarded over the four cases, those same twoideological components, along with another, featured in the results. Participants who believed that unions
are an asset to the employment relationship, in addition to those who held pluralist views on the “interests”
and “collective bargaining” components, were more likely to award higher amounts of compensation to
successful grievants over the four cases (see Table 7).
Interestingly, when grouping these three components together, a common thread emerges. Each component
arguably relates to an overall view of the role and function of unions. The “unions” component expressly
captures views on the utility (or liability) of unions. Views on collective bargaining are clearly related to an
overall view of unions because, by definition, unions are involved in collective bargaining. Similarly, viewson the “interests” component are related because the component considers whether workers‟ interests are
best looked after by management, or better served by enlisting a union or lawyer. The value of this groupingof components is that they appear to cast light on those specific values and beliefs that play a role in thecompensation awards of cases involving dishonesty, discrimination for union involvement, and generally
over four typical grievance cases.
While the grouping of components does not expressly address the hypothesis that adjudicators‟ ideologicalviews play a role in the determination of grievance cases, the finding appears plausible and in the expected
direction. Indeed, positive views of unions are analogous to the values and beliefs of the pluralist ideology.
In addition to the earlier finding that pluralist leaning views of unions are associated with a higher likelihoodof finding a redundancy case wholly in favour of the grievants, it appears that those components related to
the role and function of unions have emerged as playing the most prominent role in the subtle colouring ofadjudicators‟ determinations.
How the Findings Compare with Earlier Research
Gross‟ (1967) seminal contribution to the literature argued that adjudicator views “about ethics, man, law,
private property, economics, and so forth…consciously or unconsciously…subtly influence” (p. 55) the
manner in which adjudicators determine grievances. To the extent that employment ideology is synonymouswith those views, the finding that adjudicator ideology can, in some instances, be empirically demonstrated
to play a role in some grievance outcomes provides some support to Gross‟ (1967) work.
Similarities may also be drawn between the present study and the assertion of other researchers that
adjudicators‟ personal philosophies influence their determination of grievance cases. Giacalone et al. (1992)
suggest adjudicators who hold an authoritarian personal philosophy – that, in an employment context,
essentially amounts to a belief that workers should be submissive to, and absolutely obedient towards, theiremployer – are more likely to favour management under certain circumstances. Adjudicators who adhere toa liberal personal philosophy – that acknowledges individual personal rights and equality within theemployment relationship – on the other hand, are insinuated to be more lenient to the grievant.

New Zealand Journal of Employment Relations 36(1): 21-34

The similarities between these personal philosophies and the beliefs, attitudes and values associated with theunitarist and pluralist employment ideologies are striking. The authoritarian philosophy, for example,
appears analogous to the unitarist ideology insofar as the notions of submission and absolute obedience
towards employers are consistent with the unitarist beliefs that workers should (or do) respect absolute
managerial prerogative and authority, and act loyally toward their employer. In the same vein, the liberalphilosophy appears analogous to the pluralist notions of different sectional groups within organisations,differing sources of leadership and loyalty, and the acceptance of conflict. So, to the extent that personalphilosophies are analogous to employment ideologies, the findings of this study go some way to support theassertions of Giacalone et al. (1992).
Limitations
Before concluding, it is important to note some potential limitations to the study. First, the ability togeneralise the findings may be limited by way of the sample and experimental technique. Although thesample size of 66 may be considered small, it is considerably larger than the entire population of
Employment Relations Authority members in New Zealand, which that amounts to 17. Moreover, while
participants were primarily undergraduate and postgraduate students in employment relations andemployment law, it must be acknowledged that participants had no real grievance adjudication experience.
The approach is, however, consistent with previous research. Lastly, the determinations made byparticipants were based upon written case descriptions. Although this approach is consistent with earlier
research (Biernat and Malin, 2008; Bingham and Mesch, 2000; Thornton and Zirkel, 1990), the obvious
limitation is that it does not perfectly replicate the nuances of a typical investigatory hearing by an
employment adjudicator.

Conclusion
The present study found some evidence to suggest that adjudicators‟ general empirical ideologicalpredispositions may subtly colour certain aspects of the grievance determinations that they make. Taken
holistically, the extent of this colouring was only observed with respect to the amounts of compensation
awarded to grievants over a range of cases, and therefore provides only partial support to the hypothesis. At
the component level, however, particular views on the role and function of unions were revealed to be
associated more specifically with the outcomes of dishonesty, discrimination for union involvement andredundancy cases. These findings present a number of implications. First, the absence of finding any
relationship between holistic ideological views and particular types of cases suggests that future research
may benefit from focusing on a narrower set of beliefs, attitudes and values relating to the nature of
workplace relationships. Second, the regular feature of union-related views as being associated with certain
case outcomes presents an opportunity for more work to be done on examining the intricacies of thisrelationship. Moreover, if these findings are indeed generalisable, they may be of interest to policy makers
and those who are responsible for the selection of new adjudicators.

References
Bemmels, B. (1998). Gender Effects in Discipline Arbitration: Evidence from British Columbia. The
Academy of Management Journal. 31(3): 699-706
Biernat, M. and Malin, M.H. (2008). Political Ideology and Labour Arbitrators‟ Decision Making in Family
Conflict Cases. Personality and Social Psychology Bulletin. 34: 888-899
Bingham, L.B. and Mesch, D.J. (2000). Decision Making in Employment and Labour Arbitration. Industrial
Relations. 39(4): 671-684

New Zealand Journal of Employment Relations 36(1): 21-34
Bogumil, W.A. and Franklin, L.A. (1985). Students as Surrogates in Arbitration Studies. Developments in
Business Simulation & Experiential Exercises. 12: 123-126
Cain, J.P. and Stahl, M.J. (1983). Modelling the Policies of Several Labor Arbitrators. Academy ofManagement Journal. 26(1): 140-147
Crow, S.M. and Logan, J.W. (1994). Illicit Drug Effects in Labor Arbitration Decision Making. Journal of
Drug Issues. 24(3): 489-505
Dundon, T., Harney, B. And Cullinane, N. (2010). De-Collectivis and Managerial Ideology: Towards andUnderstanding of Trade Union Opposition. International Journal of Management Concepts and Philosophy.
4(3-4): 267-281
Dunlop, J.T. (1958). Industrial Relations Systems. USA: Southern Illinois University Press.
Elkouri, F. and Elkouri, E. (2003). How Arbitration Works. (6th ed). Washington, USA: BNA Books
Fleming, R.W. (1967). The Labor Arbitration Process. Urbana, Illinois: University of Illinois Press.
Fox, A. (1966). Industrial sociology and industrial relations. London: HMSO.
Geare, A.J. (1986). An Examination of Certain Aspects of Industrial Relations Ideologies: A Theoretical
Analysis and an Empirical Study of Managers. PhD Thesis 87 30270. New Zealand, University of Otago.
Geare, A.J. (1994). Ideology in Industrial Relations. New Zealand Journal of Industrial Relations. 19(2):117-130.
Geare, A.J., Edgar, F. and McAndrew, I. (2006). Employment Relationships: Ideology and HRM practice.
The International Journal of Human Resource Management. 17(7): 1190-1208.
Geare, A.J., Edgar, F. and McAndrew, I. (2009). Workplace Values and Beliefs: an Empirical study ofIdeology, High Commitment Management and Unionisation. The International Journal of Human Resource
Management. 20(5): 1146-1171.
Godard, J. (1997). Whither Strategic choice: Do Managerial IR Ideologies Matter? Industrial Relations.
36(2): 206-228.
Goll, I. (1991). Environment, Corporate Ideology and Involvement Programs. Industrial Relations. 30: 138149
Giacalone, R.A., Reiner, M.A. and Goodwin, J.C (1992). Ethical Concerns in Grievance Arbitration.
Journal of Business Ethics. 11(4): 267-272
Gross, J.A. (1967). Value Judgements in the Decision of Labor Arbitrators. Industrial and Labor Relations
Review. 21(1): 55-72
Gross, J.A. (1997). Value Judgements in Arbitration: Their Impact on the Parties‟ Arguments and on the
Arbitrators‟ Decisions. In J. Najita (ed). Arbitration 1997: The Next Fifty Years. Washington, DC: The
Bureau of National Affairs
Gurdon, M.A., McAndrew, I. and Risak, M.E. (2009). Understanding the Outcomes of Employment
Adjudicators: a Comparative Study of Adjudication Bodies in New Zealand and the United States. Paper
presented at the 15th Industrial Relations Association World Congress, 2009. Sydney, Australia.

New Zealand Journal of Employment Relations 36(1): 21-34

Harcourt, M. (2000). How Attorney Representation and Adjudication Affect Canadian Arbitration andLabor Relations Board Decisions. Journal of Labor Research. 21(1): 149-159
Heneman, H.G. and Sandver, M.H. (1983). Arbitrators‟ Backgrounds and Behaviour. Journal of Labor
Research. 4(2): 115-124
McAndrew, I. (2002). Determinations of the Employment Relations Authority. New Zealand Journal ofIndustrial Relations. 27(3): 323-347
McAndrew, I. (2010). The Employment Institutions. In E. Rasmussen. (ed). Employment Relationships:
Workers, Unions and Employers in New Zealand. Auckland, New Zealand: Auckland University Press.
McAndrew, I., Edgar, F., Geare, A., and Ballard, M. (2010). Employment Relations Ideologies andCooperative Partnership Approaches to Bargaining: The New Zealand Perspective. Korean Journal ofIndustrial Relations. 20(1): 53-79
McCammon, M. And Cotton, J.L. (1990). Arbitration Decisions in Subcontracting Disputes. Industrial
Relations. 29: 13-144
Nelson, N.E. and Kim, S.M. (2008). A Model of Arbitral Decision Marking: Facts, Weights and Decision
Elements. Industrial Relations. 47(2): 266-283
Nichols, T. and Armstrong, P. (1976). Workers Divided. London: Fontana.
Osterman, P. (1994). How Common is Workplace Transformation and Who Adopts it? Industrial and Labor
Relations Review. 47: 531-544.
Oswald, S. L. (1991). Students as Arbitrators: an Empirical Investigation. Industrial Relations. 30(2): 286293.
Parkin, F. (1971). Class Inequality and Political Order. London: MacGibbon & Kee.
Patterson, A. J. and McAndrew, I. (2010). Employment Ideology and Grievance Adjudication: an Empirical
Examination of Adjudicators‟ Ideological Predispositions and Grievance Case Determinations. 10th Annual
Pacific Employment Relations Association Conference, November 2010. Australia.
Ross, P. and Bamber, G. (2009). Strategic Choices in Pluralist and Unitarist Employment Relations
Regimes: a Study of Australian Telecommunications. Industrial and Labor Relations Review. 63(1): 24-41.
Seitz, P. (1986). Communications-Value Judgement in Decisions of Labor Arbitrators. Industrial and Labor
Relations Review. 21(3): 427-430
Spiller, P. (2007). Dispute Resolution in New Zealand (2nd ed.). Melbourne, Australia: Oxford University
Press.
Thornton, R.J., and Zirkel, P.A. (1990). The Consistency and Predictability of Grievance Arbitration
Awards. Labor Studies Journal. 19: 35-44.

New Zealand Journal of Employment Relations 36(1): 35-51

How Bad is the State of Occupational Fatalities in New Zealand?
PHILIP GUNBY*
Abstract
The Pike River disaster has increased attention on safety in the New Zealand mining industry.
While mining is a dangerous occupation, its fatality rate does not appear to have increased.
Furthermore, most workplace fatalities do not occur in mining. This paper explores the dataon occupational fatalities and finds the following. First, occupational fatalities areconcentrated in just a few industries. Second, these industries are noticeably riskier thanothers. Third, the gap between New Zealand‘s occupational fatality rate and those ofcountries it compares itself with has increased. Fourth, work-related fatalities are only a small
proportion of all accidental deaths in New Zealand. Possible reasons for these facts are
discussed.

Keywords: Accidents; Occupational Safety; Occupational Health.

Introduction
The recent Pike River mining disaster in which 29 men were killed in a methane explosion
has once again focused attention on the state of occupational health and safety in New
Zealand (The Press, 2010a; NZ Herald, 2010a; Sunday News, 2010). It has also led to calls
for increased regulation of mining (The Press, 2010b; NZ Herald, 2010b), but a natural
question to ask is are things really that bad in mining or was this just a one-off event? Even if
the enquiries about mining health and safety do find systematic problems, are the health andsafety shortcomings just in the mining industry or do they occur more widely? A possibleclue to answering these questions is a couple of ministerial press releases, one issued morethan 13 years ago and the other issued a year ago. In October 1997, the then Minister ofLabour issued a media release noting his unhappiness with the level of fatalities, especially infarming, forestry, and construction, announcing that he had initiated a campaign to reduce
workplace deaths, and stating that he thought that the number of fatalities could be reduced(Department of Labour, 1997). In January 2010, the current Minister of Labour issued amedia release expressing her unhappiness about the level of workplace fatalities, in this casein the construction, forestry, and agriculture sectors and announced a new strategy to prevent
their occurring (Wilkinson, 2010). The perception in both cases was that there were too manyoccupational deaths, that certain industries were over-represented and that something could
and should be done to reduce them.
These sorts of public proclamations have been made many times before in many different
contexts. In 2000, the General Manager of the branch of the Department of Labour (DoL)
dealing with occupational safety and health launched Worksafe Week 2000 designed to target*

Philip Gunby is a Senior Lecturer in the Department of Economics and Finance.
philip.gunby@canterbury.ac.nz
I would like to thank Sandra Wallace for helpful suggestions. I would also like to thank the anonymous referees
and the Editor for their comments. The opinions and conclusions expressed are solely those of the author. Allerrors are my own

New Zealand Journal of Employment Relations 36(1): 35-51
the main cause of the ―appalling toll of accident, injury, and illness‖ (Department of Labour,
2000a). That year the DoL issued media releases about the unacceptably high number ofworkplace accidents in agriculture, especially involving vehicles and in construction,
especially from falls (Department of Labour, 2000b; Department of 2000c) Over the last 12
months, the DoL has issued media statements about the high number of workplace accidents
in agriculture, especially involving vehicles and in construction, especially from falls(Department of Labour, 2009; Department of Labour, 2010). Concerns about mining safety
are also not new. In response to mining deaths in 2006, the DoL issued a discussion paper in2008 (Department of Labour, 2008) and sought submissions about how to improve health andsafety management in the underground mining industry, but few changes eventuated from
this.
While much appears to have been done to reduce work-related accidents and deaths, nothing
seems to have changed in terms of New Zealand‘s industrial safety record. The DoL
consultation draft for its National Action Agenda 2010–2013 only serves to highlight thisfact, with the Minister of Labour stating in it that:
The national Strategy aims to reduce injuries and fatalities at work and deliver
healthy and productive workplaces for all New Zealand. It has been in place forfive years, but we have yet to see a significant reduction in our fatality and injury
rates (Department of Labour, 2005: 4).
Clearly, this statement suggests that what has been done to date has not worked. Maybe thePike River disaster does, indeed, point to wider problems with the management of workplace
health and safety in New Zealand. This paper explores the general state of occupational
fatalities in New Zealand to see if mining is as dangerous an industry as commentary aroundthe Pike River disaster suggests, if mining has become more dangerous, if the Department ofLabour‘s general concerns over occupational fatalities have any validity and to point to where
future research may need to occur so as to improve New Zealand‘s occupational safety
record.

Occupational Fatalities by Industry
The first thing to establish is what has actually happened regarding work-related accidents
and fatalities in New Zealand. Unfortunately, this is not as simple as it sounds since the datacollected on occupational accidents in New Zealand by government agencies, such as the
Accident Compensation Corporation (ACC), the DoL and the New Zealand Health
Information Service, is notoriously incomplete (Wren, 1999; Pearce, Dryson, Feyer, Gander,
McCracken and Wagstaffe, 2006).1 However, inaccurate and incomplete occupational injury
data is not specific to New Zealand and is, instead, a general feature of workplace injury data
regardless of where it is collected (see OECD, 1990; Takala, 1999; Dong, Fujimoto, Ringen,
Stafford, Platner, Gittleman and Wang, 2011). Thankfully, while data on all forms ofoccupational accidents have deficiencies, some categories of occupational accident data are
noticeably more reliable than others. For instance, Dong et al (2011: 347) find that ―fatal
injury rates should also be taken into account for OSHA‘s targeting given that fatality data
are much more complete and reliable than nonfatal injury data‖. Fatalities, by their very
nature, are simply much more difficult to hide or misclassify than non-fatal injuries.
Occupational fatality data, while not perfect (see Langley, McNoe and Feyer, 2006, on workrelated bystander deaths), are likely the most accurate that we have. Encouragingly, whenseeking to make comparisons between countries, Langley et al, 2006 report that even thoughNew Zealand Journal of Employment Relations 36(1): 35-51
bystander deaths are treated inadequately, they are at least treated in a similar way acrosscountries, suggesting that countries‘ safety records can be compared using fatality data withat least some degree of confidence. As long as any mis-measurement does not change overtime and is similar between countries and between industries, and this seems to be much
more the case for data on occupational fatalities than for injuries, then this seems the best
data to use to make comparisons and therefore is what is used in this paper.
Figure 1 shows the number of workplace fatalities from 1993 to 2009 for all industries aswell as what proportion of them occur in specific industries (Cryer, Langley and Stephenson,2008).2 The number of fatalities has increased over time from 86 in 1993 to a high of 136 in2007 before dropping back. Looking at the raw number of work-related fatalities, most (close
to 80%) now occur in agriculture, forestry, and fishing, construction, manufacturing, andtransportation and storage. Normally, mining accounts for at most a couple of fatalities eachyear and in some years none occur at all.
Figure 1: Share of Occupational Fatalities by Industry(Number of Occupational Fatalities).

Looking at just the raw number of fatalities is misleading because this does not take into
account the number of employees who potentially could be killed. Other things equal, we
would expect an industry with a larger workforce to have more fatalities than one with asmaller workforce. Since the New Zealand labour force has increased by 41% from 1993 to2009 (using data from the Household Labour Force Survey), we would expect the number ofoccupational fatalities to increase too. Figure 2 shows the number of workplace fatalities per
100,000 employees from 1993 to 2009 for all industries as well as those industries indicatedin Figure 1 as potentially being riskier than average. The four industries where many of thefatalities occur do, in general, have higher incidence rates than other industries. This justmirrors what has been found internationally, that particular industries and occupations seemto be inherently riskier than others. Furthermore, the riskiest industries in other countries arealso those that are riskiest in New Zealand (Feyer, Langley, Howard, Horsburgh, Wright,
Alsop and Cryer, 2001; National Occupational Health and Safety Commission, 2004; OECD,1990).

New Zealand Journal of Employment Relations 36(1): 35-51
Figure 2: Fatality Rates for the Riskiest Industries

Mining (not shown as it is highly variable and the occasional, very high fatality rate distorts
the axes, making it difficult to make comparisons between the other industries) also has ahigh average fatality rate, in fact, the highest of all industries. It is not possible to give aprecise number because ACC do not give a specific number of fatalities for an industry in ayear if it is between one and three. Mining often falls into this range with 65% of the years
between 1993 and 2009 having between one and three deaths. But the best scenario (one eachyear it is between one and three) and the worst scenario (three each year it is between one andthree) give an average of between 31 and 59 fatalities per 100,000 employees from 1993 to
2009. The average total number of deaths is very low though since the mining workforce isso small. In addition, the mining fatality rate is also highly variable with some years where
deaths do not occur. In contrast to its possible perception since the Pike River disaster, thedata up until 2009 do not show that mining has become any riskier over the past 15 years.
The Pike River disaster seems to be one of those tragic low-probability, high death events
that occur once every generation in mining in New Zealand. Additional examples are the1967 Strongman coal mine explosion, which ended in 19 deaths and the 1939 Glen Aftoncoal mine carbon monoxide poisoning, which resulted in 11 deaths (New Zealand Herald,
2010c).3
Figure 3: Fatality Rates for Safe and Risky Industries

New Zealand Journal of Employment Relations 36(1): 35-51
So, returning to the original questions: have things changed regarding fatality rates acrossindustries and over time? The answers are that things have not improved, fatality rates are nolower and are possibly even higher in some cases, and the industries that have traditionally
had high fatality rates are still the ones that have high fatality rates.

How Do We Compare Internationally?
The data in the previous section tells a simple and clear story. There has not been an
improvement in the safety record of New Zealand‘s workplaces and there is a group ofindustries, which have continuing higher levels of risk than other industries. This begs thequestion of whether or not the occupational safety experience in New Zealand differs
markedly from that overseas. Maybe it is just a worldwide phenomenon.
Figure 4: Work-Related Fatalities by Country

Compared to Australia and the United States, which were used in 2000 to assess the relative
state of health and safety in New Zealand workplaces in a review of the Health and Safety in
Employment Act (Office of the Minister of Labour, 2000), New Zealand‘s overall rate ofoccupational fatalities has worsened. As can be seen in Figure 4, New Zealand‘s overall
fatality rate is more than double that of Australia‘s and two-thirds higher than that of theUnited States. Even more troubling is that the work-related fatality rates in Australia and theUnited States have been falling whereas the New Zealand rate appears unchanged, or evenpossibly increasing. Feyer, Williamson, Stout, Driscoll, Usher, and Langley (2001), using
different data sets covering 1985 to 1994 for New Zealand and 1989 to 1992 for Australia
and the United States, also find that workplace fatality rates are the highest in New Zealand.
They also find falling fatality rates for all of the three countries over the period studied, but
this is a period before that studied in this paper. The observations are in sharp contrast to
Palmer, Calvert, Fryer and Kalafatelis (2009), who find that a strong majority of New
Zealanders believe New Zealand is safer than other developed Western countries and that
New Zealand is becoming safer.
These differences between the fatality rate of New Zealand and the rates of Australia and theUnited States, while obviously troubling, also presents an opportunity. There must be somereason(s) for the differences. This gives us a chance to figure out the key factors driving theNew Zealand Journal of Employment Relations 36(1): 35-51
differences in fatality rates, such as different and changing demographic or employment
patterns or awareness and attitudes about risk or in occupational regulations, and then use thisto devise policies to improve the situation in New Zealand.

Accidents Waiting to Happen?
Perhaps New Zealand‘s higher workplace fatality rates, relative to those of other countries,
just reflect a willingness by New Zealanders to tolerate a greater level of risk. One way ofassessing this would be to look at the rate of workplace fatalities in relation to fatality rates inother areas of New Zealanders‘ lives. The accident and fatality rates for different areas ofpeoples‘ lives are shown in Figure 5. Relative to all accidents in New Zealand, workplace
accidents make up only a small and relatively stable proportion of accidental deaths (onaverage about eight percent). Motor vehicle fatalities, while making up the greatest source ofaccidental deaths in 1992, declined to about a quarter of all such in deaths by 2009 and haveactually fallen in total number. Accidental fatalities outside the workplace and not caused by
motor vehicle accidents have increased in number and in importance, and now constitute asignificant majority of accidental deaths (about two-thirds of all accidental deaths).
Figure 5: Accidental Fatalities in New Zealand by Origin(Total Number of Accidental Fatalities)

So, the absolute numbers of workplace accidental fatalities have increased but this is not thearea of New Zealanders‘ lives which seem to have become riskier in terms of accidental
death. Accidental deaths in the home (37.8% of all accidental deaths in 2009), fromrecreation and sports (3.8%), from medical treatment errors (4.3%), and elsewhere (15.5%)
have all experienced increases. Furthermore, the size of the increase in the rate of accidental
deaths outside the workplace and not involving motor vehicles has increased substantially,
from nine accidental deaths per 100,000 people in 1992 to 27 in 2009, and is an order ofmagnitude larger than the increase in workplace fatalities, from five accidental deaths per
100,000 workers in 1993 to 5.5 in 2009. Interestingly, this is, in contrast, to the survey resultsof Palmer et al (2009) who find that New Zealanders believe they are most likely to beNew Zealand Journal of Employment Relations 36(1): 35-51
injured on the road rather than in the workplace or the home. This relates to all accidental
injuries of which fatalities only make up a small part, but even still, it does suggest people
incorrectly estimate the level of risk they face in different areas of their lives. Maybe
understanding more about why there is this difference in perceptions versus reality will help
to shed light on what, if anything, can be done about improving the workplace fatality rate aspart of the Workplace Health and Safety Strategy (Department of Labour, 2005).

General Discussion
The state of occupational safety in New Zealand can be summarised by four basic facts. The
obvious question is: what explains these facts? The first two facts — namely, that a handfulof industries account for most work-related fatalities and that this handful of industries arealso significantly more risky than all of the other industries — are easily explained. Some
types of work are simply inherently riskier than others. Fatalities are far more likely to occur
when working at heights building an office tower than in standing at a till in a supermarket,
or driving a fast moving or lightly protected very heavy vehicle on hilly slopes than standing
in front of a classroom of children. This does not mean that actions cannot be taken to reducethe chances of being injured or killed in the high risk industries, just that there will always be
a naturally higher probability of dying in them than in other ones.
It is the last two facts that are the most intriguing. Why has the gap between New Zealand‘soccupational fatality rate increased relative to countries with which it compares itself,
including Australia? Why is it that work-related fatalities make up only a small and stableproportion of all accidental deaths in New Zealand with most occurring outside work andincreasingly more of these at home? Knowing what has caused the changes in New Zealand‘s
workplace fatality rates and how they relate to wider society is crucial to knowing how to
reduce them.
There are three basic types of possibilities worth exploring. The first relates to the willingnessof people to take risks. It is clear that people are willing to do things even when there is apositive risk of death. For example, Monasterio (2005) found that while New Zealand
mountaineers and alpine rock-climbers had an accident rate of 47% and a death rate of overeight percent, 96% of the climbers studied, aware of the high accident and fatality, had
knowingly climbed in high risk situations. The climbers reported that they found the activity
beneficial and chose to climb despite the perceived risks of the sport. Clearly for them, thebenefits of the sport outweighed the costs, including the potential for injury and death.
Furthermore, there is evidence that even if some actions are taken to reduce risks that people
react in ways that tend to offset them, with the result that the risks faced do not fall nearly as
much as originally envisaged. A classic example being in efforts to improve automobile
safety where the evidence, overwhelmingly, shows that drivers act at least partially to offset
increases in safety from policy initiatives or better technology by driving in ways that are
riskier, such as driving faster and overtaking more often (Peltzman, 1975; Chrinko andHarper, 1993; Risa, 1994). A New Zealand example of this effect is studied by Garbacz(1991). There is also no reason to think that this principle does not cover actions taken by
employees that affect their workplace risk, whether these are actions outside work, such as
drug use (Musson and O‘Reilly, 1999) or the amount of sleep chosen (Ruby, 1997), or atwork, such as drugs or alcohol use (Gleason, Veum and Pergamit, 1991; Gerber andYacoubian, 2001; Ministry of Health, 2001), or avoiding using highly uncomfortable safety
equipment.

New Zealand Journal of Employment Relations 36(1): 35-51
If the basic notion that people are willing to live with a certain level of risk in what they do (ifthey feel it is worth it) is accepted, this opens up possibilities in explaining the differences infatality risk rates (Viscusi, 1992). Factors, such as the monetary and personal costs of actions
to increase safety, how effective actions are in reducing risks, the benefits of the risky
activities being engaged in or the inherent tolerance of risk, would then have a role indetermining the ultimate fatality rate experienced. Maybe New Zealanders are more willingto live with risk than people from other countries. Or, it could be that efforts to improvesafety are less effective in New Zealand than elsewhere. It is possible that the costs ofimproving safety can be higher in New Zealand than overseas or that activities in New
Zealand have higher risks of dying, but also confer higher benefits, than those available inother countries.
Comparing costs versus benefits of actions that affect workplace safety can potentiallyexplain why work-related fatality rates have not decreased compared to other countries.
However, if we look at each of the individual factors mentioned previously, we know thatdriving fatality rates have gone down and home-related fatality rates have dramaticallyincreased. It seems implausible that this is because people have a different willingness of risk
in each area of their lives. So this factor does not seem able to explain the behaviour ofoccupational fatality rates. Given that knowledge is readily transferable, as is equipment, it isdifficult to believe that efforts to improve safety are less effective in New Zealand thanelsewhere (and that they are becoming radically less effective at home). A similar argument
would also seem to hold for costs of improving safety. If there is a worldwide market forknowledge and equipment then the costs of preventing accidents should be the same between
countries. This leaves differences in the benefits of activities.
One of the benefits for employers to reduce the riskiness of their workplaces is that they do
not have to pay to compensate for the risks. The ‗safe‘ industries in New Zealand have got
safer (see Figure 3), which means employers in riskier industries would need to pay morecompensation to workers for the greater relative difference in risks. Employers in risky
industries then have the motivation to reduce this ‗cost‘ by making their workplaces safer,
which would means their fatality rates should have fallen. If real wages are increasing thenemployees who die miss out on a more enjoyable life than if wages were lower (some willfind this an artificially cold piece of analysis, but it is nevertheless a logical possibility). This
gives them an incentive to take more care in their work and lives. However, given that real
wages have increased – the average annual increase in hourly earnings for all industries from1993 to 2009 is 4.4% (Quarterly Employment Survey (QES)) and average annual inflation
over this period was 2.7% (Consumer Price Index) we would expect employees to take morecare so fatality rates would fall. While the analysis of the costs and benefits of taking carepresented is only indicative and at an aggregated level, and would need to be more extensive
to be fully convincing, the analysis does suggest that factors of this type do not seem able toexplain much of the observations about occupational fatality rates.
Another possibility is that people are making decisions in risky situations based on inaccurate
beliefs about the risks they face and, as a result, they believe they are acting more safely thanthey really are. This is consistent with the findings of Palmer et al (2009). If people are
mistaken about which activities are risky, they end up taking care in the ―wrong‖ places. For
example, being very careful when driving but less careful when at home or in the workplace
would explain why the rate of driving fatalities has decreased and the risk of home or leisurebased fatalities has increased. Believing (falsely) that New Zealand workplaces are safer thanthose overseas might explain why they have not declined. Essentially, New Zealand workers
take less care than they should because of a sort of ―Lake Wobegone effect‖. If this is true,

New Zealand Journal of Employment Relations 36(1): 35-51
then a possible policy could be a sustained drive to communicate the true level of workplacerisk to workers, especially in the high risk industries. However, as might be deduced from theintroduction, there have been repeated attempts of this over the years with little impact. So it
is the case that either the ways in which this has been done need changing to be effective, or
it is that inaccurate beliefs, even if they exist, are not causing the observed level of workplace
deaths.
The second broad group of factors relate to the structure of New Zealand workplaces andsociety. One is changes in the proportion of employment among industries. Maybe the shareof employment in high risk industries in other countries has fallen whereas in New Zealand it
is unchanged or has increased. For example, Feyer, Williamson, Stout, Driscoll, Usher, andLangley (2001) found that incorporating differences in the distribution of employment byindustry reduces (but does not eliminate) the occupational fatality rate of New Zealandrelative to the United States and Australia over the mid 1980s to the mid-1990s. If the
distribution of employment over the last ten years did not change or even increase in the highrisk industries in New Zealand, both absolutely and relative to the Australia and the UnitedStates, then this could explain the workplace fatality rate trends.
Using Statistics New Zealand data on the distribution of employment by industry for thisperiod shows that the employment in the safe as well as the risky industries move in the same
direction (a simple correlation of 0.39 using the HLFS), and that the average share of
employment in the high risk industries has decreased, but this is not uniform over all theseindustries as the share of employment in construction actually increased. If we look at what
happens with constant shares of employment in 1997/98 and then use the annual rates offatalities till 2008/09, even with the share of construction increasing we would still expect the
total number of fatalities to be almost the same in the riskiest industries, and the risky
industry fatality rate to be almost the same as the actual fatality rate. My calculations showthat if employment shares over 1997/98 to 2008/09 had been the same as at the start of thisperiod, then the total number of fatalities for the four riskiest industries would decrease by
four and the average combined fatality rate for these industries would be one-tenth of apercentage point lower compared to the actual numbers and rates of fatalities. Looking athours worked is more complicated because the QES excludes agriculture and fishing. Since
the fraction of employment in these two industries has fallen, their shares of hours worked
has probably fallen too. The changes in the distributions of hours are similar in nature to thechanges in the distributions of people employed but tend to be larger. Without agriculture andfishing it is difficult to give an exact answer, but it seems likely that we could expect results
similar to those from looking at changes in numbers of people employed since the patterns ofchanges in the remaining industries are similar. So changes in the distribution of employment
across industries do not seem to be the answer either.
The final types of factors affecting workplace fatality rates are government intervention in
workplace safety and health, that is, the regulations that affect workplace risks (see Campbell(1995) for a history of government intervention in occupational safety and health in New
Zealand). This includes the types of regulations, their enforcement, and the penalties imposedby the courts. The main form of regulation affecting workplace safety and health is the Healthand Safety in Employment Act (HSEA). This type of regulation is referred to as ex anteliability because noncompliance can occur regardless of whether or not an accident occurs(Wittman, 1977; Shavell, 1984; and Kolstad, Ulen and Johnson, 1990). Of course,
independent of whether or not an employer is prosecuted ex ante they can also be prosecuted
after an accident occurs or ex post. Gordon and Woodfield (2007) argue that the HSEA is
likely a worthwhile complement to ex post liability but that weak penalties and low

New Zealand Journal of Employment Relations 36(1): 35-51
inspection probabilities dilute its effectiveness. Less effective regulation in New Zealand thanother countries would explain the gap between their relative fatality rates. If New Zealand
regulation is weaker than that of overseas, employers‘ incentives to prevent workplace
accidents are lower so they may put fewer resources into accident prevention andconsequently, increasing the number of accidents that occur.
However, this factor, alone, does not explain the increasing gap. To have a growing gap in
fatality rates would require that the New Zealand government is continually putting fewer
resources into policing the HSEA, or the fines issued by New Zealand courts are falling overtime, or both. Or it would require foreign governments and courts to be continually increasing
the impact of their regulations and increasing the fines they levy. Both possibilities are
logical explanations, but the question is how likely are they? Take funding of the DoL for
promoting compliance to the HSEA (Gunby and Wilkinson, 2010). Measured per businessenterprise, this funding fell from 1992 to 2000 but then rose from 2007 to 2009; the former
trend coinciding with a fall in fatality rates and the latter with a rise in fatality rates. This
seems counterintuitive as we would expect the two to be positively correlated. Similarly
confusing is that even though the number of DoL health and safety inspectors has beensteadily falling since 2001, the fatality rates were falling or constant until 2005 before they
started to rise. Since the probability of being inspected decreases with fewer inspectors, wewould expect employers to have taken less care of workplace safety from roughly 2001
onwards, which should be accompanied by increases in fatality rates from then onwards. It
could be that the changes in the numbers of inspectors have a lagged impact on health andsafety efforts by employers, but it could also be that they have only a marginal impact onsafety and health activities in workplaces. Of course, other factors may be confounding theeffect of the changes in government resourcing of health and safety promotion and policing
of its regulations (for example, see Rea (1981) about the potential effects of worker
compensation schemes on industry risk), but at face value, changes in government resourcing
do not seem to adequately explain changes in fatality rates. They also do not explain thehigher accidental fatality rate outside the workplace.
Adding to the difficulty of using changes in government interventions to explain observed
facts about fatality rates are the conclusions of Mears and Chapple (1996) and the findings ofMare and Papps (2000). Mears and Chapple (1996) carried out an extensive literature reviewof the international evidence about government intervention and workplace safety for the
DoL. They concluded that evidence up until 1996 clearly showed government intervention ofwhatever form materially changed employer behaviour but also had little impact on overall
workplace accident rates. This may explain why one of the main amendments to the HSEA in
2002, increasing worker participation in workplace health and safety through allowing
employees to form health and safety committees and requiring employers to have employee
health and safety representatives, seems to have had negligible impact on fatality rates.4 It
may be that health and safety committees are only as effective as employers want them to be,
as found by Lewchuck, Robb and Walters (1996), or it depends on the right states of acomplex mix of factors (including the attitude of management) as found by Markey andPatmore (2011). It may also be that most of the causal factors of workplace accidents are
attributes of the workforce, such as age, education, the experience levels of employees, andworkforce turnover rates, as found by O‘Grady (2000). However, for whatever the reason,
introducing worker participation, unfortunately, does not appear to have had much of an
impact on occupational fatality rates, which is consistent with the conclusions of Mears andChapple (1996) that government intervention has little impact on safety outcomes. Finally,
Mare and Papps (2000) used the DoL administrative database of all DoL activities for theperiod July 1993 through to June 1997 and found that the HSEA had no significant orNew Zealand Journal of Employment Relations 36(1): 35-51
conclusive impact on occupational health and safety outcomes.
If you take these two pieces at face value then government regulation in New Zealand does
not seem a likely cause of the trends in New Zealand‘s workplace fatality rates. Even if it did
increase the level of care taken by employers, there is always the possibility that employees
acted in a way to at least partially offset the increases. In any event, it is clear that we would
benefit from an updated a review of international studies on safety and health regulation. The
past 15 years has seen a significant improvement in the work-related fatality rates in Australia
and the United States so it is possible that these countries have discovered more effective
policies than those used previously. It would also be helpful to have more studies done on the
net impact of the HSEA on occupational safety in New Zealand to know if this is the cause of
the growing gap between the workplace fatality rate in New Zealand versus those overseas,or even if it prevented any increase in the fatality rate that might have otherwise occurred(getting the right counter-factual here is obviously important).

Summary
Returning to the start of this paper: what is the state of occupational safety in New Zealand?
Starting with mining where the Pike River disaster has caused people to wonder about thestate of this industry, there is unequivocal data that mining is a risky industry, both inisolation and relative to other industries. However, the data also shows that there has been no
noticeable increase in the average fatality rate in the industry, and furthermore, the numbersof deaths from mining are usually very low and sometimes even zero. The Pike River disasteris likely one of those terrible low-probability, high-death mining events that occurs once
every generation in New Zealand.
What about occupational safety in general? Here, the data is also unequivocal. A handful ofindustries have consistently higher fatality rates than other industries, namely agriculture,
fishing, forestry, construction, manufacturing and transportation, and of course mining. Thispattern is also found in other countries. However, in contrast to other countries, who havefalling occupational fatality rates, the overall fatality rate has not declined in New Zealand.
Why this exists in New Zealand is an important research question that needs to be addressed.
One possible place to start is what is happening outside the workplace in New Zealand, inparticular at home, in sports and other recreational activities, since the accidental fatality rates
in these areas have not only increased but increased much more than in the workplace. For
instance, a possible area of focus is on the perceptions of risks by New Zealanders, which,seem to be markedly out of touch with reality. Another possibility is to look at what changes
have occurred in other countries and the level to which people there take care at home and atwork as well as the level of care businesses take with respect to their workers (workforce
demographics, sizes, types of business enterprises etc). Do differences exist in the types ofgovernment policies (prescriptive versus principle-based laws, the amounts of resources
governments expend on safety and health including inspections, differences in legal
treatments of accidents, differences in compensation schemes, and so on)? The things learnt
from the Pike River disaster may not lead to improvements in mining safety in New Zealand
but by drawing people‘s attention to the general issue of workplace safety and realising that
New Zealand‘s safety record is relatively poor, we may learn things that can potentially be
used to improve the safety of all New Zealand workplaces. After all, if other countries canimprove the safety of their workplaces then why can‘t we?

New Zealand Journal of Employment Relations 36(1): 35-51

Notes
1

Shortcomings include changing definitions, multiple claims for the one accident, lack ofdescriptive information about the sources of accidents and the occupation of the injured, andunder-reporting of accidents. Firth and Herbison (1990) provide evidence of under-reportingof occupational injuries in New Zealand and Mayhew and Quinlan (2006) provide evidenceof reasons for why under-reporting occurs.
2

The ACC injury and fatality data from the period 1996 to 2000 should be treated withcaution. Cryer et al (2008) report that employers who were part of the accredited employer‘sscheme did not always submit data to ACC as required. Furthermore, ACC records in 2000
are incomplete because employers were able to purchase private workplace insurance. Thismeans that the ACC data understate the true number of employees injured during this period.
The underreporting of fatalities to ACC is probably minor given how few occur and how
serious and public they are in nature.
3

The background regulatory facts of the Strongman mine disaster are interesting given thecurrent investigation of the Pike River mine tragedy and the calls for dedicated mine
inspectors. At the time of the Strongman mine explosion, there existed a separate Mines
Department which was responsible for the safety of mine workers, with mining regulated
under the Mining Act 1926. Furthermore, six dedicated coal mine inspectors were employedspecifically for coal mine safety, with coal mines regulated under the Coal Mines Act 1925,
which was prescriptive in nature (Mines Department, 1966 and 1967). The existence of a
dedicated mines department, a prescriptive government Act solely concerned with coalmining as well as dedicated coal mine inspectors, did not prevent the Strongman coal mine
explosion and the resulting deaths of 19 men.
4

The basis of the HSEA was the 1972 report of Lord Robens which placed a large emphasis
on ―self-regulation‖ or joint participation of employees and employers in workplace healthand safety. The HSEA before the 2002 amendments did not include this aspect of the
Robens‘ report, however, it should be noted that unlike large and medium sized firms,
smaller businesses are only required to have a representative if desired by their employees.
Excluding the self-employed data from the Department of Statistics, it shows that roughly
40% of all those employed work in businesses with 20 or fewer employees, so clearly,
potentially many employees may not have access to a representative. However, since theproportion of employees in small firms has been stable over the past decade, this aspect ofsafety and health is unlikely to have caused changes in occupational fatality rates.

References
Campbell, I. (1995). State Regulation of Occupational Health and Safety. In C. Slappendel(ed). Health and Safety in New Zealand Workplaces. (Chapter 3, pp. 81-116). Palmerston
North: Dunmore Press.
Chirinko, R. and Harper, E. (1993). Buckle Up or Slow Down? New Estimates of Offsetting
Behaviour and their Implications for Automobile Safety Regulation. Journal of Policy
Analysis and Management. 12(2): 270-293

New Zealand Journal of Employment Relations 36(1): 35-51

Cryer C., J Langley and S. Stephenson. (2008). The New Zealand Injury Prevention Strategy
Serious Injury Outcome Indicators. New Zealand Injury Prevention Strategy Technical
Report, Wellington.
Department of Labour. (1997). Worksafe Week – Together to Zero – Eliminating Workplace
Death. Retrieved http://www.dol.govt.nz/News/Media/pre2000/worksafe-week-1997.asp
Department of Labour. (2000a). Workplace Killers Targeted. Retrieved fromhttp://www.dol.govt.nz/News/Media/2000/workplace-killers.asp
Department of Labour. (2000b). A Bad Yearhttp://www.dol.govt.nz/News/Media/2000/bad-year.asp

for

Farmers.

Retrieved

from

Department of Labour (2000c). Dangers Associated with Working at Heights. Retrieved fromhttp://www.dol.govt.nz/News/Media/2000/working-heights.asp
Department of Labour. (2005). Workplace Health and Safety Strategy for New Zealand to2015. Retrieved from http://www.dol.govt.nz/whss/strategy/WHSS-Strategy-June05.pdf
Department of Labour. (2008). Improving Health and Safety Hazard Management in the
Underground Mining Industry. Wellington, Department of Labour.
Department of Labour. (2009). Research Confirms the Importance of Work in Agriculture
Health and Safety. Retrieved from http://www.dol.govt.nz/News/Media/2009/agriculturesafety-health.asp
Department of Labour. (2010). Falls from Heights are a Leading Cause of Death and Serious
InjuryintheConstruction
Industry.
Retrievedfrom
http://www.dol.govt.nz/News/Media/2010/falls-heights-construction.asp
Dong, S., Fujimoto, A., Ringen, K., Stafford, E., Platner, J., Gittleman, J. and Wang, X.
(2011). Injury Underreporting among Small Establishment in the Construction Industry.
American Journal of Industrial Medicine. 54: 339-349
Feyer, A., Langley, J., Howard, M., Horsburgh, S., Wright, C., Alsop, J. and Cryer, C.
(2001). The Work-Related Fatal Injury Study: Numbers, Rates and Trends of Work-Related
Fatal Injuries in New Zealand 1985-1994. New Zealand Medical Journal. 114: 6-10
Feyer, A., Williamson, A., Stout, N., Driscoll, T., Usher, H., and Langley, J. (2001).
Comparison of Work-Related Fatal Injuries in the United States, Australia and New Zealand:
Method and Overall Findings. Injury Prevention. 7(1): 22-28
Firth, H. and Herbison, G. (1990). Occupational Injuries in Dunedin. New Zealand Medical
Journal. 103(891): 265-266
Garbacz, C. (1991). Impact of the New Zealand Seat-Belt Law. Economic Inquiry. 24(2):310-316

New Zealand Journal of Employment Relations 36(1): 35-51

Gerber, J. and Yacoubian, G. (2001). Evaluation of Drug Testing in the Workplace: Study of
the Construction Industry. Journal of Construction Engineering and Management. 127(6):438-444
Gleason, P., Veum, J. and Pergamit, M. (1991). Drug and Alcohol use at Work: a Survey ofYoung Workers. Monthly Labor Review. 114(8): 3-7
Gordon, P. and Woodfield, A. (2007). Ex Ante Liability rules in New Zealand‘s Health and
Safety in Employment Act: a Law and Economics Analysis. New Zealand Economic Papers.
41(1): 91-108
Gunby, P. and Wilkinson, M. (2010). Evaluating the Impact of the 2002 Amendments to the
Health and Safety in Employment Act. Paper presented at the 2010 New Zealand Associationof Economists Conference. 30 June-2 July, 2010. Wellington.
Kolstad, C., Ulen, T. and Johnson, G. (1990). Ex Post Liability for Harm vs. Ex AnteRegulation: Substitutes or Complements? American Economic Review. 80(4): 888-901
Langley, J., McNoe, B. and Feyer, A. (2006). Work-Related Bystander Deaths in New
Zealand: a Significant Hidden Problem. New Zealand Medical Journal. 119(1247): U2357
Lewchuk, W., Robb, L and Walter, V. (1996). The Effectiveness of Bill 70 and Joint Healthand Safety Committees in Reducing Injuries in the Workplace: The Case of Ontario.
Canadian Public Policy. 22(3): 225-243
Mare, D. and Papps, K. (2000). The Effects of Occupational Safety and Health Interventions.
Labour Market Bulletin. 2: 101-131
Markey, R. and Patmore, G. (2011). Employee Participation in the Health and Safety in theAustralian Steel Industry, 1935-2006. British Journal of Industrial Relations. 49(1): 144-167
Mayhew, C. and Quinlan, M. (2006). Economic Pressure, Multi-Tiered Subcontracting andOccupational Health and Safety in Australian Long-Haul Trucking. Employee Relations.
28(6): 212-219
Mears, T. and Chapple, S. (1996). Government Involvement in Health and Safety: a
Literature Review. Occasional Paper No. 1996/1. Labour Market Policy Group. Departmentof Labour, Wellington.
Mines Department. (1966). Mines Statement Incorporating the Report on the Working of theState Coal Mines for the Year ended 31 December, 1964. Appendix to the Journals of theHouse of Representatives of New Zealand 1966. Vol. II, Section C2: Appendix B,
Wellington.
Mines Department. (1967). Mines Statement Incorporating the Report on the Working of theState Coal Mines for the Year ended 31 December, 1966. Appendix to the Journals of theHouse of Representatives of New Zealand, 1967. Vol. II, Section C2: Appendix B,
Wellington.
Ministry of Health. (2001). New Zealand Drug Statistics. Wellington. New Zealand Health
Information Service, Ministry of Health.

New Zealand Journal of Employment Relations 36(1): 35-51

Monasterio, E. (2005). Accident and Fatality Characteristics in a Population of Mountain
Climbers in New Zealand. New Zealand Medical Journal. 118(1208): 1249-1256
Musson, M. and O‘Reilly, R. (1999). Cannabis Use by Forestry Worker. Mehanizacija
Sumarstva. 24(3-4): 110-111.
National Occupational Health and Safety Commission. (2004). Fatal Occupational Injuries –How does Australia Compare Internationally? National Occupational Health and Safety
Commission: Canberra.
New Zealand Herald – Herald on Sunday. (November 28, 2010a). Miner Had Questioned
Safety. p.A012.
New Zealand Herald. (December 11, 2010b). Inspector Warned of Explosion. p.A002.
New Zealand Herald. (2010c, 19 November). New Zealand’s Worst Mining Accidents.
Retrieved from http://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=10688752
O‘Grady, J. (2000). Joint Health and Safety Committee: Finding a Balance. In T. Sullivan(ed). Injury and the New World. (pp.162-197). Vancouver: University of British Columbia
Press.
OECD. (1990). Occupational Accidents in OECD Countries. In Employment Outlook 1990.
(pp.133-159). OECD: Paris
Office of the Minister of Labour. (2000), Discussion Paper on the Review of the Health and
Safety in Employment Act (1992), Wellington, Office of the Minister of Labour.
Palmer, S., Calvert, E., Fryer, K. and Kalafatelis, E. (2009). Monitoring the New Zealand
Injury Prevention Strategy: The General Public’s Attitude and Beliefs towards Injury in New
Zealand. Report prepared for Accident Compensation Corporation: Welington.
Pearce, N., Dryson, E., Feyer, A., Gander, P., McCracken, S. and Wagstaffe, M. (2006).
Surveillance of Occupational Disease and Injury in New Zealand: Report to the Minister forLabour. National Occupational Health and Safety Advisory Committee: Wellington.
Pelztman, S. (1975). The Effect of Automobile Safety Regulation. Journal of Political
Economy. 83(4): 677-725
Rea, S. (1981). Workmen's Compensation and Occupational Safety Under Imperfect
Information. American Economic Review. 71:80-93.
Risa, A. (1994). Adverse Incentive from Improved Technology: Traffic Safety Regulations in
Norway. Southern Economic Journal. 60(4): 844-857
Robens, L. (1972). Committee on Health and Safety at Work Report. London: HMSO. Cmnd
5034
Ruby, M. (1997). You Snooze... You Lose. Safeguard. March/April: 14-18

New Zealand Journal of Employment Relations 36(1): 35-51

Shavell, S. (1984). A Mode of the Optimal Use of Liability and Safety Regulation. Rand
Journal of Economics. 15(2): 271-280
Sunday News. (December 14, 2010). Mining Concerns. p.14.
Takala, J. (1999). Global Estimates of Fatal Occupational Accidents. Epidemiology. 10(5):640-646
The Press. (November 23, 2010a). No Excuses for Mine Disasters – Expert. p.3.
The Press. (November 26, 2010b). Call for Overhaul of NZ Mining Regulations. p.5.
Wilkinson, K. (2010). Minister Plans Renewed Health and Safety Focus. Retrieved fromhttp://www.beehive.govt.nz/release/minister-plans-renewed-health-and-safety-focus
Wittman, D. (1977). Prior Regulation versus Post Liability: the Choice Between Input and
Output Monitoring. Journal of Legal Studies. 6(1): 193-211
Viscusi, K. (1992). Fatal Tradeoffs: Public & Private Responsibilities for Risk. New York:
Oxford University Press.
Wren, J. (1999). Lies, Damned Lies and Occupational Injury Statistics. Employment Law
Bulletin. 6: 101-120

New Zealand Journal of Employment Relations 36(1): 52-64

What Happens After Graduation? The Market for Economists
MALCOLM ABBOTT* and ERSHAD ALI**
Abstract
The paper examines the labour market for economists in New Zealand. In particular, it makes use of datafrom the New Zealand Department of Labour (DoL), the Census and the Ministry of Education (MoE) to
make inferences about the level of demand and supply of economists. In doing so, the paper acknowledges
that in the market for economists in New Zealand, there are two distinctly different sub-categories (academic
and non-academic) that exhibit quite different characteristics. In recent years, employment prospects havebeen good for non-academic economists although are less favourable for academic employment. Economics
graduates also have reasonable salaries compared to other graduates.

Introduction
In undertaking reviews of the manner in which economics is taught at the higher education level in New
Zealand, it is important to understand the destinations of economics graduates. Since the 1960s, the areas ofthe economy, where economic graduates and economists are employed, have grown and diversified.
Employment conditions for both economics graduates and economists were adversely affected by thefinancial crisis of 2008-09, just as employment conditions were affected elsewhere in the economy, however,on the whole, employment conditions for both were fairly buoyant during the 1990s and 2000s in New
Zealand.1
The paper examines the labour market for economists in New Zealand over the longer term. In doing so, it
concentrates on the employment circumstances of economists rather than the broader category of economics
graduates although the conditions affecting the latter are examined as an aid to determining the circumstancesof the former. In particular, the paper makes use of data from the New Zealand DoL, Statistics New Zealandand the MoE to make inferences about the level of demand and supply of economists. Therefore, the paper
acknowledges that in the market for economists (as opposed to economics graduates) in New Zealand, there
are two distinctly different sub-categories (academic and non-academic) of economists that exhibit quite
different labour market characteristics. In addition, economists working in non-academic areas are also
divided into a number of sub-categories (i.e. policy/regulatory, finance, etc).
In the following section, a description of the economics profession in New Zealand is given. This isfollowed by a section with an analysis of the demand for economists in New Zealand, a section where adescription of the supply is provided and a section which presents a discussion on relative salaries. In the
final section, some conclusions are made.
*Malcolm Abbott is an economist by profession and the Associate Dean of Research at Swinburne
University of Technology, Lilydale Campus. mabbott@swin.edu.au**
Ershad Ali, AIS St Helens. ershada@ais.ac.nz

New Zealand Journal of Employment Relations 36(1): 52-64

Economists in New Zealand
Even though the growth of the study of economics at New Zealand universities took place at the same time as
the development of the profession of economist in New Zealand, the two groups of people (economists andeconomics graduates) are not necessarily the same. Before looking at the nature of the labour market foreconomists in New Zealand, it is important to make a clear distinction between those people who enter theworkforce as economics graduates and those who are employed specifically as “economists”. Many
economics graduates use their degree as a generic degree before taking up employment in the business or
government sectors. Often their work takes them into economics related areas, but it can also take them into
other fields. A person employed as an economist, generally, makes specific use of the skills and techniques
acquired in their education on a range of economics related problems.
The profession of economist can perhaps be defined as being experts who study, develop and apply theories
and concepts from economics to solve business and policy problems. In business, they study data andstatistics in order to spot trends in economic activity, economic confidence levels and consumer attitudes.
They evaluate this information using advanced methods of statistical analysis, mathematics, computer
programming and make recommendations about ways to improve the efficiency of a system or takeadvantage of trends. Economists who work in the public sector assist policy makers to gauge the costs andbenefits of public policies and to assist with the regulation of private business activity (or conversely, work
on behalf of private companies to help them respond to regulation, often on contract from consulting firms).
The profession is an important one as the advice of economists can have an influence on the nature andconduct of government policy and regulation and the development of business strategies.
The economics profession itself developed originally in the United States, the United Kingdom and Germanyin the early years of the twentieth century. With the increased commercialisation and industrialisation ofsociety, a more scientific/rational approach to knowledge evolved, which embodied an increased emphasis ontechnical expertise (Bellis, 2000). This growth of modern knowledge strengthened „new‟ professions such as
economics because its members were able to provide specialist knowledge to modern, expanding industries
and to exercise their professional judgement when called upon to give policy advice.
Following the establishment of economics degree programmes in British universities, courses in economics
were introduced into the four colleges of the University of New Zealand in the 1900s. 2 Standalone economics
degrees were not developed, but were established as economics majors in the Bachelor of Commerce degree.
Economists first became noteworthy in New Zealand during the economic debates of the 1930s and Second
World War mobilisation. At this stage, they were relatively few in numbers, however, with the decision of
the public service, at the end of the Second World War, to recruit graduates, including economics graduates,
the profession began to emerge.
Up until the 1950s, the bulk of students studying economics were part-time students of accountancy and only
a few students were specialised in the study of economics (Beaglehole, 1937; Parton, 1979). The recruitmentof economics graduates into the public sector in the 1950s and 1960s provided encouragement forundergraduates to undertake economics majors. In addition, the expansion of the number of secondary
school teachers teaching economics in schools in the 1970s encouraged students to specialise in economics.
Even though the number of economics graduates rose steadily in the 1960s, the number of people who wereformally employed as “economists” was, at this time, very limited in numbers. Generally speaking, theemployment of economists was restricted to a number of positions with the Research Bank, the universities, aNew Zealand Journal of Employment Relations 36(1): 52-64
limited number of positions with the trading banks along with a number of secondary school teachingpositions. While the Treasury employed a few economists at this time the numbers were not great 3, but fromthe 1970s onwards, economics graduates were sought more extensively by the finance and business sectors.4
During the 1970s, the Treasury also began to employ a greater number of economics graduates (McKinnon
2003). Public sector employment of economists later spread to other departments, such as the Ministry of
Economic Development, the Commerce Commission, Statistics New Zealand and the Ministry of Agriculture
and Fisheries, etc. In recent times, local government authorities have also employed economists to help
develop local economic development strategies.
In even more recent years, the finance sector has employed an increasing number of economists to judge andforecast economic conditions, as have utilities such as telecommunications, electricity and gas companies.
As the latter have been subjected to government economic regulation, they find the employment of
economists useful in responding to regulatory and policy changes. As the quantification of economic impact
of Government policy and regulation has become more common, more economists have been employed inorder to carry this out. However, it is not just Government agencies doing so but also large companies,
industry and professional associations and even charities as they, too, are required to respond toGovernmental policy changes with economic arguments.5 In fields such as property and transport
development, making economic cases and rationales are important in order for builders to gain government
approvals, hence the reason these fields also employ economists. As not all companies, associations andgovernment agencies find it feasible to employ all the economists they require directly, many purchase theseskills from consulting companies. The number of privately-owned, economic consulting firms has grown in
New Zealand in recent years; these firms offer advice to and predict economic scenarios for individuals andlarge corporations and occasionally act as consultants to branches of the government.
Economics in New Zealand went through a process of professionalisation in the 1950s and 1960s and started
to take on the characteristics of newer types of professions that had been appeared in the twentieth century.
The professions were classified by a specialised body of knowledge, intellectual skill or technique, which
was only acquired through a lengthy period of formal education. Acquiring this included mastering the skill
underpinning it. That is to say, formal education in an academic setting. The introduction of a discipline
like economics into the university system, as mentioned earlier, was an important stage of the overall
professionalisation process as well as the creation of a viable career opportunity (Ashenfelter, 2001; Boddy,
1973; Abelson and Valentine, 1985; Ehrenburg, 2004).
In terms of its intellectual and academic development, the professionalism of New Zealand economics washigh by the 1970s. This is substantiated by the fact that the subject was firmly established as an academic
discipline at the universities and the number of undergraduates was passing through university courses at areasonable level. The training programmes were robust with some university departments achieving highstandards of research and teaching. Employed economists had evolved from being technical workers tobeing highly trained economic theoreticians, specialising in a number of sub-fields such as production
economics, economic forecasting and modelling and price theory.
In contrast to regulated professions, such as engineering, law or medicine, there is not a legally-required
educational requirement or license for economists in New Zealand, but in New Zealand, most economists
have at least a Bachelor‟s degree with a major in economics while some also have Masters‟ qualifications
and a few with a Doctorate. In some cases, economists have gained their skills from related disciplines, suchas statistics or some types of applied mathematics, such as mathematical finance. Generally, only a minorityof economics graduates become professional economists even though many work in related fields, such as
finance, accounting, insurance, tax or management. Overall, a majority of economics graduates end up

New Zealand Journal of Employment Relations 36(1): 52-64
working in economics-related areas, but the proportion is lower than that of accounting, engineering,
medical, education or law graduates.6

The Demand for Economists
It is not entirely clear just how many professional economists there are working in New Zealand as there is
no formal licensing of economists and given that it is a self-defined profession and, presumably, as many
economists regard themselves as public servants or, for example, financial market analysts rather thaneconomists, the number is difficult to determine. Many economics graduates also work in areas which
combine some of the responsibilities of an economist with those of other fields.
In 2008, the New Zealand Association of Economists reported that it had 354 members (NZAE 2008), and as
membership is not crucial to a successful career as an economist in New Zealand, many economists choose
not to join the association or, instead, join professional agencies or societies that more closely reflect theirwork areas, for example, the New Zealand Agriculture and Resource Economics Society and the New
Zealand Statistical Association. Therefore, the number reported by the NZAE probably does not reflect aclear figure of the number of economists working in New Zealand.
The 2006 Census counted 480 people who listed their occupation as economists – a number that would nothave included those who worked and classified themselves as other occupations (ie: academic, teacher,policy analyst, statistician etc). In 1996, over 1,000 New Zealanders declared themselves to be economists,
but the subsequent creation of the occupation of „policy analyst‟ for the 2001 Census took away from this.
The category of „policy analyst‟ was largely taken from numbers of those who had previously characterised
themselves as being economists or social scientists. At the 1996 Census, economists accounted for 31
percent of the two categories combined. At the 2001 Census, the combined number of economists, social
scientists and policy analysts was at 1,430 (31 percent) and 1,850 in 2006.
Table 1: Employment Numbers at Census 7

Economist
Policy Analyst
Social Scientists*
Market Research Analyst
Statistical Analyst &Mathematicians

1971
204
n/a
13
239
114

1976
789
n/a
69
313
188

1981
1,107
n/a
179
441
198

1986
750
n/a
122
654
229

1991
735
n/a
1,176
1,752
507

1996
1,005
n/a
2,200
n/a
492

2001
375
2,910
1,332
1,737
495

2006
438
4,029
1,497
3,072
801

Source: New Zealand Statistics (1971-2010).
*Many later categorised as social scientists in 1971 and 1986 were classified as government officials, included entirelyin this category in 1991 and 1996 then subsequently shifted to the Policy Analyst category.

As the number of policy analysts with an economics backgrounds in New Zealand has grown steadily during
the 2000s as well as there being increase in the number of economists in the finance sector (at least up until
the financial crisis of 2008/09), the number of economists in New Zealand today is almost certainly far
higher than the 1996 Census figure. Looking further at the census data, it is clear that other fields that
employ economists, such as market research analysts and statisticians have grown strongly through the 1990s
and 2000s. It is, therefore, probable that the number of economists working in New Zealand today is wellNew Zealand Journal of Employment Relations 36(1): 52-64
over 2,000, considerably more than the number of economists counted by the Census in 2006 or themembership numbers of the New Zealand Association of Economists. 8
Traditionally in New Zealand, a fair proportion of economists worked as university academics. From thefigures just cited and the list of numbers of economists employed in New Zealand universities, it would
appear that academic economists are a small minority of the full number of economists working in New
Zealand. From Table 2 it can be seen that, in 2010, there were 159 academic economists with full time
positions in New Zealand. In addition, there are a small number of economics lecturers at polytechnics andprivate providers such as UNITEC, Manukau Institute of Technology and AIS St Helens. Although thisnumber has grown steadily since the 1960s in line with student numbers, it is a number far below that ofgovernment and private sector economists. This differs to the situation in Australia where the number of
economics academics has been stagnant since the mid 1990s (Maxwell, 2003).
Table 2: Academic staff in economics departments of New Zealand Universities, 1965 to 2005

1965
1975
1985
1995
2006
2010

University Departments
7
7
7
7
8
8

Staff
49
86
118
143
150
159

Source: Association of Commonwealth Universities, 1965-2010

In addition, a significant number of economics graduates were employed as economics teachers in secondary
schools in the past. Demand for economics school teachers, however, has been waning since the 1980s as
students have switched to other subjects. Figure 1 provides data on the number of students studying
economics in secondary schools in New Zealand. Some of this decline can be attributed to the switch of
students to other business related subject, although it should be noted that the number of students studying
the combined total of accounting, economics and other business related subjects has declined significantly
since the 1980s.9
Figure 1: Economics & Business Related Subject Numbers in Secondary School from 1989 to 2009.

Source: Ministry of Education (1989-2009).

At one time, it would have been reasonable to state that the bulk of economists in New Zealand worked in theuniversities, secondary schools or key government departments, such as the Treasury and Reserve Bank but

New Zealand Journal of Employment Relations 36(1): 52-64
this is no longer true as the bulk either works in a range of government agencies or for the private sector.
What appears to have occurred during the 1990s is that the number of economists has grown steadily, but
most of this growth has been in the public and business sectors rather than in the universities or secondary
education sector. The number of economists has grown in a number of other areas such as utility regulation(electricity, gas and telecommunications), transport and urban planning, market and business research andhealth and social services as well as the finance sector. However, not all of these economists work directly
for the public sector, but they often work for consulting companies that provide advisory services. Today,
the vast majority of economists work in business or for the Government rather than the education sector.
One final aspect of demand for economists that should be noted is the lack of crossover in the labour marketof academic and non-academic economists. Given the general requirement of academic economists to have a
Doctorate and non-academic economists to have work experience (on top of their Bachelor‟s degrees), thecrossover between the two areas is not great. While there are some examples in New Zealand of academic
economists who have gone on to public or business careers in economics and examples of business or public
sector economists who have taken up academic careers, it is far more common for economists to specialise ineither area at an early stage and continue to stay in that field. That means the labour market conditions in theacademic market and business and public fields are not necessarily the same. For example, it is possible fordemand to be strong in one sector of the market and weak and flagging in the other. This would tend to havebeen the case in New Zealand in recent years as demand for professional economists has tended to be strong
whereas demand for economists in the education sector (both higher and secondary) stagnant at best.

The Supply of Economists
Looking at the supply side, it would appear from Table 3 that there has been some growth in the number of
economics graduates in the 1990s and 2000s, with a speed up occurring in the latter decade. 10 Some of thisgrowth was due to a greater number of overseas students taking up studies in economics, but even after
taking this into account the number of domestic graduates seems to have been rising steadily (Table 3).
While there is no way of knowing exactly how many graduates in New Zealand have majored in economics,
the number is probably around 10,000.
Table 3: Economics and Business graduates in New Zealand higher education, 1985 to 2008

Economics
Bachelors
graduates
1985
1990
2000
2005
2008

207
364
520
840
1,020

Economics,
post-graduate
certificates,
diplomas
21
26
320
230
370

Economics
Masters

Economics
PhD

Domestic
economics
allCommerce Economics/
Graduates Commerce

20
19
60
60
70

3
1
10
10
10

n/a
n/a
760
690
1,020

1,196
2,355
7,169
10,04010,080

0.210
0.117
0.113
0.114
0.146

Source: Ministry of Education, 1989-2010; Scott, 2009a

Most economists working in the business and public sector have economics majors in Commerce degrees,
rather than Masters or Doctorate qualifications, although it is notable in Table 3 that, in recent years, thenumber of graduates doing Postgraduate certificates, diplomas and honours programmes has been increasing
steadily, indicating that a number of working economists may have been upgrading their skills.

New Zealand Journal of Employment Relations 36(1): 52-64
In the business and public sectors in New Zealand, most recruitment of entry level economists is from thepool of New Zealand graduates only. There is a tendency on the part of both Government agencies andprivate businesses not to employ immigrant economists on the grounds that they do not have much in theway of New Zealand related experience. New Zealand immigration has never given any special preference
to the entry of economists to New Zealand (as it has done for instance at times for accountants), and as New
Zealand employers do not have a propensity to recruit or support the migration of economists the number of
economists immigrating to New Zealand has tended to be low (Table 4).
Table 4: Immigrants of economists to New Zealand, 2003/4 to 2009/10

Skills applicantsEconomist
Policy Analyst
Market Research Analyst
Statistical Analyst
University lecturer or tutor
Work applicants approved
Economist
Policy Analyst
Market Research Analyst
Statistical Analyst
University lecturer or tutor

41
92
63
42
1,035
124
79
85
92
1,031

Source: Department of Labour, 2010.

Conditions are somewhat different in terms of the recruitment of economists in university positions.
Although the number of doctoral graduates in New Zealand is relatively low in the field of economics, theuniversities regard the market for economics to be an international one and are far less concerned about theirstaff‟s knowledge of New Zealand conditions. A sizable proportion of New Zealand university economists
have overseas qualifications and the permanent staff tends to have doctorate qualifications.
The different employment prospects for non-academic and academic economists have had important
implications for the growth of post-graduate qualifications in New Zealand. Strong growth in employment
for non-academic economists has meant strong demand for university courses at the post-graduate certificatesand diploma as well as Masters level; growth in the number of Doctorate students seeking academic
employment has been more limited. If employment prospects for non-academic economists continues togrow it would be expected that growth of the non-Doctorate courses to continue
Given the different demands of employers (universities versus business/public sector) in terms of
qualifications and experience, there tends to be little crossover between the two classifications of economists.
Generally, to become an academic economist in a New Zealand university, a young graduate must commit anumber of their most productive years to study for a Doctorate. As business and public agencies are moreinterested in the work experience that young economists may have, they tend not to recruit people who havecommitted most of their younger years to higher study. Conversely, the universities act in a similar way
towards experienced, but formally under qualified, economists and prefer to recruit economists who perhaps
lack professional experience but have Doctorates even if they were trained overseas. 11 Therefore, it appears
that there is a clear division in the supply of economists between the academic and non-academic sectors.

New Zealand Journal of Employment Relations 36(1): 52-64

Salaries
Evidence of relative salary levels for economists in New Zealand is rather scarce but what there is indicatesthat salaries over the years have kept up with, or exceeded growth in, salaries in general. Table 5 provides
data on the relative salaries of graduating economics majors in both New Zealand and Australia.
In a labour market for skilled workers, like economics graduates, experienced staff and new entrants are notnecessarily close substitutes for each other. Nonetheless, starting salaries and how they change over time dogive some indication of market conditions. If there was strong growth in demand for a particular type of
employee, it would be expected that average salary levels would rise due to a limited supply.
Statistics New Zealand undertook a survey in 2003 and 2006 of the average salaries of a number of different
types of graduates. Some of the survey results are summarised in Table 5. In addition, median salaries for
economics graduates in Australia are also presented in Table 5. In 2003, it was found that the average salaryof New Zealand economics graduates was $36,200, well above the average for graduates in general andcomparable to that of accountants. Three years later, the same surveyed group had seen their salaries growquite strongly such that their relative salaries were even higher in relation to that of other graduates.
Table 5: Salaries for economists in New Zealand and Australia

NZ post-degree median salaries
One-year
2003
Economics
36,200Accounting
36,400Management & Commerce
33,700All degree
33,000National median
26,800
Economics/All degree
1.10
Economics/Management & Commerce 1.07
Economics/National Median
1.36
Australian post-degree median starting salaries
2003
Economics
37,400Accounting
35,000Business
35,000All degree
37,000
Economics/all degree
1.01
Economics/Business
1.07

Three-year2006
48,10049,80043,90041,30028,800
1.16
1.10
1.73
2007
45,00040,00040,00043,0001.07
1.13

Source: Scott, 2009b; Graduate Career Council, 2003

The higher level of salaries of New Zealand and Australia economics graduates, compared to other graduates,
is a phenomenon that has been found in other countries as well, such as in the United States (National
Association of Colleges 2011).

New Zealand Journal of Employment Relations 36(1): 52-64
In the Australian case, entry level salaries at $37,400 in 2003 and $45,000 in 2007 were well above theaverage for graduates and grew at a faster rate in the period 2003 to 2007. Australian studies have also foundthat unemployment rates amongst economics graduates have been relatively low in the period 2003 to 2007
(Graduate Careers Council, 2009). Other work by Lewis, Daly and Fleming (2004) found that there has been
rising rates of return on economics graduates, both absolutely and compared to other business disciplines
since the mid 1980s. While there has been no study of the unemployment rates of economics graduates in
New Zealand, it would be expected that they would be faced with similar conditions.
The higher level of economics graduates salaries and strong growth in salaries during the 2000s, bothabsolutely and relative to other salaries, would imply that there has been a tight labour market for economics
graduates and economists, at least in the public and private sectors. In the universities, the small number of
positions, low turnover of staff and willingness on the part of universities to recruit overseas presents a quite
different story.

Conclusion
In summing up the findings of this study a few conclusions can be made, despite the limitations placed on the
study by the availability of data. First of all, the employment market for economists has been relatively goodin New Zealand over the past 20 years. From employment in central government agencies (the Treasury andReserve Bank), job prospects have grown in other departments of the Government along with the financesector and with regulated companies. The regulation of utilities, the Resource Management Act and the
expanded use of regulatory impact statements have all helped to expand job opportunities for economists.
This employment is mainly with the Government but also with consultants and regulated companies.
Financial market employment has also been good, at least up until the recent global financial crisis.
The place where employment for economics graduates is now not as good is in secondary education andtertiary education. While the number of higher education economics academics is not falling, it is not
growing at any rate even though there has been modest growth in the number of students studying economics
in recent years.
In terms of remuneration, it appears, from evidence in both New Zealand and Australia, that economics
graduates are reasonably well paid, are sought after and, perhaps over the past ten years, have improved theirposition compared to other graduates. Further data on the level of professional salaries in New Zealandwould enable more conclusive statements on this. Finally, there appears to be no oversupply of economists
in New Zealand. Economics graduates numbers are rising – only slowly and immigrant numbers are small.
New Zealand companies have a tendency to prefer economists with New Zealand experience thus improving
prospects for local applicants. Somewhat

Notes
1

This reduction in employment has occurred more in the finance sector rather than in the public sector and inareas of regulatory affairs (Lahart 2009).

New Zealand Journal of Employment Relations 36(1): 52-64
2

The four colleges were Auckland, Victoria Wellington, Canterbury and Otago. Separate chairs of
economics were established at Auckland College in 1926 (Belshaw), Canterbury 1920 (Condliffe), Victoria
Wellington 1920 (Murphy), and Otago 1924 (Fisher).
3

The Treasury in New Zealand did not begin to employ economics graduates in any numbers until the late1960s. This meant that it was the Reserve Bank, which was the most important source of employment foreconomists in the 1950s and 1960s (McKinnon, 2003; Hawke, 1973).
4

At the 1981 Census, Statistics New Zealand reported that around two-thirds of economists were employedby the private sector (the other third being employed by Government agencies). If university and secondary
school teachers are added to these numbers, then around one-half of economists could be said to be employedby the public sector
5Legislative measures, such as those requiring Regulatory Impact Statements and requirements under the
Resource Management Act have created a cottage industry of economists (both public and private) who
analyse the economic impact of legislative changes and planning applications.
6

The Australian Graduate Careers Council found in its studies that approximately 58 percent of economics
graduates found work in economics related areas. This compares to 84 percent of accounting graduates andmuch lower levels for social science and humanities levels which tended to be 20 to 30 percent.
7

Although it can be safely assumed that the majority of these policy analysts work for the government, asizable minority would also work for utilities, industry and professional associations and consulting
companies.
8

This means that the NZAE would be far less representative of economists in New Zealand compared to 30
years ago. For instance in 1970, the NZAE had 215 members (Holmes, 2011), compared to a reported 204
economists at the 1971 census (plus academic economists). It is fair to say that, at that time, mosteconomists in New Zealand were members of the association, which is untrue today. In addition, a numberof economics graduates teach economics in secondary schools. In 2009, 350 schools in New Zealand offeredeconomics subjects. It can probably be assumed that each of these schools has at least one teacher of
economics although many of these would combine the teaching of economics with other related subjects suchas business, accounting, mathematics and politics.
9

The number of schools offering economics as a subject peaked in 1991 and 1993 at 371, and has since
fallen to 351 in 2007 (Education Statistics of New Zealand).
10

This contrasts somewhat to the situation in Australia where numbers increased through the 1980s and1990s but at a rather reduced rate (Millmow, 2009).
11

Although it is sometimes argued that the low salary levels in universities are a deterrent to the recruitmentof economists from outside of academia, public sector and university salaries are of comparable levels. Evenin the private sector, the number of highly paid economist positions is limited.

New Zealand Journal of Employment Relations 36(1): 52-64

References
Abelson, P. and Valentine, T. (1985). The Market for Economists in Australia. Economics Papers. 4:1-16
Association of Commonwealth Universities. (1965-2010). Commonwealth Universities Yearbook. London.
Ashenfelter, O. (2001). Economics: Overview. The Profession of Economics, International Encyclopedia of
Social and Behavioral Sciences. 6: 4,159
Bellis, C.S. (2000). Professions in Society. Sessional Papers presented to the Institute of Actuaries ofAustralia. Sydney: 1-29
Beaglehole, J.C. (1937). The University of New Zealand: an Historical Study. New Zealand Council for
Education Research: Wellington.
Boddy, F.M. (year). The Market for Economists. American Journal of Agricultural Economics. 55(4): 720724
Department of Labour. (2010). www.dol.govt.nz
Ehrenberg, R.G. (2004). Prospects in the Academic Labor Market for Economists. Journal of Economics
Perspectives. 18(2): 227-238
Graduate Careers Council. (2003). Graduate Destination Survey: a National Survey of the Activities of Year
2002 University Graduates. Canberra.
Hawke, G.R. (1973). Between Government and Banks: a History of the Reserve Bank of New Zealand.
Government Printer: Wellington.
Hawke, G. R. 1973, Between government and banks: a history of the Reserve Bank of New Zealand,
Government Printer, Wellington.
Holmes, F. (2011). The New Zealand Association of Economists: Memories of its Early Years. Retrieved
from http://nzae.org.nz/wp-content/uploads/2011/08/NZ_Association_of_Economists_Early_Years.pdf
Lahart, J. (February 10, 2009). Job Market for Economists Turns... Dismal. Retrieved from Wall Street
Journal Online. http://online.wsj.com/article/SB123431516742770969.html
Lewis, P., Daly, A., and Fleming, D. (2004). Why Study Economics? The Private Rate of Return to an
Economics Degree. Economic Papers. 23(3): 234-243
McKinnon. M. (2003). Treasury: the New Zealand Treasury, 1840-2000. Auckland University Press:
AucklandMaxwell, P. (2003). The Market for Economics in Australia. Economics Papers. 22(1): 79-92

New Zealand Journal of Employment Relations 36(1): 52-64
Millmow, A. (2009). The Boom We Didn‟t Really Have: Australian Economic Degree Enrolments, 19972007. Economic Papers. 28(1): 56-62
Ministry of Education. (1989-2009). Education Statistics of New Zealand. Wellington.
National Assocation of Colleges, 2011, Salary Survey, Washington.
New Zealand Association of Economists. (2008). Annual Report. Wellington.
New Zealand, Ministry of Education. (2010). Educationcounts. Retrieved fromwww.educationcounts.govt.nz
Parton, H. (1970). The University of New Zealand. Auckland University Press: Auckland.
Scott, D. (2009a).Trends in Fields of Study of Bachelor Degree Graduates in New Zealand. Retrieved fromhttp://www.educationcounts.govt.nz/publications/tertiary_education/41801/1
Scott, D. (2009b). Statistics New Zealand & Ministry of Education. What do Students Earn after their
Tertiary Education. Retrieved from http://www.stats.govt.nz/browse_for_stats/income-andwork/employment_and_unemployment/LEED-reports/eote-what-do-students-earn-after-their-tertiaryeducation.aspx
Statistics New Zealand. (1971-2010). Census of Population and Housing. Retrieve from www.stats.govt.nz

New Zealand Journal of Employment Relations 36(1): 65-75

Pay Equity and Equal Employment Opportunity in New Zealand:
Developments 2008/2010 and Evaluation
PRUE HYMAN*
Abstract
This is the fourth in a series of papers updating developments relating to pay equity and Equal Employment
Opportunities (EEO) and evaluating their impact. As with the previous papers, it focuses primarily on
gender, but also discusses the overall situation and touches on issues related to ethnicity, age and disability.
In the last two years the election of a National Government has led to an even less interventionist climate,with the abolition of the Pay and Employment Equity Unit in the Department of Labour and the cancellationof associated pay equity investigations. This paper will discuss these moves and what remains of the Unit‟swork and other EEO initiatives. It will also examine recent evidence on discrimination on the basis of
ethnicity, age, and disability as well as reports/recommendations/actions for its elimination – including
employer and union attempts to improve opportunity for recent migrants and people with disabilities.
Finally, the situation for older workers will be examined, with increasing labour force participation at 65+
observed and encouraged, despite considerable discrimination faced by this group.

Introduction
The conclusion to a paper on the same topic published in the New Zealand Journal of Employment Relationsin 2008 included:
The picture outlined above of the last two years shows many reports and some progress, albeit slow,
in a number of areas. The prospects for the future are of concern at a time of world economic
uncertainty and likely increases in unemployment – where low paid and EEO groups are often thefirst to suffer. The election policies of the parties indicated that those elected to government arelargely committed to market solutions, educational progress for all, and enhanced growth to improve
the position of these groups rather than more specific policies which Labour led governments
delivered, albeit to an increasingly limited extent. Voluntary codes and educational resources arelikely to continue to be promoted (Hyman, 2008: 13).
I forecasted the survival of several institutions including the EEO Trust, instituted by the 1990 National
Government after it repealed Labour‟s more interventionist Employment Equity Act, the National Advisory
Council on the Employment of Women (NACEW), and the Ministry of Women‟s Affairs (MWA), and also
hoped that the Department of Labour‟s Pay and Employment Equity Unit (PEEU) would survive. Three outof four was a fair score, and unsurprisingly it was the one about which I was least certain, the PEEU, which
was abolished. I also suggested that the prospects for real outcomes from the work were even less rosy withrespect to pay equity and dollars for pay increases in caring work under a National led government than theywould have been under Labour. This was accurate, with National‟s plans to reduce the size of the public
service and further free up the labour market. The introduction of 90-day probation periods for new
employees was inevitable, with lower paid groups, particularly women, Maori/Pacific/immigrants andpeople with disabilities the most likely to be affected (for good or ill, with polarised opinion). This paper
will outline what has occurred in these areas as well as the voluntary initiatives by these and otherinstitutions to assist less advantaged groups in the labour market.

*

Adjunct Professor of Gender and Women‟s Studies, Victoria University of Wellington, New Zealand, Prue.Hyman@vuw.ac.nz

New Zealand Journal of Employment Relations 36(1): 65-75

Pay Equity for Women – Equal Value and Equal Opportunity
Feminist groups have long argued that female-dominated work is undervalued by both decision makers andthe market and that gender neutral job evaluation tools are needed to assess the value of such work againstcomparable male-dominated occupations, followed by remedial mechanisms. Arguments centred on themarket as the only appropriate means of evaluation and on the cost of remedying any undervaluation found
to exist have held sway and prevented much progress on the equal pay for work of equal value agenda.
However, the arguments have been used with some success in collective bargaining and decision making forsome groups including nurses, midwives and primary teachers. Nevertheless, the gender pay gap has
narrowed only very slowly since the major improvement resulting from the extension of equal pay for equal(identical) work legislation to all work in the 1970s (by a National Government), with women moving up
job hierarchies and into male-dominated jobs having more impact than improving the relative pay of femaledominated work. Since the 1980s, Labour-led governments have been somewhat more likely to pursue
proactive pay equity policies than those led by National, but both are nervous of any major interventions in
the market. Labour‟s short lived 1990 Employment Equity Act, repealed by National the same year, had notime to take effect.
The 1999-2008 Labour Government‟s nine years of leading coalition governments saw a much changed
employment relations system, with national awards and occupation bargaining long gone, giving less
opportunity for equal value implementation. Hence, government policies focused on jobs financed from thepublic purse, with the establishment of the PEEU to service the activity. Organisations in the core public
service, the public health sector, and the public education sector were obliged to conduct pay reviews tocheck if rewards and participation in the full range of job types and job levels were affected by gender and if
there was a difference in men‟s and women‟s experiences of respect and fairness. The review process was toinclude development of a response plan for moving towards gender equity by addressing any issues
identified, to include a strategy for implementation, monitoring and evaluation. Most had been completed,
together with some in local government and Crown Research Institutes by the time a National government
was elected late in 2008 and the Unit abolished soon after. The Unit had provided tools and assistanceincluding a Pay and Employment Equity Analysis Tool (PEEAT). The website developed by the Unit 1,
remains active and gives a link to order the PEEAT, the Equitable Job Evaluation scheme (EJE), and the
Spotlight Skills Recognition Tool (for more details on each of these, see Hyman, 2009). All these tools wereavailable free of charge to both public and private sector employers. Overall, reviews found lower startingsalaries for women, barriers to career development, lower performance pay, and pay gaps ranging from 3%
to 25%, varying by department and occupation. Women‟s incomes also tended to be lower in femaledominated occupations. Two very useful overview papers on the reviews and the process were prepared by
the Unit in its last days and are also included in the Toolkit available on the Department of Labour website 2.
With the gap left by the PEEU, the Human Rights Commission (HRC) in 2010 released a pay andemployment equity monitoring framework and questionnaire for organisations to use for self-assessment andmonitoring to measure their current performance and progress towards gender equity, concentrating on a
few key indicators (Humans Rights Commission, 2010a). Designed to permit a quick „health‟ check of thegender statistics, policies and practices of an organisation, and see what adjustments may need to be made, it
could be followed by use of the review process. Where reviews have already been conducted, it can assist
with scrutiny of key indicators to assess progress since the review and examine the effectiveness or the
response plan.
Current government policy in this area is set out as follows at Department of Labour‟s PEE website:
Government‟s overarching policy for employment and workplace relations is based on
demonstrating good faith, natural justice, human rights, good employer practice and meeting all
statutory requirements. Government policy supports continuing implementation of pay andemployment equity response plans, excluding (my italics) pay investigations of female-dominatedoccupations, and recognises the obligations of public sector chief executives to ensure they continue
to address and respond to any identified gender inequities as part of good management practice andNew Zealand Journal of Employment Relations 36(1): 65-75
being a good employer. Government encourages voluntary participation of public and private sector
organizations in pay and employment equity projects. The Department of Labour will continue toprovide to both public and private sector organisations the pay and employment equity tools andresources including the review tools and the Equitable Job Evaluation System (Department ofLabour, 2010a).
Hence, organisations should be continuing to implement their response plans but without an internal
government organisation to provide an overview of progress. The HRC, with a strong EEO role and Equal
Employment Commissioner, Dr Judy McGregor, therefore, took upon itself a role in monitoring progress inthe public sector. Noting that the reviews and response plans were not made public, the Commission asked
government departments to report their overall gender pay gap at June 2010 as well as actions taken toaddress gender disparities in starting salaries, to increase representation of women in management positions,and to implement other recommendations in their response plans. The results are included in theCommission‟s recent wide-ranging two-yearly report on their Census of Women in Professional Life, which
has been extended to a number of new areas (Human Rights Commission, 2010b).
The HRC found that the overall gender pay gap in the public service, measured by average earnings,
remained the same between 2008 and 2009 at 15.4%. The range of the gender pay gap across government
departments was wide, with only one department, the Serious Fraud Office, having a gap in favour of
women and with 12 of the 34 departments having gaps over 20%. To put this in dollar terms, the 23.2% pay
gap at the Ministry of Economic Development amounts to an average $19,636 difference in annual pay.
Comments on the gender pay gap, unsurprisingly, focused on occupational segregation effects, with women
predominating among the lowest paid staff. Several departments said that they were monitoring startingsalaries and determining salaries for roles using gender neutral job sizing. Some went further, with
Agriculture and Forestry saying they checked the gender mix on short-listed applicants, used moderation toensure internal equity for salaries, and included a decision justification of starting salary in personnel files.
Nevertheless, only 17.6% of public service chief executives are women, a decline from 23% two years
earlier, with women also under-represented throughout senior management. The proportion of women in tier2 and 3 management positions is 37.8%, unchanged in two years, but up from 35.6% in 2005. Women fromethnic groups other than European are particularly under-represented. Of the women in senior management
positions, 10.3% are Maori, 1.5% Asian, 1.5% Pacific and 84.2% European. A number of departmental
responses on initiatives to improve the position referred to: career development programmes and theidentification and development of talent, with specific strategies including identifying barriers, actively
supporting talented women and rethinking management roles. On other actions taken, common responses
included changes to human resource practices such as revision of the recruitment process, resizing jobs,
revising remuneration systems and policies, increased monitoring and reporting, professional development
programmes, flexible work practices, and creating a positive work environment. Many individual
departmental responses on all the questions are included in the report. Overall, while welcoming the widerange of activities, the report concludes that the “declining percentage of female chief executives and thelarge number of departments with significant gender pay gaps is unacceptable and requires a whole ofgovernment commitment and stronger accountabilities for public service chief executives” (Human Rights
Commission, 2010b: 60).
The Government‟s specific ruling out of pay investigations of female-dominated occupations recommended
by reviews was of major concern to the organisations which have long fought for equal pay for work ofequal value – the investigations would have analysed and compared job content against male-dominatedwork to see whether the work was undervalued. Interestingly, the definition of pay equity on the official
website appears to sanction equal pay for work of equal value, although the reference to market factors
dilutes this somewhat:
Pay equity means gender doesn‟t affect what people are paid. It means women receive the same pay
as men for doing the same work, and for doing work that is different, but of equal value. The valueof work is assessed in terms of skills, knowledge, responsibility, effort, and working conditions.

New Zealand Journal of Employment Relations 36(1): 65-75
Other considerations in setting remuneration can include market factors, productivity andperformance (Department of Labour, 2010a).
The first two pay investigations recommended by reviews covered CYFS social workers and special
education support workers, the latter a female-dominated low paid group working one-to-one with special
needs children part-time and without security of tenure. These pay investigations had been completed with
the EJE scheme used to make comparisons of the value of the work of special education support workers
against prison officers and hospital orderlies. The decision, on the grounds of possible unaffordable
remuneration pressure, prevented trade unions from addressing discriminatory pay rates and related issues in
pay negotiations with the employing departments and meant probably underpaid female-dominated groups
bearing the brunt of economic pressures.
With the abolition of the PEEU, MWA was given the responsibility of more gender pay gap work financed
by a 12% funding increase ($2 million over four years) from the savings – and probably attempting to defuse
adverse political reaction. The MWA‟s 2008 Briefing Papers to the incoming government had included asection headed “Legislation is not the answer”. It argued that issues such as closing the gender pay gap...will not necessarily respond to further legislation or other forms of direct government action (suchas requiring gender implications statements on some Cabinet Committee papers). Removing theselast barriers that prevent women – and men – from achieving their full potential will require a much
more co-operative and lateral thinking approach. For the Ministry it will mean working more closelywith other government agencies, with NGOs, with communities and with individuals. It will alsomean engaging more with men because men will also benefit from a society that makes the best useof everyone‟s talents (Ministry of Women‟s Affairs, 2008: 9-10).
The MWA‟s approach has thus been to find partners and allies, and act as influencers and catalysts, working
with businesses, professions, and the wider sector. This aligns well with the National government‟s
approach. The four areas of work mentioned in the programme are:

Understanding the differences in pay between male and female workers with tertiary education
Occupational segregation: promoting trades and removing barriers for women
Career pathways for women in low-paid occupations
Making the business case for flexible work arrangements.

The work-to-date related to two of these areas is described as follows in the MWA‟s annual report to June
2010:





“undertaking case-study research with the accountancy sector to identify the benefits of good flexible
work practices. The study showed that benefits include greater productivity, higher profits, improved
customer satisfaction, cost savings and increased efficiency, and the ability to recruit and retain top
staff
working to get more women into traditional trades and to keep them there by developing women in
trade networks and working with industry training organisations (ITOs) to promote and support theirinitiatives
undertaking analysis of graduate income data (2002–2007), which showed that one year after
entering employment the average income gap between men and women with a bachelor‟squalification or above was around 6%, and after five years the average income gap had increased to17%.” (Ministry of Women‟s Affairs, 2010a: 8).

The MWA‟s (2010b) working paper on graduate incomes, entitled Analysis of Graduate Income Data 20022007 by Broad Field of Study, was based on IRD data (the Student Loans and Allowances Integrated data set– the uptake of student loans was between 72% and 82% in that period) and examined 2001 graduates‟
incomes in 2002 and 2006. Despite limitations, such as very broad divisions for field of study and lack ofNew Zealand Journal of Employment Relations 36(1): 65-75
hours/occupations data, the gap is striking and is in line with earlier Vice Chancellors‟ Committee graduate
income reports. Nevertheless, there is a significant premium for women attached to gaining a bachelor‟s or
higher qualification, with income premiums 20% to 47% higher after five years (see MWA, 2010b for moredetails). With women, by 2006, constituting 62% of all bachelors‟ graduates and outnumbering men inbusiness, management, sales, marketing and law, in addition to their ongoing dominance in teaching andnursing, the situation should be changing, but the Ministry‟s accountancy case study demonstrates theresistance to change in such professions (Ministry of Women‟s Affairs, 2010c).
The case study research reported in the MWA‟s report Workplace Flexibility in the Accounting Sector(2010c) inquired into the nature and prevalence of flexible workplaces and practices, and to what degree thiswas a response to significant challenges, including skills shortages, demographic challenges, an increasing
number of women entering the profession, and the need to retain younger people, mainly women, to assist inmeeting these challenges. 12 public practice firms using some form of flexibility were involved, ranging insize from four staff to 900. Although a majority of accountancy staff from graduates to senior managers are
now women, a majority of partners and associates are men and “many experienced women „disappear‟ long
before making the step up to partnership.“ (Ministry of Women‟s Affairs, 2010c). This was clearly alignedwith a dominance in most firms of a traditional working and office culture, emphasising long working hours
and „networking‟ over drinks and at sporting fixtures. While a couple of firms were „breaking the mould‟ thereport noted that in most large firms…there was little recognition that in losing talented female graduates to partnership they might belosing their most talented employees, with implications for the quality of the partnership andultimately its profitability. This is not just a gender issue. Younger people indicated that few of themwanted to be partners because of the long hours and the nature of the commitment required (Ministryof Women‟s Affairs, 2010c: 11).
This resistance to change in accountancy is borne out by the HRC Census which reports the numbers of
women partners in large firms (see Human Rights Commission, 2010b: 26). The 12 largest accountancy
firms had only 76 women partners out of 598 (12.71%), despite the majority of accountancy staff from
graduates to senior managers being women. The proportion varied from zero at Polson Higgs (13 partners)
to 20.7% at PKF (29 partners). The largest firm, Price Waterhouse Coopers, had 13 out of 110 (11.8%).
Many qualified and experienced women leave long before making the step up to partnership for the reasons
outlined in the case study so that while the pipeline effect should produce fairly rapid change, these factors
cast doubt on this unless firms change their practices considerably. The Census also has sections on
women‟s representation in central and local government, DHBs, law, the media, the police, science, sport,teaching, the judiciary, and senior management together with a suggested agenda for change to improve thesituation.
Interestingly, the area where there is most activity, even if the results are slow to change, is that of
attempting to increase the representation of women on Boards of Directors. Such efforts are clearly neededas the latest corporate board figures show New Zealand poorly placed on this with only 9.32% women
directors in the New Zealand Stock Exchange top 100 firms, while the Scandinavian countries vary from
12.5% (Denmark) to a high of 44% (Norway), Spain has 19.2%, the United States 15.2% and the United
Kingdom 12.2% (Human Rights Commission, 2010b). Initiatives to assist women develop the skills needed
include an EEO Trust sponsored cross-company mentoring programme, with ten women to be mentored bymen and women from different companies, while the New Zealand Shareholders Association has added
three women to its board.
Global Women has launched a year long programme involving customised mentoring and coaching aimed atbuilding the next generation of female leaders in large public, private, and non-profit organisations while
there are also some sector specific initiatives (for details, see Human Rights Commission, 2010b: 8). The
business case for women on boards has been put in a glossy publication sponsored by Business New
Zealand, the Institute of Directors and the MWA (2009) and available on a new section of the Ministry‟s
website which “aims to inspire more women to join boards and committees. It provides governance advice,New Zealand Journal of Employment Relations 36(1): 65-75
tools and information drawn from the expertise of the Ministry of Women‟s Affairs and experienced women
directors” (Ministry of Women‟s Affairs, 2009) and contains advice and case studies.
Another major initiative is a partnership between the HRC and the EEO Trust entitled „A Place at theTable‟, aimed at improving the diversity of Boards of Directors in New Zealand to span women and other
underrepresented groups. In particular, „Women on Boards: Getting Ahead‟ was launched in September toinvolve meetings with male Board chairs, engage with shareholding ministers and make approaches to the
top 100 companies lacking women directors. At the launch, The Warehouse director Janine Smith argued
that diversity of thought on boards was essential to business success. The main ideas and suggestions fromthe forum span: encouraging human capital reporting, mainstreaming the business case, telling the story,
involving men as champions, mentoring and leadership, bridging the divide between public sector andprivate sector boards and setting targets(detailed suggestions under each heading at
http://www.eeotrust.org.nz/a_place_at_the_table/index.cfm).
Important as it is to have good gender representation in top positions in all areas, many women‟sorganisations regret the emphasis on this at the expense of improvement in the participation, status, and payof women throughout the labour market, especially that of low paid women in which ethnic minorities areoverrepresented, and where their caring work is often hard to combine with paid work. Aggregate genderearnings gaps have hardly changed in the last decade, with women of all ethnicities having lower averagehourly earnings than men from the same groups. However, ethnic earning gaps are even wider than gender
gaps, as the tables below show, with ethnicity and gender gaps compounding. Pacific workers are the lowest
earnings group with Pacific women earning on average only 69.9% of the hourly rate of Pakeha men.
Further, the latest unemployment figures show the Pacific rate at 13.5% and the Maori rate 16.2%, both far
higher than the average of 6.4%.
Table 1: Average hourly earnings by gender and main ethnic groups
All women $22.15

All men$25.57All Mäori
$20.84

All Pakeha $24.65

All women as % of
all men 86.6%
All Maori as % of
all Pakeha 84.5%

Women
Men
All
$22.71$26.62$24.64
Pakeha$20.04$21.56$20.84Mäori$18.62$20.35$19.54
Pacific$20.77$21.93$21.38Asian
Source: Statistics NZ Income Survey, June quarter 2010, Table 10

Table 2: Average hourly earnings comparisons by main gender/ethnic groups
Relative toPakehawomen

Mäori men

Pacific men

Asian men

105.3%
Pakeha111.6%
103.5%
women
88.2%
92.9%
Mäori
98.4%
91.3%
women
81.9%
86.3%
Pacific
91.4%
84.9%
women
91.4%
96.3%
Asian
102%
94.7%
women
Source: Statistics NZ Income Survey, June quarter 2010, Table 10

Pakeha men

All men

85.3%

88.8%

75.2%

78.3%

69.9%

72.8%

78%

81.2%

Further, there is evidence of a combination of mistaken complacency that EEO has been achieved or is
outmoded or need not be taken seriously despite anti-discrimination legislation, in some quarters at least. In
September, a woman refused a job selling cars because she was female was paid $6500 and received an

New Zealand Journal of Employment Relations 36(1): 65-75
apology from the dealer with the help of legal representation by the Office of Human Rights Proceedings,
following a complaint to the HRC and the failure of mediation. She had answered an advertisement for a car
salesperson but was told that as the firm had two „sales ladies‟ (sic) on board; they would only consider men
for this vacancy, despite the fact that she had previous sales experience and was qualified for the sales job
advertised. The Director of the Office of Human Rights Proceedings Robert Hesketh said the woman was
delighted at the outcome
It does raise the issue of whether there should be provision for the Tribunal to award punitive
damages. If that was possible, it would publicly highlight the unacceptability of discrimination andperhaps we would see less of this kind of issue. (Human Rights Commission, 2010c).
It is not surprising that these types of events still occur, but more so because employers are too ignorant evento cover up such discrimination, showing their ignorance of the legislation.
Also in the EEO area, there is much lip service paid to the importance of parents‟ and others‟ caring workfor children and others in need, and the desirability of work-life balance encouraged by family friendly
workplaces – although official policies and employer attitudes often fall far short of what is needed. Caveats
about the realities were expressed in my previous paper in this series (Hyman, 2009), despite the Flexible
Employment Arrangements Act, 2007. Lower level workers have little bargaining power and their insecure
patterns of perilous work may be misrepresented as allowing work-life balance, and higher level workers
seeking flexibility often find it interpreted as a lack of commitment, as the accountancy case study above
illustrated. The PEEU reviews mentioned earlier had similar findings on this, with the desire for part time
work or flexibility often reducing career options, especially for women.
Nevertheless, some employers are making efforts in this area. The EEO Trust 2010 Work & Life Awards
had over 40 entries with the supreme award, interestingly, going to The Warehouse for parenting
programmes for distribution staff – leading to better team cohesion and performance. Over 200 employees in
the company‟s South Auckland distribution centres took part in the programmes run by the Ministry ofSocial Development-backed parenting programme SKIP (Strategies for Kids, Information for Parents) inwork time. They “drew out participants‟ feelings and beliefs about what being a good parent meant andexplored how to help each other be better parents, stressing communication and non-physical discipline”(EEO Trust, 2010). Staff were reported as becoming closer, with engagement and productivity increasing
and absenteeism decreasing. The Trust has also published WorkLife, which “offers examples, ideas andcommentary, supporting people developing flexible and productive workplaces” (EEO Trust, 2010).

Barriers to Equality for Ethnic Minorities, Older Workers, and People with Disabilities
The disadvantaged position of Maori and Pacific workers accentuated by the global recession has alreadybeen mentioned and the outlook for Maori employment in the short-term is not promising. A large
proportion are employed in manufacturing, retail and tourism-related industries which are particularly
affected, though improved educational outcomes and Treaty settlements may improve the situation in themedium term (Department of Labour, 2009). On initiatives to remove barriers, and reduce discrimination
faced by all these groups, there is sadly little to add to my paper from two years ago:With the only legislative underpinnings for EEO in the private sector being the anti discrimination
provisions of industrial relations and human rights law, the main developments have been ineducation and provision of resources to encourage employers to make the best use of all groups of
employees (Hyman, 2008: 10).
Here, I outline some of the new evidence on the barriers to these groups and resources to suggest how to
remove them and be innovative in the workplace.

New Zealand Journal of Employment Relations 36(1): 65-75
A paper prepared for the HRC shows that Asians in New Zealand face more discrimination than all otherethnic groups and are at a disadvantage in finding employment even though many are recruited here for theirskills. Despite the challenges, Asian people tend to be satisfied with their lives in New Zealand, valuing theopportunities and lodging fewer complaints about discrimination than other groups. However, “Asian people
who have entered NZ through the General Skills Category have higher levels of unemployment and lower
levels of employment than all other migrant groups entering NZ under the same category” despite being “thegroup with the highest number of university qualifications” (Girling, Lui and Ward. 2010: 10). The reportsuggests development of a national strategy towards combating discrimination against Asians. In 2009, theDepartment of Labour surveyed 942 employers who had had contact with Immigration New Zealand (INZ)
with respect to employing immigrants. The survey was aimed at assessing benefits and issues with respect toemploying such migrants, settlement issues, and the efficacy of INZ in assisting employers in this area. Of
the 442 responses (a 45% response rate, reasonable for such a survey), 91% had at least one migrant on staff
and 87% rated these workers as good or very good, with language difficulties reported as the main challenge(Department of Labour, 2010b).
The trade union movement joins with other agencies in promoting non-discrimination in employment. It isclear that age discrimination is still prevalent in the labour market despite human rights legislation and a
rapid increase in participation of the 65 plus age group. If the age of eligibility for New ZealandSuperannuation is gradually raised, in line with trends overseas and increasing longevity (as recommended
by the Retirement Commissioner, though this is not on the immediate agenda of the current government), it
will be even more important to ensure that such discrimination is eliminated. Further, it is important for the
economy to make best use of the accumulated skills of older workers. For example, the report Age Okay –Unions Promoting Skills and Experience contains case studies, resources and suggestions aimed atpromoting joint employer/employee initiatives in this area (NZ Council of Trade Unions, 2010).
The HRC has recently carried out two pieces of work involving extensive consultation of relevance to all theEEO target groups. Its status report on the human rights performance of New Zealand in 2010 has sections
on the right to work and the rights of disabled people, women, sexual and gender minorities, migrants andrefugees, with recommended areas of action to advance the position of each group (Human Rights
Commission, 2010c). The Commission‟s National Conversation about Work, with over 3000 participants
over two years, concluded that a human rights approach to employment involves empowerment,
accountability, non-discrimination, participation and a link between decision making and agreed humanright norms (Human Rights Commission, 2010e – with elaboration of these ideas at pages 29-32). It includes
12 examples of organisations and programmes demonstrating good practices and 10 broad priorities for
EEO, one of which is to “increase the labour market participation of people with disabilities through active
employment policies addressing attitudes, access to work and reasonable accommodation” (ibid: 33). The
recent announcement by the Government of the establishment of a full-time Disability Rights Commissioner
within the HRC has been welcomed by disability rights groups as a sign of real progress in measures topromote, protect and monitor the implementation of the United Nations Convention on the Rights of Persons
with Disabilities, with a strong focus on ensuring disabled people can take an equal place in New Zealandsociety without discrimination.
However, amendments to the Employment Relations legislation to extend 90-day trial periods for new
employees from businesses with under 20 workers to all businesses is seen as negative by the HRC andmany other groups. Proponents of the extension argue that it will encourage employers to take on more newstaff because of the reduced risks, costs, and other consequences of recruitment errors, for example, arisingfrom personal grievance cases, hence the 90-day trial periods will have potential benefits for the low wage
earners and long-term unemployed workers. However, the HRC argues that “…the legislation‟s „fire without
redress‟ measures offend against natural justice, diminish procedural fairness and undermine a „fair go‟ foremployees” (Human Rights Commission, 2010d: 188). Disability and lesbian/gay groups, together with
unions representing low paid, ethnic minorities and young workers, have concerns that employees they
represent are likely to be the most adversely affected. Overall, there is limited research of this major
employment relations change, though employer opinions were canvassed in recent Department of Labour
research with around 1,000 employers being interviewed but surprisingly only 13 employees wereNew Zealand Journal of Employment Relations 36(1): 65-75
interviewed (Johri and Fawthorpe, 2010). Finally, the HRC is also opposed to the legislation permitting theexchange of the fourth week of the universal holiday entitlement for cash, with employer pressure andfinancial issues for the low paid likely to push some employees into an undesirable trade-off.

Conclusion
Widening earnings and income inequalities has been a common experience in much of the world over thelast thirty years, with New Zealand moving from a relatively equal society to one of the most unequal. This
makes labour market protections, including EEO, of even more importance than in the early days ofawareness and policy making. There is still much to be done, as the evidence above shows, withcomplacency, backlash and slippage too often impeding equal opportunity for all groups in the labour
market.

Notes
12

http://www.dol.govt.nz/services/PayAndEmploymentEquity/index.asp
http://www.dol.govt.nz/services/PayAndEmploymentEquity/order/Default.aspx

References
Business New Zealand, the Institute of Directors and the Ministry of Women‟s Affairs. (2009). Women on
Boards: Why Women on Company Boards are Good for Business. Retrieved fromhttp://www.mwa.govt.nz/women-on-boards/find-a-candidate/women-on-boards-why-women-on-companyboards-are-good-for-business-2
Department of Labour. (2009). Maori in the New Zealand Labour Market. Retrieved fromhttp://www.dol.govt.nz/publications/lmr/maori/in-the-labour-market-2009/maori-nz-lm-toc.asp
DepartmentofLabour.
(2010a).
Pay
and
Employment
http://www.dol.govt.nz/services/PayAndEmploymentEquity/index.asp

Equity.

Retrieved

from

Department of Labour. (2010b). Employers of Migrants 2009 – from Recruitment To Retention.
http://www.dol.govt.nz/publications/research/employer-survey-recruitment-to-retention/employer-surveyrecruitment-to-retention.pdf
EEO Trust. (2010). Warehouse Staff Parenting Programme takes Top Award. Retrieved fromhttp://www.eeotrust.org.nz/news/index.cfm?content_id=20108
Girling, A.N., Jui, J.H. and Ward, C. (2010). Confident, Equal and Proud? A Discussion Paper on the
Barriers Asians Face to Equality in New Zealand. Retrieved from the Victoria University of Wellington
website. http://cacr.victoria.ac.nz/__data/assets/pdf_file/0017/4085/Barriers-to-Asian-Equality-DiscussionPaper.pdf
Human Rights Commission. (2010a). Towards Pay and Employment Equity: a Self Assessment andMonitoring Tool. Retrieved from http://www.neon.org.nz/payequitymonitoringtool/
Human Rights Commission. (2010b). New Zealand Census of Women’s Participation 2010. Retrieved fromhttp://www.neon.org.nz/census2010/

New Zealand Journal of Employment Relations 36(1): 65-75

Human Rights Commission. (2010c). Gender Discrimination Case Settles with Apology and $6500
Damages.
Retrievedfrom
http://www.hrc.co.nz/news-and-issues/sexual-discrimination/genderdiscrimination-case-settles-with-apology-and-6500-damage/
Human Rights Commission. (2010d). Human Rights in New Zealand 2010. Retreieved fromhttp://www.hrc.co.nz/hrc_new/hrc/cms/files/documents/Human_Rights_Review_2010_Full.pdf
Human Rights Commission. (2010e). What Next? National Conversation about Work? Wellington: Human
RightsCommission.
Retrieved
fromwww.hrc.co.nz/hrc.../19-Jul-2010_09-1634_HRC_What_Next_Report.pdf
Hyman, P. (2008). Pay Equity and Equal Employment Opportunity in New Zealand: Developments
2006/2008 and Evaluation. New Zealand Journal of Employment Relations. 33(3): 1-15.
Hyman, P. (2009). Pay Equity and Equal Employment Opportunity – Developments 2006/2008 andEvaluation. In P.S. Morrison (ed). Labour, Employment and Work in New Zealand, 2008. Proceeding of theJoin LEW 13/ALMRW Conference. (pp.224-233). Wellington: Victoria University of Wellingon.
Johri, R. and Fawthorpe, L. (2010). Trial Employment Periods – An Evaluation of the First Year ofOperation.
Retrievedfrom
http://www.dol.govt.nz/publications/research/trial-periods/trial-periodsevaluation.pdf
Ministry of Women‟s Affairs. (2008). Briefing to the Incoming Minister of Women’s Affairs. Retrieved fromhttp://www.mwa.govt.nz/news-and-pubs/publications/briefing-to-the-incoming-minister-2008-1
Ministry of Women‟s Affairs. (2010a). Report of the Ministry of Women’s Affairs for the Year Ended 30
June 2010. Annual Report. Retrieved from http://www.mwa.govt.nz/news-and-pubs/publications/annualreports/annual-report-2010
Ministry of Women‟s Affairs. (2010b). Analysis of Graduate Income Data 2002-2007 by Broad Field of
Study. Retrieved from http://www.mwa.govt.nz/news-and-pubs/publications/graduate-income-data
Ministry of Women‟s Affairs. (2010c). Workplace Flexibility in the Accounting Sector. Retrieved fromhttp://www.mwa.govt.nz/news-and-pubs/publications/accounting-research
New
ZealandCouncilofTrade
http://issuu.com/nzteu/docs/age_okay_leaflet

Unions.

(2010).

Age

Okay.

Retrieved

from

New Zealand Statistics. (2010). New Zealand Income Survey: June 2010 Quarter. Retreived fromhttp://www.stats.govt.nz/browse_for_stats/work_income_and_spending/Income/NZIncomeSurvey_HOTPJu
n10qtr/Commentary.aspx

New Zealand Journal of Employment Relations 36(1): 75-82

Chronicle: October 2010 – January 2011
October 2010
The Industrial Relations Select Committee continued to hear submissions on the Employment
Relations Amendment Bill (No 2). The NZ Herald ran a report on the submission by Business NZ.
Business NZ submitted that unions should not have unrestricted access to the workplace.
Spokesperson Paul Mackay claimed that “unions used access as a form of marketing to gain
membership and, therefore, cashflow”. Mackay argued that unions should face penalties for breachesof the Bill and that the Bill before Parliament could be simplified so that written permission to enter aworkplace could be substituted for a phone call. Predictably, the Labour Party members of the selectcommittee disagreed with the submission with Carol Beaumont claiming that, with bad employers
already restricting access to the workplace, the Bill would make it worse. Another Labour Party MP
Darien Fenton claimed that lawyers would get hours of work when companies refused access andunions took them to court.
The „Hobbit movie‟ issue, which emerged in late September seemed to reach fever pitch during
October. Throughout the month, colourful headlines such as „Why hobbits threaten to dwarf Key‟
(Dominion Post), „It‟s still our precious‟ (Dominion Post) and „A hobbits tale revised‟ (NZ Herald)
played on the movie theme of the dispute. Early in the month, newspaper reports were optimistic thata resolution was in sight as first the NZ Council of Trade Unions and then Government Ministers
became involved. The Minister for Economic Development Gerry Brownlee met with all the parties
involved. They seemed to agree that it would be disastrous if the movie production moved offshore.
Conflicting legal opinions predictably backed up the views of each side. Crown Law advice was that
New Zealand actors were contractors and were not allowed coverage under the Employment Relations
Act. The unions claimed that they had legal advice that said they were employees. Employment
lawyer Peter Cullen took a helicopter view of the dispute in a Dominion Post article and pointed outthat New Zealand operated in an international marketplace and then focussed on the issue of workers
as employees or contractors.
In late October, the prospect of amendments to the Employment Relations Act loomed. Even this was
confusing as various Government Ministers had differing views. While Minister of Finance Bill
English appeared to rule out a change to employment relations, the Prime Minister and Minister for
Economic Development Gerry Brownlee were ruling them in. A visit from senior executives from
Warner Brothers seems to have put extra pressure on the Government to resolve the issue. A
Dominion Post article stated that Mr English‟s attitude appeared as if the Hollywood studios werepractising a bit of “old-fashioned arm-twisting and extortion” to get a more generous subsidy from the
NZ Taxpayer.
The union movement and specifically the CTU were criticised for their performance during the whole
affair. One article in the Dominion Post suggested that “regardless of the rights and wrongs of theirargument”, the unions played “into Government hands through an extraordinary series of
misjudgements and bad calls”. The article went on to suggest that the movie was always going to bemade in New Zealand but the Government had been given a convenient whipping boy – the union
movement. Iconic New Zealand movie personalities, Sir Peter Jackson and Sir Richard Taylor, were
scathing in their criticism of the unions‟ involvement, with CTU President Helen Kelly retorting that
Sir Peter Jackson was acting like a „spoilt brat‟.
The Press reported in late October that the powerful American movie moguls were playing hardball inorder to maximise their returns. While it was accepted that the threats by the unions were lifted in aNew Zealand Journal of Employment Relations 36(1): 75-82
tacit acknowledgement that the unions had overplayed their hand, Warner Bros wanted a guaranteethat filming in New Zealand would not be disrupted by future expensive industrial action.
Finally, the Prime Minister announced that legislation would be introduced to clarify the precise
employment status of film workers. This prompted extensive media debate; the Government and its
supporters argued that, if there had been general uncertainty in the current legislation over the statusof employees and contractors, then a law change could be accepted. The Opposition and the unions
warned that a law change at the behest of the studios would set a dangerous precedent. What was alsotranspiring, however, was that financial considerations had played a considerable part in the impasseover The Hobbit movie, with Warner Bros wanting a bigger filming incentive than the current New
Zealand 15% tax break. This tax break would amount to $65 million but, as pointed out in some media
report, this appeared to be about half of that offered in some other nations. The Prime Minister had
agreed to spend further taxpayer money as he had offered further subsidies, with another $10 million
rebate for each of the two films, plus offsetting Warner Bros‟ marketing costs to the tune of $13.5
million.
Hundreds of South Canterbury students had to stay home after the Post Primary Teachers‟ Association(PPTA) rejected the Government‟s latest offer during pay negotiations. PPTA members had alreadyhad a nationwide strike, with further industrial action planned during December. After three days of
bargaining, the union‟s national executive voted unanimously to reject the Education Ministry‟s offer
of 0.5% and a $1,000 (before tax) one-off payment for the first year, and 1.9% for the second year.
The previous offer was 0% and $1,000 for the first year, and 1.8% for the second year.
Junior doctors rejected the District Health Boards‟ (DHB) offer of a 2% pay rise and requested better
shift rosters instead. The Resident Doctors‟ Association also had talks with the DHBs over theircollective agreement but so far the negotiations were in the preliminary stage.
The Dominion Post reported that the Public Service Association (PSA) had filed legal proceedings
against more than 30 employers of disability support workers. The PSA was seeking payment of theminimum hourly rate for staff who work on sleepovers. The proceedings were a backdrop to thedecision expected from the Court of Appeal where the IHC had appealed the decision of the
Employment Court that employees on sleepover duties were due to be paid the minimum wage (seeMarch Chronicle).

November 2010
The Government was accused of introducing populist legislation to ensure that it would be re-elected.
Specifically, the part-time work-testing for sickness beneficiaries due to come into force in May 2011
was targeted by Labour Party Employment Spokesperson Grant Robinson. Mr Robertson said that
there were no jobs for people and that the Government should be focused on expanding the economy
to create jobs and up-skilling beneficiaries so they could take advantage of jobs created. He also
criticised other proposals such as the extension of the 90 day probation period and the requirement forunions to get permission to gain access to the workplace.
In early November, the NZ Herald reported that the Transport and Industrial Relations SelectCommittee reported back on the Employment Relations Amendment Bill and the Holidays
Amendment Bill. The Select Committee recommended that both Bills be passed as written with minorchanges. Some of the changes recommend by the Select Committee included a recommendation that if
a union requested consent to enter a workplace an employer had to respond within one working day.
If the employer still withheld consent, this had to be in writing by the next working day. Otherchanges included the removal of the terms „voluntary‟ and „informed‟ from the clause of the Holidays

New Zealand Journal of Employment Relations 36(1): 75-82
Act Amendment Bill that would allow workers to cash up a week of annual leave, and transferring
public holiday holidays; this would reduce the onus on employer, according to the reporting back fromthe Select Committee. The Labour Party and the Green party pointed to the regulatory impact
statement, which said cashing up a week of annual leave would have a disproportionately negative
impact on workers who were already disadvantaged in the labour market.
A Dominion Post article on a KPMG „Mood of the Market‟ survey said that the „fire-at-will‟
legislation was giving small businesses the „confidence to rebuild their depleted workforce‟. The
survey claimed that while about a quarter of businesses were planning to employ more staff, current
employees had concerns about job security. According to the report, on-line job seeking sites wereexperiencing an increase in job advertisements.
In a NZ Herald article, the Maritime Union of New Zealand vowed to go on the “offensive against
employment law changes”. The Secretary of the Maritime Union Joe Fleetwood said the passing of
the Employment Relations Act and the Holidays Act Amendment Bills spelled the „beginning of theend‟ for the Key Government, stating that the changes were “making life harder and sucking more
profit out of hard-pressed working people”. Mr Fleetwood described Prime Minister John Key as amulti-millionaire with “no interest in the wellbeing of the majority of New Zealanders”.
Opinion pieces on the „Hobbit saga‟ still appeared during November. Business NZ‟s CEO PhilO‟Reilly said in a Dominion Post article that the whole saga showed up how the Employment
Relations Act promoted uncertainty about whether someone is an employee or a contractor. Onceagain the case of Bryson v Three Foot Six was quoted as the catalyst, which sent „alarm bells ringing‟for Warner Brothers. Mr O‟Reilly accused the unions of reopening the contractor-employee problem
on a „massive scale‟ saying their actions were „provocative and naive‟. While Mr O‟Reilly said thatthe urgent change in legislation had fixed the problem for the film industry the contractor-employee
was still a problem elsewhere blaming the Employment Relations Act for creating the uncertainty. In
conclusion, he recommended a systematic review of the Employment Relations Act but “not acomplete reversal or upheaval”, saying that the Act needed to be improved to better service New
Zealand‟s productivity and economy.
Once again, the large state sector groups featured in the media as various employment negotiations hit
problems. The Dominion Post and the Marlborough Express reported that collective agreement
negotiations between junior doctors and their District Health Board employers hit a snag after theunion complained to the Employment Relations Authority. The reports said a threat of strike action
looked likely. In another part of the health sector, a settlement between District Health Boards andmedical laboratory workers was reached but an article in the Press suggested that the settlement
would not resolve critical issues within the sector. Union President Stewart Smith said the agreement“...was a pragmatic decision by the members...” and that the pay gap between laboratory workers andother scientific and technical groups was growing and people were not training in the field.
Furthermore, his members were earning considerably less than nurses despite having to complete a
degree which took four and a half years. Meanwhile, unionised radiographers went on a full strike for48 hours throughout the country after the DHBs withdrew their collective agreement offer.
The education sector also recorded industrial action during November. The Press reported that thesecondary school teachers were returning to the bargaining table but the planned strike action was still
due to go ahead. The PPTA and the Ministry of Education were due to resume negotiations. Limited
action including a ban on attending professional development, meetings and events continued. The
main issues for teachers included conditions such as class-sizes and allocation of time to do workrequired as well as working towards a secure collective agreement “not eroded by clawbacks” and apay increase. The PPTA turned down the latest offer of a 0.5% pay increase, a $1000 payment and aNew Zealand Journal of Employment Relations 36(1): 75-82
further 1.9% increase in September 2011. The PPTA was seeking a 4% salary increase plus improved
conditions such as more professional development.
The union for primary school teachers – the New Zealand Educational Institute (NZEI) – announced
that it had rejected an offer of a $1000 lump sum payment and a 1.8% pay increase. The offer was
rejected by 93% of teachers and the NZEI gave notice that teachers would vote on possible industrial
action in early 2011. Primary school teachers were also seeking a 4% pay increase.
A report on a survey of Police found that nearly 70% were ambivalent about their jobs. A Dominion
Post article said that 37% of the respondents believed that the Police management did not adequately
deal with harassment, bullying or discrimination complaints and 35% of respondents feared reprisal ifthey raised complaints about such behaviour with management.
A Treasury research paper found that employees who carried on working while sick cost the economy
billions of dollars every year. It said that proposed changes to sick leave were unlikely to reduce thecost. The annual indirect costs of ill-health were estimated to be between $5.4 billion and $13 billion.
Most of the estimated cost was through lost work hours because of sick days and „presenteeism‟,
where people attempted to work through their illness but who were ultimately unproductive.

December 2010
There was still some reporting on the „Hobbit case‟ during December with the NZ Herald running areport which alleged that a top United States union leader had “climbed on The Hobbit bandwagon”,
suggesting that the amendment to the Employment Relations Act could affect American union support
for the proposed Trans-Pacific Partnership trade negotiations between the US and New Zealand. In a
letter to the Minister of Trade Hon Tim Grosser, Richard Trumka stated that “[t]he Government‟s
move to eliminate the fundamental rights of workers in order to attract investment would violate thelabour provisions of any future trade agreement between our two countries that we could support.” Mr
Trumka also said that “[t]he misclassification of workers in the film production industry is a serious
problem that not only robs workers of decent wages, working conditions and benefits but also
deprives workers of the right to organise, form a union and bargain collectively.” NZ Council of Trade
Union President Helen Kelly was quoted as saying the issue had been a „hot topic‟ at a recent
International Labour Organisation meeting.
Meanwhile, a Dominion Post article stated that an official information request revealed emails
between Sir Peter Jackson and Hon Gerry Brownlee‟s office stated that the blacklist threat from theActors Equity union was not the main threat to moving the Hobbit movie offshore but the “grey areasin our employment law” were threatening the filming. Sir Peter maintained that Warner Brothers had
lost all confidence in filming in New Zealand “because they had just witnessed how a tiny andcapricious union, manipulated by an offshore agency, could bring a multimillion production to its
knees – for no legitimate reason.” He said the Government‟s law change “gave the studio confidence
that the film could made in New Zealand without the threat of unjustified ongoing industrial action”.
CTU President Helen Kelly expressed disbelief at Jackson‟s latest statement. She believed he knew
The Hobbit boycott was not a big issue because producers wanted to come to New Zealand “to force
law changes and money”.
The Dominion Post reported on a survey of employers which revealed only a partial implementationof the 90-day trial period implemented by the changes to the Employment Relations Act. The
Employers & Manufacturers Association‟s (Northern) annual employment round-up survey found that
50% of the 375 of those surveyed would use the 90-day trial period. A further 8% said they wereuncertain. CTU President Helen Kelly said the survey showed that despite the Government saying

New Zealand Journal of Employment Relations 36(1): 75-82
workers would have a choice about whether or not to accept the 90-day no rights period, employers
considered that the choice was theirs. She said that “[i]t is our view that those that don‟t use it arelikely to have better attitudes to their workers and better systems for employing people and are likely
to be more successful because of this”.
The Press reported that, after almost two years of negotiations, employees at Nelson‟s Sealord fishprocessing plant had ratified a collective employment agreement. The workers who were represented
by the Service and Food Workers‟ Union gained a wage increase of 8% over a two-year period and a$500 lump-sum payment.
The Dominion Post reported that primary school teachers and principals had voted in favour of a pay
proposal agreed to by the primary teachers‟ union in November after months of bargaining with the
Ministry of Education (see November Chronicle). The agreement provided a 2.75% pay rise and $300
lump sum payment.
With the Christmas party season approaching, the usual warnings about over the top behaviour byinebriated employees full of Christmas cheer and the responsibilities of employers at these functions
were published. A Dominion Post article reminded employers that they were liable for sexual
harassment committed by one employee to another in the course of employment. An employer could
defend the claim by proving that it had taken all reasonable and practical steps to provide a safe
workplace. A recent case before the Human Rights Tribunal provided a sobering warning where a cafe
proprietor was ordered to pay the sum of $19,000 to a former employee who had been sexuallyharassed by a fellow staff member. The Human Rights Review Tribunal said the case highlighted thedangers of running a business without any understanding of the provisions of the Human Rights Act
relating to sexual harassment and without any understanding that such behaviour can be unwelcome toothers.
Other noteworthy personal grievance cases highlighted in the media included a former chief executiveof the Plumbers, Gasfitters and Drainlayers Board who used „guerrilla tactics‟ against his former
employer but had failed to get reinstatement in his job after being dismissed. The employee had takenover 4,000 documents from his office in order to prove his claims of serious irregularities about faulty
gas certifications. The Employment Relations Authority found that the decision to dismiss the man
was one that any fair and reasonable employer would have reached.
In another Dominion Post article, a former employee of the Ministry of Social Development had
posted a Facebook description of herself as a “very expensive paperweight” who was “highly
competent in the art of time wastage, blame-shifting and stationary [sic] theft”. The employee wasdismissed from her position as a prison reintegration case manager and failed in her bid for unfair
dismissal. Employment Relations Authority member Dzintra King said in her judgment that the online
comments “endorsed a stereotyped view of slothful and exploitative public servants”. The Facebook
postings would not in themselves have warranted the person‟s dismissal but, combined with her past
behaviour, the Ministry was justified in its actions because management could not trust her, Ms Kingsaid.
An article in the Waikato Times highlighted the vulnerability of companies to employees using
offensive websites during working hours. An Employers and Manufacturers survey revealed that only
9% blocked offensive websites that carried pornography with business owners saying they would deal
with issues as they arose, but nearly a third of companies blocked potentially time-wasting sites
including Trade Me and Facebook. Waikato-based Computer Troubleshooters‟ Director Dennis Jones
said employers who trusted staff to only use the internet for work purposes were normally sadly
mistaken. He was quoted as saying that “[a] lot of employers are baby boomers and a lot of employees

New Zealand Journal of Employment Relations 36(1): 75-82
are Generation X and Y who are so experienced at hiding Facebook from mum that employers are a
doddle”.

January 2011
The end of the Christmas holiday season brought further calls for a change in the Holidays Act. In a
Dominion Post article, business leader Cameron Brewer was quoted as saying that though theHolidays Act was intended to boost the pay packets of those working on public holidays, it was,instead, forcing many businesses to shut down in the holiday season. Mr Brewer, who chairs
Auckland Council‟s Business Advisory Panel, called for the Act to be repealed. He was quoted assaying that “[t]he intentions of the 2003 legislation were honourable, but now we‟re seeing one big
unintended consequence. That is, it‟s actually forcing businesses shut and workers to cut back theirhours when they probably need extra money the most.”
Yet more commentary on the Hobbit issue emerged as the Timaru Herald and the Southland Times
reported that union leaders were considering laying a complaint with the United Nations over the
Employment Relations (Film Production Work) Amendment Bill. The NZ CTU said that the new law
breached international conventions on employment rights. CTU President Helen Kelly said the union
was looking at laying a complaint with the International Labour Organisation (ILO). The ILO uphelda similar complaint against the New Zealand Government over the Employment Contracts Act 1991,
she said. To be found in breach of the conventions again would embarrass the Government.
In further news on the implementation of the 90-day trial period reported in both the NZ Herald andthe Dominion Post, the Government was accused of making empty promises after saying the 90-day
trial period for new workers would be voluntary, and then asking all public sector employers toinclude it in all contracts. The State Services Commission defended an email which said that
Government employers were expected to implement Government policy, including the 90-day trial.
State Services Commission‟s Spokesperson Jason Ryan said that the email was nothing more thanguidance for public sector chief executives to “act lawfully and implement government policy”, but
the Labour Spokesperson for State Services Grant Robertson said the email made a mockery of theclaim that the trial period would be optional. A spokesperson for The Hon Kate Wilkinson said that“Workers are free to negotiate whether it applies.” The Service and Food Workers Union had about3000 members in collective agreements which did not have the trial period while the Tertiary
Education Union had similar agreements.
Both the Timaru Herald and the Dominion Post reported that industrial action by health workers cost
DHBs at least $2 million – 10 times more than it would have cost to settle pay claims, according to a
spokesperson for the radiographers. Both radiographers and hospital lab workers participated in fourmonths of rolling go-slows and work-to-rule action last year during protracted and bitter collective
agreement negotiations with their health board employers. The radiographers‟ union, Apex, said at thetime that the difference between what their members were asking for and what District Health Boards
were offering was just $200,000. Wellington‟s Capital & Coast DHB – which spent $678,000 during
the most recent strike – allegedly paid nearly $50,000 to senior doctors to act as gate-keepers todetermine whether a patient needed life saving treatment.
The Unite union‟s National Director Mike Treen was escorted from SkyCity Auckland after aworkplace access dispute. Unite, which represented about 1000 of SkyCity‟s 3000 employees, wasprotesting over wage and employment conditions. Management and security at SkyCity followed Mr
Treen as he spoke to workers despite a trespass order.

New Zealand Journal of Employment Relations 36(1): 75-82
Amongst the personal grievance cases reported in January was the case of a worker, who was refused
reinstatement by the Employment Relations Authority after it was found that she incited violenceagainst a fellow worker when an argument got out of hand. A dispute between the two workmates
reached its climax in late October 2010 when the woman‟s husband visited her workplace during hislunch break and beat up her fellow worker. The attack on the employee was described as “adisgraceful episode” by Authority member James Crichton. Bad blood had existed between the twoworkers since August 2009 when the victim complained about offensive racial remarks made against
him by the employee. Interestingly, in another case, the Dominion Post reported on one of its own
reporters who was appealing her dismissal for allegedly plagiarising an article by columnist Deborah
Coddington. The journalist maintained that although she had read the article any similarities between
the two were inadvertent.

Erling Rasmussen & Colin Ross
Auckland University of Technology