Special Edition: Labour Law
Contents Page: NZJER, 2012, 37(1)
Name

Title

Page
Number
1-2

Margaret Wilson

Introduction

Andrew Steward

Australian Labour Law in Transition: The Impact 3-21of the Fair Work Act

Joellen Riley

Bargaining Fair Work Style: Fault-lines in the 22-29
Australian Model

Leeanne Templer

Good Faith in Collective Bargaining
Communications in Australia and New Zealand

Max Harris

The Rule of Law in Private Law: A New 44-59
Animating Ideal for Employment Law?

Susan Hornsby-Geluck

An Uneven Playing Field – Partial Strikes

Scott Worthy

Revisiting Stokes Valley: Trial Periods and 70-81
Statutory Interpretation

Jonathan Barrett
Leigh Thomson

30-43

60-69

& Returning Dignity to Labour: Workplace Safety as 82-89
a Human Right

Leeanne Templer

New Zealand and the Proposed Australian Model
Workplace Health and Safety Act

90-99

Jennifer Moore

An Evaluation of Whether New Zealand’s 100-117
Occupational Health and Safety Law Adequately
Addresses the Risks to Workers Exposed to
Nanotechnology and Nanoparticles

John Goddard

Hunting for Happy Feet in Honolulu: The Elusive 118-150
Struggle for Pay Equity – A Comparative View

Amanda Reilly

Time, Work, and Law: a New Zealand Perspective

Amanda Reilly

Equality and family responsibilities: a critical 161-166
evaluation of New Zealand law

151-160

New Zealand Journal of Employment Relations 37(1): 1-2

Special Edition NZJERLabour Law
Introduction
On 3 June 2010, the New Zealand Labour Law Society was launched in Auckland by its Patron
Judge Coral Shaw. The launch was sponsored by the NZWALMI (New Zealand Work and LabourMarket Institute) which has continued to support the Society with administrative assistance. The
Society has sought and been granted affiliation to the International Society of Labour and Social
Security Law (ISLSSL) as the New Zealand member of the international society. The purpose of
the Society include: promoting the study and exchange of ideas about labour law; providing a forum
for debate for lawyers and others working in the field; and the holding of meetings, seminars andconferences and publication of papers and research relating to labour law.
This publication resulted from papers presented at the first Labour Law Conference held in
Wellington in December 2011 in fulfilment of the objectives of the Society. The Society was
substantially supported in the holding of the conference by the Victoria University of Wellington
Faculty of Law. The papers cover a diverse range of topics including the keynote address byAndrew Stewart that reviews recent developments in the Australian labour law regulatory
framework. Recent changes to the Australian health and safety legislation are also reviewed while
another paper compares the Australian and New Zealand health and safety regimes. Two otherpapers also discussed aspects of health and safety including the risks associated with nanoparticles
and nanotechnology. Topics covered in other papers included partial strike law, recent case law on
the 90-day rule, developments in pay equity and the relationship between equality, the family andemployment law. There was also a thought provoking paper on the application of the rule of law toemployment law, and another on the notion of a Guaranteed Basic Income. The scope and diversityof the topics demonstrated the range of issues confronting labour lawyers.
The increasing number of challenges facing the regulation of employment relations is not
surprising, given that the labour market is facing the reality of globalisation of the New Zealandeconomy. The challenge for New Zealand has been to adapt to the demands of globalisation
without destroying the values and principles that underpin the unique character of our society. The
pressure to forsake the notions of equalitarianism, a sense of fairness, and respect for others has
been great in recent times. Since the 1970s, New Zealand has been locked in an ideologicalstruggle over the regulatory framework for employment relations. This has created uncertainty anda short termism that may account at least partially for low productivity and economic growth.
New Zealand is not alone in a clash of ideologies to determine the labour market regulatory regime.
Developments within the International Labour Organisation (ILO) and the European Union (EU)have also centred on how to reconcile economic and social objectives within the labour market
public policy. For example, the 1998 ILO Declaration on Fundamental Principles and Rights at
Work and the Decent Work programme were a response to a labour market that demanded greater
flexibility. This ‘soft law’ approach was designed to work with countries to advance labour rights
through a programme of measures that were appropriate to their conditions. There has been avigorous debate within the academic world on whether this approach has undermined the notion of
employment rights. The reality is that the labour market policy follows economic policy and whenthat policy embraced the notion of the unregulated or regulation-light market, the labour market had
to adjust.

New Zealand Journal of Employment Relations 37(1): 1-2
The Employment Relations Act was an attempt to accommodate the changing reality of the labour
market while ensuring the rights of workers to organise and bargain collectively. The notion ofgood faith was incorporated in the legislation to inject a requirement for fairness when determining
the wages and conditions that would regulate the employment of workers. The enactments ofhealth and safety, holidays, and paid parental leave legislation were also an attempt to provide alabour standards code for New Zealand workers. This code has been amended by the National
government to provide further labour market flexibility by removing from workers in the film
industry employment rights such a holidays, sick leave, paid parental leave and health and safety
requirement by deeming them to be contractors. The 90-day rule, the cash for holidays exchange
and restricting union representatives’ access to the workplace are examples of recent regulated
flexibility. Further changes are foreshadowed in the National government election manifesto.
If past experience is anything to go by, the next change of government will also see a raft ofstatutory changes. This see-saw approach to labour market regulation creates challenges for law
practitioners. Hence, the relevance of the New Zealand Labour Law Society as a forum for legal
practitioners to analyse, discuss and contribute to the policy debate. It is intended to hold further
conferences, seminars and workshops in the future and make available through publications such as
the NZJER the productivity of these events to a wider audience. It is appropriate to acknowledge
the contribution of the committee members who have contributed to the current issue including
Professor Gordon Anderson, President; Pam Nuttall, Secretary; Amanda Reilly, Simon Mitchell,
Stewart King, Anne-Marie McInally, Andrew Dallas, Mike French, and Margaret Wilson,
Committee Members.

Margaret Wilson
Professor of Law and Public Policy
Faculty of Law
University of Waikato

New Zealand Journal of Employment Relations 37(1): 3-21

Australian Labour Law in Transition: The Impact of the Fair Work
Act
ANDREW STEWART*
Introduction
The last two decades have seen almost constant change in Australian labour law. Since the Hawke
Government replaced the Conciliation and Arbitration Act 1904 with the broadly similar Industrial
Relations Act 1988, there has scarcely been a year without some substantial proposal for legislativereform, at either federal or State levels, or both.
However, since 2005 in particular, the pace of change has quickened dramatically. We have seen
two major rewrites of federal industrial law. The first, the Howard Government‘s ‗Work Choices‘amendments, brought thousands of Australians onto the streets in protest, set off an advertising war,and ultimately helped to bring an end to 11 years of conservative government. The second, theLabor Government‘s ‗Fair Work‘ legislation, has disappointed unions and employer groups alike –yet holds out the welcome prospect of a return to stability in labour regulation.
This paper outlines the changes effected by the Work Choices and Fair Work legislation, and thevalues and objectives underlying these two important and contentious sets of reforms. In order to put
them in their proper context, however, it is necessary to start by explaining a reform process thatbegan over 20 years ago.

Background: From Compulsory Arbitration to Enterprise Bargaining
Back in the 1980s, labour regulation in Australia was still dominated (as it had been for much of thetwentieth century) by the idea of industrial tribunals using compulsory powers of conciliation andarbitration not just to resolve workplace disputes as they arose, but to set minimum standards on
wages, working hours and other conditions of employment 1. Those standards were expressed inawards, legally binding instruments that could (and often did) apply across entire industries or
occupations. The Commonwealth and each of the States had their own tribunal systems, with noclear or predictable delineation between them. Because the federal system was based on the
Commonwealth‘s constitutional power to provide for the conciliation and arbitration of industrial
disputes that crossed State boundaries, its reach was limited by the propensity of parties to become
involved in (or indeed deliberately create) ‗interstate‘ disputes2 (Guidice, 2007). Some industries* Andrew Stewart is John Bray Professor of Law, University of Adelaide; and a Consultant at Piper Alderman.
This paper is an updated version of a piece that originally appeared as ―Labour Law in Transition: From Work Choices
to Fair Work‖ in P Sadler (ed) Contemporary Issues in Law & Policy (Applied Law & Policy, Perth, 2010) 73.
1

As to the origins and development of the conciliation and arbitration systems, see S Macintyre and R Mitchell (eds)
Foundations of Arbitration (Oxford University Press, Melbourne, 1989); J Isaac and S Macintyre (eds) The New
Province for Law and Order: 100 Years of Australian Industrial Conciliation and Arbitration (Cambridge University
Press, Melbourne, 2004).
2
See G Giudice ―The Constitution and the National Industrial Relations System‖ (2007) 81 Australian Law Journal 584
at 591–595.

New Zealand Journal of Employment Relations 37(1): 3-21

tended to be covered by federal awards, some by State instruments, and others still by a mixture of
the two. There were also certain matters that were regulated by State legislation, even for workers
covered by federal awards, such as occupational health and safety.
In practice, it was common for employers and trade unions to negotiate as to the content of awards,
and, indeed, to strike enterprise-level deals that improved on award conditions or dealt with local
issues. However, that bargaining took place under the shadow of conciliation and arbitration
procedures that could be unilaterally invoked at any time. The arbitration systems gave Australianunions a role and influence that went beyond their capacity to organise at individual workplaces.
Whether or not an employer was prepared to negotiate over employment conditions, a union with arecognised interest in the relevant industry or occupation could notify a dispute to a tribunal andseek new or varied award standards to cover that business – regardless of whether it had members
there or not. Unions could also seek, in various ways, to protect their organisational security,
including seeking award provisions and giving their members ‗preference‘ in employment over nonmembers3.
During the 1980s, the conciliation and arbitration system came under increasing fire from a numberof academics, business groups and conservative commentators. Although there were a range ofcriticisms, the most damning charges included that the system privileged unions, imposed
unnecessarily high labour costs, and was generally too centralised in its focus.4 Importantly, andunder the influence of the likes of John Howard and Peter Costello, the Liberal Party became
committed to the idea of a radical ‗deregulation‘ of the labour market that would severely limit the
influence of both unions and tribunals, and restore the prerogative of management to set conditions
that suited the needs of their business. It was a vision based firmly on the individualisation of
employment relations.5
In only one instance did such thinking lead to the complete dismantling of an arbitration system; thatwas in Victoria, where in 1992 the Kennett Government – very much taking its lead from New
Zealand‘s Employment Contracts Act 1991 – introduced a system of individual employment
agreements, underpinned by a set of limited statutory standards.6 The reforms had only limited
success, not least because many unions sought federal award coverage so as to override the new
State laws. In 1996, the Government abandoned the experiment and instead entered into a deal with
the newly elected Liberal/National Government headed by John Howard to refer almost all of theState‘s industrial powers to the Commonwealth7. Since then, with certain exceptions, Victorian
workers have been subject only to federal industrial laws.

3

See generally P Weeks Trade Union Security Law: A Study of Preference and Compulsory Unionism (Federation Press,
Sydney, 1995).
4
See eg H R Nicholls Society Arbitration in Contempt (H R Nicholls Society, Melbourne, 1986); R J Blandy and J
Sloan ―Escape From the Banana Republic: Labour Market Reforms‖ 98 National Institute of Labour Studies Working
Paper Series (Flinders University, Adelaide, 1988); J Niland Transforming Industrial Relations in New South Wales: A
Green Paper (NSW Government Printing Office, Sydney, 1989); Industrial Relations Study Commission of theBusiness Council of Australia Enterprise-Based Bargaining Units: A Better Way of Working (Business Council ofAustralia, Melbourne, 1989). See also C Mulvey ―Alternatives to Arbitration: Overview of the Debate‖ in R Blandy andJ Niland (eds) Alternatives to Arbitration (Allen & Unwin, Sydney, 1986).
5
See generally S Deery and R Mitchell (eds) Employment Relations: Individualisation and Union Exclusion (Federation
Press, Sydney, 1999); D Peetz Brave New Workplace: How Individual Contracts are Changing Our Jobs (Allen &Unwin, Sydney, 2006); B Dabscheck ―The Contract Regulation Club‖ (2006) 16 Economic and Labour Relations
Review 3
6
Employee Relations Act 1992 (Vic).
7
See Commonwealth Powers (Industrial Relations) Act 1996 (Vic).

New Zealand Journal of Employment Relations 37(1): 3-21

Elsewhere, there was agreement – even on the part of supporters of the arbitration system – that
greater emphasis must be placed upon bargaining at the enterprise level than had hitherto been thecase.8A particular objective was to use enterprise bargaining to lift the productivity and, hence,competitiveness of Australian businesses. This is a goal that was embraced by the Australian Labor
Party (ALP) and the peak union body, the Australian Council of Trade Unions (ACTU), as much as
by the conservative parties and the employer groups. During the 1990s, Labor and conservative
governments at the federal level, and in every State, enacted legislative amendments to give theirindustrial laws a greater focus on the enterprise. 9 Aside from in Victoria, these reforms followed acommon pattern. They permitted parties to register enterprise-level agreements which, if they met
certain criteria, could take effect for what was nominally a fixed period. During that period, theagreements would not only override any awards that would otherwise be applicable, but alsopreclude the relevant tribunal from exercising its arbitral powers in relation to the matters covered.
In effect then, the amendments created a limited right to ‗opt out‘ of the various conciliation andarbitration systems. At the federal level, it was also accepted that workers should have the right totake ‗protected‘ industrial action in support of a new enterprise agreement. Prior to that, strikes andother forms of industrial action had almost invariably been illegal, although extremely prevalent inpractice. 10
Despite the common pattern, there were key differences between the legislative models favoured by
the Labor and Conservative parties. The ALP‘s preferred option was to impose a ‗no-disadvantage‘
test. This allowed almost unlimited freedom to bargain upwards from the wages and conditions set
by existing awards (now thought of as a ‗safety net‘ rather than the primary form of regulation),while preserving the tribunal‘s capacity to reject agreements which undercut those conditions. 11
Labor also accepted – albeit over the opposition of the union movement – that collective agreements
could be struck between an employer and a group of workers without the involvement of a union;
but it endeavoured to hold the line against allowing employers to strike deals with individual
workers that overrode awards. The conservative parties, by contrast, tried in most jurisdictions notjust to ‗strip back‘ awards, so that they dealt with a more limited range of matters than had
previously been the case, but to make it easier for agreements to reduce the award conditions thatremained. They sought to achieve this objective in a number of ways, including by replacing the nodisadvantage test with a requirement that an agreement comply with a small number of basic
minimum standards. They also attempted to accord primacy to individual agreements over collective
agreements, to outlaw any form of discrimination against non-unionists, and, more generally, toreduce the power and influence of the tribunals.
The Howard Government‘s first wave of reforms in 1996 achieved most of these objectives,
including the introduction of a system of individual Australian Workplace Agreements (AWAs) 12,
but the Liberal/National Coalition‘s lack of control of the Senate meant that it was forced to enter
into a compromise with the centrist Australian Democrats to secure the passage of its legislation. In
particular, it was compelled to accept the retention of a no-disadvantage test for both AWAs and
8

See generally A Stewart ―Procedural Flexibility, Enterprise Bargaining and the Future of Arbitral Regulation‖ (1992) 5
Australian Journal of Labour Law 101; D Macdonald, I Campbell and J Burgess ―Ten Years of Enterprise Bargaining inAustralia: An Introduction‖ (2001) 12 Labour & Industry 1.
9
See generally D R Nolan (ed) The Australasian Labour Law Reforms: Australia and New Zealand at the End of theTwentieth Century (Federation Press, Sydney, 1998).
10
See B Creighton ―Enforcement in the Federal Industrial Relations System: An Australian Paradox‖ (1991) 4
Australian Journal of Labour Law 197.
11
See eg the reforms introduced by the Industrial Relations Reform Act 1993 (Cth).
12
See Workplace Relations and Other Legislation Amendment Act 1996 (Cth), which amended the Industrial Relations
Act 1988 (Cth) and renamed it the Workplace Relations Act 1996 (Cth).

New Zealand Journal of Employment Relations 37(1): 3-21

certified (collective) agreements. Over the next eight years, the Howard Government put forward
various proposals for further reform,13 but only a few of these were passed, and then in amended
form. 14 The more contentious measures failed to progress, notably in relation to the exemption ofsmall businesses from the need to act fairly in terminating employment. 15 This last measure was said
to be necessary in order to generate job growth, although no hard evidence was ever advanced to
substantiate the assertion that unfair dismissal laws were deterring employers from hiring workers
who would not otherwise have found a job.16

The Work Choices Legislation
The Coalition‘s opportunity was to come in 2005, when it unexpectedly gained control of the
Senate. In May 2005, after a lengthy internal debate about just how far to go in dismantling theexisting system, John Howard announced a package of reforms that was eventually given the brandname ‗Work Choices‘ and marketed to the public at considerable expense. 17 It was claimed that thereforms would ―create a more flexible, simpler and fairer system of workplace relations forAustralia‖, one which would ―improve productivity, increase wages, balance work and family life,and reduce unemployment.‖18
In November, a massive and hastily-drafted Bill was put before the Parliament – not, as might havebeen expected, to replace theWorkplace Relations Act 1996 (WR Act), but to amend and renumber
it. After a cursory Senate inquiry, the Bill was passed with nearly 300 amendments, all proposed by
the Government itself and most correcting oversights or errors. It passed into law as the Workplace
Relations Amendment (Work Choices) Act 2005 and was proclaimed to take effect on 27 March
2006, together with a hefty new set of regulations. 19
Given the controversy that surrounded their enactment, it is hardly surprising that the Work Choices
reforms were described as ―radical‖ or ―revolutionary‖ by many commentators.20 However, in many
ways, they fell short of the ―big bang‖ that might have been expected.21 What the Coalition chose to
do was to retain many of the existing institutions and processes, but undermine them in various
ways.
13

See eg Workplace Relations Legislation Amendment (More Jobs, Better Pay) Bill 1999 (Cth).
See eg Workplace Relations Amendment (Termination of Employment) Act 2001 (Cth); Workplace Relations
Amendment (Genuine Bargaining) Act 2002 (Cth); Workplace Relations Amendment (Improved Remedies for
Unprotected Action) Act 2004 (Cth).
15
See eg Workplace Relations Amendment (Fair Dismissal Reform) Bill 2004; and see S O‘Neill ―Unfair Dismissal andthe Small Business Exemption‖ Background Note (Parliamentary Library, Canberra, 2008).
16
See P Waring and A de Ruyter ―Dismissing the Unfair Dismissal Myth‖ (1999) 25 Australian Bulletin of Labour 251;
W Robbins and G Voll ―The Case for Unfair Dismissal Reform: A Review of the Evidence‖ (2005) 31 Australian
Bulletin of Labour 237.
17
The validity of the appropriation of the A$55 million that was eventually spent on the campaign was challenged in theHigh Court, but upheld in Combet v Commonwealth (2005) 224 CLR 494.
18
Explanatory Memorandum, Workplace Relations Amendment (Work Choices) Bill 2005 (Cth) 1.
19
See especially the Workplace Relations Regulations 2006 (Cth).
20
See eg J Murray ―Work Choices and the Radical Revision of the Public Realm of Australian Statutory Labour Law‖(2006) 35 Industrial Law Journal 343; R Hall ―Australian Industrial Relations in 2005 — The WorkChoices Revolution‖(2006) 48 Journal of Industrial Relations 291.
21
See A Stewart ―Work Choices in Overview: Big Bang or Slow Burn?‖ (2006) 16(2) Economic and Labour Relations
Review 25. The changes were certainly not as fundamental as those adopted by the Keating Government in 1993: see R
Mitchell, P Gahan, A Stewart, S Cooney and S Marshall ―The Evolution of Labour Law in Australia: Measuring theChange‖ (2010) 23 Australian Journal of Labour Law 61.
14

New Zealand Journal of Employment Relations 37(1): 3-21

This was particularly true in relation to the national industrial tribunal, and the Australian Industrial
Relations Commission (AIRC). Its powers to set and adjust minimum wage rates were transferred toa new body, the Australian Fair Pay Commission, whose five members were appointed on limited
term contracts. It was widely assumed that this group would be more sympathetic to theGovernment‘s desire to hold down wage increases in order to create greater incentives for employers
to hire low-paid workers.22 The AIRC also lost responsibility for the approval of collective
workplace agreements, which, like AWAs, were now lodged with the Office of the Employment
Advocate (OEA). Most significantly, its compulsory powers of conciliation and arbitration were
almost entirely removed. Leaving aside certain functions in controlling the use of industrial action,
the AIRC was now expected to compete with private mediators and arbitrators in providing
voluntary dispute resolution services; although the fact that its services were freely available, andthat it retained the support of most of the major employers and unions, gave it a significant edge inthat regard.23
Awards, too, were retained, though provision was made for further ‗simplification‘ and‗rationalisation‘ of their content and coverage. Crucially, the no-disadvantage test for registeredagreements was removed, meaning that awards no longer functioned as a safety net for workplacebargaining. Certain award provisions were designated as having ‗protected‘ status – for example,
any requirement to pay overtime or other ‗penalty rates‘ for long or anti-social hours of work. But
even a protected award condition could be modified or removed by clear enough words in aworkplace agreement. Hence, there was nothing now to stop employers from engaging workers on
sub-award conditions, especially through AWAs. Indeed, the legislation made it clear that
employers could require job-seekers to sign an AWA as a condition of being hired. Furthermore,
once an employee became subject to an AWA or collective agreement, the bulk of any otherwise
relevant award would no longer apply to them, even if the agreement was subsequently terminatedand not replaced. The true safety net was now provided by the Australian Fair Pay and Conditions
Standard (AFPCS), a set of five minimum conditions that applied to all federal system employees,
except those covered by pre-Work Choices agreements. The AFPCS required employers to observea basic wage rate (in most cases derived from an award), and refrain from expecting employees towork more than 38 hours per week plus reasonable additional hours. It also obliged employers toprovide four weeks‘ annual leave, various forms of personal leave, and 12 months‘ unpaid parental
leave.
Other significant reforms introduced by Work Choices included an exemption from unfair dismissal
claims that extended well beyond ‗small‘ businesses. Employers with 100 or fewer employees were
now entirely immune from any complaint that they had acted harshly, unjustly or unreasonably in
dismissing a worker; and even larger employers could resist any claim by pleading a ‗genuine
operational reason‘ for a dismissal.
There were also amendments that further restricted the capacity of trade unions to organise protectedindustrial action, or to enter workplaces to hold discussions with current or potential members. The
new rules on industrial action included a requirement to conduct a secret ballot of members to obtain
their authorisation for the action to proceed. In addition, there were limitations on the kind of terms
22

See eg P Waring, A de Ruyter and J Burgess ―The Australian Fair Pay Commission: Rationale, Operation,
Antecedents and Implications‖ (2006) 16(2) Economic and Labour Relations Review 127. In the result, most of the Fair
Pay Commission‘s decisions awarded minimum wage increases that broadly matched what the AIRC had been granting
over the previous decade. It was only in its final decision in July 2009, which imposed a wage freeze in response to therecession brought on by the global financial crisis, that the Commission performed to expectations: see Wage Setting
Decision July 2009 (2009) 183 IR 1.
23
See A Forsyth ―Dispute Resolution under Work Choices: The First Year‖ (2007) 18 Labour & Industry 21.

New Zealand Journal of Employment Relations 37(1): 3-21

that could be included in a workplace agreement, with prohibitions aimed specifically at provisions
commonly sought by unions. A separate but related initiative involved the enactment of special
legislation to regulate bargaining and industrial action in the building industry.24 Among otherthings, this established the Australian Building and Construction Commission (ABCC), a body withextensive powers of investigation and enforcement, whose task was to combat the culture of―lawlessness‖ in the industry identified by the Cole Royal Commission. 25 Employers in the industry
were required to conduct their employment relations strictly in accordance with the Government‘s
National Code of Practice for the Construction Industry if they wished to bid for publicly funded
work. In a similar vein, the threat of funding cuts was used to force universities not just to offer all
staff individual agreements, but to rewrite all their policies and procedures to remove any
guaranteed role for unions.26The ―command and control‖ mentality27, evident in these and otherrestrictions on agreement-making stood in stark contrast to the Howard Government‘s rhetoricalcommitment to ―freedom‖ and ―choice‖ in bargaining.28
Perhaps the most far-reaching changes introduced by the Work Choices legislation concerned thecoverage of the federal system. Instead of operating by reference to interstate industrial disputes, the
new system‘s application was dictated primarily by the nature or location of each employer. In
particular, the corporations‘ power in s 51(xx) of the Constitution was used to regulate all trading,financial or foreign corporations and their employees. In addition, all other employers in Victoria
and the Territories were covered: the former as a result of the 1996 referral of powers, the latter by
reliance on the Commonwealth‘s general power in s 122 of the Constitution to make laws in relation
to the Territories. Added to the Commonwealth‘s control of its own agencies, this brought
somewhere between 75 and 85% of the Australian workforce within the scope of the federal
system.29 The WR Act was now specified to operate to the complete exclusion of State or Territory
industrial laws, except on ‗non-excluded‘ matters, such as workers compensation, occupational
health and safety, discrimination, training and long service leave. Therefore, for most purposes,
federal system employers could only now be subject to federal regulation. Where a State award or
agreement had previously applied to such an employer, it was given effect as a federal instrument. A
subsequent measure, the Independent Contractors Act 2006, also prevented the States and Territories
from subjecting contractors engaged by corporations (or by Commonwealth agencies or in a
Territory) to anything in the nature of ‗industrial‘ regulation. 30

24

Building and Construction Industry Improvement Act 2005 (Cth); and see A Forsyth, V Gostencnik, I Ross and T
Sharard Workplace Relations in the Building and Construction Industry (LexisNexis Butterworths, Sydney, 2007).
25
See T R H Cole Final Report of the Royal Commission into the Building and Construction Industry (Commonwealth,
Canberra, 2003).
26
See Higher Education Legislation Amendment (Workplace Relations Requirements) Act 2005 (Cth); S Rosewarne―Workplace ―Reform‖ and the Restructuring of Higher Education‖ (2005) 56 Journal of Australian Political Economy
186
27
See J Howe ―‗Deregulation‘ of Labour Relations in Australia: Towards a More ‗Centred‘ Command and Control
Model‖ in C Arup et al (eds) Labour Law and Labour Market Regulation (Federation Press, Sydney, 2006) 147;
S Cooney, J Howe and J Murray ―Time and Money under Work Choices: Understanding the New Workplace Relations
Act as a Scheme of Regulation‖ (2006) 29 University of New South Wales Law Journal 215.
28
See Stewart ―Work Choices in Overview‖, above n 21, at 35, 52; Murray, above n 20, at 365. The reaction by many
employers and unions to the government‘s restrictions was to negotiate informal ‗side‘ deals on matters that could not
lawfully be included in registered agreements: see A Stewart and J Riley ―Working Around Work Choices: Collective
Bargaining and the Common Law‖ (2007) 31 Melbourne University Law Review 903.
29
There have been varying estimates of this coverage, none of them precise. For more recent figures, see Explanatory
Memorandum, Fair Work Amendment (State Referrals and Other Measures) Bill 2009 (Cth), v–vi.
30
See J Riley ―A Fair Deal for the Entrepreneurial Worker? Self-Employment and Independent Contracting Post Work
Choices‖ (2007) 19 Australian Journal of Labour Law 246; A Forsyth ―The 2006 Independent Contractors Legislation:
An Opportunity Missed‖ (2007) 35 Federal Law Review 329.

New Zealand Journal of Employment Relations 37(1): 3-21

The Fight Against Work Choices
The immediate response by the States and Territories to the federal ‗takeover‘ was to mount a
constitutional challenge to the Work Choices legislation; but in November 2006, the High Court
rejected that challenge on all counts. 31 Other legal responses by some of the States, each of which, at
the time, had Labor Governments, proved more successful. 32 These included ‗de-corporatising‘certain public sector agencies or local councils, so that they fell outside the scope of the new federal
system;33 and also legislating to extend their regulation of federal system employers in some of the‗non-excluded‘ areas still left to them.34 A further tactic was to establish inquiries or commission
research to explore the impact of the Work Choices reforms on workers and their families. 35
Victoria, indeed, created a new public office, the Workplace Rights Advocate, with the specificobjective of promoting the ‗fair industrial treatment‘ of Victorian workers.36 A number of otherStates and Territories followed suit. 37 Some also introduced procurement guidelines that effectively
required government suppliers or contractors not to use the federal changes to cut working
conditions. 38
The most significant campaign waged against Work Choices, however, was the one conducted bytrade unions and various community groups, under the banner of ‗Your Rights at Work‘.39 Featuringsome highly effective TV advertising, it highlighted the potential for employers to exploit the newlegislation to remove entitlements and dismiss workers with impunity. One particular advertisement
had a major impact. It showed a mother, ‗Tracey‘, being threatened with the sack unless she came in
to work at short notice, despite being unable to make any arrangements for the care of her children. 40
With the economy growing strongly at the time, unemployment low and skilled labour in short
supply, there was, in truth, little incentive or opportunity for most employers to use the newlegislation to their full advantage. Nonetheless, evidence began to emerge of low-wage workers inindustries, such as retail and hospitality, seeing their take-home pay fall under standard or ‗template‘
agreements (both individual and collective) that lowered or removed ‗protected‘ award conditions.41
31

New South Wales v Commonwealth (2006) 229 CLR 1: see A Stewart and G Williams Work Choices: What the High
Court Said (Federation Press, Sydney, 2007); S Evans, C Fenwick, C Saunders, J-C Tham and M Donaldson ―Work
Choices Case: Analysis and Implications‖ in Work Choices: The High Court Challenge (Thomson, Sydney, 2007) 1.
32
See I Landau ―Legislating on the Margins of the Federal Takeover: Victoria‘s Response to WorkChoices‖ (2008) 21
Australian Journal of Labour Law 30; A Stewart ―Testing the Boundaries: Towards a National System of Labour
Regulation‖ in A Forsyth and A Stewart (eds) Fair Work: The New Workplace Laws and the Work Choices Legacy(Federation Press, Sydney, 2009) 19 at 29–32.
33
See eg Public Sector Employment Legislation Amendment Act 2006 (NSW); Statutes Amendment (Public Sector
Employment) Act 2006 (SA); Local Government and Industrial Relations Amendment Act 2008 (Qld).
34
As, for example, in relation to child labour: see eg Industrial Relations (Child Employment) Act 2006 (NSW); Child
Employment Act 2006 (Qld) Parts 2A - 2B.
35
See eg Industrial Relations Commission of South Australia Inquiry Into the Impact of Work Choices in SA – Report(Adelaide, 2007).
36
See Workplace Rights Advocate Act 2005 (Vic).
37
A Workplace Rights Ombudsman was created in Queensland, a Fair Employment Advocate in Western Australia, anda Workplace Advocate in the Northern Territory.
38
See J Howe and I Landau ―‗Light Touch‘ Labour Regulation by State Governments in Australia‖ (2007) 31
Melbourne University Law Review 367 at 382–383.
39
See K Muir Worth Fighting For: Inside the Your Rights at Work Campaign (UNSW Press, Sydney, 2008).
40
The ad can be seen at http://www.youtube.com/watch?v=1WvMTAci5nU
41
See eg D Peetz Assessing the Impact of ‘Work Choices’ — One Year On (prepared for the Department of Innovation,
Industry and Regional Development, Victoria, 2007); J Evesson, J Buchanan, L Bambery, B Frino and D Oliver
Lowering of Standards Report: From Awards to Work Choices in Retail and Hospitality Collective Agreements(Workplace Research Centre, Sydney, 2007); B Pocock, J Elton, A Preston, S Charlesworth, F MacDonald, M Baird, R

New Zealand Journal of Employment Relations 37(1): 3-21

A much-publicised example of this was the retailer, Spotlight, offering an increase of two cents perhour in basic wage rates, while abolishing penalty rates and paid rest breaks.42 Suspicions were also
aroused when it emerged that the Government was suppressing data collected by the OEA withregards to the content of workplace agreements.43
With community unease over the reforms growing, and facing a resurgent Labor Opposition now led
by Kevin Rudd and Julia Gillard, the Howard Government was forced into a retreat. Declaring that it
had never intended its new system to be used to strip away award conditions, it announced in May
2007 a series of changes that were subsequently given effect through amendments to the WR Act.44
The changes included a new ‗fairness test‘ for workplace agreements, which required ‗fair
compensation‘ to be provided to an employee in the event that any protected award conditions werechanged. The task of processing agreements and determining whether they passed the fairness test
was given to a new agency, the Workplace Authority, which replaced the OEA. Responsibility forensuring compliance with awards and other standards was also transferred. The Office of Workplace
Services, formerly a unit within the Department of Employment and Workplace Relations, wastransformed into the Office of the Workplace Ombudsman, with a specific brief to be more visible andactive in enforcing the WR Act.45 The Government also sought to drop all reference to the unpopularterm ‗Work Choices‘, even going so far as to instruct call centre staff responsible for handling
public enquiries about the new laws to used ‗workplace relations‘ instead46.
Despite these changes, and support from business-funded advertising that sought to portray‗workplace reform‘ as being under threat from a union-dominated ALP, 47 the Coalition lost office inNovember 2007. Industrial relations featured strongly during the election campaign as one of the
key points of difference between the major parties.48 John Howard became only the second serving
Australian Prime Minister to lose his own seat, after Stanley Bruce in 1929. In a curious parallel, he,too, had suffered defeat over the issue of reforming the federal industrial system.
There seems little doubt that what brought the Work Choices reforms undone was a combination ofan effective scare campaign, and the Howard Government‘s unwillingness to come clean about boththe nature and likely consequences of its changes. For example, the Government constantly referredto ‗higher wages‘ under the new system, even though the abolition of the no-disadvantage test meantthat take-home pay could be reduced by the cutting of penalty rates under agreements. It claimed
that award conditions would be ‗protected by law‘, when they could be removed by a single line in
the fine print of an agreement. It spoke of empowering employers and employees to ‗sit down
together‘ and negotiate conditions that suited their mutual needs, when it must have known that in

Cooper and B Ellem ―The Impact of ‗Work Choices‘ on Women in Low Paid Employment in Australia: A Qualitative
Analysis‖ (2008) 50 Journal of Industrial Relations 475.
42
See ―Spotlight AWAs could cut retail workers‘ pay by up to $100 per week: ALP‖ Workplace Express (Australia, 25
May 2006).
43
See M Davis ―Revealed: how AWAs strip work rights‖ Sydney Morning Herald (Australia, 17 April 2007) at 1. The
information in question was later released by the Rudd Government: see ―Gillard says statistics prove AWAs ripped off
workers‖ Workplace Express (Australia, 13 March 2008).
44
Workplace Relations Amendment (A Stronger Safety Net) Act 2007 (Cth).
45
As to the impact of this change, see T Hardy ―A Changing of the Guard: Enforcement of Workplace Relations Laws
Since Work Choices and Beyond‖ in Forsyth and Stewart, above n 32, at 75.
46―Federal Government deletes more references to Work Choices‖ Workplace Express (Australia, 17 May 2007).
47
See M Lyons ―‗Lies, Damned Lies and Statistics‘: The Business Coalition for Workplace Reform Campaign of 2007‖(2007) 18(1) Labour & Industry 119.
48
As to the significance of industrial relations in the lead-up to the 2007 election, see R Hall ―The Politics of Industrial
Relations in Australia in 2007‖ (2008) 50 Journal of Industrial Relations 371 at 373

New Zealand Journal of Employment Relations 37(1): 3-21

the real world employment conditions are generally imposed rather than negotiated.49 When
independent research and analysis highlighted the likely impact of the Work Choices changes on
low-paid and vulnerable workers, or questioned the need for reform at all, 50 the Government‘s
response was generally to vilify those concerned, rather than to engage with the substance of theirwork.51
It is interesting to speculate what might have happened if John Howard and his colleagues had
shown the courage of their convictions on industrial relations. This might have involved admittingstraight up that the purpose of their reforms was to shift the balance of power in favour of
employers, accepting that some workers would be worse off as a result, but then seeking to show
how this would create economic and social benefits for the community. As it was, the Government
found itself caught up in an advertising war it could not win.It was the ACTU‘s image of workers
under pressure from uncaring bosses that captured the public mood, rather than the Government‘s
glossy vision of smiling workers shaking hands with their supervisors, or the business groups‘
attempts to show small retailers being menaced by union ‗thugs‘. The Coalition was also outflanked
by a Labor policy that was more effective in claiming ownership of the concept of ‗fairness‘ inlabour regulation.

Forward with Fairness
The ALP‘s ‗Forward with Fairness‘ policy was carefully crafted during 2007,52 with two main
objectives in mind. One was to capitalise on the widespread anti-Work Choices sentiment; to that
end, Labor promised to abolish AWAs, end the capacity of employers to offer agreements that
undercut award standards, and restore access to unfair dismissal claims. It also undertook to expand
the statutory safety net of minimum conditions, and impose an obligation on parties to bargain ingood faith when negotiating collective agreements. To reinforce the impression of a new beginning,
there was a promise of a new agency, Fair Work Australia (FWA), to replace both the AIRC and thevarious other bodies created by the Howard Government.
The second objective, on the other hand, was to reassure both the business community (in particular,
the mining sector) and the wider electorate that Labor‘s changes would be ‗responsible‘ rather thanradical. Forward with Fairness promised to retain ‗tough‘ laws on industrial action, right of entry
and freedom of association. There would be special recognition for the position of small businesses
in the new unfair dismissal system. A lengthy transitional period before many of the main changes
were introduced would allow employers ample time to adjust. In addition, Labor promised to49

See M Westcott, M Baird and R Cooper ―Reworking Work: Dependency and Choice in the Employment
Relationship‖ (2006) 17(1) Labour & Industry 5; and see also M Gardiner ―His Master‘s Voice? Work Choices as a
Return to Master and Servant Concepts‖ (2009) 31 Sydney Law Review 53. The typical lack of bargaining in mostemployment relationships was evident in the tendency for AWAs to be standardised documents that did not vary fromworker to worker: see P Waring and J Burgess ―The Privileging of Individualism in Australian Industrial Relations‖(2006) 14 International Journal of Employment Studies 61 at 70–71.
50
See eg G Considine and J Buchanan Workplace Industrial Relations on the Eve of Work Choices: A Report on a
Survey of Employers in Queensland, NSW and Victoria (Workplace Research Centre, Sydney, 2007), suggesting thatmost employers were in fact content with the existing system, and that the changes were being driven by ‗fears‘,‗imagined problems‘ and ‗a preoccupation with isolated pockets of union militancy‘: Ibid, at 23.
51
See A Stewart and A Forsyth ―The Journey from Work Choices to Fair Work‖ in Forsyth and Stewart, above n 32, 1
at 15.
52
See K Rudd and J Gillard Forward with Fairness: Labor’s Plan for Fairer and More Productive Australian
Workplaces (ALP, Canberra, 2007); K Rudd and J Gillard Forward with Fairness: Policy Implementation Plan, (ALP,
Canberra, 2007).

New Zealand Journal of Employment Relations 37(1): 3-21

complete two tasks left unfinished by the Howard Government. It would seek the co-operation of theStates to create a single, national system of industrial regulation, at least for the private sector, and it
would also modernise the award system, offering new scope for employers and individual workers
to vary the effect of selected provisions.
The pervasive theme in Forward with Fairness was that of restoring balance– between ‗fairness‘ and‗flexibility‘, and (implicitly) between the interests of workers and employers. The very fact thatelements of the policy attracted criticism from both unions and business groups was treated as some
sort of proof that Labor must have ‗got the balance right‘.53 There are those who would havepreferred to see the ALP take the opportunity to start again and design an entirely new system ofregulation, based on fundamental rights and values,54 but for all the rhetoric about ‗tearing up‘ or‗burying‘ Work Choices, it was apparent that Forward with Fairness was promising incremental
rather than radical change – and that significant aspects of the Howard Government‘s reforms would
survive. 55

The Fair Work Legislation
The Rudd Government‘s first move on taking office was to secure the passage in March 2008 of anumber of key amendments to the WR Act.56 Among other things, these reintroduced a nodisadvantage test in place of the more limited ‗fairness test‘, and precluded employers from offering
any further AWAs – although those who had been using such agreements were permitted to offer
Individual Transitional Employment Agreements instead, at least until the end of 2009. The
amendments also initiated a process for the AIRC to review and modernise the award system again
by the end of 2009.
With those changes out of the way, the Government moved to draft the ‗substantive‘ measure thatwould give effect to the bulk of its proposed reforms and replace the WR Act. In marked contrast to
the Work Choices legislation, the Government consulted widely over its new legislation and was
prepared to make changes in response to stakeholder submissions, although it generally resistedpressure to depart from the central commitments in its Forward with Fairness platform. The
Government also made a conscious effort to make the new legislation more accessible to users. Overthe preceding two decades, the federal industrial legislation had become lengthy and excessively
complex. A significant reason for this was the lack of trust that successive governments had shownin the AIRC and the courts. Rather than allowing decision-makers to use their judgement ininterpreting and applying the legislation, those governments had sought to anticipate and provide forevery eventuality. 57 By contrast, Labor‘s avowed aim was to make the new legislation ‗simple and53

See A Stewart ―A Question of Balance: Labor‘s New Vision for Workplace Regulation‖ (2009) 22 Australian Journalof Labour Law 3 at 45–46. Cf The ―third way‖ rhetoric adopted by the Blair Government in the UK: see eg H Collins ―Is
There a Third Way in Labour Law?‖ in J Conagahan, R M Fischl and K Klare (eds) Labour Law in an Era of
Globalization: Transformative Practices and Possibilities (Oxford University Press, Oxford, 2002) at 449.
54
As for example with the proposal from the Australian Institute of Employment Rights for a ‗charter‘ of rights: see M
Bromberg and M Irving (eds) Australian Charter of Employment Rights (Hardie Grant Books, Melbourne, 2007); andsee further R McCallum ―Australian Labour Law After the Work Choices Avalanche: Developing an Employment Law
for our Children‖ (2007) 49 Journal of Industrial Relations 436; C Fenwick ―Decency and Fairness in Labor Standards:
An Australian Perspective on a Canadian Proposal‖ (2008) 29 Comparative Labor Law & Policy Journal 491; J Riley
and P Sheldon (eds) Remaking Australian Industrial Relations (CCH Australia, Sydney, 2008).
55
See generally Forysth and Stewart, above n 32.
56
Workplace Relations Amendment (Transition to Forward with Fairness) Act 2008 (Cth).
57
See A Stewart ―A Simple Plan for Reform? The Problem of Complexity in Workplace Regulation‖ (2005) 31
Australian Bulletin of Labour 210 at 216–219; Stewart ―Work Choices in Overview‖, above n 21, at 26–27.

New Zealand Journal of Employment Relations 37(1): 3-21

straightforward to understand‘, and to avoid ‗micro-regulation‘ by ‗conferring broad functions andappropriate discretion on Fair Work Australia.‘58
The outcome of the consultation and drafting process was the Fair Work Bill 2008, which wastabled in Parliament in November 2008. Following a series of last-minute compromises to secure thesupport of the crossbenchers in the Senate, it eventually passed in March 2009, becoming the Fair
Work Act 2009.59 The bulk of its provisions were proclaimed to take effect on 1 July 2009. Two
important parts, however, were given a delayed commencement. These were the new ‗safety net‘provisions in Part 2-2, setting out the National Employment Standards (NES) that prescribe
minimum conditions for all employees covered by the Act, and Part 2-3, dealing with modern
awards. In accordance with the timetable set while Labor was in opposition, these provisions tookeffect from 1 January 2010.
Where Forward with Fairness envisaged a single regulatory body to oversee the new regime, the FW
Act created two. FWA has replaced the AIRC, the Fair Pay Commission and the Workplace
Authority. Structured in a way that is broadly similar to the AIRC, it has also inherited that
tribunal‘s President and most of its members. 60 Its work is complemented by a separate body, theOffice of the Fair Work Ombudsman (FWO). This has not only taken over the compliance andenforcement functions of the Workplace Ombudsman, but also assumed responsibility for theprovision of information and advice on workplace rights and responsibilities. Labor also proposedthat the ABCC be replaced by a Fair Work Building Industry Inspectorate, with more limited
powers, though the necessary amendments failed to pass in the Senate.61
Besides the safety net provisions mentioned above, other features of the FW Act included:
 a new system of ‗enterprise agreements‘ between employers and groups of employees,
covering either single or multiple enterprises; an obligation on the part of employers, unions and other ‗bargaining representatives‘ tonegotiate new enterprise agreements in good faith, with provision for FWA to intervene invarious ways to resolve bargaining disputes;
 provision for FWA to conduct annual wage reviews, plus four-yearly reviews of modern
awards; a new set of ‗general protections‘ against discriminatory and other wrongful treatment atwork, subsuming (and expanding upon) a range of provisions in the WR Act concerning
matters, such as freedom of association, coercion, misrepresentation and unlawful
termination;
 a revamped system for employees to complain of unfair dismissal, subject to a requirement
to complete a ‗minimum period‘ in employment of six months, or 12 months in the case ofan employer with fewer than 15 workers; and a right to take protected industrial action in relation to a proposed single-enterpriseagreement, subject to similar requirements as under the WR Act.
58

Explanatory Memorandum, Fair Work Bill 2008 (Cth) at [r.4].
For an overview of the legislation, see Stewart ―A Question of Balance‖, above n 53.
60
As to the similarities and differences between the AIRC and FWA, see the symposium on ‗Fair Work Australia andthe Legacy of the Commission‖ (2011) 53(5) Journal of Industrial Relations.
61
Building and Construction Industry Improvement Amendment (Transition to Fair Work) Bill 2009 (Cth). A similar
proposal is currently before the Australian Parliament, but on present indications seems unlikely to fare any better: see
Building and Construction Industry Improvement Amendment (Transition to Fair Work) Bill 2011 (Cth). The
government needs support either from the Liberal/National Coalition, which opposes any changes to the ABCC, or theGreens, who want to see an end to all special regulation for the building industry. At present there is no compromise insight that would secure the votes of either group.
59

New Zealand Journal of Employment Relations 37(1): 3-21

The FW Act is complemented by a number of related measures, 62 the most important being the Fair
Work (Transitional Provisions and Consequential Amendments) Act 2009 (TPCA Act). This hasrepealed the WR Act; other than two schedules relating to the registration, rules and internal affairsof trade unions and employer associations. Those schedules have survived as a renamed Fair Work
(Registered Organisations) Act2009. The TPCA Act has also preserved the operation of selected
other provisions in the WR Act for transitional purposes. While many of the arrangements in the
TPCA Act will shortly be of historical significance only, the main exception is Schedule 3, which
provides for the continuing operation of pre-FW Act awards and agreements as ‗transitional
instruments‘. These can generally continue to operate until supplanted by modern awards or new
enterprise agreements.
For the most part, the rights and obligations created by the new Fair Work legislation apply in
relation to ‗national system employers‘ and their employees. According to s 14 of the FW Act, those
employers include trading, financial and foreign corporations, Commonwealth agencies and other
employers that operate in a Territory. The term ‗national system employer‘ is separately extended toinclude any other type of employer in a ‗referring State‘, subject to any limitations imposed by that
State.63 Towards the end of 2009, New South Wales, Queensland, South Australia and Tasmania
agreed to join Victoria in referring powers to the Commonwealth, 64 with effect from 1 January 2010.
Only Western Australia, now in the hands of a Liberal government, has refused to co-operate increating a national system. Apart from Victoria, the referring States have determined that they willretain their own industrial legislation and tribunals to deal with State government agencies and(except in Tasmania) local councils. However, non-governmental employers and employees are now
almost entirely subject to federal regulation.
As was the case under the WR Act, even national system employers can still be regulated by State or
Territory laws in relation to ‗non-excluded‘ matters, such as training, discrimination and childlabour. Labor has not moved to take over responsibility for these areas, 65 but in some cases it isseeking to promote the harmonisation of State or Territory legislation. In relation to occupational
health and safety, for example, it has secured general agreement to the adoption of a ‗model‘ law,66
and created a new agency, Safe Work Australia, to oversee the reform process.67 It is also seeking
to develop a new national standard on long service leave,68 though less progress has been made todate on that front.

62

See eg Fair Work Regulations 2009 (Cth); Fair Work (Transitional Provisions and Consequential Amendments)
Regulations 2009 (Cth).
63
See Fair Works Act, Part 1-3 Divs 2A, 2B, as amended or added by the Fair Work Amendment (State Referrals andOther Measures) Act 2009 (Cth).
64
See Industrial Relations (Commonwealth Powers) Act 2009 (NSW); Fair Work (Commonwealth Powers) Act 2009(Vic); Fair Work (Commonwealth Powers) and Other Provisions Act 2009 (Qld); Fair Work (Commonwealth Powers)
Act 2009 (SA); Industrial Relations (Commonwealth Powers) Act 2009 (Tas).
65
Except in relation to rules regarding the payment of wages: see FW Act Pt 2-9 Div 2, replacing State legislation suchas the Victorian Workers’ Wages Protection Act 2007 (Vic).
66
See Australian, State, Territory and New Zealand Workplace Relations Ministers‘ Council, WRMC 83 Communiqué(25 September 2009). The model Work Health and Safety Act was supposed to be enacted in each participating
jurisdiction in time to take effect from 1 January 2012, though at the time of writing it appears that only the
Commonwealth, New South Wales, Queensland, the Australian Capital Territory and the Northern Territory will havepassed the necessary legislation by then.
67
See Safe Work Australia Act 2008 (Cth).
68
See Explanatory Memorandum, Fair Work Bill 2008 (Cth) at [r.76].

New Zealand Journal of Employment Relations 37(1): 3-21

The Fair Work Legislation in Operation
At the time of writing this paper, the new Fair Work regime has been in operation for over two
years. There have certainly been some significant changes – though their practical impact has been
muted. For example, although the new NES are important, most were already available to workers
under the WR Act.69
One exception is the entitlement of up to 16 weeks‘ severance pay on redundancy, under s 119 of
the FW Act. This was previously a standard benefit under awards and enterprise agreements, but has
now been extended to managerial and professional employees not covered by awards.70 There is also
a right under s 65 for (some) working parents to request flexible work arrangements toaccommodate their caring responsibilities, but there is, in most cases, no way of challenging thereasonableness of any refusal by the employer.71 Research suggests that in any event, such flexible
arrangements were already a common feature of employment relationships in Australia, albeit byconsent rather than legal right.72 Perhaps a more significant initiative in this area has been the
introduction of a ‗paid parental leave‘ scheme, remedying a long-standing gap in Australia‘s labour
standards.73 However, this was not done as part of the NES, which continue to provide anentitlement only to unpaid parental leave. There is, instead, a separate statute, the Paid Parental
Leave Act 2010 – though its title is a misnomer, as rather than provide for leave as such, it offers agovernment-funded payment, set at the national minimum wage, that can be spread over up to 18
weeks. For eligible employees, any right to take leave must still depend on the NES, or require theagreement of the employer.74
The advent of the ‗modern award‘ system has brought more substantial changes. To the surprise ofmany seasoned observers, the AIRC completed the massive task of reviewing more than 1500
federal and State awards in time for the new system to commence in 2010. There are now 122
modern awards, almost all of which are structured to apply to a specified industry. Importantly,
however, most have transitional provisions that are designed to phase in the modern award wage
rates over a period that will end in mid-2014, so that, for the time being, many ‗old‘ awards remain
relevant in determining minimum conditions and setting a safety net for enterprise bargaining.
(Unsurprisingly, employer groups have tended to complain about the wage or penalty rates that are
steadily being phased up, while saying little about the many that are being phased down). There arealso a large number of ‗enterprise awards‘ that can continue to apply to a single business, at least
until the end of 2013. 75 In theory, these can be ‗modernised‘ by FWA and continue in operation afterthat date, although in practice FWA has signalled that it will take a great deal of convincing that the69

See J Murray and R Owens ―The Safety Net: Labour Standards in the New Era‖ in Forsyth and Stewart, above n 32, at
40.
70
See B Creighton and A Stewart Labour Law (5th ed, Federation Press, Sydney, 2010) at [18.57]–[18.61]. Note that
there are various exclusions and exemptions, so that for instance the entitlement does not apply to anyone working for an
employer with fewer than 15 staff.
71
See Creighton and Stewart, above n 70, at [13.94]–[13.97].
72
See N Skinner and B Pocock ―Flexibility and Work-life Interference in Australia‖ (2011) 53 Journal of Industrial
Relations 65.
73
See Productivity Commission Paid Parental Leave: Support for Parents with Newborn Children (Inquiry Report
No 47, Melbourne, 2009).
74
The eligibility requirements for the two schemes (the NES unpaid leave entitlement and the Paid Parental Leave Act)are somewhat different, so that complex issues arise as to their interaction: see generally E McCarthy, E Jenkin and
A Stewart Parental Leave: A User-Friendly Guide (Lawbook Co, Sydney, 2012).
75
See TPCA Act, Sch 6.

New Zealand Journal of Employment Relations 37(1): 3-21

employers concerned should not fall back to the relevant industry award. 76 FWA has also beenreluctant, to date, to vary modern awards, other than to correct errors or remove ambiguities,77
although it is about to embark on an interim review of the modern award system required by thelegislation. 78
In relation to wage fixation, FWA‘s new Minimum Wages Panel has, to date, completed two of theannual reviews it is required to undertake.79 Its decisions have resulted in modest adjustments toaward rates of pay, and also to the National Minimum Wage Order that protects award-free workers.
The National Minimum Wage now sits at A$15.51 per hour. Perhaps of greater significance,
however, has been the use made of the pay equity provisions in Part 2-7 of the FW Act. Thesepermit FWA to make ‗equal remuneration orders‘ for specified groups of employees. Unlike
equivalent provisions in previous legislation, which were never successfully invoked, the newprovisions focus on the need for equal pay for work of equal or comparable value, and there is norequirement to establish that existing pay rates have been set on a discriminatory basis. 80 A test casebrought by the Australian Services Union to secure wage rises for the largely female workforce inthe social and community services sector has resulted in a finding that their work is significantly
undervalued.81 At the time of writing, no orders have yet been made, FWA having requested further
evidence and argument as to the scope and timing of any increases. However, the Commonwealthhas committed to providing at least $2 billion in funding to permit organisations in the sector –many of whom rely heavily on government funding to provide their services – to afford any
resulting pay increases. 82
As for the new enterprise bargaining regime, any initial expectations that the new obligation to
bargain in good faith might have a major impact have been quickly dispelled. Under Division 8 ofPart 2-4 of the FW Act, FWA can make ‗bargaining orders‘ to resolve concerns about a failure tonegotiate in good faith. These have been most commonly used to prevent employers from rushing to
put an agreement to a vote of the relevant group of employees without first giving unions or otherbargaining representatives a reasonable opportunity to negotiate.83 However, in other respects FWA
has been fairly conservative in using its new powers, ruling, for instance, that an employer may
legitimately bypass unions and communicate directly with its workforce as to the progress ofbargaining.84 In a number of cases, it has issued ‗majority support determinations‘, forcing
recalcitrant employers to bargain where a majority of employees in a workplace or enterprise can be
76

See eg Re Bank of Queensland Agents Award (2010) 195 IR 358; Yum! Restaurants Australia Pty Ltd v Full Bench of
Fair Work Australia [2011] FCA 1315. In both these cases FWA elected to terminate enterprise awards rather thanmodernise them.
77
For a significant exception, see Shop, Distributive and Allied Employees Association v National Retail Association Ltd[2011] FWAFB 6251, agreeing to reduce the minimum shift length for young shop employees who want to work a short
shift after finishing school. An earlier attempt to secure a more general change to the shift length provisions in the
General Retail Industry Award 2010 had been rejected: see Appeal by National Retail Association Ltd [2010] FWAFB
7838.
78
See TPCA Act, Sch 5 item 6; Award Modernisation [2011] FWA 7975.
79
See Annual Wage Review 2009–10 (2010) 193 IR 380; Annual Wage Review 2010–11 [2011] FWAFB 3400
80
See M Smith and A Stewart ―A New Dawn for Pay Equity? Developing an Equal Remuneration Principle under the
Fair Work Act‖ (2010) 23 Australian Journal of Labour Law 152.
81
Equal Remuneration Case [2011] FWAFB 2700.
82
See ―Gillard commits $2 billion to fund SACS equal pay increases‖ Workplace Express (Australia, 10 November2011).
83
See eg Australian Municipal, Administrative, Clerical and Services Union v Queensland Tertiary Admissions Centre(2009) 185 IR 371.
84
See eg Construction, Forestry, Mining and Energy Union v Tahmoor Coal Pty Ltd (2010) 195 IR 58. Cf A Bukarica
and A Dallas Promoting Good Faith Bargaining under Australia’s Fair Work Act 2009 (Construction, Forestry, Mining
and Energy Union, Sydney, 2010).

New Zealand Journal of Employment Relations 37(1): 3-21

shown to want that.85 It should be emphasised, however, that, unlike the position in New Zealand,s 228(2) of the FW Act makes it clear that parties cannot be required to reach agreement, or to makeparticular concessions. There has been nothing to suggest that the new provisions will do much tospread collective bargaining, except in those rare cases where an employer is facing an organised
workforce but still refuses to recognise the union(s) in question. 86
Despite all this, Australian employer groups have been increasingly vocal in attacking what theyclaim to be an increase in ‗union power‘ under the Fair Work legislation.87 There have been
particular complaints about the ‗barriers‘ that the new legislation is said to impose on attempts to lift
productivity.88 There are at least two problems, however, with such arguments.
The first is the absence of any credible link between labour productivity and labour regulation, as anumber of recent studies have pointed out.89 During the 1990s, Australia experienced what is
generally regarded as a surge in productivity, under both Labor and Conservative governments. For
the past decade, productivity has declined; notwithstanding the dramatic shifts in regulatory policy.
There is little, if any, evidence to support the Rudd Government‘s claim that the renewed emphasison collective bargaining in the Fair Work legislation would lift productivity,90 but nor, by the same
token, is there anything to suggest that the current laws are ‗sapping productivity across thecountry‘. 91 As the President of FWA has pointed out, ―much of the debate about productivity seems
to be based on political positioning rather than on hard analysis.‖92
The second point is that even the most superficial scrutiny of the employer group complaints reveals
that their primary concern is not productivity, but profitability. This is especially true of thepersistent attacks by retailers on the ‗archaic penalty rate structure‘ that continues to be embodied in
the modern award system. 93 Being able to pay shop workers less for working on evenings orweekends would, undoubtedly, lower labour costs – but it is hard to see how it would make thoseworkers more productive.
Another area in which there has been a great deal of hysteria and overreaction has been theregulation of industrial action. As previously noted, Labor has largely retained the Howard
Government‘s restrictive laws on industrial action, ensuring that Australia remains in flagrant breach85

See eg Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union v Cochlear Ltd (2009) 186 IR
120.
86Division 9 of Part 2-4 does have some interesting provisions that are intended to facilitate multi-employer bargaining
in ‗low-paid‘ sectors. But only one application has been made to date under these provisions and their practical value isopen to question: see R Naughton ―The Low Paid Bargaining Scheme – An Interesting Idea, But Can it Work?‖ (2011)24 Australian Journal of Labour Law 214.
87
See eg ―It‘s all going unions‘ way, says AiG‖ Workplace Express (Australia, 30 November 2011), referring to aspeech by Heather Rideout from the Australian Industry Group.
88
See eg P Anderson, Chief Executive, Australian Chamber of Commerce and Industry ―Employer Flexibility versus
Job Security‖ (Workforce Conference, Sydney, 5 September 2011); G Bradley (President, Business Council ofAustralia) Address (Australia–Israel Chamber of Commerce, 12 September 2011).
89
See eg ―Working by Numbers: Separating Rhetoric and Reality on Australian Productivity‖ ACTU Working Australia
Paper (Melbourne, 2011); K Hancock ―Enterprise Bargaining and Productivity‖ (Twenty Years of Enterprise Bargaining
Workshop, Melbourne, 5 November 2011).
90
See Explanatory Memorandum, Fair Work Bill 2008 (Cth), [r.194]–[r.198].
91
Australian Mines & Metals Association ―Tsunami of consensus building for IR change‖ (5 September 2011).
92
G Giudice, Address (Australian Labour and Employment Relations Association National Conference, Fremantle, 7October 2011) at 7.
93
See eg Australian Retailers Association ―Retailers call for IR review after PC says Fair Work deters employment‖(press release, 5 August 2011).

New Zealand Journal of Employment Relations 37(1): 3-21

of international labour standards. 94 Working days lost to industrial action remain at historical lows,95
and if the public might be inclined to believe otherwise, it would only be because disputes are sorare today that almost every incidence of industrial action gets reported by the media! Despite this,the super-profitable mining industry remains so concerned at union ‗militancy‘ that it is calling for
the FW Act to be changed to outlaw industrial action where union claims are considered to be‗extravagant‘, or where the workers concerned are earning more than $118,100.96
If changes to the laws on industrial action are to be made, however, they may well take a different
form – and purely because of one high-profile dispute. Qantas had been, unsuccessfully, negotiating
for some months with three groups of its workers (long-haul pilots, flight engineers and groundstaff), when, on Saturday 29 October 2011, it took the dramatic step of announcing that it would
lock out those workers. While the lockout was set to commence in two days‘ time, it opted to ground
its entire fleet with immediate effect, stranding many passengers around the world. The Federal
Government immediately applied to FWA to have all industrial action at Qantas terminated unders 424 of the FW Act, on the basis that an indefinite work stoppage at Australia‘s major airline would
be likely to cause significant damage to important parts of the economy, such as the tourism sector.
Some 30 hours later, and following two late-night sittings, the order was made.97 The parties were
given 21 days to negotiate new agreements. When that deadline passed, the matters were listed forcompulsory arbitration in early 2012. 98 FWA will be required to make a ‗workplace determination‘
under Part 2-5 that effectively resolves each bargaining dispute and has the same force as aregistered enterprise agreement.
At one level, the Qantas affair played out in an entirely predictable way. The unions representing thethree groups of workers were seeking commitments on job security that management was notprepared to give, having adopted a business strategy that involves offshoring many of its operations,both to reduce costs and to open up new markets in Asia. All three groups had been taking sporadic
industrial action that, at least in the case of the engineers and baggage handlers, was costing theairline money and driving customers away. Qantas was perfectly entitled, under the legislation, to
respond by taking protected industrial action of its own; and by initiating a complete shutdown, it
would have known that an application to FWA to send the matter into arbitration was inevitable –just as would have happened had any of the unions commenced an indefinite strike. It was clearlybanking on getting a more favourable outcome from arbitration than from a negotiated settlement
induced by many months of damaging but low-level industrial action. Few other organisations could
have adopted a similar strategy. The route to ‗last-resort‘ arbitration under s 424 is available (as it
has been since 1993) only in the case of major threats either to the economy, or to public health andsafety. There are not many employers, at least outside the essential services, that have that kind of
impact. FWA has, in any event, tended to interpret s 424, and other provisions dealing with the94

See S McCrystal The Right to Strike in Australia (Federation Press, Sydney, 2010).
See eg the figures extracted in Giudice, above n 92, at 6. A ‗spike‘ in the most recent data, showing 10.1 days lost per
thousand employees over the third quarter of 2011, is put in context by comparing it with the figures of over 50 (and insome cases 80) recorded in 1990–91: see Australian Bureau of Statistics Industrial Disputes, Australia, September 2011
Catalogue Number 6321.0.55.001 (ABS, Canberra, 2011). The great part of the recent increase was in any event
attributable to an industrial dispute involving New South Wales public servants – who are not covered by the Fair Worklegislation.
96
Australian Mines and Metals Association ―The Fair Work Act – Meaningful Change Required‖ (press release, 26
September 2011). The dollar figure chosen is the same as the ‗salary cap‘ for unfair dismissal claims, as discussed
below.
97
For Tertiary Education, Skills, Jobs And Workplace Relations [2011] FWAFB 7444.
98
See ―Qantas-TWU arbitration to begin in March, as ALAEA asks members to consider status quo on job security‖
Workplace Express 25 November 2011.
95

New Zealand Journal of Employment Relations 37(1): 3-21

suspension or termination of protected industrial action, as requiring something more than theordinary kind of loss or disruption that is the very point of taking or threatening such action.99
Despite this, the aftermath of the Qantas action has seen a clamour for the law to be changed. This
partly reflects a sense of outrage about two particular features of the airline‘s conduct: its failure to
give any advance notice of its actions (though nothing in the Act forced it to do so);100 and the factthat it could, in effect, inflict ‗self-harm‘ in order to seize what it perceived as a strategic advantage.
However, there have also been suggestions that the threshold for compulsory arbitration should belowered.These issues are likely to be ventilated in an independent review of the FW Act that willcommence in 2012, in accordance with a commitment given before the legislation was passed. Since
its narrow re-election in 2010, what is now the Gillard Government has generally been reluctant tocontemplate changes to the legislation but, in the wake of the Qantas affair, it seems to haverediscovered an appetite for reform. It has announced that it is prepared to look at the idea of alegislated ‗code of conduct‘ for bargaining,101 and also supported a change to Labor‘s policy
platform calling for FWA to be given greater powers to intervene in bargaining disputes.102
While employer associations have been vociferous in their attacks on the modern award system andthe bargaining regime, less has been said about the issue of unfair dismissal protection. Relief fromsuch laws undoubtedly remains a core objective for the small business sector. But in truth, the new
unfair dismissal system is operating in a way that creates few difficulties for employers. With therestoration of eligibility for those working for employers with 100 or fewer staff, 103 the annual
number of claims of ‗harsh, unjust or unreasonable‘ dismissal has jumped from 8,000 to just under
13,000.104 Over a quarter of these now involve employers with less than 15 workers,105 though
importantly, FWA is administering the new procedures in such a way that the overwhelming
majority of claims are settled within a few weeks, usually after a conciliation conference conductedby telephone. 106 Information collected about settlements reveals that 58% involve payouts of lessthan $4000.107 Few applicants are reinstated to their old jobs. Therefore, in effect, the unfair
dismissal laws are not delivering industrial justice, so much as a modest severance payment.
There has been greater employer concern about the new ‗general protections‘ against victimisation
at work. The redrafting of these provisions has created a deal of uncertainty as to their operation,108
although it, as yet, hard to find examples of genuinely new forms of liability being imposed. 109 The
99

See eg Construction, Forestry, Mining and Energy Union v Woodside Burrup Pty Ltd (2010) 198 IR 360.
Section 414 of the FW Act requires employees to give at least three clear working days‘ notice of any protectedaction. But employers taking ‗response‘ action must merely give written notice immediately before a lockout starts. The
same applies if employees then in turn respond.
101
See ―Minister flags bargaining code‖ Workplace Express (Australia, 9 November 2011).
102
See ―ALP considering easier access to arbitration‖ Workplace Express (Australia, 3 December 2011).
103
Note that non-award employees (principally managers and professionals) earning more than A$118,100. per year are
still excluded, as they have been since 1994: see Creighton and Stewart, above n 70, at [19.39]–[19.43].
104
See Annual Report of Fair Work Australia, 1 July 2010–30 June 2011 (FWA, Melbourne, 2011) at 10, 81
105
See ―FWA says investigations on track, President defends his speech in fiery Estimates‖ Workplace Express(Australia, 19 October 2011).
106
See J Acton ―Where Have All the Cases Gone? Voluntary Resolution of Unfair Dismissal Claims‖ (Australian
Labour Law Association National Conference, Adelaide, 19 November 2010).
107
See ―Three-quarters of conciliated unfair dismissal claims involve money‖ Workplace Express (Australia, 20 October2010).
108
See eg S Rice and C Roles ―‗It‘s a Discrimination Law Julia, But Not as We Know It‘: Part 3-1 of the Fair Work Act‖
(2010) 21(1) Economic and Labour Relations Review 13.
109
Cf Barnett v Territory Insurance Office [2011] FCA 968, ruling that an employee may not claim under s 340 thatadverse action has been taken against them because of a ‗workplace right‘, where the only right in question arises under
their employment contract.
100

New Zealand Journal of Employment Relations 37(1): 3-21

decision that has generated most controversy, that of the Full Federal Court in Barclay v Board of
Bendigo TAFE110 could have arisen under any previous version of these provisions. It involved aunion delegate who was disciplined for sending an e-mail alleging corrupt behaviour bymanagement without following proper procedures. Even though it was accepted that his employer
believed it was taking action against him for breaching his employment obligations, the majority of
the court ruled that, on an objective basis, the ‗real reason‘ lay in his activities as a union official. It
remains to be seen whether the High Court, which has granted leave to appeal, will agree with thisfairly radical reinterpretation of the protections for union members and delegates.
What has been particularly worrying employers has been the increasing number of dismissal-related
general protections claims that are being lodged with FWA under s 365 of the FW Act. The
legislation provides for the compulsory conciliation of such complaints, over 500 of which weremade in the third quarter of 2011 alone. 111 FWA cannot make a formal decision in relation to theseclaims, which, if they are to be pursued, must be taken to the Federal Court or Federal Magistrates
Court; but the conciliation conference is still an opportunity to confront the employer and seek someform of settlement. Anecdotal evidence suggests that many of these proceedings involve tenuous
allegations, and are really unfair dismissal claims that have been lodged out of time.112 It seems
likely that there will be calls during the forthcoming review of the Act for some form of ‗filter‘ to be
applied to such applications.

Looking Ahead
Despite the increasingly strident calls for change from Australian employer groups, there is a realprospect of a period of stability in Australian labour law for the first time in over 20 years. There arestill some adjustments to be made, as the transition continues from the WR Act to the new Fair
Work regime; but it seems unlikely that the next several years will be anything like as turbulent as
the past five have been.
As far as further reforms are concerned, there are undoubtedly some in the Liberal Party with asense of unfinished business. Since the failure of Work Choices, the pragmatic view has been that it
would be better to steer away from radical changes to labour regulation. Indeed, Liberal leader,
Tony Abbott, has declared Work Choices ‗dead, buried and cremated‘,113 and went into the 2010
election promising no immediate change to the Fair Work legislation. However, pressure is growing
from sections of the party to re-think this stance – and also from the employer groups, whose salvoes
against the current system are quite clearly framed with the Opposition in mind, not so much theGovernment. Nevertheless, even if the Coalition is persuaded to revive elements of its former
policies, it seems likely that the left-leaning Greens will continue to hold the balance of power in thenext few Senates, as they have done since mid-2011. That hardly bodes well for any proposal toreintroduce individual statutory agreements, reduce unfair dismissal protection or create new formsof ‗flexibility‘ for employers.
As for Labor, there is still a great deal of pressure from the union movement (and indeed many
backbenchers) to go further than it did with the Fair Work legislation, especially in freeing up the110(2011) 274 ALR 570.
See Unfair Dismissals Report Jul–Sep 2011 (FWA, Melbourne, 2011).
112
Under s 366(1), a dismissal-related general protections claim must be filed within 60 days of the termination, whereas
the time limit under s 394(2) for a claim of harsh, unjust or unreasonable dismissal is a much tighter 14 days.
113
See ―Abbott refuses to say ―never, ever‖; reform needed, says business‖ Workplace Express (Australia, 19 July2010).
111

New Zealand Journal of Employment Relations 37(1): 3-21

controls on industrial action. However, there seems little inclination on the part of the ALP‘s current
leadership to move in that direction. Labor has proclaimed a willingness to give primacy tocollective bargaining, and its new laws have certainly created a more level playing field for tradeunions.114 Its policies and legislation remain primarily concerned with the rights and freedoms ofindividual workers. Unionism is tolerated, but not actively encouraged – certainly not the ‗militant‘variety.115 In its second term, it has been willing (among other things) to propose increases tocompulsory employer contributions to superannuation schemes,116 new forms of protection forvulnerable outworkers in the clothing industry and long-distance truck drivers,117 and a new (thoughvery limited) payment for fathers and other ‗secondary carers‘ taking leave on the birth or adoptionof a child.118 Overall, however, there seems every reason to suppose that Labor will continue topractise the ‗politics of balance‘ that carried it into office, and that has been so evident in its
handling of workplace relations to date.

114

See A Forsyth ―‗Exit Stage Left‘, now ‗Centre Stage‘: Collective Bargaining under Work Choices and Fair Work‘ inForsyth and Stewart, above n 32, at 120; C Fenwick and J Howe ―Union Security After Work Choices‖ in Forsyth andStewart, above n 32, at 164.
115
See further Stewart ―A Question of Balance‖ , above n 53 at 47–9.
116
See Superannuation Guarantee (Administration) Amendment Bill 2011 (Cth).
117
See Fair Work Amendment (Textile, Clothing and Footwear Industry) Bill 2011 (Cth); Road Safety Remuneration
Bill 2011 (Cth).
118
See Paid Parental Leave: Dad and Partner Pay (Australian Government, Canberra, 2011).

New Zealand Journal of Employment Relations 37(1): 22-29

Bargaining Fair Work Style: Fault-lines in the Australian Model
JOELLEN RILEY
Abstract
The model of good faith bargaining introduced by the Fair Work Act 2009 (Cth) requires bargaining
representatives to bargain in good faith with every other bargaining representative appointed by an employer or
employee. This obligation is producing some interesting problems. The work once done by trade unions (inmarshalling collective views of employees, funding the work of bargaining, and settling their own demarcation
issues) appears to be falling into the lap of employers. This paper will examine some of the fault lines
appearing in the system – possibly as a consequence of an ill-considered attempt to accommodate individualism
in an essentially collective system. The paper is based on some empirical research, as well as an examination of
Fair Work Australia decisions.

Good faith bargaining according to the Fair Work Act 2009 (Cth).
The introduction of an obligation to bargain in good faith in Australian labour law1 has produced a great deal ofprofessional commentary and scholarly analysis, seeking to clarify precisely what such an obligation means for
employers and unions.2 Much of that commentary compares the Australian obligation, enshrined now in the
Fair Work Act 2009 (Cth) s 228, with good faith bargaining obligations in North American and New Zealandlaw. This paper focuses on a peculiarity of the Australian law, not found in the North American laws: theobligation to bargain in good faith with a number of bargaining representatives, and not only with a single
employee association that has secured an entitlement (through some kind of trade union recognition process) torepresent the entire workforce.

1

Joellen Riley is Professor of Labour Law, Sydney Law School, University of Sydney. Email: Joellen.riley@sydney.edu.au.

The term “labour law” has been adopted here, in preference to “industrial law”, which is out of vogue in Australia since the inceptionof single business enterprise bargaining, and “workplace relations law”, which connotes the particular anti-union agenda of the former
Howard Coalition government.
2
For a selection of publications see: Alex Bukaric and Andrew Dallas with Anthony Forsyth (ed) Promoting Good Faith Bargaining
under Australia’s Fair Work Act 2009: Lessons from the Collective Bargaining Experience in Canada and New Zealand (CFMEU
Mining and Energy, Sydney, 2010); Rae Cooper and Bradon Ellem “Fair Work and Re-regulation of Collective Bargaining” (2009) 22
AJLL 284; Rae Cooper and Bradon Ellem B “Getting to the Table: Fair work and Collective Bargaining” (paper presented at theCollective Bargaining Workshop, RMIT, 23-24 November 2010); Breen Creighton Good Faith Bargaining under the Fair Work Act –Striking a Balance: Discussion Paper for the Business Council of Australia (January 2010); Anthony Forsyth “„Exit Stage Left‟, now„Centre Stage‟: Collective Bargaining under Work Choices and Fair Work” in Anthony Forsyth and Andrew Stewart (eds) Fair Work:
The New Workplace Laws and the Work Choices Legacy (Federation Press, Sydney, 2009) 120; Richard Naughton “The Obligation to
Bargain in Good Faith: Inspired Innovation or Legislative Folly?”, Working Paper No 6 (Centre for Employment and Labour
Relations Law, University of Melbourne, 1995); Aaron Rathmell “Collective Bargaining after Work Choices: Will „Good Faith‟ takeus Forward with Fairness?‟ (2008) 21 AJLL 270; George Strauss “Should Australia Copy America Employee Relations Practices?” inJoellen Riley and Peter Sheldon Remaking Australian Industrial Relations (CCH, Sydney, 2008) 223.

New Zealand Journal of Employment Relations 37(1): 22-29
It is argued here that this peculiarity of Australian law introduces an inconvenient level of complexity in theAustralian system. This paper notes three inconvenient consequences of the obligation to bargain with multiple
bargaining representatives:
1. The absence of a formal trade union recognition process, and the ability for everyone to appoint his or
her own individual representative, means that the obligation to arrive at a consensus on the employees‟side of the bargaining table now falls to the employer. Bargaining is multi-lateral, not bi-lateral;
disputes between competing employee groups can hold up the process for settling agreements. The
obligation (and opportunity) to find the appropriate consensus between competing employee demands
appears to fall into the employer‟s hands.
2. Arguments have emerged over who is responsible for paying wages for the work of bargaining. Unions
pay their own delegates to perform bargaining duties, but non-union bargaining representatives must
fund themselves while in bargaining negotiations. Employers are not obliged to pay wages to
employees during bargaining negotiations. Those who agree to pay wages are legitimately concernedthat this may encourage more employees to self-represent.
3. Old demarcation disputes have reemerged. It appears that employees can exercise their right to appoint
any bargaining representative, even when that representative is affiliated with a union that has no
general entitlement to represent the industrial interests of the workforce at that particular site.
It appears that two conflicting agendas have created this complexity. On the one hand, the ALP (Australian
Labor Party) Government has been committed to the reinstatement of collectivism in Australian labour law,after the ravages of the Work Choices laws which hastened union exclusion and individualisation of
employment relations.3 On the other hand, the Government has found it politically expedient to maintain theconcept of freedom of association articulated in the Workplace Relations Act 1996 (Cth) as a right to belong or
not to belong to a union. 4 The trade union movement was so effectively demonised during the Howard years
that it is highly unlikely any ALP Government could ever sell the electorate legislation which gave unions amonopoly in the negotiation of enterprise bargains. The rhetoric adopted by the Australian Council of Trade
Unions (ACTU) in its pre-2007 Election campaign supporting the abolition of the Work Choices laws, “Your
Rights at Work”,5 has been very influential in shaping the Fair Work (FW) Act as legislation protecting
individual worker‟s rights. That individualism extends to the right to participate directly in enterprisebargaining negotiations. Nevertheless, the growth of this kind of individualism probably has earlier roots.

The origins of non-union bargaining in Australian labour law
The absence in Australian law of a formal trade union recognition process to ensure that employees speak in asingle voice in collective enterprise bargaining appears to have had its genesis in the Keating Government‟s
Industrial Relations Reform Act 1993 (Cth). This enactment included provisions permitting employers to make3

Work Choices” is used throughout this paper as shorthand for the Workplace Relations Amendment (Work Choices) Act 2005 (Cth)which commenced on 26 March 2006, and is widely reputed to have driven the demise of the Howard Coalition government: see Roy
Morgan (2007) “IR Reforms Still Driving Labor Support: Liberal Voters Afraid of Union Dominance”<www.roymorgan.com/news/polls/2007/4179>.
4
See former Workplace Relations Act 1996 (Cth) Part XA, enacted in the Workplace Relations and Other Legislation Amendment
Act 1996 (Cth) with effect from 1 January 1997.
5
To view a selection of advertisements, visit the YouTube website <www.youtube.com>.

New Zealand Journal of Employment Relations 37(1): 22-29
collective enterprise agreements (called “enterprise flexibility agreements”, or EFAs) directly with employees,
without the involvement of a union. 6 A rationale for this novel invention was the desire to encourage enterprisebargaining as a means for trading productivity improvements for better wages and conditions (and for escaping
the prevalence of “one size fits all” industrial awards), not only in unionised industries, but in new industry
enterprises where unions had no effective presence.7 The unions did not much like this innovation, nevertheless,the concept that the Australian enterprise bargaining system should permit non-unionised employees toparticipate independently of unions has remained.
The Howard Government‟s Workplace Relations Act 1996 (Cth) (both before and after the notorious Work
Choices amendments) also maintained an avenue for direct bargaining between employers and employees,
without the involvement of unions.8 Of course, many of the agreements made without union involvement weremade as a consequence of the acceptance of “take-it-or-leave-it” offers, and not as a consequence of any
genuine negotiation process.9 Notwithstanding, concerns about these non-union enterprise agreements, the ideathat each employee, whether a member of a union or not, should be entitled to participate in enterprisebargaining, has persisted, even after the enactment by the ALP Government of the FW Act 2009 (Cth).
The system established by the Work Choices laws that all enterprise agreements are made between employers
and employees directly, and that trade unions participate as “bargaining representatives”, has been retained.10
All employees have an entitlement to appoint a bargaining agent; union members will be taken to haveappointed their union, unless they expressly make an alternative election. 11 Employers (who are, by definition,
bargaining representatives themselves) are obliged to bargain in good faith with all bargaining representatives
appointed by employees.12 In most cases, the bargaining representatives are unions, nevertheless, there havebeen some instances where employees have appointed other bargaining representatives (or sought to represent
themselves), and on these occasions, employers have sometimes faced difficulties in securing an enterprisebargain.

Employer experiences
Assertions that the present bargaining framework manifests the inconvenient consequences described above
became apparent in the course of some interviews conducted as part of a research project into Australian
employers‟ experiences of good faith bargaining in the first round of bargains, struck after the commencementof the FW Act.13 This project, conducted by the author with Dr Troy Sarina,14 initially set out to investigate
whether the new good faith bargaining obligation in s 228 of the FW Act was having any influence on thebargaining strategies of those employers, who had maintained a practice of bargaining collectively with unions
6

See Amanda Coulthard “Non Union Bargaining: Enterprise flexibility Agreements” (1996) 38 JIR 339.
See Second Reading Speech, House of Representatives, 28 October 1993, Debates, at 2781.
8
See generally Anthony Forsyth and Carolyn Sutherland “Collective Labour Relations Under Siege: the Work Choices Legislation
and Collective Bargaining” (2006) 19 AJLL 183.
9
See generally Shelley Marshall and Richard Mitchell “Enterprise Bargaining, Managerial Prerogative and the Protection of Workers‟
Rights: An Argument on the Role of Law and Regulatory Strategy in Australia under the Workplace Relations Act 1996 (Cth)” (2006)
22 IJCCLIR 299.
10
See Fair Work Act, s 174.
11
See Fair Work Act, s 176.
12
See Fair Work Act, s 176(1)(a).
13This project, “Legal Regulation and the Evolution of Organisational Practice: The Impact of Good Faith Bargaining Rules on
Employment Relations Strategies” was funded by an Institute of Social Sciences Research Grant, University of Sydney
14
Lecturer, Faculty of Business and Economics, Macquarie University.
7

New Zealand Journal of Employment Relations 37(1): 22-29
throughout the Workplace Relations and Work Choices years. We wanted to see whether a statutory injunction
to bargain “in good faith” would make any difference to the behaviour of experienced collective bargainers whoalready enjoyed established relationships with trade unions. We knew that good faith bargaining obligations,
together with the abolition of the option of using Australian Workplace Agreements, had dragged certain big
players (such as, Telstra, Cochlear and the Commonwealth Bank) back to the bargaining table with unions, but
we were curious to see whether s 228 was doing any work in improving the quality of enterprise negotiations.
We wished to test the assertions by the Minister of the day (Julia Gillard) that good faith bargaining would
encourage “employees and employers to examine the way they work, discover new ways to improve
productivity and efficiency, and share ideas that make workplace more harmonious and flexible.”15 We
interviewed several industrial relations managers from three large enterprises, and also held a workshop
attended by a number of advisors to many organisations, with a view to discovering the impact of the good faithbargaining obligation in practice.16 In the course of this project, however, we discovered some unexpected
matters which were distracting even experienced collective bargainers. One of them was the problem of dealing
with multiple bargaining agents.

Multiple bargaining agents
As explained above, the FW Act entitles each employee to appoint a bargaining representative to negotiate on
his or her behalf in collective bargaining negotiations with their employer. In theory, an employer may be
obliged to recognise as many bargaining representatives as there are employees in an organisation. In practice,very few employees appoint their own independent bargaining representatives, however, if any employees havechosen to do so, an employer will be faced with the obligation to negotiate with a number of employee
representatives, each representing a different cohort of the workforce. For some of the managers weinterviewed, this created some apprehension that their former settled relationships with established andexperienced union negotiators would be disturbed by the intervention of any number representatives of special
interest groups, and possibly some eccentric “Aunt Sallys”, interested only in coming along to bargaining
meetings out of curiosity, or to enjoy the perks of attending bargaining sessions.
Managers were concerned about practical inconveniences and costs: what if dozens of employee representatives
in a national enterprise all insisted on being flown (at the employer‟s expense) to a central meeting location, andaccommodated over night? Would this add to the cost of bargaining, and perhaps encourage more employees toappoint themselves as bargaining agents, so that they too could join the party? The industrial relations
managers said this problem had not yet emerged as a major inconvenience, however, some managers did reportthat they now had to deal with a second bargaining representative acting for a minority of the workforce with adifferent agenda from the union. At a workshop discussing these views, one industrial relations manager for auniversity said that she had, in fact, received notification from more than 50 non-union bargaining
representatives when she first issued the required notices under Fair Work Act s 173. She opined that employers
with highly professional workforces were more likely to face a need to deal with multiple bargaining
representatives.
One question arising when more than one representative is appointed is whether an employer is obliged to meetwith all bargaining representatives simultaneously, or whether the good faith obligation permit s separate
15

Julia Gillard, Minister for Employment and Workplace Relations “Introducing Australia‟s New Workplace Relations System”(National Press Club, Canberra, 17 September 2008).
16
The project‟s findings on good faith are to be published separately.

New Zealand Journal of Employment Relations 37(1): 22-29
negotiations with the different groups. Managers interviewed generally expressed a preference for holding
meetings separately, generally because they felt that separate meetings allowed them greater control overnegotiations. Several managers expressed a fear that bargaining representatives may bring adverse action claims
if they were disgruntled by the employer‟s approach to dealing with different groups.
„Adverse action‟ complaints can be brought under the General Protections provisions in FW Act Part 3-1, wherean employee can demonstrate that they have been treated in a less advantageous manner than others at theworkplace, on account of their entitlement to exercise a workplace right (such as their freedom to join or notjoin a union, or their right not to suffer discriminatory treatment on the grounds of sex, disability, age, or someother protected characteristic). Adverse action claims can be brought by employees during the course of theiremployment, not only upon termination. 17
The concern that special interest groups may delay settlement of an agreement, and may bring adverse action
claims, was realised in Qantas Airways Limited.18 This was an application for approval of an enterpriseagreement voted up by Qantas flight attendant staff after successful negotiations involving the AustralianServices Union (ASU) which supported the application for approval. Two employees, Ms. Waterhouse and Ms.
Edwards, were bargaining representatives for a number of part-time employees in the Brisbane internationalterminal. They objected to some clauses in the agreement, for reasons including that those clauses gave
preference in the allocation of overtime to full-time staff. Their objection to approval of the agreement wasalleged indirect discrimination on the grounds of sex. This argument could not be sustained: Commissioner
Raffaelli found that women made up the majority of the full-time workforce as well as the part-time workforce,so any advantage conferred upon full-time staff could not be construed as an act of discrimination against
women. The part-timers objection was discounted and the agreement ultimately approved. Nevertheless, thisskirmish demonstrates that the obligation to negotiate with minority groups can delay the approval of anagreement voted up by majority of employees.
Even in this case, where Qantas had met with the minority group‟s representatives and made some changes tothe agreement to accommodate their concerns, the minority could still contest approval. In the days whenagreements could be made directly with unions, the union bore the responsibility of accommodating disparate
claims into a unified employee voice. It is not surprising that a system which burdens the employer with that
responsibility should raise concerns for employers who have long been accustomed to dealing only with theunion.
Employers are not permitted to take any steps themselves to require the various employee representatives to sortout their claims themselves before coming to the bargaining table. There is provision in the FW Act for Fair
Work Australia (FWA) to make a bargaining order (under s 229) if it finds that the participation of too manybargaining representatives is interfering with efficient bargaining.19 FWA can make an order under s 231 that“some or all” of the representatives meet and elect one of their number to represent them all in bargaining. 20
Nevertheless, employers cannot pre-empt this kind of problem by requiring employees to elect representatives
for the purpose of bargaining, as was demonstrated in Capricornia Pty Ltd trading as Quality Hotel Batman’s
Hill on Collins.21 In that case, an employer with a non-union workforce wanted to strike an enterprise bargain
under the FW Act with employees. Instead of doing what many employers appear to do, and simply put its own
17

See for example Australian Licensed Aircraft Engineers Association v Qantas Airways Ltd [2011] FMCA 58.
Qantas Airways Limited [2011] FWA 3632.
19
See Fair Work Act, s 230(3)(a)(ii).
20
The provision does not appear to have been used to date.
21
Capricornia Pty Ltd trading as Quality Hotel Batman’s Hill on Collins [2011] FWA 727.
18

New Zealand Journal of Employment Relations 37(1): 22-29
non-negotiable agreement to a vote of employees 21 days after announcing the intention to bargain, this
employer genuinely attempted to encourage employees to bargain. The employer asked employees to form abargaining team by electing a number of representatives from each of the classifications of occupation at theworkplace. This approach – designed to establish a manageable team of elected representatives chosen by avote of the majority – was held to contravene the FW Act, because it denied each individual employee thestatutory entitlement to appoint his or her own personal bargaining representative. The employer‟s error inassuming that the responsibility for choosing a workable number of representatives should rest upon thecollective of employees would be excusable if the employer was familiar with collective bargaining practices in
European and North American jurisdictions. This peculiarity of Australian law actually discourages employers
without a union presence from proactively encouraging the establishment of employee bargaining teams.

Who pays for bargaining work?
Managers interviewed also expressed concerns about how much paid time they needed to provide non-union
bargaining representatives to engage in bargaining meetings. For a national employer who can expect to holdweekly meetings over the course of a few months to meet the good faith bargaining obligations in s 228, this
could amount to a considerable amount of paid time. Unions, of course, pay their own dedicated staff, most ofwhom will not be direct employees of the employer in any event. But who pays the non-union bargaining
representatives? The work is done for the employee or employees appointing the representative. What if therepresentative is the employee, or another member of the employer‟s staff, so that the bargaining work will takethe employee away from normal duties? Is the employer obliged to release employees from normal duties toattend bargaining sessions?
The question of who must pay for the time that independent bargaining representatives spend around thebargaining table was resolved in Bowers v Victoria Police.22 Sergeant Bowers wanted to attend the samenegotiation meetings for an enterprise agreement with VicPol as the Police Federation of Australia (PFA).
VicPol had agreed to organise his rosters to enable him to attend the meetings, but he argued that he should beentitled to attend during paid working hours. Commissioner Smith held that Sergeant Bowers was acting as his
own bargaining representative, and on behalf of 132 other police prosecutors, and was not entitled to paid time
off work to attend bargaining meetings. Although Commissioner Smith said that “many employers do provide
paid time for employees to attend bargaining sessions,”23 he held that VicPol‟s obligation to give genuine
consideration to his proposals did not mean that it was obliged to pay his salary during meeting times.
The Bowers decision implies that the industrial relations managers‟ concerns about the costs of bargaining caneasily be resolved: employees pay the costs for their own representation. This is entirely consistent with thespirit of Article 2 of the International Labour Organisation(ILO) Right to Organise and Collective Bargaining
Convention C98, which insists that employers should fund or otherwise exert influence over worker
organisations. Bargaining is indeed „work‟, but it is not work that forms part of the employee‟s duties in serviceof the employer. Organised trade unions deal with the problem of how to pay for the work of bargaining by
employing their own paid officials. Union members pay for bargaining services through their dues. The new
breed of voluntary bargaining representatives need to establish their own arrangements for funding the work of
bargaining. They cannot impose those additional costs upon the employer; and they ought not accept payment
from the employer while performing any collective bargaining function, because this conflicts with the ILO

22
23

Bowers v Victoria Police [2011] FWA 2862.
Ibid at [30].

New Zealand Journal of Employment Relations 37(1): 22-29
principle that workers ought not be under any suspicion of control or influence by the employer when engaged
in collective bargaining.
Interestingly enough, no issue was raised in the Bowers case about the obligation of the 132 police prosecutors
to contribute to a fund to pay for the work Sergeant Bowers was undertaking on their behalf. This exposes
another peculiarity of the Fair Work system. It permits free-riding. Those who pay union dues support workthat benefits many who do not contribute, but the FW Act (like the Workplace Relations Act before it) prohibits
the compulsory levying of any kind of bargaining fee. 24 It should also be remembered that in the Australiansystem, once an enterprise bargain is struck for a particular occupational group, every employee performing thatkind of work will be covered by the enterprise agreement, not only the union members of a union that bargained
for the agreement.
Another potential source of grievance buried in the Bowers case, is the timing of bargaining meetings. The
employer and the union are likely to want meetings to be in normal working hours, because industrial relations
managers and union delegates like to get their work done in ordinary time. Self-appointed employee bargaining
representatives, however, may want bargaining meetings to occur out of hours, if attendance will interfere with
their paid work. Whose will prevails? How will the obligation to bargain in good faith, by meeting at
reasonable times, sort out these kinds of disagreements?

Reemergence of demarcation disputes?
Some of the industrial relations managers interviewed also expressed concerns that the system requiring
recognition of many bargaining agents has the potential to generate the kinds of problems that were once settled
by the conciliation or arbitration of demarcation disputes. This fear is well illustrated by the FWA decision in
Tracey v Technip Oceania Pty Ltd,25 which involved agreement-making with waterside workers. This is anindustry with a rich and colourful history of union rivalry.
When Technip advised employees of their right to appoint a bargaining representative for the purpose ofnegotiating a proposed agreement, it was dismayed to find that a number of them purported to appoint a certain
Mr. William Tracey. Technip challenged the appointment because Mr. Tracey was Assistant Branch Secretaryof the Maritime Union of Australia (MUA), well known to be a militant union. As a consequence of thesettlement of a demarcation dispute many years earlier, Technip‟s staff were all entitled to be members of theAustralian Maritime Officers Union (AMOU), but not the MUA. Understandably, Technip wished to bargain
only with the AMOU and did not want the MUA influencing negotiations (or getting into stoushes with the
AMOU during the course of bargaining). Technip sought to rely on the FW Act s 176(3) which provides that“an employee organisation cannot be a bargaining representative of an employee unless the organisation isentitled to represent the industrial interests of the employee in relation to work that will be performed under theagreement”. Nevertheless, Commissioner Cloghan found that as the employees had appointed Mr Tracey
himself, and not the MUA, Technip should be ordered to recognise him as a bargaining agent. The MUA could
not act as their representative, but the MUA‟s representative could, so long as he acted in his personal capacity.

24
25

See Fair Work Act, s 353.
Tracey v Technip Oceania Pty Ltd [2011] FWA 3509; [2011] FWAFB 6551.

New Zealand Journal of Employment Relations 37(1): 22-29
Technip appealed to a full bench of FWA. On appeal, the principal finding that Mr. Tracey had been validly
appointed as a bargaining agent for the employees was not disturbed.26 Nevertheless, the bargaining order was
overturned by a majority of the full bench (but with a strong dissent by Drake SDP) on the basis that Mr. Tracey
had applied for the order not in his personal capacity, but in his position as an official of the MUA. His
correspondence was „bristling‟ with indications that he was acting as an MUA official. 27 He used the MUA logo
and his MUA contact details in his sign-off. Had he been more cautious and used personal stationery for hiscorrespondence, it is arguable that Mr. Tracey would have succeeded in the matter.
It is not surprising that employers who have dealt in the past with difficult demarcation disputes should beapprehensive that some of those problems may be re-enlivened by rules which permit any person – even a union
organiser for a rival union – to act as a bargaining representative at a workplace. It seems rather naïve to suggestthat a union delegate can genuinely act in a personal capacity for persons who are not entitled (as a consequenceof a demarcation arrangement) to official representation. On the other hand, it is difficult to see what otherdecision Commissioner Cloghan could have made given the privilege the FW Act confers on the individual‟sright to choose his or her own bargaining representative.

Conclusions?
The FW Act is relatively young. It is due for revision in 2012, as a consequence of promises made in the
Explanatory Memorandum to the original Fair Work Bill 2008. My intuition, however, is that these matters areunlikely to be addressed in any review of the Act. The inconveniences caused by this peculiar system are an
inevitable consequence of the now entrenched individualism in Australia‟s approach to labour relations.
Perhaps this is understandable, given the poor reach of union influence in many sectors of the Australianeconomy. 28 If you are a part-time worker in the private sector, chances of being a union member are now as low
as 14 percent. While it is understandable the system should accommodate an insistence upon the Workplace
Relations-style of freedom not to associate, it is clear that if too many non-union employees decided to pursue
their rights of individual representation too vigorously, the system could become quite unmanageable.
Presently, the general apathy of most of the non-unionised workforce is the only thing that permits collective
enterprise bargaining to proceed efficiently. If too many more employees were to follow the path of the parttime flight attendants, the police prosecutors and waterside workers in the cases above, the hairline faults noted
above may ultimately fracture the Fair Work bargaining system.

26

Tracey v Technip Oceania Pty Ltd [2011] FWAFB 6551 at [24].
Ibid at [26].
28
From August 2009 to August 2010, overall union density rates in Australia declined from 20% to 18%. See Australian Bureau of
Statistics “6310.0 - Employee Earnings, Benefits and Trade Union Membership, Australia, Aug 2010” (2010) <www.abs.gov.au>.
27

New Zealand Journal of Employment Relations 37(1): 30-43

Good Faith in Collective Bargaining Communications in Australia and
New Zealand
LEEANNE TEMPLER*
Abstract
Communications during collective bargaining are of central importance to the conduct of employment
relations in Australia and New Zealand as they may substantially impact collective bargaining
outcomes. Although communications during collective bargaining are required to be in good faith inboth jurisdictions, the Courts have approached communication material that seeks to “negotiate” withor persuade employees of employer viewpoint quite differently. This paper discusses how theAustralian courts have allowed greater latitude to employer and employee representatives tocommunicate their points of view during collective bargaining, and in turn led to results which may beseen as undermining the collective bargaining process.

Introduction
This paper compares the law covering communications during collective bargaining between
employers, employees and bargaining representatives in Australia and New Zealand in the context ofGood Faith Bargaining (GFB) requirements. Communication issues have assumed greater importancewithin the systems of enterprise based industrial relations in Australia and New Zealand over the last
20 years. They are integral to any consideration of collective bargaining parameters, and may
substantially affect negotiation outcomes.1
Collective bargaining has only recently been concurrently covered by GFB provisions in bothjurisdictions.2 Although the current legislation in Australia and in New Zealand was enacted by Labour
Governments, there are differences in the respective philosophies underpinning the two Acts. The Fair
Work (FW) Act is based on individual rights and enterprise collective bargaining3 and does not accord
unions any particular status other than as professional bargaining agents like any others. Good faith isjust one of many objects of the FW Act, and it contains simple GFB obligations. The New Zealand
Employment Relations Act (ERA) 2000, however, promotes collective bargaining, accords unions
exclusive status as bargaining representatives and gives good faith as well as GFB a central position in
the objects of the legislative framework.4*

1

LLM Student, Faculty of Law, Victoria University of Wellington

Pam Nuttall “The Impact of Good Faith Principles on Communication Issues in Collective Bargaining” (2007) 32(1)NZJER 87 at 87.
2
Aaron Rathmell “Collective Bargaining After WorkChoices: Will „Good Faith‟ Take Us Forward With Fairness?” (2008)
21 AJLL 164 at 167.
3
Fair Work Act 2009 s 3 (f), Rae Cooper and Bradon Ellem “Fair Work and the Re-regulation of Collective Bargaining”(2009) 22 AJLL 284 at 295.
4
Gordon Anderson and Michael Quinlan “The Changing Role of the State: Regulating Work in Australia and New Zealand
1788-2007” (2008) 95 Labour History 111 at 126, Mazengarb „s Employment Law, Online Edition, at 3-7.

New Zealand Journal of Employment Relations 37(1): 30-43
These different philosophies are shown in the following research to have impacted on the different
ways communications that seek to “negotiate” during “good faith” collective bargaining are perceived
in each jurisdiction.

The New Zealand Position
The New Zealand government‟s recent reform of s 32 of the ERA5 is the latest in a series of legislativeand judicial attempts to deal with the lack of clarity and relative complexity in the law coveringcommunications during collective bargaining. This reform confirms an employer may communicate
with the employer‟s employees during collective bargaining, including about the employer‟s proposals
for the collective agreement as long as the communication is consistent with the GFB requirements set
out in ss 32(1)(d) and 4 of the ERA.
In order to understand the current New Zealand legal position, it is necessary to understand the legal
position in respect of communications during collective bargaining under the Employment Contracts
Act 1991 (ECA). Section 12(2) was the key section relating to communications in collective
bargaining negotiations. This section, which is much less prescriptive than the current ERA, referred to“recognising the authority” of the representatives for negotiations, rather than any direct reference tocommunications.
Employment Contracts Act Cases
A discussion of the ECA position is facilitated by examining the following four cases, whichinterpreted ECA s 12(2).
In the first case, Eketone v Alliance Textiles (NZ) Ltd,6 Cooke P expressed the law as it then stood tobe: “[c]ertainly an employer is free not to negotiate with anyone: but if he wishes to negotiate I doubt
whether he can bypass an authorised representative”.
In the next case, NZ Medical Laboratory Workers v Capital Coast Health,7 the employer was judged tohave crossed the boundary between the provision of legitimate information and attempted direct
negotiation by the Employment Court. The employer had held a meeting which involved apresentation by management to employees on matters pertaining to the proposed collective
employment contract that the union was not invited to, and informed employees of proposals before
they informed the union. A number of letters and an information pack with a copy of the contract andexplanatory material were also sent to staff. The Employment Court held the employer had
undermined the authority of the bargaining agent.
On appeal in Capital Coast Health, the Court upheld the finding that some of the communications
amounted to direct negotiation. However, Hardie Boys J expressed the position that “[t]he provision of
factual information does not impinge on that [negotiating] process. But anything that is intended or
calculated to persuade or to threaten the consequences of not yielding does.”8 The employer‟s letter
warning of the financial consequences of strike action had not amounted to negotiating or attempting tonegotiate with staff.
5

Employment Relations Amendment Act 2010, s 9.
Eketone v Alliance Textiles (NZ) Ltd [1993] 2 ERNZ 783 at 787.
7
NZ Medical Laboratory Workers v Capital Coast Health [1994] 2 ERNZ 93.
8
Capital Coast Health Ltd v New Zealand Medical Laboratory Workers Union Inc [1995] 2 ERNZ 305 at 320.
6

New Zealand Journal of Employment Relations 37(1): 30-43
Between the Employment Court and Court of Appeal decisions in the Capital Coast Health case, Ivamy& Ors v New Zealand Fire Service Commission was decided.9 The Fire Service Commission arranged
for individual information packs containing contract proposals to be sent to fire fighters at a time whennegotiations were under way. During negotiations, the employer had also been seeking to implement a
restructure and there had been extensive meetings. The employer had agreed, as part of a settlement,
not to negotiate directly with employees. In the Employment Court, Chief Judge Goddard stated thatno further communication on the subject of negotiations should be addressed to the employees by theemployer once negotiations were under way.10 The employer argued that, pursuant to its right tofreedom of expression under the Bill of Rights Act,11 it should be allowed to communicate with
employees in the manner it had.
Following that decision but before the Court of Appeal judgment in Ivamy, the decision in Couling v
Carter Holt Harvey was delivered.12 Judge Colgan considered that it was a matter of fact and degree as
to whether communications about negotiations amounted to an attempt to negotiate. They would notnecessarily undermine negotiations or representatives‟ authority to represent employees.
The Court of Appeal judgment in Ivamy then overturned the earlier Employment Court judgment andfound the employer communications in that case did not undermine the authority of the bargaining
agent.13 Thomas J in his dissent commented that:14[the fundamental rights of employees to choose whether they bargain collectively]…and tochoose their bargaining agent or representative … [will be taken away] …and the processof collective bargaining … [will be] undermined if the authority of the bargaining agent torepresent the employees in negotiations for a collective employment contract is notrecognised by the employer.
Thomas J listed two paragraphs of conduct that he did not think would be acceptable in recognising theauthority of the bargaining agent but would now be considered legitimate in light of the majority
decision.15
As explained in Butterworths Employment Law Guide, the decisions in Ivamy and Capital Coast
Health Ltd v NZ Medical Laboratory Workers Union the Court of Appeal drew a line between
impermissible “direct negotiation” with the employees represented, and on the other hand, permissible“direct communication” with those employees.16 This difficult distinction effectively rendered section
12 inoperative in all but the most blatant bypassing cases.
The Current Position
The ERA provisions relating to communications during collective bargaining were designed to remedy
the problems that had arisen under the ECA and clarify the type of communications which would cross9

Ivamy & Ors v New Zealand Fire Service Commission [1995] 1 ERNZ 724 (EC)At 766.
11
New Zealand Bill of Rights Act 1990 s 14. Ivamy above n 9 at 751.
12
Couling v Carter Holt Harvey [1995] 2 ERNZ 137.
13
New Zealand Fire Service Commission v Ivamy [1996] 1 ERNZ 85, [1996] 2 NZLR 587 (CA).
14
At 116.
15
At 124-125.
16
Peter Agnew (ed) Butterworths Employment Law Guide (6 ed, LexisNexis, Wellington, 2002) at 232.
10

New Zealand Journal of Employment Relations 37(1): 30-43
the line into unacceptable “negotiations” with employees. The ERA provisions were also designed toensure the employer did not undermine the employee‟s agent during collective bargaining.
The current position was established in the leading case Christchurch City Council v Southern Local
Government Officers Union Inc.17 Pursuant to s 32(1)(d) of the ERA, an employer is prevented from
communicating directly with employees after bargaining has been initiated:(a)about their terms and conditions of employment, without the union‟s consent, if it amounts to“negotiating” during bargaining (emphasis added)(b) in a manner that undermines or is likely to undermine the bargaining with the union or theunion‟s authority in bargaining (emphasis added).
The Christchurch City Council case considered the extensive provisions in the ERA relating to goodfaith and communications during collective bargaining. In that case, the City Council‟s CEO
communicated directly with council employees on matters related to bargaining during negotiations fora collective employment contract. The Employment Court found the council had breached s 32(1)(d)of the ERA, and had failed to comply with the duty of good faith with respect to three of thecommunications.
The Court of Appeal upheld the Employment Court‟s opinion that by sending out the communicationsin question the City Council failed to comply with its duty of good faith.18 However, it stressed that it is
only in the absence of provisions in the Bargaining Process Agreements setting out what
communications are acceptable that the statutory default provision comes into play. 19 However, theCourt of Appeal took a different approach to interpreting the statutory provisions to the Employment
Court. Firstly, it applied the principle of statutory interpretation that specificity trumps general andconcluded that s 4 must be read consistently with the more specific s 32. Section 4 continues to apply
in a s 32 case to the extent it is not inconsistent with the specific provision of s 32.
Section 4(1A) imposes a general “good faith” obligation that parties to an employment relationship canonly communicate matters of “fact and opinion that are reasonably held about an employers business ora union‟s affairs.” Such communications also need to comply with another good faith obligation “to be
active and constructive and responsive and communicative” in employment relationships. They mustalso not do anything to mislead or deceive each other, or that is likely to mislead or deceive each other,pursuant to section 4(1)(b). Subsection 4(6) makes it a breach of subsection (1) for an employer toadvise or to do anything with the intention of inducing an employee –(a)(b)

not to be involved in bargaining for a collective agreement; ornot to be covered by a collective agreement.

These obligations apply at all times whether or not bargaining has been initiated. However,communications must also comply with s 32(1)(d) after bargaining has been initiated.20 (emphasis
added)

17

Christchurch City Council v Southern Local Government Officers Union Inc [2007] 1 ERNZ 37 (CA).
At [56].
19
Gordon Anderson “Communications with employees during bargaining” [2007] ELB 37 at 39. Bargaining Process
Agreements are important to assist the parties with an orderly bargaining process., as noted in AUS v Vice Chancellor of the
University of Auckland [2005] 1 ERNZ 224 at [78].
20
Jasmine Brown and Blair Scotland “Advising employers – Communication and passing on in collective bargaining”[2007] ELB 51 at 53.
18

New Zealand Journal of Employment Relations 37(1): 30-43
Secondly, the Court of Appeal found the s 5 definition of “bargaining” covers all interactions between
parties which relate to bargaining for a collective contract. However, the parties to the bargaining are
the employer and union. The Court seems to have found only s 5(b)(i) applies to the employees
represented in bargaining as it does not refer to “parties.”
Section 5 defines bargaining in relation to bargaining for a collective agreement as follows:(a) all the interactions between the parties to bargaining that relate to bargaining; and(b) (i)includes negotiations that relate to the bargaining; and(ii) communications or correspondence (between or on behalf of the parties before, during or
after negotiations) that relate to the bargaining.
The Court of Appeal has indicated that an employer can potentially communicate with union member
employees to clarify its position or to rectify incorrect and/or untruthful statements made by a union.
However, such communication must comply with s 32(1)(d) and not undermine the union or thebargaining.21
In order to best understand s 32(1)(d) of the ERA, it is important to understand how the Employment
Court‟s interpretation of s 32 differed from the way the Court of Appeal interpreted it. The
Employment Court had interpreted s 32(1)(d)(ii) as meaning “on matters relating to thebargaining…the employer must not communicate or correspond with persons for whom arepresentative is acting.”22
However, the Court of Appeal took the Employment Court to mean the above section meant allcommunications during bargaining were wrong. It is fair to say that s 32(1)(d) is confusing because not
all communications on “matters related to the bargaining” are likely to cross the line into unacceptable“negotiations”. Nutall makes the helpful point that at Select Committee stage and while the
Employment Relations Bill was before Parliament, debate centred on whether all communications
during bargaining should be prevented or only those that related to and undermined bargaining.23 It
seemed to be the intention of Parliament to only prevent communications that related to andundermined bargaining as opposed to statements of fact. Parliament simply does not seem to haveexpressed this clearly in the statute. The recent 2010 amendment is aimed at expressing this moreclearly.
“Directly or Indirectly Bargaining” and Undermining Bargaining
There are several other terms in the ERA relating to Communications in bargaining that still requireclarification by the Courts. Firstly, the exact meaning of “to directly or indirectly” bargain under s32(1)(d)(ii) is still not completely clear. Some guidance can be taken from authorities under the ECA
as the Court in Christchurch City accepted s 32(1)(d)(i) is based on the law as it stood under the ECA.
However, in the Christchurch City case, the Employment Court also found that s 32(1)(d) does not
codify the ECA 1991 position, rather it extends the obligations of each party. As extended, thedefinition of “undermine or likely to undermine” would encompass communications that:24

21

Brown and Scotland at 54.
Christchurch City Council v Southern Local Government Officers Union Inc [2005] ERNZ 666, at [87] (EC).
23
Pam Nuttall “Reviewing the communication cases: Christchurch City Council revisited” (2008) 33 (2) NZJER 45-55 at
49-52 and 54.
24
Geoff Davenport “Communications with employees during bargaining – no blanket ban but still uncertainty [2007] ELB
40 at 44; Christchurch City Council, above n 22 at [116] and [117].
22

New Zealand Journal of Employment Relations 37(1): 30-43[p]ut the Council‟s case for wishing to have a MUCA and was a communication that
related to the bargaining before the negotiation (although the Court of Appeal confined theobligations to after bargaining has formally been initiated); or “presented only one side of
the argument without reference to the union”
Conduct which is “likely to undermine bargaining” or “the authority of the other in bargaining” is also
capable of covering a broad range of activities. “Likely” in this section was defined in BONZ as “moreprobable than not” and a “real risk.”25
Davenport, in his article on the subject, lists reasons why communications by the Council in
Christchurch City had potential to undermine bargaining as the timing, content, presenting a one-sided
argument, whether the communication criticised the bargaining party, the consequence for the union‟smember (did it create confusion or ill feeling?) and the nature of the issues communicated on andwhether they are “negotiating points.” 26
The following significant cases relating to communications during a bargaining period have considered
the meaning of “undermine” in s 32(1)(d).Association of University Staff Inc v The Vice-Chancellor of
the University of Auckland,27 and NDU v General Distributors.28 In the AUS case, the union wanted tonegotiate a Multi-Employer Collective Agreement (MECA) with all New Zealand Universities,
however, the Vice Chancellor of the University of Auckland wanted to negotiate its own separate
Single Employer Collective Agreement (SECA) with the Union. The issue was whether the Vice
Chancellor had breached his duty of good faith.
In that case, the Court accepted that “undermine” had a broad meaning:29
Although the figurative dictionary definition of the word “undermine” includes
underhanded, subtle or insidious means, we consider that s 32 (1) (d) (iii) is not so limited
and must contemplate the action of undermining being carried out overtly as, for example,
by a refusal to meet to bargain.
The Court found that as the Vice Chancellor had genuine reasons for taking the stance he did, that wereclearly expressed to the union and acted on the legal advice it was given, it did not amount to a breachof good faith, even though its actions may have undermined bargaining.30
The Court expressed the view that:31
While on their face these communications were arguably unexceptional, we conclude thatthe timing, their unilateral nature and their instantaneous and personal distribution by email
may, in all the circumstances, have undermined bargaining. By announcing that it would
never bargain with other employers, contrary to the way in which it did so in the previous

25

BONZ Group Pty Ltd v Cooke [1994] 3 NZLR 216 at 229, Davenport, above n 24, at 44.
Davenport above n 24 at 44.
27
AUS v Vice Chancellor of the University of Auckland, above n 19, at [78].
28
National Distribution Union Inc v General Distributors Limited [2007] 1 ERNZ 120.
29
AUS v Vice Chancellor of the University of Auckland, above n 19 at [99].
30
At [99].
31
At [90].
26

New Zealand Journal of Employment Relations 37(1): 30-43
bargaining round, could have the effect of undermining the form of bargaining balloted forby Auckland University staff who are members of AUS.
Other factors in the AUS and NDU cases which may be considered to determine whether they
undermine bargaining or the union include: the effect on union membership and the tenor of thecommunications.32 The NDU case highlighted that if the negotiating parties conclude a BPA specifying
what the employer can communicate with union members directly, or stating what types ofcommunications from either party are acceptable, then sending communications to the union for its
comments before providing it to union members may provide some protection for employers against a
breach of good faith claim.
Recent Cases Considering Good Faith in Collective Bargaining Communications
The following more recent cases have further clarified the meaning of GFB, and conduct which may
undermine bargaining.
In Service and Food Workers Union Inc v Sealord Group Ltd,33 the Employment Relations Authority
held that the employer breached its GFB obligations when it held a meeting at which it addressed
employees, including union members, and essentially ran the argument it used when negotiating withthe union during collective bargaining. It also posted notices on its notice boards that were critical of
the union‟s stance and which made negative statements about the union. The Authority held that theemployer had bargained directly with union members, ignored the authority of the union
representatives and conducted itself in a manner which had the potential to undermine bargaining.
In the case of Mana Coach Services Ltd (MCSL) v NZ Tramways and Public Passenger Transport
Union Inc,34 the Employment Court found that direct communication with the union‟s members wasbad faith behaviour in breach of s 32(1)(d) of the Act. This evidenced a refusal to recognise theauthority of the union‟s representatives, amounted to an attempt at indirect bargaining without its
authority, and was conduct likely to undermine the bargaining or the authority of the union in relation
to the bargaining. Individually, the letters that were sent to employees did not set out MCSL‟s
expectation of the recipients but, read together, the implication was clear: members were to bringpressure on the union to accept options by the deadline if those options were not to be replaced byterms less attractive. MCSL‟s intention was to bypass the union and to present a new offer inbargaining. These communications were opportunistic and brazen.
In Eastern Bay Independent Industrial Workers Union Inc v ABB Ltd,35 the defendant was held not tohave undermined bargaining when a management representative suggested to a member of the union‟snegotiating team that a potential impasse could be avoided either by dispensing with both leadnegotiators (who had each demonstrated uncompromising attitudes) or otherwise progressing
negotiations without them. The union had earlier, and successfully, argued for a change of theemployer‟s previous lead negotiator and – in any event – the proposal to sideline the union‟s leadnegotiator was part of a package that would also have sidelined the lead negotiator for the employer.

32

At [99], NDU Inc. v General Distributors Ltd [2007] 1 ERNZ 120 at [161].
Service and Food Workers Union Inc v Sealord Group Ltd (2002) 6 NZELC 96,828.
34
Mana Coach Services Ltd v NZ Tramways and Public Passenger Transport Union Inc [2010] NZEmpC 110..
35
Eastern Bay Independent Industrial Workers Union Inc v ABB Ltd [2008] ERNZ 537 (EC)..
33

New Zealand Journal of Employment Relations 37(1): 30-43
In Housing New Zealand Corporation v PSA,36 the Employment Relations Authority held that theevidence did not establish that the PSA attempted to undermine bargaining although it sent inaccurate
and misleading communications to employees and breached terms of the Bargaining Process
Agreement. It had not acted in good faith pursuant to s 4 of the ERA, however, the PSA was not
penalised.

The Australian Position
In Australia, the Rudd Labor government implemented the Fair Work Act 2009 (FW Act) which wasintended to “get the balance right” between fairness and flexibility in Australian workplaces.37 The
conservative Howard coalition government‟s previous WorkChoices legislation had expressly repealed
the previous GFB provision. Work Choices had also closed off the ability of the courts or theAustralian Industrial Relations Commission to imply good faith obligations into the bargaining
regime.38
The industrial relations model under “WorkChoices” became known as “direct engagement” whereby
employers were told to “bypass unions, bypass the Australian Industrial Relations Commission anddeal directly with employees” in collective bargaining.39 Employers had been left relatively free tocreate their own bargaining norms and, as there was no certification process to ensure agreements did
not disadvantage employees, the quality, integrity and fairness of enterprise bargaining outcomes were
threatened.40
The objects set out in s 3 of the FW Act, on the other hand, include achieving productivity and fairness
through an emphasis on “enterprise level” collective bargaining. The FW Act reintroduced GFBrequirements and enhanced rights for union involvement in collective bargaining.
The key GFB provisions in the FW Act in s 228(1) relate to bargaining representatives for enterpriseagreements. The obligations are:
(a)
(b)
(c)
(d)
(e)
(f)
36

attend and participate in meetings at reasonable times;
disclose relevant information (but not confidential or commercially sensitive information) in atimely manner;
respond to proposals made by other bargaining representatives in a timely manner;
give genuine consideration to the proposals made by other bargaining representatives, andgive reasons for the responses made to those proposals;
refrain from capricious or unfair conduct that undermines freedom of association or collective
bargaining (emphasis added)
recognise and bargain with the other bargaining representatives.

Housing New Zealand Corporation v PSA ERA Wellington WA 174/10, 5311242, 29 October 2010.
Andrew Stewart “A Question of Balance: Labor‟s New Vision for Workplace Regulation” (2009) 22 AJLL 3 at 7; Andrew
Stewart and Anthony Forsyth “The Journey from Work Choices to Fair Work” in Andrew Stewart and Anthony Forsyth(eds) “Fair Work” (Federation Press, Annandale, 2009) at 7-8.
38
Confirmed in Association of Professional Engineers, Scientists and Managers, Australia v Telstra Corp Ltd [2008] AIRC
734 at 11.
39
Anthony Forsyth “Good Faith Bargaining: Australian, United States and Canadian Comparisons” (paper presented toChairman‟s Lunch Seminar, US National Labor Relations Board, Washington DC, 4 November 2009) at 19, at n 50 per
Stuart Wood as exemplified by Rio Tinto, Telstra and the Commonwealth Bank, “Good faith laws will end the Rio
revolution” Workplace Express, 24 August 2009.
40
Rathmell, above n 2, at 165.
37

New Zealand Journal of Employment Relations 37(1): 30-43
It is noteworthy that s 228(1)(f) has some similarities with s 12(2) of the New Zealand ECA 1991.
Cases decided pursuant to this section, and set out above, could be relevant in interpreting this sectionof the FW Act. Cases considering s 32(1)(d)(ii) of the ERA could also be relevant to s 228(1)(e) as bothare concerned with conduct that undermines collective bargaining.
There was initial speculation about how the very general new GFB provisions in the FW Act would beinterpreted. The Rudd government‟s “Forward with Fairness” platform, and central theme of fairness
in the objects of the FW Act, signalled a clear change of direction in industrial relations. In practice,
Fair Work Australia has stressed the need to approach the GFB requirements on a case by case basis.41
The Commissioners have found breaches of the GFB provisions of the Act when:
(a)
(b)
(c)

(d)

(e)

bargaining agents have been bypassed by employers at crucial stages of negotiations (such as
close to the time of a vote on a circulated agreement): T & R (Murray Bridge) case; 42agreements have not been properly explained to the employees or they have been misled:Class Electrical v CEPU and United Group Rail cases;43
agreements have been put to a vote for employee approval without advising the bargaining
agent without giving them a reasonable time to propose any amendments to the document,
and without responding to the proposals they put through their bargaining representative
concerning the content of such an agreement: APEESMA v DTS,44 Alphington Aged Care,45
United Group Rail NUW v Defries cases;46
a different position has been put to employees through their bargaining representative, and theemployer has sought to bargain with the representative and make an agreement with
employees at the same time, such as in Finance Sector Union,47Aegis Aged Care cases;48 andthe voting process has been unfair: United Group Rail case

The practical outcomes of the current Australian law relating to communications in collective
bargaining in Australia have many parallels with those that existed under New Zealand‟s ECA 1991,
and Australia‟s IR Act from 1993 to 1996.49
Early Cases Interpreting section 228 of the Fair Work Act
Very little foreign or pre-FW Act precedent has been cited in the decisions. A reason for this wasgiven in the case of Finance Sector Union.50 Commissioner Smith referred to decisions under the
National Labour Relations Act in the United States of America in relation to bargaining in good faith.
He decided not to deal with those cases for reasons including “there are a number of extra factors

41

The Australasian Meat Industry Employees Union v T & R (Murray Bridge) Pty Ltd [2010] FWA 1320 (26/2/2010) at[44]; Construction, Forestry, Mining and Energy Union v Tahmoor Coal Pty Ltd [2010] FWAFB 3510(5/5/2010) at [24].
42
The Australasian Meat Industry Employees Union v T & R (Murray Bridge) Pty Ltd, above n 41.
43
Class Electrical v CEPU [2009] FWA 1541 (9/12/2009); United Group Rail Services Limited [2009] FWA 452(9/10/2009).
44
APESMA v DTS [2010] FWA 429, (28/1/2010).
45
Alphington Aged Care [2009] FWA 301 (17/9/09).
46
National Union of Workers v Defries [2009] FWA 88 (18/8/2009).
47
Finance Sector Union [2010] FWA 2690 (9/4/2010).
48
Aegis Aged Care Staff Pty Ltd [2010] FWA 3715 (12/5/2010).
49
Rathmell, above n 2. See the Explanatory Memorandum to the FW Act, cl 168 which refers to good faith in the Industrial
Relations Reform Act 1993.
50
Finance Sector Union [2010] FWA 2690 (9/4/2010)

New Zealand Journal of Employment Relations 37(1): 30-43
which may bear upon the establishment of the US jurisprudence in relation to GFB, including theestablishment of exclusive bargaining rights, which do not find legislative parallels in Australia”.51
In an early case, the recommendation in AFMEPKIU v Transfield Australia Pty Ltd by Drake SDP was
initially seen as signalling a step towards the more restrictive approach in New Zealand. 52 Herecommended:53[t]hat [during the program for negotiations] Transfield will not attempt to bypass thebargaining agent representatives in relation to its proposal by contacting for this purposethe members of the bargaining agent representatives directly, in meetings or by text or othertelephonic messages;
Transfield will deal with all officers and delegates of the bargaining agent representatives
who are authorised by their organisations to conduct negotiations.
However since then, another line of authority has developed through the Heinz,54Fosters,55Mingara,56
and Tahmoor Coal cases.57 Fair Work Australia has stressed the Courts should be “slow to interfere in
the legitimate tactics undertaken by the parties during the bargaining process.”58 In some of thesecases, there is little doubt that the employers‟ communication tactics would breach the New Zealand
ERA standards, and will be considered in greater detail in the following pages. Fair Work Australia
has continually highlighted the well-established principle that “it is important to encouragecommunication between employees and employers both directly as well as through their representative
organisations.”59
Two early decisions provided guidance in interpreting the GFB provisions of the FW Act. In the first,
Total Marine Services Pty Ltd v Maritime Union of Australia, Commissioner Cloghan establishedguidelines to assessing good faith conduct as follows:60…for Fair Work Australia to be satisfied that good faith bargaining has not been met, it isnecessary to assess all the circumstances including the industrial context, character ofnegotiators and negotiations. He also observed that the question must be asked, whether
any of the parties are not genuinely trying to reach agreement, secondly, when making anassessment of the negotiations, to be even handed, and thirdly, referring to the Explanatory
Memorandum to the Fair Work Bill 2008, in relation to what was to become s 228 of theAct, which refers to assisting when bargaining representatives do not bargain voluntarily or
co-operatively.

51

At [58].
AFMEPKIU v Transfield Australia Pty Ltd [2009] FWA 93 (14/8/09) at 93; Forsyth above n 39,at 20.
53
Forsyth above n 39 at 18.
54
AFMEPKIU v HJ Heinz Co Australia Ltf (Echuca Site) [2009] FWA 322 (22/9/09).
55
LHMU v Fosters Australia Ltd [2009] FWA 750 (28/10/2009).
56
LHMU v Mingara Recreation Club Ltd [2009] FWA 1442 (1/12/2009).
57
Construction, Forestry, Mining and Energy Union v Tahmoor Coal Pty Ltd [2010] FWAFB 3510 (5/5/2010).
58
LHMU v Fosters Australia Ltd at [20].
59
LHMU v Hall [2010] FWA 1065 (11/2/2010).
60
Total Marine Services Pty Ltd v Maritime Union of Australia [2009] FWA 290 (16/9/2009).
52

New Zealand Journal of Employment Relations 37(1): 30-43
In the second, LHMU v Fosters Australia Ltd,61 Kaufman SDP considered the meaning of “undermined
freedom of association or collective bargaining” pursuant to s 228(1)(e) of the Act, and the meaning of“capricious”. Capricious is defined as “guided by caprice; readily swayed by whim or fancy;inconstant,” and “caprice” as “an unaccountable change of mind or conduct.”
He quoted the Explanatory Memorandum to the FW Act:62
The good faith bargaining requirements are generally self-explanatory. The lastrequirement, “refraining from capricious or unfair conduct …” is intended to cover a broad
range of conduct. For example, conduct may be capricious or unfair conduct if an employer– does not permit an employee who is a bargaining representative to attend meetings or
discuss matters relating to the terms of the proposed agreement with fellow employees.
In a number of cases where employer communication tactics have been held not to breach the FW Act,
the Fair Work Australia Commissioners have commented that the evidence has not supported thefinding of a breach. In future, a more thorough approach to the presentation of evidence setting out
details of alleged communication breaches would likely result in a stricter approach by Fair Work
Australia to preventing conduct which undermines collective bargaining and good faith requirements.
Cases Illustrating the Differences in the Australian Approach to Communications
As the GFB requirements apply to employee bargaining representatives as well as employers, there
have been a number of cases where employers have claimed unions breached GFB requirements duringnegotiations. In the Total Marine Services case, Fair Work Australia declined to find a breach of GFB
provisions by the unions involved, instead viewing the union‟s behaviour as “legitimate negotiatingtactics.” The Commissioner found during negotiations the union wanted to keep some options open andthe employer wanted to consider the claim as a whole. In the Heinz case, the union was found to beentitled to distribute a notice advising employees not to respond to the employer‟s proposal for eighthour shifts and accusing the employer of not acting in good faith. In Minda,63 Fair Work Australia
found it was acceptable for the union to communicate directly “once off” with the company‟s board. In
Capral, the union was entitled to distribute flyers to employees relating to the proposed enterpriseagreement and terms and conditions of employment.
In some situations where Fair Work Australia has allowed a robust approach to negotiations, aggressive
tactics have often been the norm for both employers and employees. Fair Work Australia has allowed
communications with employees which would be seen as “negotiating and bargaining” in breach of the
New Zealand ERA. Significantly, in the Queensland Nurses Union case,64 the Commissioner found“an employer may directly communicate and/or bargain with its employees throughout the bargaining
process”.
The recent Full Bench Appeal decision Construction, Forestry, Mining and Energy Union v Tahmoor
Coal Pty Ltd illustrates the different approach Fair Work Australia has taken to communication issues

61

LHMU v Fosters Australia Ltd, above n 55.
Fair Work Act 2009, Explanatory Memorandum at [951], LHMU v Fosters Australia Ltd at [13].
63
LHMU v Minda Incorporated [2010] FWA 3461 (30/4/2010).
64
Queensland Nurses Union v The Corporation of the Roman Catholic Diocese of
Toowoomba t/a Lourdes Home for the Aged, Lourdes Home Hostel [2009] FWA 1553 (7/12/2009).
62

New Zealand Journal of Employment Relations 37(1): 30-43
in comparison with the New Zealand position.65 The CFMEU sought an order restraining the employer
from putting the employer‟s proposed agreement to an employee ballot and relied only on the alleged
breach by Tahmoor of the requirement in s 228(1)(e) to “refrain from capricious or unfair conduct that
undermines freedom of association or collective bargaining”.66
The Commissioner at first instance had followed Mingara in holding that communicating with staff
was good management practice.67 So long as the employer did not refuse to meet and communicate
with a bargaining representative, then in the Commissioner‟s view there was no breach of the GFBrequirements of the Act. The CFMEU argued the material presented by Tahmoor management atmeetings and in packages sent out to employees was tantamount to arguing in support of the position it
was taking in collective bargaining. It also argued that there was a “level of intimidation” in that thepossibility of a lock out of employees and selective re-engagement had been raised. Tahmoor also
terminated bargaining meetings in January 2010 in order to put its proposed agreement to employees ina ballot. Small group meetings had been held without union officers being invited to attend and themeetings were held compulsorily during work time. At these meetings, the company adopted a “hardsell” position relating to its views in the employment negotiations. The meetings lasted forapproximately four to five hours each.
The Commissioner, at first instance, had accepted that the employer bargaining representative adopted
a very aggressive approach in the employee meetings and that he “probably crossed the line of what isreasonable in such circumstances”, but he commented that aggressive tactics appeared to be the normin the coal industry.
On appeal, the Commissioners found that although the company‟s action in communicating directlywith employees might be inconvenient and offensive to the CFMEU, it was not improper. The
Commissioners accepted that it appeared that the company made it less than convenient for CFMEU
Lodge Officers to attend the small group meetings, and that Tahmoor may have been trying to
influence employee views. However, the Full Bench found that the general practice adopted by
Tahmoor in communicating directly with employees did not constitute an undermining of the
CFMEU‟s role as bargaining representatives. The company‟s wish was to put its view to employees inan unencumbered manner as possible. The absence of a bargaining representative at a meeting held
between the company and its staff was not considered inconsistent with the GFB requirements.
The Full Bench held on appeal that the Commissioner was entitled to conclude that after a very long
period of negotiation the parties were simply unable to agree. In those circumstances, the conclusion
was open that it was “not capricious or unfair conduct for Tahmoor to seek to explain its negotiating
position to the employees directly.”
A second case provides another good illustration of the differences in the Australian approach tocommunications during GFB.
In LHMU v Hall,68 LHMU applied for bargaining orders.
Commissioner Cloghan declined to issue the orders as he was not satisfied on the basis of the evidence
the employer had breached the GFB requirements. This case also highlights the need for applicants toensure they obtain convincing evidence.

65

Construction, Forestry, Mining and Energy Union v Tahmoor Coal Pty Ltd [2010] FWAFB 3510(5/5/2010).
At [7].
67
LHMU v Mingara Recreation Club Ltd, above n 56.
68
LHMU v Hall, above n 59.
66

New Zealand Journal of Employment Relations 37(1): 30-43
Amongst the negotiations, there was “robust” documentation by both parties describing each other‟sposition. This included the LHMU portraying the employer as “frightening” employees, describing
negotiators as “monkeys” (in words and in caricature); misleading or inaccurate information (according
to the employer) and the caricatured black suited, cigar smoking “fat capitalist” dragging a trolley loadof money. For the employer, “robust” was the use of words like “unfair” “unreasonable” and “unAustralian” to describe the LHMU as well as portraying their role as wanting “to cause trouble” andproviding misleading or inaccurate information (according to the LHMU). The union highlighted theemployer‟s taking and putting the employer‟s own (best) perspective on information circulated. A
difficulty that the union faced was that it did not come to the hearing with “clean hands.”69
The Commissioner found that it was not unusual for the employer to meet with its employees (withoutbargaining representatives or their delegates present) and to put forward the best perspective of theemployer was common. He found that, with the absence of maybe an employer representative‟scomments in relation to the closing down of facilities and the possible loss of jobs, these meetings wereconducted in an environment where employees were free to have their say and did so. However, he did
say he was sure that, on some occasions, the content and conduct of such meetings would breach GFBrequirements, but he had not seen or heard evidence on this occasion to determine that it falls into thiscategory.”
Contrast with New Zealand case law
In contrast, the leading New Zealand case of Christchurch City Council70 held that comparable direct
employee communication tactics to those used in Tahmoor and Hall of holding meetings where theemployer adopted a hard sell approach to their position in employment negotiations would be a breachof good faith in New Zealand. Similarly, in a case decided under the ECA in New Zealand, theemployer in New Zealand Fire Service v Ivamy sent out information packs to staff.71 Under current
New Zealand law, communications of this nature would be in breach of GFB obligations, as illustrated
by the recent New Zealand case of Mana Coach Services72. In this case, it was held thecommunications material sent to employees‟ homes was intended to persuade them of the employer‟spoint of view and not allowed under the ERA. Unfortunately, insufficient evidence was presented in
Tahmoor of the nature and content of information that was sent to employees. If the material was
simply factual, it would not have breached the New Zealand GFB requirements. The New Zealand
Sealord case also found that the employer had undermined the employees‟ bargaining representative by(inter alia) holding meetings at which they directly communicated their negotiating position to staff, ina similar manner to Tahmoor and Hall.73
In the Tahmoor Coal case, the employer conducted compulsory meetings with staff that lasted four tofive hours and adopted a hard sell approach. Although aggressive tactics were the norm in the coalindustry, this should not have allowed the employer to breach its GFB obligations and communicate ina way that undermined the employee bargaining representative‟s authority.
Hall provides another example of where the New Zealand Courts would find a breach of GFB
provisions as the aggressive tactics, meetings and misleading information on behalf of the employer
and even the union could be seen as undermining bargaining (if sufficient evidence was presented).
69

At [23].
Christchurch City Councilv Southern Local Government Officers Union Inc, above n 17.
71
New Zealand Fire Service Commission v Ivamy, above n 13.
72
Mana Coach Services Limited v NZ Tramways and Public Passenger Transport Union Inc, above n 34.
73
Service and Food Workers Union Inc v Sealord Group Ltd, above n 33.
70

New Zealand Journal of Employment Relations 37(1): 30-43

Conclusion
Although the Australian Parliament has legislated for good faith bargaining in the FW Act, it is not
being applied to employee communications as strictly as the equivalent GFB provisions in New
Zealand. A much stricter approach is taken in New Zealand to conduct that undermines bargaining, as
evidenced by the leading case of Christchurch City Council v Southern Local Government Officers
Union Inc.74
Fair Work Australia has interpreted the GFB requirements on a case by case basis, emphasising aneven handed approach and the importance of encouraging communication between employees andemployers both directly as well as through their representative organisations. The level of fairness andgood faith in collective bargaining has increased from the “direct engagement” level under AustralianWork Choices to the extent that employee bargaining representatives are now being recognised, andcannot be bypassed at crucial stages of negotiations. In addition, employees must not be misled,agreements must be properly explained and agreements cannot be put to vote for employee approval
without advising the bargaining agent. However, persuasion, direct influencing of and bargaining with
employees, intimidation, aggressive tactics and other conduct that would be seen as undermining
bargaining in North America and New Zealand has been allowed in some cases. In the result, theactions of employers in cases like Hall and Tahmoor Coal may seriously undermine the process ofcollective bargaining.

74

Christchurch City Council v Southern Local Government Officers Union Inc, above n 17.

New Zealand Journal of Employment Relations 37(1): 44-59

The Rule of Law in Private Law: A New Animating Ideal for
Employment Law?
MAX HARRIS*Introduction
Law exists so that principles, and not purely power, govern relations between people in a society. The
rule of law, by extension, is just concerned with maintaining and upholding, steadfastly, thoseprinciples of law against the reach of naked power. That simple formulation of the rule of law consistsof many strands, however. Most rule of law literature focuses on how principles of law can be
maintained and upheld against the reach of naked public power in the realm of public law.1 What thispaper focuses on is a forgotten strand of the rule of law: the need for principles of law to be maintained
and upheld by the courts away from public law, where powerful private parties seek to place
themselves above, or outside of, the law to secure an advantage for themselves. This strand is called inwhat follows “the rule of law in private law”. What is meant by private law is that area of law,generally involving two private parties (though sometimes involving the State acting in some private
capacity), where no special duties or obligations attach to either party because of their affiliation tobranches of government: obvious examples include the law of contract and the law of torts. The rule oflaw in private law is simply the application of rule of law precepts to that context.
This paper seeks to unravel the meaning of the rule of law, as well as to show that the strand of the ruleof law identified above may already be woven into the fabric of private law. Only a single case studyof an area of employment law is selected to test this claim, but it is tentatively suggested that “the ruleof law in private law” might, with further investigation, be shown to be at work underneath the logic ofdecisions in employment law, and private law as a whole.2 It should be noted that this paper focuses on
cases in employment law involving two private parties, without State involvement, and does not intend
to take any firm position on the debate over whether employment law should be classified as part ofpublic law or private law. Examples of employment cases with two private parties do not prompt thatdebate.
This paper argues, too, that there may be merit in identifying this underlying pattern in the tapestry of
employment law specifically. Viewing the pattern that gives effect to the rule of law in private law
may help to spark thinking about the underlying ideals of employment law, and about the way in which
employment law should interact with other bodies of law, such as public law, in developing concepts
like the rule of law in private law.

*

BA/LLB (Hons.), The University of Auckland. My thanks to Mark Bennett, Scott Worthy and Sir Edmund Thomas fortheir helpful comments on this paper. The usual disclaimer applies. The opinions expressed in this paper are mine alone.
1

See, for instance, the analysis of Jeremy Waldron in: Jeremy Waldron “The Concept and the Rule of Law” (2008) 43 Ga L
Rev 1.
2
It should be pointed out that the term “employment law” is preferred to “labour law” in this paper, though it is notintended to carry a different meaning to the meaning attached commonly to “labour law” (for instance, the meaning given to
the term “labour law” at the 2011 New Zealand Labour Law conference at which this paper was first presented).

New Zealand Journal of Employment Relations 37(1): 44-59
The paper‟s structure reflects the development of these three points. Part I sketches the contours of“the rule of law in private law”, explains how it can be situated within broader rule of law thinking, andexamines whether the idea survives logical scrutiny. Part II explores a case study to show that, in
employment law across several jurisdictions, the courts‟ approach to whether a party is an employee or
independent contractor reflects the operation of the rule of law in private law. Close attention is paid inthis regard to the recent United Kingdom Supreme Court judgment in Autoclenz Ltd v Belcher – itsbackground, procedural history, relevant analysis, and relationship to the rule of law in private law –and the New Zealand parallel to this judgment is mentioned in passing. 3 Finally, Part III considers how
the rule of law in private law might become a non-ideological animating ideal for employment law, andnotes that the process of applying the rule of law in private law to employment law is a reminder of theneed for dialogue between different bodies of law. This is not just some interesting but fruitlessjourney down a theoretical rabbit warren. Rather, it is an inquiry that can help explain and understandsome of the forces driving many judgments in the employment law sphere. It is an inquiry, even morethan that, that enjoins us all to work harder to improve the dialogue between employment law and otherfields of law in a manner that proves to be profitable for all participants in that conversation.

The rule of law in private law
This section develops and defends the concept of “the rule of law in private law” that is at the core ofthis paper, and is later applied to the employment law context. It is necessary to explore in more detailwhat the idea is, and what it is not. To illustrate that it involves a legitimate offshoot of rule of law
thinking, an effort is then made to connect it with more conventional, existing rule of law ideas. Someobvious objections to the concept are also briefly considered, and rejected.
An outline of the concept
In the late Lord Bingham‟s magisterial book, The Rule of Law, Thomas Fuller‟s 1733 injunction isquoted: “Be you never so high, the law is above you.”4 This quotation captures at least one part of therule of law: the notion that nobody should be able to place themselves above the law. However, there
is nothing in the injunction, “[b]e you never so high, the law is above you”, or in the phrase “the rule oflaw”, that suggests that it is only the executive or public officials that should not be able to place
themselves above the law. It is understandable that most discussions of the rule of law have focused onbranches of government: they wield power openly, which has the capacity to be abused, and needs
regulating by principles of law. However, it is the thesis of this paper that any account of the rule oflaw is incomplete if it does not also explain how the rule of law might apply to private actors,
especially in a private law context. The rule of law, I contend, must also extend to curbing the excessesof powerful private actors. They, too, are subject to the law and have the capacity to attempt to rise
above it. When Thomas Fuller says “the law is above you”, then, the “you” is a reference to not justthe branches of government, but also private actors exercising power. It is a reference to all of those towhom the law applies.
This is all, however, a little fuzzy and in need of refinement, so that “the rule of law in private law” canhave some more precise content.5 What does “the rule of law” mean in a private law context, and how
3

Autoclenz Ltd v Belcher [2011] UKSC 41 [Autoclenz (SC)].
Tom Bingham The Rule of Law (Penguin, London, 2011) at 4.
5This is not to say that perfect precision should be sought in any conception of the rule of law. (As Jeremy Waldron notes,
such precision is not possible in the rule of law context – and not desirable: Jeremy Waldron “Thoughtfulness and the Rule
4

New Zealand Journal of Employment Relations 37(1): 44-59
can it be used to prevent abuses of power by private parties? I argue that the rule of law, in general, isdirected at retaining the integrity and strength of law. 6 It prevents parties from evading the reach oflaw. In the private law context, therefore, the rule of law can have the most purchase if it serves tocurb private actors’ attempts to create for themselves their own law in a manner that usurps the powerof the court to be a final arbiter of the law and secures an advantage for themselves. Private actors‟
efforts to “contract out” of the general law to achieve some benefit, without any legal authorisation forthat contracting out, are the private law analogue of the executive and legislature placing themselves
above the law (through, for example, the use of ouster clauses 7 or the passage of legislation overturninga court decision stating the law). 8 Just as these actions of the branches of government offend our ruleof law sensibilities by giving the law a plasticity and malleability that allows manipulation by those inpower, so too, the private law analogue – parties seeking to arrogate to themselves the power todetermine the law, and to deprive the courts of this power – troubles our rule of law instincts. And, therule of law in private law should be applied especially vigilantly where attempts to evade the reach of
the law provide a particular benefit for the more powerful party in a transaction, since the rule of law –and law as a whole – are designed to protect against arbitrary advantages secured only through theassertion of power.
The rule of law in private law operates in the same way as other strands of rule of law thinking: as botha precept underpinning legislation and judicial decision-making (a descriptive concept), and an
aspirational ideal to which we should reach in law reform and advocacy (a normative concept). In
some instances, the rule of law in private law might be partially, but not fully, incorporated into
legislation or the common law – its influence on a rule or on reasoning might be apparent, but theconcept might not have been adopted wholesale. Several examples may help to render vivid thissomewhat abstract discussion. In the New Zealand context, in favour of which this paper admits acertain inevitable bias, the rule of law in private law is manifested in the judicially-settled conclusionthat it is generally not possible for parties to contract out of the Fair Trading Act 1986. The courts havemade clear, in line with the rule of law in private law, that the general consumer protection principlesof the Fair Trading Act are to apply to all and that parties should rarely be able to place themselves
above these principles.9 The rule of law in private law also animates the hostility towards “entire
agreement” clauses expressed in s 4(1) of the Contractual Remedies Act 1979. This provision statesthat if a clause purports to “preclude a [c]ourt” inquiring into pre-contractual representations, the court
will not, in practice, be precluded from reviewing matters unless it is “fair and reasonable” for theclause to be conclusive. It is suggested that this judicial straining to avoid giving effect to entire
agreement clauses is driven by a desire to uphold the rule of law in private law, since entire agreement
clauses are prima facie contrary to the rule of law in private law – they allow private parties to create
their own law, and to block the courts‟ ability to oversee the legality of an aspect of a transaction.
These examples illustrate that traces of the rule of law in private law can already be found across thelegal landscape, and that it may prove fruitful to excavate the concept further in existing law and toacknowledge its influence on judicial decisions.
of Law” (British Academy Law Lecture, London, 1 February 2011.)) What is sought here is sufficient clarity for theconcept to be a workable one for the purposes of the analysis in the remainder of this paper.
6
While one should take care not to place too much stock in linguistic analysis, it is noteworthy that the language that we use
in talking about the law seems to assume that the law needs some inner strength: this is arguably why we speak of“breaking” the law. Infringements “break” the law, arguably, because they chip away at the law‟s normative integrity.
7
As in, for instance, s 109 of the Tax Administration Act 1994, recently discussed by the New Zealand Supreme Court in
Tannadyce Investments Ltd v Commissioner of Inland Revenue [2011] NZSC 158
8
See, for instance, the Foreshore and Seabed Act 2004 (repealed by the Marine and Coastal Area [Takutai Moana] Act2011), enacted in response to the Court of Appeal decision in Ngati Apa v Attorney-General [2003] 3 NZLR 643 (CA).
9See, for example, David v TFAC Ltd [2009] NZCA 44, [2009] 3 NZLR 239.

New Zealand Journal of Employment Relations 37(1): 44-59
The ties between this concept and other strands of rule of law thinking
The rule of law is understood, in this paper, in Richard Fallon‟s terms as a web of interconnectedstrands that together serve to uphold principles of law against the reach of public and private power.10
That is not how the rule of law is always conceptualised by scholars and judges. It is often associatedwith single ideas (such as liberty) or simple propositions, but these attempts over-simplify what the ruleof law is, and how it is maintained in practice. They also polarise or shut down the debate on what therule of law might mean instead of opening up new lines of inquiry. Accepting that the rule of law
encompasses a web of related concerns properly accounts for the complexity of the concept,
encourages ongoing debate about the meaning of the rule of law, and provides a useful set of familiar
concepts that can be used to test whether a new strand of rule of law thinking belongs in the web of ruleof law ideas. It is useful now to reflect how the rule of law in private law fits alongside conceptions of
the rule of law already developed by other scholars.
There is, first, an echo of the rule of law in private law in the work of scholars who state that the rule oflaw requires the supremacy of law. Andrei Marmor points out that the “ideal of the rule of law isbasically the moral-political ideal that it is good to be ruled by law”11, which resembles Tamanaha‟sview that “the law does rule and should rule”12, as well as Hayek‟s claim that the rule of law requires“reliance on the action of abstract rules governing the relations between individuals”13. Marmor‟s
article goes no further than explaining why it is good to be ruled by law; but his observation (alongside
Hayek, 1969) is broad enough to encompass the rule of law in private law. Marmor‟s approachpresumes that all should be ruled by the law, including those private citizens who seek to evade thecourt‟s scrutiny by contracting out of the law or making their own law. Fallon‟s description of one
aspect of the rule of law also has similarities to the concept that I have sketched above. Fallon‟s
conception of the rule of law has five elements; the fourth of these elements is “the supremacy of legal
authority”. Elaborating on this, he argues that the “law should rule officials, including judges, as wellas ordinary citizens.”14 Fallon gets closer to the rule of law in private law because of his express
reference to the rule of law reaching out to protect private citizens. What his theory of the rule of law
confirms is that the rule of law in private law has pertinent parallels to the definition of the rule of law
as being concerned with the paramountcy of law itself.
Second, the rule of law in private law has resonance because it builds on rule of law theory relating toabuse of power. Dicey, of course, gestures towards the need for the rule of law to regulate arbitrary
power.15 Philip Selznick, whose theory of the rule of law in industrial relations most closely mirrors
10

Richard H Fallon, Jr “„The Rule of Law‟ as a Concept in Constitutional Discourse” (1997) 7 Columbia Law Review 1 at
6: “The Rule of Law is best conceived as comprising multiple strands, including values and considerations to which each of
the four competing ideal types calls attention. It is a mistake to think of particular criteria as necessary in all contexts for
the Rule of Law. Rather, we should recognize that the strands of the Rule of Law are complexly interwoven, and we should
begin to consider which values or criteria are presumptively primary under which conditions.”
11
Andrei Marmor “The Ideal of the Rule of Law” in Dennis Patterson (ed) A Companion to Philosophy of Law and Legal
Theory (2 ed, Blackwell, Oxford, 2010) 666 at 667.
12
Brian Z Tamanaha “A Concise Guide to the Rule of Law” in Gianluigi Palombella and Neil Walker (eds) Relocating theRule of Law (Hart, Oxford, 2009) 3 at 10.
13
FA Hayek The Political Ideal of the Rule of Law (National Bank of Egypt, Cairo, 1955) at 32, cited in Philip Selznick(with the collaboration of Philippe Nonet and Howard M Vollmer) Law, Society, and Industrial Justice (Russell Sage
Foundation, New York, 1969) at 15.
14
Fallon, above n 10, at 8 (my emphasis).
15
Dicey‟s account focuses on the supremacy of law, as well as the need to prevent abuse of power: see AV Dicey
Introduction to the Study of the Law of the Constitution (10 ed, Macmillan, London, 1961) at 202, where Dicey says that the

New Zealand Journal of Employment Relations 37(1): 44-59
the theory sketched in this paper, notes that the rule of law “seeks progressively to reduce the degree ofarbitrariness in positive law and its administration.”16 E.P. Thompson expands on the idea. Famously
calling the rule of law “an unqualified good” (a pronouncement that surprised his Marxist colleagues,
many of whom viewed law as an inherently ideological instrument),17 Thompson writes that it requires“the imposing of effective inhibitions upon power and the defence of the citizen from power‟s allintrusive claims.”18 The rule of law in private law is consistent with Thompson‟s view. Thompson
does not distinguish between public and private power, merely viewing power as “all-intrusive”; thiswould seem to justify a conception of the rule of law (such as the rule of law in private law) that aims
to account for the abuse of private power. Thompson‟s enjoinder for effective inhibitions upon power
also matches the notion of the rule of law in private law, which places a check on power by preventing
attempts by parties to create their own law in a manner that will benefit the powerful party.
Third, the rule of law in private law may trade on the strand of writing that emphasises the links
between equality and the rule of law. Bingham emphasises that equal application of the law is anecessary part of the rule of law. 19 That legitimises what might appear to be an extension of the rule oflaw from the public law to the private arena, to ensure that the law is applied with equal vigilance topowerful private parties. Further, a recent paper by Paul Gowder underscores that the rule of law has
equality, not liberty, at its foundation. 20 For Gowder, the rule of law is about “vertical equality
between officials and ordinary citizens and horizontal equality among ordinary citizens.”21 The rule oflaw in private law aims to foster such horizontal equality, by applying the law fearlessly where parties
attempt to contract out of the law or secure advantages over each other.
This brief survey of some overlapping rule of law literature illustrates that the rule of law in private law
has a certain pedigree in rule of law thinking: it is connected to strands of thought exploring thesupremacy of law, the abuse of power, and equality. That pedigree suggests that the rule of law inprivate law is a concept that belongs in the web of interconnected strands that make up “the rule oflaw”, and helps to explain its initial persuasiveness.
Objections to this view of the rule of law
With a prima facie case now established for the plausibility of the rule of law in private law, it isimportant to consider criticisms of the concept. If the rule of law in private law can be defended
against these criticisms, it might be considered a workable idea that could be usefully applied to theemployment law context.

rule of law “means, in the first place, the absolute supremacy or predominance of regular law as opposed to the influence ofarbitrary power, and excludes the existence of arbitrariness, of prerogative, or even of wide discretionary authority on thepart of the government.”
16
Selznick, above n 13, at 12. I am grateful to Mark Bennett for drawing Selznick‟s work to my attention after a first draftof this paper had been completed. Selznick articulates the question that drives his inquiry in the following way: “Can we
justify, within the framework of legal theory, the application to private organizations of principles hitherto restricted to
public government?” See: ibid, at 244. Selznick‟s approach differs from my own in that Selznick argues that the rule of law
should apply to private individuals and associations where private “governance” exists: ibid, at 274. I would not restrict thecompass of the rule of law to the same extent.
17
See discussion in Daniel H Cole “„An Unqualified Human Good‟: E.P. Thompson and the Rule of Law” (2001) 2 Journalof Law and Society 177.
18
As noted in: ibid, at 182.
19
Bingham, above n 4, at 55.
20
Paul Gowder “Equality under the (Rule of) Law” (unpublished, 2011) <http://papers.ssrn.com>.
21
Ibid, at 2.

New Zealand Journal of Employment Relations 37(1): 44-59
It might be said immediately that speaking about “the rule of law in private law” is to colonise private
law with public law concepts. The rule of law is a purely constitutional concept, some might say; auseful idea to bandy around when talking about governance and public administration, but an idea thatwould be out of place if applied to private transactions. To apply it to such transactions might be toallow for concepts that are even more foreign to the private lawyer, like human rights and procedural
justice, to seep into private law. This objection has a superficial appeal; but, even if one were to accept
the desire to rigidly compartmentalise the concepts and categories of private law and public law, thisobjection seems overstated. The notion of the rule of law in private law has content distinct from what
the rule of law means in other contexts, as has been explained above (though it may share with otherconceptions of the rule of law higher-level justifications such as equality and abuse of power). It
requires already-existing law in the private law space to be enforced vigilantly against parties seeking
to escape the reach of the law. Once seen in this light, it can be recognised that the rule of law inprivate law need not radically alter the arc of private law‟s development; it only provides a new way of
explaining decisions already made, and a new precept to bear in mind as the law is applied anddeveloped.
That first objection comes from a private law perspective. What about the damage that might be done
to “the rule of law” itself by devising or developing this new concept of the rule of law in private law?
It is already accepted that there is some indeterminacy around what “the rule of law” means: indeed,
Waldron, amongst others, has asked whether it is an “essentially contested” concept.22 Does thisdevelopment of a new strand of rule of law add further woolly thinking to an already imprecise area?
And, could affirmation of this new strand dilute what little content has been accepted as part of the ruleof law? While these are valid concerns, it is suggested that there are more advantages thandisadvantages for the idea of the rule of law that come from bringing into its web the concept of “therule of law in private law”. The rule of law is presently confined, arbitrarily (according to the argumentin this paper), to the public law sphere. To explore how it should operate in private law is to contributeto the development of a fuller conception of the rule of law, which can operate across the legal system.
Additionally, any concern about imprecision or the dilution of core rule of law content is easily
minimised once it is acknowledged that, in defining the rule of law, we are not seeking one-linesoundbites or simple propositions, but are rather identifying a web of interrelated concepts.
A separate challenge to “the rule of law in private law” relates to how new the concept really is. On
one view, it might seem that the concept is reducible to a rallying-cry that provisions such as s 4(1) of
the Contractual Remedies Act 1979 are to be applied without fear or favour – but that is merely to callfor the enforcement of existing law! On another view, if “the rule of law in private law” requires onlythat the courts insist that parties do not block access to the courts, it is difficult to distinguish theconcept from the notion that courts should be independent and impartial in applying the law – anuncontroversial tenet of the rule of law. It may be true that there is some overlap between “the rule oflaw in private law” and these positions. In fact, as was noted in the previous section, the linkages
between “the rule of law in private law” and other conceptions of the rule of law could be part of thereason for the concept‟s appeal. However, it is wrong to say “the rule of law in private law” offers
nothing new. It plainly aims to reorient the rule of law to include the private law context, and focuseson the ability of private parties to evade the obligations of law – two areas that remain neglected, if notuntouched, by existing rule of law scholarship.
Not all the possible deficiencies of this new concept can be canvassed or even envisaged here. What
has been attempted is an assessment of whether “the rule of law in private law” can withstand some22

Jeremy Waldron “Is the Rule of Law an Essentially Contested Concept (in Florida)?” (2002) 21 Law and Philosophy 137.

New Zealand Journal of Employment Relations 37(1): 44-59
obvious objections. It is suggested that it passes this test. Attention turns in the next part of the paper
to applying “the rule of law in private law” to the employment law context.

A case study: employment law through the lens of the rule of law in private law
This paper does not pretend to prove, once and for all, that the rule of law in private law underpins
private law as it is expressed in statute and the common law. That wide proposition can only be
explored through extensive research. What is attempted here is to throw light on a single recent
judgment of the United Kingdom Supreme Court, Autoclenz Ltd v Belcher, to illustrate how the rule oflaw in private law might be seen as driving legal reasoning in the employment law context. After the
background, procedural history, and judgment are discussed, especial focus is placed on the rule of law
in private law in the judgment. It is then noted in passing that the New Zealand parallel of Autoclenz
Ltd v Belcher – Bryson v Three Foot Six Ltd,23 which also dealt with the question of who is an
employee deserving of employment law protections, may reflect reasoning grounded in the rule of law
in private law. These examples – as well as providing a useful primer on recent developments in thisarea of employment law – suggest that the rule of law in private law may be an important principle
latent in the law of employment.
Autoclenz Ltd v Belcher: some background
The issue in Autoclenz Ltd v Belcher (“Autoclenz”) was whether 20 valeters providing car-cleaning
services in Derbyshire were “workers” under the National Minimum Wage Regulations 1999, or
independent contractors not deserving of payment of minimum wages and entitlement to statutory paid
leave. The Regulations defined a “worker” as a person who has entered into or works under:24(a) a contract of employment; or(b) any other contract, whether express or implied and (if it is express) whether oral or inwriting, whereby the individual undertakes to do or perform personally any work orservices for another party to the contract whose status is not by virtue of the contractthat of a client or customer of any profession or business undertaking carried on by theindividual.
National Minimum Wage Regulations 1999 (SI 1999/584) (UK), reg 2(1).
The respondents (the valeters) had a contract with Autoclenz, the appellant, and Autoclenz had
contracts with British Car Auctions (BCA) to clean vehicles. The original written contracts between
those employed and Autoclenz, one of which was examined by the United Kingdom Supreme Court
and was dated June 1991, described a person who had been employed by BCA as “the Subcontractor.”25 The contracts noted an undertaking by those employed to “perform the services ... withina reasonable time and in a good and workmanlike manner.”26 Clauses 2 and 3 of the contract also
attempted to make clear the legal status of those employed. In Clause 2, the signing party was said to“[confirm] that he is a self-employed independent contractor”, with tax arrangements specified, and in
Clause 3, the parties were said to “agree and acknowledge that the Sub-contractor is not, and that it is23

Bryson v Three Foot Six Ltd [2005] NZSC 34, [2005] 3 NZLR 721.
National Minimum Wage Regulations 1999 (SI 1999/584) (UK), reg 2(1).
25
Autoclenz (SC), above n 3, at [4].
26
Ibid, cl 1.
24

New Zealand Journal of Employment Relations 37(1): 44-59
the intention of the parties that the Sub-contractor should not become, an employee of Autoclenz.” On
the basis of these contracts, Inland Revenue had concluded in May 2004 of the status of those working
for Autoclenz that “the balance of probability leans more towards self-employment than PAYE.”27
In 2007, two new documents were drafted by Autoclenz. The first, not signed by the respondent
Belcher, claimed that Autoclenz would engage valeters “FROM TIME TO TIME on a sub-contract
basis”. It asked valeters, which it acknowledged to be “experienced”, to complete and return a form ofagreement, which was said to “confirm that any contractual relationship between Autoclenz andyourself is one of client and independent contractor and not one of employer/employee”, and to protect
Autoclenz from tax and insurance obligations. The first document said that “as an independent
contractor”, the person employed could engage individuals to carry out work on the person‟s behalf;
would have to purchase overalls from Autoclenz identifying the person as an Autoclenz contractor;
would be required to provide cleaning materials; would have to have a valid driving licence; and would“not be obliged to provide ... services on any particular occasion”. The second document, which
seemed to bear some resemblance to the original contract, was signed by the respondent and describedhim as a “sub-contractor”. It also expressly noted that it was the intention of the parties that the subcontractor was not an employee.28
Procedural history
The Employment Tribunal (ET), which issued a judgment, in March 2008, on the preliminary questionof whether the respondents were “workers”, made findings of fact after reviewing the contract
constituted in the two documents described above. It held that the valeters would not have been offeredfurther work had they not signed the revised contracts, and that the valeters did not negotiate any of theterms (though it was made clear to them by Autoclenz that Autoclenz regarded the valeters as selfemployed). The valeters worked in teams of four, taking a batch of six vehicles at a time, and on mostdays, there was enough to work keep 14 valeters busy. They were paid according to their work, withinvoices being prepared by Autoclenz (though notionally prepared by the valeters), and tax andnational insurance arranged by valeters on a self-employed basis. Autoclenz provided equipment andmaterials, introducing a 5% charge for materials in 2007, as well as Autoclenz overalls. 29
The ET found that the valeters were “workers” since they were working under a contract of
employment, according to limb (a) of the definition of “workers” quoted above, and were at any rate
workers under limb (b) of the definition. Judge Foxwell, giving judgment for the ET, emphasised thatthe valeters had no control over their hours of work, no economic interest in the way that work isorganised, and did not work as individuals, but rather as teams. The individuals could not source theirown materials and were, crucially, “subject to the direction and control of the respondent‟s employees
on site”. Autoclenz prepared invoices, determined the deductions and rates of pay, devised thecontracts, and gave detailed specification of the services. Judge Foxwell thought that the supply of
training and company overalls was not determinative, though it was relevant to the view that thevaleters were “fully integrated into the respondent‟s business” and had “no real other source of work”.
The substitution clause, which allowed a valeter to engage individuals to send another valeter on theirbehalf did not reflect “what was actually agreed between the parties”, according to Judge Foxwell,which was that valeters were relied upon to turn up and had to notify employers in advance if they were
unavailable for work: one of the respondents had worked elsewhere only once in 17 years of work. In
27

Ibid, at [5].
Ibid, at [6]–[10].
29Ibid, at [11]–[15].
28New Zealand Journal of Employment Relations 37(1): 44-59
sum, these were contracts for “personal service” where work was done in return for money, with “thedegree of control” exercised by Autoclenz consistent with these agreements being contracts of
employment.30
The Employment Appeal Tribunal (EAT) differed, holding that the respondents had not worked undera contract of employment, per limb (a) of the definition, but had been working under a limb (b)contract, in which work was done for another party who was not a client or customer, rendering theindividual doing the work a “worker”.31 The Court of Appeal (Sedley, Smith and Aikens LJJ) restored
the judgment of the ET, holding that the valeters fell within both (a) and (b) of the definition. Each
Judge delivered a separate judgment. Lady Justice Smith said “that the parties to a contract describe
the effect of their contractual arrangements in a particular way is not conclusive of the actual effect of
the contractual arrangement.”32 The EAT had placed too much emphasis on the written agreement inreaching its conclusion that there was no contract of employment, said Smith LJ, 33 but was correct thatthe substitution clause and “right to refuse work” clause were a sham, obscuring the true status of theparties as workers or employees. 34 Lord Justice Aikens wished to state his reasons in his own words
because the case raised “a serious issue in employment law and it is one that must arise frequently.”35
Lord Justice Aikens felt it was not helpful to talk of “true intention” or “true expectation”, lest a court
stray into parties‟ subjective, private intentions.36 In the employment sphere, where written terms canbe dictated by one party, a court must, however, be “realistic and worldly wise” and “investigate
allegations that the written contract does not represent the actual terms agreed.”37 Applying thatapproach in the present context reveals that the valeters were workers, not independent contractors.
Lord Justice Sedley was less hesitant in confirming that the valeters were “employees in all but name”.
The protestations to the contrary in the contract were “odd” and “bore no practical relation to the realityof the relationship.”38
The judgment of the United Kingdom Supreme Court
The Supreme Court (Lords Hope, Walker, Collins, Clarke and Wilson) handed down a unanimous
judgment on 27 July, 2011, with the reasons given by Lord Clarke. Lord Clarke noted that the key
question was in what circumstances the terms of a written agreement might be ignored. After layingout certain uncontroversial propositions, Lord Clarke observed that “a different approach has beentaken” to interpreting contracts in the context of employment contracts. (Lord Clarke was careful tonote that the judgment should not be, of course, thought as the correct legal approach to othercontracts).39 There is a need to focus on “the reality of the situation” where written documentation may
not reflect the reality of the relationship.40 Lord Clarke went on to consider the variety of instanceswhere a court may disregard written terms because they represent “a sham”. After resolving somedisagreements in the case law that need not detain us here, his Lordship observed that a court mustassess “what was the true agreement between the parties.”41 He agreed with the Court of Appeal that
30

These details are all taken from the quoting of the ET‟s findings at [37] of the Supreme Court‟s judgment.
Ibid, at [3].
32
Autoclenz Ltd v Belcher [2009] EWCA Civ 1046 [“Autoclenz (CA)”], at [13].
33
Ibid, at [54].
34
Ibid, at [57]–[62].
35
Ibid, at [71].
36
Ibid, at [91]37
Ibid, at [92].
38
Ibid, at [104].
39
Autoclenz (SC), above n 3, at [21].
40Ibid, at [22].
41
Ibid, at [29].
31New Zealand Journal of Employment Relations 37(1): 44-59
the issues of bargaining power that arise in an employment context require a more sensitive approach towhether the terms of a written agreement represent the “true agreement” between the parties. Lord
Clarke labelled this “a purposive approach.”42 Applying these principles, Lord Clarke then leaned
heavily on the findings of fact reached in the ET. He found that these findings could not be sensibly
challenged, and concluded that it was open to the ET to hold that the terms of the written document
could be disregarded, 43 thereby confirming the view that the valeters were “workers” under (a) and (b)of the definition.
Analysis
On first glance, the outcome in this case might seem surprising, especially for those observers in favourof giving effect to written terms in contracts. The relevant written contract here had been as express as
possible in identifying the valeters as independent contractors, not as employees; they were describedas sub-contractors throughout; and both parties had signed this document. Autoclenz could have done
little more to attempt to attain independent contractor status for the valeters. Despite this, the Court
was uncompromising in finding that the written terms of the contract could be disregarded, and that it
could, nonetheless, find that the valeters were workers, or, as they would be called in New Zealand,
employees. What drove the Court to this conclusion?
In some ways, this was an orthodox application of the case law: several cases were cited by the Court
for the proposition that the written agreement may not reflect the reality of the employment relationship– notably Consistent Group Ltd v Kalwak and Firthglow Ltd (t/a Protectacoat) v Szilagyi – and the
Court simply applied the propositions from these cases. 44 The factual context also pulled strongly inthe direction of the conclusion that the Court reached. It was evident that the substitution clause,
allowing for alternative valeters, had not been used in practice, and “the right to refuse work” clause
was a similarly hollow undertaking, given the fact that the evidence suggested one valeter had worked
elsewhere only once in 17 years. It was arguably the settled legal position, and the facts, that led the
Court to reject Autoclenz‟s submission that the valeters should be regarded as independent contractors,
in reliance at least in part on the written contract.
I argue, however, that the Court was, at most, impelled to its conclusion, and at the very least, fortified
in its view, by an underlying commitment to the rule of law in private law. The Court in Autoclenzsought to guard against the ability of a party (in this instance, Autoclenz) from usurping the court‟sfunction to determine the law and secure an advantage by inserting seemingly definitive statements into
a contract. The Court affirmed that parties may not place themselves above the law, or the courts, inthis way – and reminded parties that it will retain a supervisory role, reviewing written agreements inthe employment sphere, and being willing to disregard these agreements where they do not accurately
represent the factual matrix between the parties. Lady Justice Smith‟s words in the Court of Appeal
express the precept pithily: any attempt by parties to “describe the effect of their contractual
arrangements in a particular way is not conclusive of the actual effect of the contractual arrangement”
as determined by a court.45 Of course, it is true that, had the factual matrix indicated that, the valeters
were independent contractors, the Court would not have disregarded the terms of the written contract.
However, that would be because no party would have been seeking an advantage through the creation
42

Ibid, at [35].
Ibid, at [38].
44Consistent Group Ltd v Kalwak [2008] EWCA Civ 430, [2008] IRLR 505; Firthglow Ltd (t/a Protectacoat) v Szilagyi[2009] EWCA Civ 98, [2009] ICR 835.
45
Autoclenz (CA), above n 32, at [13].
43New Zealand Journal of Employment Relations 37(1): 44-59
of an autonomous law, away from the Court‟s oversight. More importantly, had the Court
acknowledged that the valeters were independent contractors in those circumstances, it would not haverelinquished its role as final arbiter of the law, and would still have resisted parties‟ attempts to decide
the law for themselves. Overall, the Court was influenced in Autoclenz by upholding the rule of law inprivate law – although the extent of that influence might be difficult to state with any certainty.
Some might say that it is odd to attribute to the United Kingdom Supreme Court, in this case, a basis
for its decision that it did not itself identify. Lord Clarke might be surprised to be told that the reason
he reached the conclusion he did was not one he recognised at the time. The same critique might claimthat the reconstruction of the decision offered above involves too great a degree of inferential
interpretation and reading between the lines of the judgment in Autoclenz. To be sure, suggesting thatthe rule of law in private law underlay the Court‟s decision requires inferences to be drawn. However,it will be recalled that no attempt has been made to say just how influential this concept was in guiding
the Court to its conclusion. All that has been done is suggested, tentatively, that the Court had in mind
a precept – relating to the role of the courts, and the relationship between the parties and the generallaw – that I have attempted to articulate and develop. It is difficult for courts to be wholly transparent
in canvassing all considerations that have a bearing on their judgments. What is proposed here is themodest claim that there was one consideration latent in the judicial reasoning in Autoclenz that theSupreme Court may have been influenced by, but did not fully explain or explore.
Similar reasoning in Bryson v Three Foot Six in the New Zealand context
It is useful to note, in passing, that in the New Zealand parallel to Autoclenz, Bryson v Three Foot Six,46in which the Supreme Court of New Zealand examined the question of whether a film industry worker
was an employee or independent contractor; it might also be argued that the Court aimed to uphold therule of law in private law. A contract, the “crew deal memo”, stipulated that the film industry worker
in that case, Mr Bryson, was an independent contractor. The Supreme Court raised some doubts
initially about whether the characterisation of the legal relationship between Mr Bryson and Three FootSix, the company doing work for the Lord of the Rings Project, was a question of law at all, amenable
to appeal.47 However, proceeding to consider whether the Employment Court Judge had made an errorof law, the Court (in a decision given by Blanchard J) held that she had, rightly, not treated “as adetermining matter any statement by the persons that describes the nature of their relationship”,
consistent with s 3(b) of New Zealand‟s Employment Relations Act (ERA) 2000. Only when “theCourt or Authority has examined the terms and conditions of the contract and the way in which it
actually operated in practice … will [it] usually be possible to examine the relationship …”48 In thiscase, it was open to the Judge to find that “the crew deal memo did not give any reliable indication of
the real nature of the relationship,”49 and to find that – on the basis that he was fully integrated intoThree Foot Six, not able to delegate his work, and working effectively full-time – Mr Bryson was an
employee.

46

Bryson v Three Foot Six Ltd [2005] NZSC 34, [2005] 3 NZLR 721. This case has had something of a legislative sequel:
the Employment Relations (Film Production Work) Amendment Act 2010, colloquially known as “The Hobbit legislation”
because of the circumstances surrounding its passage, purports to preclude the possibility that workers in Mr Bryson‟sposition could be “employees”, by amending the definition of “employee” in s 6(1) of the Employment Relations Act 2000.
No court has yet definitively settled the legal effect of this amendment.
47
Ibid, at [17]–[23].
48
Ibid, at [32] (emphasis added).
49
Ibid.

New Zealand Journal of Employment Relations 37(1): 44-59
Again, it might be said that, while the Court applied orthodox principles (from statute and commonlaw) in the face of strong facts, it was influenced, in some way, by an aversion to Three Foot Six‟s
attempt to stipulate definitively the legal status of its relationship with Mr Bryson. It also seems
apparent that the Supreme Court sought to underscore the need for a court or judicial body to reserve
the right to make an assessment of the factual circumstances and reach its own conclusion about
whether an individual is an employee or independent contractor. These are principles at the heart of therule of law in private law.
It had been noted in Bryson that the intention of the parties was “no longer decisive,”50 and that under
the previous legislation (the Employment Contracts Act (ECA) 1991), significant weight had beenplaced on the written contract. This raises an interesting question for proponents of the rule of law inprivate law: had the law been that the intention of the parties was decisive, how should a court haveruled in a scenario where the parties had made express that they believed that a worker was anindependent contractor? In this situation, would the rule of law in private law not pull in the opposite
direction to the law? How should a court have balanced these concerns? The answer to these questions
is surprisingly simple: the obligation of the court, under the rule of law in private law, is only for the
court to uphold the law against the parties‟ attempts to secure an advantage by placing themselves
above, or outside of, the law. In a situation where the law dictated that the parties‟ intentions were
decisive, the court would still take care to assess the parties‟ intentions. However, the parties‟ attempt
to stipulate the nature of their relationship would no longer be an instance of the parties placing
themselves above the law. Applying the rule of law in private law in that situation would require acourt to give effect to the parties‟ contract.
Needless to say, it cannot be concluded from these two examples in the employment law arena that therule of law in private law runs like a thread through private law. That would be inferring too much.
What can be said is that a glimpse has been offered here of how the rule of law in private law mightunderpin judicial decision-making. It is hoped that the consideration of this case study might provide aplatform for further thinking about the rule of law in private law in other legal contexts.

The value of this concept for employment law
The rule of law in private law is a concept that may have relevance outside of employment law, incontract law and the law of torts, amongst other areas. However, this part of the paper highlights theparticular value that the concept could have for employment law. Firstly, the rule of law in private law
might prove to be an animating ideal for employment law as a whole. Secondly, the concept isimportant in serving as a reminder of the types of new frameworks that can emerge when ideas (such as
the rule of law) originating in other fields of law (like public law) are harvested in new contexts.
A new animating ideal?
Historically, there has been little effort to theorise deeply what values lie beneath employment law: as
Horacio Spector has noted, the “literature on the philosophical foundations of labor law is scant.”51
This may be because employment law is an area of law that divides many people (including judges),and for which it is difficult to come up with bridging principles that find a middle ground between
polarised positions. Where attempts have been made to arrive at descriptions of the ideals
50
51

Ibid, at [5].
Horacio Spector “Philosophical Foundations of Labor Law” (2006) 33 Fla St UL Rev 1119 at 1121.

New Zealand Journal of Employment Relations 37(1): 44-59
underpinning employment law, the ideals have often been coloured by ideological views on freedom ofcontract or the protection of labour rights. While ideology may be difficult to escape (making talk of“non-ideological ideals” futile), there have been few accounts of employment law, as a whole, that are
not wholly reliant on a commitment to certain ideological preferences.52
The rule of law in private law has considerable promise as a concept that might be shown to undergird
employment law but that does not require such ideological preferences. The rule of law is a familiar
legal concept (even if its content is the subject of much dispute) that would not be considered foreign tothose judges, practitioners, and academics seeking a new animating ideal for employment law – even if
the rule of law in private law is a slightly novel variation on the rule of law. The rule of law in private
law is also especially suited to the needs of employment law in most jurisdictions. In mostjurisdictions, there is now a statutory framework that governs employment law, 53 and the rule of law inprivate law provides a rationale for ensuring close adherence to that framework (on the part of judges
as well as parties to a dispute), and applying that framework with vigilance.
The next challenge for scholars is to map out the theoretical underpinnings of employment law, inorder to explore whether the rule of law in private law is relevant to issues in employment law otherthan the single issue canvassed as a case study above (namely, whether an individual is an employee or
independent contractor). In the New Zealand context, several examples of future possible directions inthe scholarship can be noted. The rule of law in private law may be a fruitful concept to use whentheorising the pervasiveness of the good faith concept enshrined in s 4 of the ERA, because it
highlights the inability of parties to contract out of legal requirements in an effort to secure anadvantage. For a similar reason, it may be a useful way to justify and strengthen procedural fairness
obligations in the context of dismissal, since it would provide an explanation for why such obligations
should not be easily jettisoned. 54 It may even offer a justification for the view taken by Chief Judge
Colgan in Smith v Stokes Valley Pharmacy (2009) Ltd that the introduction of employment trial periodsof 90 days or less in ss 67A and 67B of the ERA does not extinguish the right of an employee to seek
and receive an explanation for dismissal,55 since, in that decision, Chief Judge Colgan attempted topreserve the enforcement of existing law, despite the introduction of ss 67A and 67B – a decision thatmight be thought to be consistent with the rule of law in private law. Further research is undoubtedly
needed, and tensions within the concept will have to be worked through. One challenge will bewhether the rule of law in private law can be redeployed to argue for reform in employment law (since
it would be expected that an animating ideal for an area of law could be used to justify changes in thelaw), when perhaps the rule of law in private law exhibits a bias in favour the enforcement of existinglaw. Regardless of how this challenge is worked through, it is clear that the rule of law in private law
has potential to be used as an idea both to rationalise existing employment law decisions and to forecast
future decisions, if it can be properly theorised, and if it is the case, that it is a concept that often
underlies judicial decision-making.

52

Gordon Anderson‟s most recent suggestion that social justice underpins employment law may present one solution to thisdebate, though it remains to be seen how much consensus the idea of social justice attracts. See the discussion in Gordon
Anderson Reconstructing New Zealand’s Labour Law: Consensus or Divergence? (Victoria University Press, Wellington,2011).
53

See, for example, the Employment Rights Act 1996 (UK) and the Workplace Relations Act 1996 (Cth).
The standard obligations are set out in NZ Food Processing Union v Unilever NZ Ltd [1990] 1 NZILR 35 at 45–46.
55
Smith v Stokes Valley Pharmacy (2009) Ltd [2010] ERNZ 253. This case is closely scrutinised in: Scott Worthy“Revisiting Stokes Valley and Statutory Interpretation” (New Zealand Labour Law Conference, Wellington, 2 December2011).
54

New Zealand Journal of Employment Relations 37(1): 44-59
A reminder of the value of dialogue for employment law
The preceding passage outlined a very direct benefit for employment law that might be achieved bydeveloping a theory of the rule of law in private law: namely, a unifying principle for that body of law.
However, ongoing thinking about the rule of law in private law may also supply a more cerebral benefit
for employment law: a reminder of how valuable it can be to borrow ideas from different bodies of law
and apply them to new contexts. The notion of the rule of law in private law is a product of adopting apublic law notion, the rule of law, and adapting it to the private law context. Even on the basis of thelimited analysis offered in this paper, it seems true that such cross-fertilisation has use for employment
law by sparking some fresh insight or at least probing conventional orthodoxies. It might be hoped thatthe development of the rule of law in private law might act as a spring for further cross-fertilisation
between other areas of law and employment law. What is meant by cross-fertilisation is not necessarily
wholesale, unthinking incorporation of ideas: of course, in some instances, doctrines will beinapplicable. What is required is debate, particularly amongst the academic community, about whether
ideas might be fruitfully borrowed and applied, and a willingness for scholars in employment law andother fields to be in a state of dialogue. This dialogue should go both ways: so that ideas from areas
such as public law can be tested within an employment law context, and ideas from employment law
can be held up as possible solutions for problems in other areas of law.
Before exploring examples to make these somewhat abstract observations more concrete, it is worth
making the point that employment law – at least in New Zealand, the jurisdiction with which the author
is most familiar – seems especially bereft of the benefits of this dialogue. It is unclear why
employment law has become insulated and isolated from this dialogue across different fields of law. It
may be the product of the specialisation of employment law, and the establishment of separate
institutions to deal with employment law matters (though one would think that the ability of the Courtof Appeal and Supreme Court to consider employment law issues on appeal might at least lead tojudges and lawyers being forced to contemplate employment law from time to time). It may be
because employment law is seen as an area of law that is so much the product of political preference
and policy that it can offer little by way of more general insights into the law (though employment law
is by no means unique in being an area of law that is entangled in politics). 56 Or, it may be due to thefact that employment law remains in the midst of something of an identity crisis – since it lies on themargins of public law, contract law, tort law, and equity – that makes scholars in the field of
employment law hesitant about engaging with any other particular field of law. Whatever the reason
for this insulation, and notwithstanding the fact that right across the law there is arguably insufficientdialogue between the sub-disciplines, it appears fair to say that employment law could do well to be ina more lively state of dialogue with other bodies of law.
Because the concept at the core of this paper – the rule of law in private law – is an example ofemployment law importing an idea from elsewhere, it may be helpful to gesture towards someexamples of dialogue being “exported” the other way (wherein employment law can supply concepts
and approaches that might be picked up and explored by other bodies of law) to highlight the value of
dialogue. It may not be sufficiently appreciated how much of a promising incubator employment law
might be for novel doctrines and perspectives.

56

The view that employment law, at least in New Zealand, is closely entangled with issues of ideology was well-explainedin: Margaret Wilson “Recent Developments in Employment Law” (Auckland University Law Review Contributors‟
Symposium, Auckland, 7 October 2011).

New Zealand Journal of Employment Relations 37(1): 44-59
One possible employment law “export” that might be of utility for the law of contract is the approachtaken to contractual interpretation in determining whether a person is an employee or independent
contractor, touched on in the analysis above. Employment law has long acknowledged that evidence ofthe factual matrix can be used to shed light on a relationship also embodied in a contract. At a time
when the law of contract is grappling in certain jurisdictions with deciding on how much of the factual
matrix is relevant to contractual interpretation, particularly in relation to post-contractual conduct,57
evidence of how workable and robust the employment law posture has been (albeit in achieving
different objectives) might be profitable for contract law scholars and contract law as a whole. Of
course, in Autoclenz, Lord Clarke was very careful to limit his observations about disregarding written
terms of a contract to the employment law sphere, and not to allow the comments to be used in an
ordinary contract context.58 On the approach suggested here, perhaps there would be some utility in
not being so cautious.
A second instance where employment lawyers might advance the development of other bodies of law
by outlining issues that have been dealt with in employment law that may be of relevance elsewhere,
especially in New Zealand, is on the subject of good faith. There has been an extensive, and now
possibly well-worn, debate in contract law over the existence and enforceability of a duty of goodfaith.59 It seems that this is an area where employment lawyers can fruitfully contribute reflections on
how the concept of good faith, outlined in s 4 of the ERA, has been developed and applied, even if it isa concept that has been tailored to the employment context. Dialogue might include discussion of how
workable and practical good faith has been, and how it has been defined. Interestingly, in Wellington
City Council v Body Corporate 51702 (Wellington),60 Tipping J alluded to the possible relevance of theemployment law concept of good faith when assessing whether an agreement to negotiate in good faith
was enforceable.61 While Tipping J noted that the statutory nature of the duty of good faith in theemployment law context allowed for greater certainty than in contract, the fact that he outlined theemployment law duty of good faith in spite of this superficial difference – when counsel also had not
addressed the point – reveals that perhaps Tipping J was of the view that there could be some further
dialogue between contract law and employment law on this point.
The prospect of such dialogue will not appeal to those who support absolute specialisation, or to those
who favour fine distinctions between areas of law and rooting ideas firmly within very narrowcontexts; but to those who prefer not to classify the law into hermetically sealed compartments, and
who accept that ideas, such as good faith can have a similar shape across various parts of the law, thenotion of cross-fertilisation of concepts (exemplified by the development of the rule of law in privatelaw) might be thought to be appealing. Some might even consider such cross-fertilisation essential to
the law‟s enduring unity and vitality.

57

The High Court of Australia most recently expressed the view that post-contractual negotiations should be inadmissible inAgricultural and Rural Finance Pty Ltd v Gardiner (2008) 251 ALR 322 (HCA); the New Zealand Supreme Court has
taken a more liberal view towards admissibility in Wholesale Distributors Ltd v Gibbons Holdings Ltd [2007] NZSC 37,[2008] 1 NZLR 277.
58
Autoclenz (SC), above n 3, at [20].
59
For a small selection of the contributions to the debate, see James Allsop “Good Faith and Australian Contract Law: A
Practical Issue and a Question of Theory and Principle” (2011) 85 ALJ 341; Johan Steyn “The Role of Good Faith and Fair
Dealing in Contract Law: A Hair-Shirt Philosophy” (1991) 6 Denning LJ 1131; Paul Finn “Good Faith and Fair Dealing
Australia” (2005) 11 NZBLQ 378; EW Thomas “Good Faith in Contract: A Non-Sceptical Commentary” (2005) 11
NZBLQ 391; and Rick Bigwood “Symposium Introduction: Confessions of a Good Faith „Agnostic‟” (2005) 11 NZBLR
371.
60
Wellington City Council v Body Corporate 51702 (Wellington) [2002] 3 NZLR 486 (CA).
61
Ibid, at [36].

New Zealand Journal of Employment Relations 37(1): 44-59

Conclusion
This paper began by sketching a notion of the rule of law in private law. After the core components ofthe concept were laid out, its relationship to other rule of law concepts was explained, and it was
defended against objections grounded in its alleged incompatibility with private law norms, its effecton the meaning of the rule of law, and its relative novelty. Emphasis was then placed on how the ruleof law in private law was manifested in the reasoning of the United Kingdom Supreme Court in
Autoclenz. To illustrate this, it was necessary to discuss the background and procedural history of thecase, as well as the judgment‟s main parts. It was noted that a desire to uphold the rule of law inprivate law could be inferred from the reasoning in Autoclenz, and that a similar precept arguably
underpinned the decision of the New Zealand Supreme Court in Bryson v Three Foot Six. While therule of law in private law was said not to be confined to employment law, the final part of the paper
examined the especial use of the concept to employment law – as a possible animating ideal for
employment law, and as a reminder of the need for dialogue between employment law and other areasof law.
Some of the greatest leaps in insight in the common law have occurred through the use of inductive
reasoning that has highlighted underlying patterns in parts of the law hitherto thought to be withoutorder.62 Donoghue v Stevenson is one case where that leap was made: a case where Lord Atkin
discerned, when reviewing the historical course of negligence judgments, a sense of direction (in theform of the neighbourhood principle) latent in what, up to that point, had seemed like an erratic trail ofindividual judgments.63 This paper would not immodestly claim to make that leap in insight for
employment law, or private law as a whole, in arguing that the rule of law in private law can be
induced as the underlying precept of much judicial reasoning. It does claim, however, to be written in
the spirit of Lord Atkin‟s endeavour in Donoghue v Stevenson – as part of an enterprise seeking tocrystallise or clarify the principles at the bottom of law itself. For Cardozo, this stock of principles
drawn upon in court is not a set of ideas “lying beneath” the law; this reservoir of values, precepts, andpropositions is the essence of law itself.64 Whether we see such principles as law, or just as its sources,
most would accept that the search for these principles is a worthwhile journey, upon which this paper
has humbly embarked.

62

The term “leap in insight” is borrowed from Chief Justice Elias, who uses it in: Sian Elias “JUSTICE for One Half of the
Human Race? Responding to Mary Wollstonecraft‟s Challenge” (Address to the Canadian Chapter of the International
Association of Women Judges‟ Conference, Vancouver, 10 May 2011).
63
Donoghue v Stevenson [1932] UKHL 100, [1932] AC 562.
64
Benjamin N Cardozo The Growth of the Law (Yale University Press, New Haven, 1924) at 43. Selznick shares this view:“Legal ideas, variously and unclearly labelled „concepts,‟ „principles,‟ and „doctrines,‟ have a vital place in authoritativedecision. ... It would be wrong to speak of these as merely a „source‟ of law; they are too closely woven into the fabric oflegal thought and have too direct a role in decision-making.” See Selznick, above n 13, at 27.

New Zealand Journal of Employment Relations 37(1): 60-69

An Uneven Playing Field – Partial Strikes
SUSAN HORNSBY-GELUK*Introduction
In 2002, fire fighters in the United Kingdom went on strike, creating widespread fear and causing thearmed forces to step into the breach to provide emergency service cover. In New Zealand, theannouncement in 2011 that 1,800 fire fighters were to undertake strike action provoked far less panic
due to the nature of that strike action. The difference was that, whilst the fire fighters in the United
Kingdom had been on complete strike, the New Zealand fire fighters were only partially striking. The
fire fighters continued to turn up to work and perform core fire fighting duties, but they did notundertake other usual duties such as paperwork, training, equipment maintenance, installation of fire
alarms, and community education programmes.
There is a growing trend in the use of strategic or partial strikes as opposed to the traditional form ofindustrial action whereby employees walk off the job completely. Partial strikes may include bans onparticular activities such as answering phones or filling in paperwork, working “to rule”, going slow,bans on overtime, or taking breaks at the same time as colleagues, in order to cause disruption to theemployer. The reason for this type of strike action is clear – employees do not get paid when they
completely withdraw their labour, and have, therefore, sought creative ways to strike without
sacrificing pay. As the law currently stands in New Zealand, the Fire Service Commission was notentitled to reduce the wages of the striking fire fighters – and yet, the fire fighters were not fulfilling
all the requirements of their employment agreements.
There is a natural balance of power between employees and employers engaging in “traditional”
industrial action. Whether the employee is striking or the employer has locked them out, the result isthat the employee does not get paid and, the employer does not get any work done. However, thegrowing trend of strategic or partial strikes is tilting this balance of power in favour of employees. If
employees can disrupt their employer‟s business by undertaking a partial strike whilst suffering noloss of wages, there is no incentive for them to reach an agreement and bring an end to the strikeaction.
Recent evidence of this consequence has been demonstrated within the public sector over the past two
years where partial strike action and work to rule tactics have been a common feature of protracted
bargaining. Given the lack of adverse impact on the employees conducting these strikes, the action
has, in many cases, carried on for a number of months causing significant disruption to thoseorganisations.
This paper reviews the development of the law in New Zealand and concludes that the balance o f
power in industrial action has been tilted in such a way that there is now a need for legislative reform.

The Balance of PowerHistorically, there has been a natural balance of power between employees and employers in terms of
the use of industrial action. The rights of each have been positioned to ensure the freedom of both topursue their rights and interests in bargaining. This balance has occurred because during a traditional
strike or a lockout, whilst an employee receives no wages, an employer has no output. The*

Susan is a specialist employment lawyer with over 18 years experience in the area.

New Zealand Journal of Employment Relations 37(1): 60-69
disadvantage experienced by both parties during a strike or lockout places an automatic control on the
duration and frequency of such actions. Neither side can undertake industrial action without due
consideration of the negative consequence they will experience from such action.
However, this traditional balance of power appears to have been altered by the advent of morecreative approaches to industrial action.

Partial Strikes
A partial or strategic strike occurs when employees do not walk off the job completely but refuse toundertake certain parts of their job. For example, university lecturers who refuse to mark students‟
essays but continue to carry out all the other duties of their position are on partial strike. A „go-slow‟
or „work-to-rule‟ is also a partial or strategic strike. Employees continue to perform their duties but
seek to reduce their productivity and/or efficiency to the minimum necessary to technically performthe requirements of their job description. Any type of partial strike has the potential to significantly
impact on an employer‟s productivity and cause disruption to the employer‟s business.
The Employment Relations Authority has interpreted the Employment Relations Act (ERA) 2000 insuch a way that the only sanction available to employers facing a lawful partial strike is to suspend thestriking employees altogether and, consequently, have no work performed. In this regard, theEmployment Relations Authority has found that the ERA, in its current form, prevents employers
from reducing the wages of partially striking employees.
Thompson and Ors v Norske Skog Tasman Ltd
In Thompson and Ors v Norske Skog Tasman Ltd,1 the Employment Relations Authority considered
the issue of whether employers are entitled to dock the wages of employees who engage in partial
strike action. The four employees concerned in this case were control system tradesmen at the
Kawarau paper mill. From August to December 2010, they withdrew their labour but remained onsite, solely for the purposes of covering essential and emergency services. Initially, their employer,
Norske Skog Tasman Ltd, continued to pay them full wages, notwithstanding the partial strike, in the
expectation that the strike would be a short one. However, after the strike action had continued for amonth, the company reviewed the appropriateness of continuing to pay full wages in light of the
prolonged nature of the dispute.
The company then sent the employees a letter informing them that their wages would be reduced by
80%. They were told that they did not need to be on site during their shift but had to lodge theircontact details with the Safety and Access Team so they could be contacted as necessary. The
employees‟ union was invited to provide feedback on the proposed arrangement prior to thearrangement being implemented. The union‟s response was that the company was proposing avariation to the contract. Subsequently, the union claimed that the workers were not on strike.
Ultimately, the company docked the employees‟ wages by 80% reflecting the reduction in output.
In the Employment Relations Authority, the employees claimed that there was no basis upon which
their employer could legally reduce their wages, and that the reduction was a breach of s 4 of theWages Protection Act 1983. Section 4 of the Wages Protection Act states that, except in the specified
cases, “an employer shall, when any wages become payable to a worker, pay the entire amount of
those wages to that worker without deduction.”1

Thompson and Ors v Norske Skog Tasman Ltd [2011] NZERA 291.

New Zealand Journal of Employment Relations 37(1): 60-69
If employees are on strike, that is, a total strike, and are not working at all, then wages do not become
payable. The employees in this case claimed that during a partial strike an employer has a choice
between accepting the partial performance or suspending the striking employees.
The Authority referred to Postal Workers Association v NZ Post Ltd (see below) and agreed with thedecision in that case that, to apply the doctrine of abatement, would be inconsistent with s 85(1)(c)(i)of the ERA 2000. 2 The Employment Relations Authority held that Norske Skog had acted unlawfully
as it was not entitled to make a deduction from the employees‟ wages, even though both parties
accepted that the employees were performing significantly reduced duties.
As a catchall, the Authority stated that, even if this conclusion was incorrect, the company was notable to deduct wages in the way that it did as the deduction was based on an arbitrary assessment of
the work carried out. No records were kept and the employer was unable to show that the deductions
accorded with the work not being carried out. Ultimately, the Authority made it clear that had thestrike been a full strike, the employees‟ entire wages could have been docked. However, as it was
only a partial strike and the employees continued to undertake part of their duties, they were entitledto their full wages, and no reduction could be made.
Postal Workers Association v New Zealand Post Limited
The Authority had reached this same conclusion in an earlier case involving New Zealand Post. In
Postal Workers Association v New Zealand Post Limited, posties delivered some of the mail assigned
to them but posted the rest of their allocated mail back into public post boxes along their delivery
routes. The posties were undertaking some of their duties but refusing to carry out others – meaning
New Zealand Post faced a partial strike situation. New Zealand Post did not discover what had
occurred until the following day, at which point it took immediate steps to suspend the posties
involved. New Zealand Post „backdated‟ the suspension notices to take effect from the beginning of
the day on which the partial strike occurred.
The Employment Relations Authority had to consider two issues – could an employer „backdate‟ asuspension notice; and could an employer reduce the wages of an employee refusing to undertake all
their duties? The first of these questions was easily disposed of, with the Authority finding that thestatutory scheme for suspension was not open to being imposed retrospectively.
This meant that New Zealand Post could not justify refusing to pay the striking workers on the basisthat they were suspended at the time the strike occurred. Accordingly, the Authority turned to thesecond question – is an employer entitled to dock the wages of an employee who is performing only
part of their normal duties? The Employment Relations Authority considered the common law
doctrine of abatement as this had been applied in the leading United Kingdom case relating to partial
strikes Miles v Wakefield.3
The Authority was asked to consider whether the doctrine of abatement was available in New Zealandemployment law for breach of contract as between an employer and an employee, as it is in the United
Kingdom. The Authority considered s 85(1)(c)(i) of the ERA 2000; section 85(1)(c)(i) states that
“lawful participation in a strike or lockout does not give rise to any action or proceedings for a breachof an employment agreement.” This section prevents a lawfully striking employee from being sued
for damages for breach of their employment agreement.

2
3

Postal Workers Association v New Zealand Post Limited (2007) 8 NZELC 98,918 (ERA).
Miles v Wakefield [1987] 1 All ER 1089.

New Zealand Journal of Employment Relations 37(1): 60-69
The contradiction, then, is that the doctrine of abatement is a remedy for breach of contract – but
employees are protected from claims for remedies for breach of contract in the event of participation
in a lawful strike. On this basis, the Authority held that abatement was inconsistent with the statutory
scheme in New Zealand and, therefore, was not available under New Zealand employment law. To
apply the abatement doctrine would remove part of the benefit of what is otherwise an immunity for
striking workers from civil suit, and would, therefore, be inconsistent with s 85(1)(c)(i). Further, theAuthority found that to apply the abatement doctrine would be inconsistent with the provision for thesuspension of striking workers. The Authority held that surprise or wildcat strikes are permitted by thelegislation and the employer‟s only redress in these circumstances is to suspend striking workers.
Consequently, the posties were entitled to full pay for all hours worked on the day the partial strikeoccurred.
An employer‟s statutory power to suspend striking employees without pay is based on s 87 of the
ERA 2000. Suspension is not necessary in the case of a full strike as the employees are notundertaking any work and, therefore, are not entitled to be paid. However, the Authority‟s decisionmeans that the options available to an employer in the event of a partial strike are either to accept thepartial strike action and pay the employee full wages, or to suspend the employee and pay no wages.
In a situation such as that faced by New Zealand Post, where the partial strike action was notdiscovered by the employer until after the event, the employer has no ability to suspend the employee
and, therefore, has no option but to pay full wages. The Authority acknowledged that “guerrilla”
tactics could legitimately be used by employees, but did not comment on the fact that this could meanthat employers would have no ability to respond to employees striking unexpectedly. The result is to
give employees significant power to disrupt an employer‟s business without suffering any
repercussions.
Miles v Wakefield
In order to understand the Employment Relations Authority‟s decision, it is necessary to consider theHouse of Lords decision in Miles v Wakefield, which is the leading English case on partial strikes.
The case was about a superintendent registrar of births, deaths and marriages who, as part of industrial
action and in breach of his duties, refused to conduct marriage ceremonies on Saturday mornings,
although he carried out his other duties on that morning. The Council informed Mr Miles that hewould not be paid for work on Saturdays unless he was prepared to undertake the full range of his
duties. When he refused, the Council withheld that part of his wages relating to Saturday work. Lord
Templeman referred to the situation as Mr Miles refusing to work “efficiently” on the Saturday.
The purpose of declining to work efficiently on Saturday was to inconvenience the public and thereby
advance the union‟s claim for higher salaries. Lord Templeman stated:4
The legislation does not protect the worker against losing his wages during a period ofindustrial action. If the worker were protected against losing both his job and his wages,
nearly every threat of industrial action would result in capitulation of the employer.
The House of Lords recognised that balance in industrial action was necessary and if it was removed,
all the power would be in the hands of the employee – inevitably resulting in the eventual capitulationof the employer. Ultimately, the employee hopes that the damage inflicted on the employer due to theindustrial action will drive the employer to the bargaining table before the loss of wages suffered by
the employee drives the employee back to work.

4

Ibid, at 1097.

New Zealand Journal of Employment Relations 37(1): 60-69
Working properly, Lord Templeman summed up the balance as: 5
In a contract of employment wages and work go together. The employer pays for work andthe worker works for his wages. If the employer declines to pay, the worker need not work. If
the worker declines to work, the employer need not pay. In an action by a worker to recover
his pay he must allege and be ready to prove that he worked or was willing to work.
Mr Miles‟ counsel argued that there were only two options open to the Council: to dismiss Mr Milesor pay him in full.
Ultimately, the House of Lords held that where strike action is in the form of working inefficiently,
the employer may decline to accept any work, and the employee will not then be entitled to wages.
Alternatively, the employer can accept the limited work that the employee is offering, and reduce
wages to reflect the level of work the employee is providing:6
The worker whose industrial action takes the form of „going slow‟ inflicts intended damage
which may be incalculable and non-apportionable but the employer, in order to avoid greater
damage, is obliged to accept the reduced work the worker is willing to perform. In thosecircumstances, the worker cannot claim that he is entitled to his wages under the contract
because he is deliberately working in a manner designed to harm the employer. But theworker will be entitled to be paid on a quantum merit basis for the amount and value of the
reduced work performed and accepted.
In determining the right of the employer to reduce wages, the House of Lords applied the concept of
the remedy of abatement. The underlying principle is that wages are remuneration and must be
earned; In a claim for wages under an employment contract, the worker must assert that he worked or
was willing to work. An employee could only claim wages if s/he was willing to work for them. If
the employee was not willing to work, then his/her wages could be abated accordingly.
As Mr Miles had not been ready and willing to work, and even, in fact, refused outright to undertakecertain parts of his job, the House of Lords upheld the employer‟s deduction of salary as appropriate.
The statutory scheme and abatement
As explained briefly above, abatement is a remedy for breach of contract when one party does notprovide the other party with the full benefit under that contract. In general, it is confined to contracts
for the sale of goods. For example, a purchaser has contracted with a seller to purchase 100 widgets
for a total of $200 but only 70 widgets are provided, the cost is abated accordingly and the purchaser
only has to pay $140. The doctrine operates as a remedy for breach of contract. The House of Lords
has extended the doctrine to employment contracts in the United Kingdom (Miles v Wakefield).
However, in New Zealand, the Employment Relations Authority determined that it could not apply
the common law doctrine as it is inconsistent with the statutory scheme.
The application of Miles v Wakefield and abatement in employment cases in New Zealand wasconsidered in passing by the Employment Court, prior to the two recent Employment Relations
Authority cases discussed above. In Bickerstaff v Healthcare Hawkes Bay Ltd Chief Judge Goddard
stated:7

5

Ibid, at 1098.
Ibid, at 1099.
7
Bickerstaff v Healthcare Hawkes Bay Ltd [1996] 2 ERNZ 680 at 11.
6

New Zealand Journal of Employment Relations 37(1): 60-69
The doctrine of abatement announced by the House of Lords in Miles was based on thepremise that the employer could sue the striking employees for damages for breach of contract
but should not have to wait so long and could make deductions from their wages at theirsource in respect of any non-performance resulting from concerted industrial action. The
underlying premise of ability to sue for damages in such situations has been renderedunreliable for New Zealand by s68 and accordingly the right to abate at source may have beenabolished as well. However, I will reserve the expression of a concluded view on the precise
effect of s68 for a case in which the point is argued.
The reference to s 68 is to the now repealed Employment Contracts Act (ECA) 1991. The underlying
intent of s 68 was materially similar to the intent of the current s 85 of the ERA 2000. Section 68
required the Tribunal or the Court to dismiss any proceedings brought under the ECA relating toparticipation in a lawful strike for breach of contract. Chief Judge Goddard‟s obiter comment was, tothe effect, that the reason given by the House of Lords for applying the doctrine of abatement could
not be similarly applied in New Zealand due to the statutory scheme preventing breach of contract
claims due to participation in lawful strikes.
In taking part in a partial strike by refusing to fulfil all their duties while at work, an employee isbreaching their employment agreement. Employers are prevented under New Zealand law for taking
any action for breach of an employment agreement against an employee for lawful participation in a
strike. The doctrine of abatement is a remedy for a breach of contract action. To the extent that abreach of contract action is statutorily barred, then it does seem that abatement is not available under
the present ERA 2000. However, there remains an argument that the employer is not making a„deduction‟ from employees‟ wages, which may be in breach of the Wages Protection Act. Rather, theemployer is making a „reduction‟ resulting from the employee not being entitled to pay for work thatthey did not perform.

Different Approaches
New Zealand
The New Zealand cases discussed above demonstrate an increasingly sophisticated approach toindustrial action. The aim of the parties is to cause maximum inconvenience or damage to the otherparty, whilst minimising the adverse impact on themselves. However, the increasing use of partial
strike action does arguably skew the natural balance of power in industrial action in favour of
employees. The effect is that employees have the ability to engage in strategic strike actionindefinitely, if necessary, without suffering any adverse consequence in terms of loss of pay.
Whilst employers may counter this type of activity by suspending striking workers, this depends
firstly on the employer having notice of the strike action. In the New Zealand Post case, the employer
did not become aware of the employees‟ actions until it was too late to suspend. Secondly, theemployer has to then decide whether to suffer the drop in output which will occur if it is forced tosuspend employees outright. The same considerations are applicable to any decision by an employer
to lock out.
It is noted that the decision in Southern Local Government Officers Union Inc v Christchurch City
Council relating to “technical” lockouts provides employers with the option of locking employees outof some but not all of their duties,8 provided it can ring fence the pay which relates to the specificduties of which the employees are locked. However, this option is not a direct match or counter
8

Southern Local Government Officers Union Inc v Christchurch City Council [2007] ERNZ 739.

New Zealand Journal of Employment Relations 37(1): 60-69
balance to the ability of employees to engage in partial strikes, as the employer still suffers acorresponding adverse consequence in the form of a loss of productivity.
United Kingdom
In the United Kingdom, employers may deduct pay from employees taking part in full or partial strikeaction. An employer is entitled to refuse partial performance by an employee of their duties. The
employer can instruct employees that they should only attend work when they are prepared to work infull compliance with their employment agreement. Until they do so, they will have no entitlement tobe paid. Alternatively, an employer may accept partial performance and reduce pay accordingly. This
raises the question of how an employer may assess the level of deduction to be made from an
employee‟s wages in the event of a partial strike.
Miles v Wakefield found that the reduction in wages does not have to be proportionate to the reductionin performance of the employee. Although Mr Miles was carrying some of his duties on Saturdays, he
was not paid for any work that he undertook on Saturdays. This principle was also exemplified in the1989 case of Wiluszynski v London Borough of Tower Hamlets. 9 In that case, employees were
instructed by their union not to answer elected members‟ queries. Responding to such queries formed
only a very small part of the employees‟ roles. The London Borough of Tower Hamlets warned theemployees, including Mr Wiluszynski, that until they were prepared to work normally and undertake
all of their duties, any work carried out would be regarded as voluntary and would not be paid. The
employees were not suspended from duty, but were told that their presence on the Council‟s premises
was not required until they were prepared to resume normal working. Mr Wiluszynski was one of thepartially striking employees. Consequently, the Council withheld Mr Wiluszynski‟s whole salary forthe duration of the partial strike.
Following the House of Lords in Miles v Wakefield, the Court of Appeal found that the fundamental
principle is that an employee who sues for remuneration under a contract of employment must averand prove that he was ready and willing to discharge his own obligations under that contract. The
Court of Appeal held that, as Miles v Wakefield had established that an employee is not entitled toremuneration under the contract of employment unless he is willing to perform that contract, theCouncil was entitled to say to Mr Wiluszynski that if he did not fulfil his full range of duties, hewould not be paid and should not attend work.
Mr Wiluszynski was not entitled to pick and choose what work he was willing to do under his
contract. The Court of Appeal held that he could not have it both ways – he could not refuse tocomply with his contract yet demand payment under that contract. The Court of Appeal also held that
the Council could not have it both ways – having told Mr Wiluszynski that he did not have to attend
work; the Council could not give him directions to work and refuse to pay him. Managers at theCouncil had been instructed not to pass work on to the striking employees and striking employees
were reminded daily that any work they did was voluntary.
The Court found, however, that it was reasonable for the Council to allow staff involved in the disputeto come and go as they wished. The Council could not be expected to take action physically toprevent staff from entering the premises – a lockout was impractical and would simply have worsened
relations. Ultimately, the Court of Appeal held that Mr Wiluszynski was in breach of his contractual
obligations and the Council was, therefore, entitled in refusing to pay him and had done nothing by
way of giving him directions to work or otherwise which disentitled it from asserting that position.

9

Wiluszynski v London Borough of Tower Hamlets [1989] IRLR 259.

New Zealand Journal of Employment Relations 37(1): 60-69
Mr Wiluszynski had only refused to undertake a very small portion of his duties. Nonetheless, theCourt of Appeal accepted the Council‟s position that Mr Wiluszynski was entitled to no pay at all forthe days on which he refused to undertake his full duties. This case has very particular circumstancesin that the Council specifically informed the striking employees that they would not be paid,
continued to inform them of this daily, did not require their presence at work, and did not direct themto undertake any work. However, it demonstrates that the situation in the United Kingdom is the polar
opposite from New Zealand. Under New Zealand law, a partially striking employee is entitled to fullwages. Under United Kingdom law, a partially striking employee is entitled to no wages.
Australia
On the face of it, the situation in Australia is much less complicated than in either New Zealand or theUnited Kingdom as it is specifically dealt with in statute. Under Australia‟s Fair Work Act 2009, if
employees undertake “partial work bans” the employer has a range of options from which to choose
how to respond. A partial work ban is the Australian term for what we refer to as a partial strike –employees performing part of their duties but refusing to undertake others.
Under s 471 of the Fair Work Act, an employer can dock an employee‟s wages due to the employee
refusing to perform part of their duties. The employer must give the employee written notice that,
because of the industrial action, the employee‟s pay will be reduced by a specified proportion. The
employer is then entitled to reduce the employee‟s pay in accordance with that written notice.
Regulation 3.21 of Australia‟s Fair Work Regulations 2009 outlines how the proportionate reduction
in payment is to be determined:

Step 1: identify the work that the employee is failing or refusing to perform.
Step 2: estimate the usual time that the employee would spend on performing that work
during a day.
Step 3: calculate the time estimated in step 2 as a percentage of the employee‟s usual hours ofwork for a day.
The solution is the proportion by which the employee‟s payment will be reduced for a day.

A second option open to the employer is to inform the employee that they will not be paid at all andrefuse to accept the performance of any work by the employee until the employee is prepared toperform all of his or her normal duties. This is equivalent to the ability under New Zealand legislation
to suspend the employee for the duration of the strike, but appears to be framed in a lessconfrontational manner.
Australian employers are, therefore, able to respond effectively to a partial strike. The employee‟swages can be reduced in direct proportion to the work that they are not undertaking; or the employee
can be suspended on no pay until they agree to fulfil all of their duties. This means that the traditionalbalance in industrial action between the interests of the employer and employee is maintained during apartial strike. There is equal incentive for both parties to return to the bargaining table.
An employee must be notified of the proposed reduction in wages and is consequently able to decide
whether the proposed partial strike action is worth the reduction. If the employee considers that the
proposed reduction in wages is not reasonable, the employee may make an application under s 472 of
the Fair Work Act and have Fair Work Australia determine the amount by which the payment should
be reduced. Fair Work Australia is the Australian national employment relations tribunal (equivalent
to New Zealand‟s Employment Relations Authority).

New Zealand Journal of Employment Relations 37(1): 60-69
An employer can only reduce wages from the day after written notice is given. Consequently, werethe circumstances of the New Zealand Post strike explained above to occur in Australia, the employer
would not be able to reduce wages for the day on which the partial strike action occurred. If theAustralian employer does not know about the partial strike action – there is still no effective sanction.
It is interesting that whilst the Australian legislation sets out a specific formula for employers to apply
in determining the reduction in wages, if the issue is put before Fair Work Australia, that authority has
a broad discretion to determine the appropriate reduction in wages. Fair Work Australia‟s discretion
involves taking into account: whether the proportion specified by the employer was reasonable having regard to the natureand extent of the partial work ban; and fairness between the parties taking into consideration all the circumstances of the case.
Given that the factors to be taken into account by employers and Fair Work Australia are different, it
would not be surprising for them to come to different conclusions in relation to the appropriate
reduction in wages. The case of Transport Workers Union v Department of Territory and Municipal
Services (ACTION)10 demonstrates this. In this case, the employees were bus drivers who gave noticeto their employer that they intended to undertake a partial strike by refusing to collect cash fares. In
response, the employer issued notices pursuant to s 471 of the Fair Work Act informing employeesthat their wages for each day, if they took part in the partial strike, would be reduced by two thirds.
The union took the case to Fair Work Australia claiming that a reduction of two thirds wasdisproportionate and that the collection of fares by drivers would account for no more than five or six
minutes of a driver‟s time on an average shift. The union argued that applying the three step formulain the Regulations would lead to a much smaller reduction in wages.
Fair Work Australia accepted that the employer had to apply Regulation 3.21 but emphasised Fair
Work Australia‟s greater discretion in light of s 472. Fair Work Australia was not required, or
allowed, to determine the dispute merely by applying the formula in Regulation 3.21. Ultimately, Fair
Work Australia determined that the proportion of two thirds specified by the employer was notreasonable and found that fairness required it to determine a reduction more reasonably representing
the “extent” of the action proposed.
This case demonstrates that whilst an employer could undertake an exemplary calculation in applying
the formula in Regulation 3.21, Fair Work Australia must take into account different considerations
which can substantially alter the final determination. It seems incongruous to have the employer‟s andFair Work Australia‟s calculations being undertaken on substantially different bases.
The second difficulty with the Australian approach is the requirement for employees to appeal thematter to the equivalent of the Employment Relations Authority if they are not happy with theproposed reduction. Industrial action may occur without much notice, and accordingly a more
responsive and flexible approach would seem to be preferable.

Proposed Solution
The obvious solution to the imbalance of power currently created in New Zealand by the ability of
employees to undertake partial strikes with no reduction in wages is to provide a mechanism for the
proportionate reduction of wages in such situations. The approach taken in the United Kingdom of
docking a partially striking employee‟s wages completely would not fit well in the New Zealand
10

Transport Workers Union v Department of Territory and Municipal Services (ACTION) [2010] FWA 4558.

New Zealand Journal of Employment Relations 37(1): 60-69
context as it does not appear to accord with the principle of good faith. Furthermore, it appears to
distort the balance of power between the parties in favour of the employer.
Whilst the Australian scheme provides flexibility and seeks to address the power imbalance issues, thedifference in the tests to be applied by the employer and Fair Work Australia in assessing the
reduction in pay, appears to encourage litigation. New Zealand needs to find a flexible solution to the
problem that fits within the New Zealand context and is relatively easy to implement. Firstly, thesolution needs to allow for a reduction in wages that is fair and proportionate to the employee‟s
reduction in work. As the employer and employee are likely to disagree on the appropriate reduction
in wages, it is necessary to provide quick access to an independent decision maker.
In the New Zealand scheme, Labour Inspectors are independent experts who already have a statutoryrole in determining pay issues applying broad discretion. The ERA could be simply amended toenable an employer to reduce the wages of a partially striking employee in the amount to be
determined by a Labour Inspector. In making such a decision, the Labour Inspector would hear fromboth parties and have discretion to determine the issue in accordance with the principles of natural
justice.
Rather than allowing one of the parties to make a decision on reduction in the first instance, likely
leading to disputes in the majority of situations, the initial decision would be made by an independent
authority. Parties wishing to dispute the Labour Inspector‟s determination could appeal to the
Employment Relations Authority. This would allow a fast, effective and flexible response toemployees undertaking partial strike action.
Taking this step would redress the current imbalance of power that exists in industrial action, andwould create an incentive for both parties to return to the bargaining table. This is surely consistent
with the principles of the ERA 2000.

Post Script
Subsequent to writing this paper, there have been two developments. Firstly, the National led
Government has announced its intention to amend the ERA to address the issue of partial strikes – themechanism is still unclear. Second, the Employment Relations Authority has referred a case to the
Employment Court which deals directly with this issue. 11 That case is due to be heard in April 2012.
Whether the Employment Court‟s decision supersedes the need for legislative intervention remains tobe seen.

11

NZPSA v Secretary for Justice [2011] NZERA 528 9428.

New Zealand Journal of Employment Relations 37(1): 70-81

Revisiting Stokes Valley: Trial Periods and Statutory Interpretation
SCOTT WORTHY*
The introduction of up to 90 day trial periods for employees in 2009 and their extension from
employers with fewer than 20 employees to cover all employers earlier this year has generated
much debate.1 Those in favour of the change argued that 90 day trials would encourage employers
to hire new and possibly jobless employees and provide much needed flexibility in employment
arrangements. Those against argued that the change was exploitative of trial employees, destructive
to their confidence and denied employees access to basic employment rights. That policy debate isinteresting and will, no doubt, continue. However, discussion of the merits of 90 day trials has
overshadowed the substantive effect of trial periods and how the relevant legislation has been andshould be interpreted. Addressing the effect and interpretation of trial periods is the subject of thispaper. Trial periods may, or may not, be here to stay but understanding how the Employment Court
has interpreted trial periods and the methodology of that interpretation has lasting implications for
employment law.
In Smith v Stokes Valley Pharmacy (2009) Ltd,2 Chief Judge Colgan examined for the first and,
until recently the only time in the Employment Court,3 the interpretation of trial periods. His
Honour’s judgment, produced under some urgency, carefully examines trial periods in the context
of the Employment Relations Act (ERA) 2000 (the Act). In doing so, the Court makes a number ofimportant observations and decisions regarding trial periods while acknowledging that many issues
regarding the interpretation of trial periods remain open. This paper explores two aspects of theinterpretation of trial periods which are apparent in that judgment. First, the paper considers thestrict interpretation given by the Court to the trial period provisions because, the Court argued, they
restrict access to justice. Secondly, and relatedly, the paper examines the way legislative history
was used to give meaning to the trial period provisions. In both these cases, the paper argues that
although the Court was correct to employ strict reading and legislative history to give meaning totrial periods, the Court may, with respect, have erred in aspects of the application of those
approaches to trial periods. The paper concludes by discussing how the Court saw the relationshipbetween the trial period provisions and the remainder of the ERA. In this aspect of its decision, theCourt gives valuable guidance as to how amendment acts should be reconciled with the primary act.

The Stokes Valley Decision
The facts in Stokes Valley are straightforward but they turn out to be decisive. Heather Smith was a
33 year old employee who had worked in a variety of retail positions, including at a supermarket
and a chain store. In March 2007, she began work as a retail pharmacy assistant at the Ross Cook
Amcal Pharmacy in Stokes Valley. Her employer was Stokes Valley Pharmacy Ltd and she worked
under the supervision of Mr. and Mrs. Cook, the pharmacist and his wife. In her 2 and a half years
at the pharmacy, Ms Smith developed skills in retail pharmacy and was well regarded by her
employer; she enjoyed working at the pharmacy.

*

1

Scott Worthy is Judges’ Clerk, Employment Court, Wellington

See, for example, the differing perspectives on trial periods in [2010] ELB 79-83. The views expressed in this article
are entirely the author’s own.
2
Smith v Stokes Valley Pharmacy (2009) Ltd [2010] NZEmpC 111, [2010] ERNZ 253.
3
See the recent decision of Blackmore v Honick Properties Ltd [2011] NZEmpC 152.

New Zealand Journal of Employment Relations 37(1): 70-81
In August 2009, the Cooks decided to sell their business. The method of sale was that Stokes Valley
Pharmacy Ltd would sell the business as a going concern to Stokes Valley Pharmacy (2009) Ltd.
Stokes Valley Pharmacy (2009) Ltd was owned by both Mr. Paul Kearns and Ms. Karen King, who
would operate the pharmacy, and a large pharmacy operator, Pharmacy Brands. The Cooks
informed staff that, in these circumstances, there could be no certainty of ongoing employment but
those employees who wished to stay on with the new company were welcome to apply to beinterviewed. Ms Smith duly applied and after an interview was offered a position. She was given a
letter of offer and an employment contract. Clause 10 of that employment agreement contained atrial period of 90 days which purported to be a trial provision within the meaning of the ERA 2000
as amended. The employment agreement was expressed to be not retrospective and to replace any
previous understanding between the parties. Before Ms. Smith signed her employment agreement or
Ms. King or Mr. Kearns took over the pharmacy, Ms. Smith had some time to consider theagreement and asked Ms. King some questions about it.
Ms. King and Mr. Kearns took over operation of the pharmacy business on 1 October 2009. Ms.
Smith worked, as she normally had on that day. The next day, 2 October 2009, she sat down with
Mr. Smith and, after asking some questions about the trial period, she signed the employment
agreement.
Within a short time it became clear that Mr. Kearns and Ms. King were dissatisfied with Ms
Smith’s job performance. On 8 December 2009, Ms. Smith was informed that she was dismissed
under the trial provision. Crucially, both employers declined to go into any detail about why they
had dismissed Ms. Smith, apart from saying generally that Ms Smith was not what they werelooking for and that she was inexperienced. Within 60 days of her dismissal, Ms. Smith’srepresentative wrote seeking reasons for the dismissal pursuant to s 120 of the ERA, which requires
reasons to be given in such circumstances. This request was declined, with Ms Smith’s former
employer relying on the trial period provision s 67B(5)(b) which does not require reasons to begiven under s 120 when the dismissal takes place during a trial period.
Summing up the factual situation, the Chief Judge observed: 4
In many ways this was a not uncommon employment situation. Ms. Smith was anestablished and experienced retail assistant on a relatively low hourly rate of pay and very
dependent on her job and earnings for her economic survival and that of her family. In
employment relationships, she was on her own in the sense that she did not have access toadvice from a union or from expert knowledgeable friends or family. Ms. Smith accepted atface value what she was told by her employer and was loath to challenge or otherwise rockthe boat because of her vulnerable economic circumstances. ... Ms. Smith appreciated that
there might be some risk in agreeing to the terms stipulated for by her employer but hoped,
based on her past record, that this would be minimal and that things would work out and go
well. ... Mr. Kearns and Ms. King were young recent migrants, professionally qualified intheir specialist field, but inexperienced in owning and operating their own business and in
the employment relations aspect of that in particular.
With these facts in mind, the Chief Judge then went on to interpret and apply the trial provisions as
they stood at the time of dismissal in December 2009. Those provisions relevantly provided:5

4

Ibid at [32]-[34].
Section 67A(4) was deleted by the Employment Relations Amendment Act (No 2) 2010 with effect from 1 April
2011. Thus any sized employer may now make use of trial periods.
5New Zealand Journal of Employment Relations 37(1): 70-81
67A When employment agreement may contain provision for trial period for 90
days or less(1)
An employment agreement containing a trial provision, as defined insubsection (2), may be entered into by an employee, as defined in subsection(3), and an employer as defined in subsection (4).
(2)
Trial provision means a written provision in an employment agreement thatstates, or is to the effect, that—(a)for a specified period (not exceeding 90 days), starting at the
beginning of the employee’s employment, the employee is to serve a
trial period; and(b)during that period the employer may dismiss the employee; and(c)if the employer does so, the employee is not entitled to bring apersonal grievance or other legal proceedings in respect of thedismissal.
(3)
Employee means an employee who has not been previously employed by theemployer.
(4)
Employer means an employer who, at the beginning of the day on which theemployment agreement is entered into, employs fewer than 20 employees.
...
67B

Effect of trial provision under section 67A(1)
This section applies if an employer terminates an employment agreement
containing a trial provision under section 67A by giving the employee noticeof the termination before the end of the trial period, whether the termination
takes effect before, at, or after the end of the trial period.
(2)
An employee whose employment agreement is terminated in accordance withsubsection (1) may not bring a personal grievance or legal proceedings in
respect of the dismissal.
(3)
Neither this section nor a trial provision prevents an employee from bringing
a personal grievance or legal proceedings on any of the grounds specified in
section 103(1)(b) to (g).
(4)
An employee whose employment agreement contains a trial provision is, inall other respects (including access to mediation services), to be treated nodifferently from an employee whose employment agreement contains no trial
provision or contains a trial provision that has ceased to have effect.
(5)
Subsection (4) applies subject to the following provisions:(a)in observing the obligation in section 4 of dealing in good faith withthe employee, the employer is not required to comply with section
4(1A)(c) in making a decision whether to terminate an employment
agreement under this section; and(b)the employer is not required to comply with a request under section
120 that relates to terminating an employment agreement under thissection.

The effect of these provisions is to remove access to personal grievance procedures for thosedismissed under a valid trial period. That trial period must be in writing, not exceed 90 days,
commence at the beginning of employment and applies only to an employee who has not beenpreviously employed by the employer. All the normal rights of employees, including the rights not
to be dismissed on unlawful discrimination grounds remain, subject to the specific exemptions in s
67B. As the Chief Judge has noted:

New Zealand Journal of Employment Relations 37(1): 70-81
The new sections are neither simple nor the very broad and blunt prohibition against
bringing legal proceedings that is sometimes portrayed rhetorically. They provide a specificseries of steps to be complied with cumulatively before a challenge to the justification for adismissal can be precluded. 6

Strict Reading
In deciding Stokes Valley, the Chief Judge determined that ss 67A and 67B should be interpreted
strictly. His Honour explained the reasoning for that decision in this way: 7
Sections 67A and 67B remove longstanding employee protections and access to dispute
resolution and to justice. As such, they should be interpreted strictly and not liberally
because they are an exception to the general employee protective scheme of the Act as it
otherwise deals with issues of disadvantage in and dismissals from employment. Legislationthat removes previously available access to courts and tribunals should be strictly interpreted
and as having that consequence only to the extent that this is clearly articulated.
The Chief Judge then went to on apply a strict reading of ss 67A and 67B in two ways. First, heheld that Ms. Smith was not bound by the trial period because she had been previously employed byher employer on 1 October 2009 before agreeing to the trial period the next day. In addition, theCourt considered that because of Ms. Smith’s retail work experience, she was not the type of
employee for which trial periods had been designed. The Court suggested that this was anotherreason as to why Ms. Smith could not be subject to a trial period. Secondly, the Court held that Ms.
Smith was, notwithstanding the exemption to s 120 provided in s 67B(5)(b), entitled to oral reasons
as to why her employment had been terminated because the duty of good faith requires employers
and employees to be responsive and communicative with each other.
The Chief Judge began his reasoning for applying a strict reading with a statement that employee
access to a personal grievance procedure is a longstanding employee right. The personal grievanceprocedure in the current ERA was first introduced in a recognisable form into New Zealand law in1973. That year’s Industrial Relations Act introduced, via s 117, the concept of unjustifiabledismissal as distinct from what the common law termed wrongful dismissal. That change wassignificant as it broadened the ability of employees to challenge dismissals, moving away from thelimitations of common law wrongful dismissal. 8 A personal grievance procedure has been carriedover throughout the significant changes made to employment law since the 1970s, culminating in s
103 of the current ERA. It is also important to note that the current Act appears to abolish thecommon law right to sue for wrongful dismissal because s 113 of the Act provides that the only
way to challenge a dismissal is through the personal grievance procedure in the Act. This eliminates
any possible argument that, in limiting the personal grievance procedure through trial periods,
Parliament was merely altering a statutory process that it itself invented. Because access to thepersonal grievance procedure is the only way to contest a dismissal in a New Zealand judicial body,
it is clear that the effect of ss 67A and 67B is to remove previous and longstanding rights of accessto the courts for judicial determination and relief.
The Chief Judge also stated that, because the trial provisions remove that access to justice, theyshould be read strictly. The principle of interpretation that express words are required before alimitation will be imposed on a citizen’s access to the courts has a long heritage. Where possible,
6

Stokes Valley, above n 2, at [83].
Stokes Valley, above n 2, at [48].
8Bill Hodge ―The Exaltation of Procedure‖ (paper presented to the Employment Law Conference, 1996) at 7-9.
7

New Zealand Journal of Employment Relations 37(1): 70-81
courts will read down or interpret strictly such provisions so as to narrow their effect and preserve
access to the courts. This is because, as Chief Justice Elias has put it, ―[a]ccess to the Courts forvindication of legal right is part of the rule of law.‖9 As Avory J expressed the principle in Chester v
Bateson:10
In my opinion there is not to be found in the statute anything to authorize or justify aregulation having that result; and nothing less than express words in the statute taking away
the right of the King’s subjects of access to the Court of justice would authorize or justify it.
So, ingrained is the principle that it prompted the majority of the Court of Appeal, after referring to
Chester v Bateson, to state that:11
Indeed we have reservations as to the extent to which in New Zealand even an Act ofParliament can take away the rights of citizens to resort to the ordinary Courts of law for thedetermination of their rights.
The principle has also been employed in the Employment Court. In Swann v ACI NZ Ltd and NZ
Amalgamated Engineering Etc IUOW,12 the Employment Court’s predecessor, the Labour Court,
accepted the submission that ―there is a presumption that clear and express words are required toremove a citizen’s right of access to the Court.‖13 In Ngapuhi Fisheries v Taurua, the Court decided
that it could not have been Parliament’s intention, at least without using clear words, to remove
existing procedural rights in the transitional provisions of the current ERA.14 Chief Judge Colgan,
in his concurring judgment in Credit Consultants Debt Services NZ Ltd v Wilson (No 4),15 also
referred to this principle in expressing his reluctant agreement with his full Court colleagues that the
Employment Court had lost its power to grant injunctions except in relation to strikes or lockouts.
As this long history of the application of the principle makes clear, a strict reading of provisions
with restrict access to the courts is an appropriate and necessary protection of the rule of law and theprinciple of legality.
My difficulty with the Court’s approach comes not in the Court’s decision to read ss 67A and 67Bstrictly but in the Court’s application of a strict reading in this case. It is clear that the Court,
although not stating so explicitly, gives a strict reading to s 67A(3) which defines an employee who
may enter into a trial period as ―an employee who has not been previously employed by theemployer.‖ After correctly concluding that Ms. Smith was not an employee as defined in the statutebecause she had been previously employed by the employer, albeit for one day, the Court went on
to state that:16
Even ignoring the legal position just determined, Ms Smith could hardly have been
described as a ―new‖ employee except in the narrow and technical sense that she had notpreviously been employed by the defendant company which purchased the business of her
previous employer and took on many of its existing staff including her. She was 33 years ofage with a history of diverse retail sales experience including, most recently, more than 2½
9

Lai v Chamberlains [2006] NZSC 70, [2007] 2 NZLR 7 at [1].
Chester v Bateson [1920] 1 KB 829 at 836.
11
New Zealand Drivers’ Association v New Zealand Road Carriers [1982] 1 NZLR 374 (CA) at 390 per Cooke,
McMullin and Ongley JJ.
12Swann v ACI NZ Ltd and NZ Amalgamated Engineering Etc IUOW (1990) ERNZ Sel Cas 909.
13
Ibid at 919.
14
Ngapuhi Fisheries v Taurua [2002] 1 ERNZ 562 at [34].
15
Credit Consultants Debt Services NZ Ltd v Wilson (No 4) [2007] ERNZ 446.
16
Stokes Valley, above n 2, at [89]. However, see the Chief Judge’s comment and clarification of the reasoning in thisparagraph of Stokes Valley in Blackmore, above n 3, at [111]-[112].
10

New Zealand Journal of Employment Relations 37(1): 70-81
years working satisfactorily in the actual business that was purchased by the defendant.
There is no suggestion on the evidence that there was any element of employment risk foreither party of the sort that was said to be the philosophy behind the enactment of ss 67A
and 67B.
The Court appears to be saying that, despite the definition of employee which excludes only
previously employed employees from the operation of a trial period, Ms. Smith is not eligible for asecond reason, namely that she was not, because of her retail experience; the sort of risky employeethat trial periods were designed to help into the workforce. In part, that conclusion is based upon amisreading of the legislative history where the Court impermissibly equates the definition in the
ERA of a trial period eligible employee with the Court’s own conception of a ―new employee‖
which the Court bases on the examples of new employees discussed in Parliament. I will come backto that point in the next section of this paper; but the conclusion is also based on giving thedefinition of employee a strict reading which reads down the application of the definition to exclude
well qualified or experienced employees (based on the legislative purpose of trial periods), notmerely employees previously employed by the same employer.
It is well to focus on the words and meaning of s 67A(3), but those words are capable of only one
fair meaning and, that is, employees who were previously employed by the employer may not be
the subject of a trial period. This has two effects. First, any employee who is a current employee ofthe employer and, already began the employment relationship, may not be subject to a trial period.
This includes employees who have worked for the employer for one day, like Ms. Smith, or 30
years. Second, the definition excludes those who have worked for the employer and then left
employment but who now wish to return to the same employer.
Given this clear language, the Court’s attempt to further narrow the pool of employees ineligible fora trial period, thus preserving the access of those employees to the courts, is impermissible. As Lord
Reid described, the principle of strict interpretation of an ouster clause in Anisminic Ltd v Foreign
Compensation Commission:17
It is a well established principle that a provision ousting the ordinary jurisdiction of the court
must be construed strictly – meaning, I think, that if such a provision is reasonably capableof having two meanings, that meaning shall be taken which preserves the ordinary
jurisdiction of the court.
With respect to the meaning of employee, the statutory definition is reasonably capable of only one
meaning. A strict reading of the definition which narrows the range of employees eligible for a trial
period is not possible.
The Court itself makes the point that there must be two possible meanings for the strict meaning to
be preferred when it analyses whether an employer is entitled to refuse to give reasons for dismissal
to an employee terminated under a trial provision. Section 67B(5)(b) states that an employer is not
required to comply with s 120 of the ERA which mandates that employers must provide written
reasons for the dismissal on request within 60 days of the dismissal. The effect of s 120 is to put theemployee in a position of knowing the real or purported reasons for his or her dismissal before the
90 day limit for raising a personal grievance expires. Section 120 is, therefore, an important
provision that is implicated in the decision by an employee whether to raise a personal grievance atall; it is a significant part of the personal grievance mechanism. It affects both decisions about
raising a personal grievance and provides a basis for an employee to argue to the Employment
Relations Authority or to the Court that the dismissal was unjustified.
17

Anisminic Ltd v Foreign Compensation Commission [1969] 2 AC 147 (HL) at 170.

New Zealand Journal of Employment Relations 37(1): 70-81

In interpreting s 67B(5)(b), the Court, in essence, considered that s 67B(5)(b) could have twomeanings. First, it could act to exclude the possibility of an employee receiving a reason for his or
her dismissal. After all, the whole point of 90 day trials is to allow an employer to dismiss anemployee without risk of the employer’s reasons being subject to the scrutiny of the courts which
could normally occur. However, a second interpretation of s 67B(5)(b) is that it merely removes therequirement under s 120, leaving most of the other requirements of good faith including therequirement to be responsive and communicative in s 4(1A)(b) of the Act in place. The Court,
applying a strict interpretation that minimised the intrusion on the rights of employees under theAct, rightly chose the second interpretation. 18 That is, because, in the case of s 67B(5)(b), there
were two possible interpretations consistent with the statutory language and purpose and reasonably
available to the Court.
To be clear, the Court was correct in holding that Ms. Smith was not eligible for a 90 day trial
because she had been previously employed by the employer. However, despite an appropriately
strict reading of the statute, the Court was incorrect to suggest that Ms. Smith’s experience was also
disqualifying. That construction is not a possible meaning of the statute and not a meaning open to
the Court; Parliament had expressed itself well enough in its decision to debar trial periods only
from those previously employed by the employer.

Legislative History
The Court in Stokes Valley examines the legislative history of the Employment Relations
Amendment Act 2008 in detail. It does so in order to flesh out the purpose of the Act in order tocomply with the injunction of s 5 of the Interpretation Act 1999 which requires that the ―meaning ofan enactment must be ascertained from its text and in the light of its purpose.‖ Since theabandonment of the exclusionary rule for legislative history in 1986,19 New Zealand courts haveregularly referred to legislative history to clarify the meaning of statutes. This is both because thecourts increasingly view meaning as contextual and because courts are required to address the
purpose of the legislation they seek to interpret. As Justice Keith has stated: ―meaning is not to beascertained only from the immediate text. The surrounding law and often other material will be
relevant ...‖20, and with respect to purpose, Justice Tipping, writing for the Supreme Court, hasstated that:21
It is necessary to bear in mind that s 5 of the Interpretation Act 1999 makes text and purposethe key drivers of statutory interpretation. The meaning of an enactment must be ascertained
from its text and in the light of its purpose. Even if the meaning of the text may appear plain
in isolation of purpose, that meaning should always be cross-checked against purpose inorder to observe the dual requirements of s 5. ... Where, as here, the meaning is not clear on
the face of the legislation, the Court will regard context and purpose as essential guides tomeaning.
In discussing the legislative history, the Chief Judge focused on discerning the reasons that were
given in Parliament as to why trial periods were necessary. His Honour quotes from the explanatory
note to the bill, the ―Bills digest‖ and from two passages from the Minister of Labour’s speeches in

18

This interpretation is also preferable for the reasons discussed in the third section of this paper.
Marac Life Assurance Ltd v Commissioner of Inland Revenue [1986] 1 NZLR 694 (CA) at 701.
20
R v Pora [2001] 2 NZLR 37 (CA) at [104] (emphasis original).
21
Commerce Commission v Fonterra Co-operative Group Ltd [2007] NZSC 36, [2007] 3 NZLR 767 at [22]-[24].
19New Zealand Journal of Employment Relations 37(1): 70-81
the House at the first and second readings. The quotation from the explanatory note includes thefollowing passage:22
This Bill will provide opportunities for those who might suffer disadvantage in the labour
market, for example employees who are new to the workforce or returning to the workforce
after some time away or specific groups at risk of negative employment outcomes.
Also excerpted is this passage from the first reading speech by the Minister:23
The Bill will give … new employees the opportunities to get on the employment ladder. It
will provide opportunities for those who might suffer disadvantage in the labour market —for example, employees who are new to the workforce or returning to the workforce aftersome time away, or specific groups at risk of negative employment outcomes.
These passages quoted by the Court are a fair reflection of the justification for trial periods given bypromoters of the bill. In essence, trial periods would allow employers to take on employees who
suffered from risk factors, such as inexperience, time away from the workplace or employees who
had difficult personal histories. As the Chief Judge summed up the legislative history: 24
The new provisions in ss 67A and 67B were intended to address the circumstances of ―new‖employees, that is, of people who had not previously been employed or who had not been
employed recently or for whom obtaining employment might have proved difficult for any
other reason. The scheme of the provisions, as it was promoted, was to allow employers
some latitude in engaging and dismissing new employees in respect of whom there might besome risk of compatibility or other work performance issue.
This recourse to legislative history in order to understand the purpose of the bill is both
unexceptional in modern New Zealand judgments and unobjectionable. 25 However, the potential
difficulties with legislative history usually arise when this parliamentary history and purpose isapplied to interpreting the statute. Indeed, the application of the legislative history to the statute inthis case reveals some of the inherent dangers that a court can face when using parliamentary
history and, in particular, relying on parliamentary debates.
The first difficulty is that by focusing on what was said in Parliament, the court takes its eye off thestatutory text. Thus, when considering whether Ms. Smith was an employee previously employedby the employer and, therefore, ineligible for a trial period, the Court in the passage I havepreviously highlighted above reflects on the fact that Ms. Smith was not an employee with the risk
factors used in Parliament to justify the introduction of 90 day trials. Because Ms Smith had
substantial retail experience and had not been out of the workforce, the Court suggests she was not
the sort of ―new employee‖ that Parliament thought trial periods would apply to and, therefore, notpotentially subject to a trial period. Thus, the Court uses the legislative history to fashion analternate meaning for the statutory definition which it then prefers on the strict reading grounds that
this meaning excludes fewer employees from the personal grievance procedures.
The Court has, therefore, used legislative history in a way that strays dangerously far from the text
which is being interpreted. This is highlighted by the fact that the discussion of Ms. Smith’s
22

Stokes Valley, above n 2, at [41].
Stokes Valley, above n 2, at [45].
24
Stokes Valley, above n 2, at [49].
25
For further discussion of the problems of using legislative history see Antonin Scalia A Matter of Interpretation:Federal Courts and the Law (Princeton University Press, Princeton, 1997); Johan Steyn ―Pepper v Hart; A Reexamination‖ (2001) 21 OJLS 59.
23

New Zealand Journal of Employment Relations 37(1): 70-81
eligibility for a trial period is headed ―A ―new employee‖?‖ In fact, the phrase ―new employee‖
appears nowhere in ss 67A and 67B and where the quotation marks arise from is uncertain. The
only possibility is that this phrase is used in the legislative history quoted by the Court. However,
the Court’s task is not to establish whether Ms. Smith was or was not a ―new employee‖ but
whether she had been previously employed by the same employer. This error is of the typecautioned against by Justice McGrath, writing extra-judicially when he argued that:26
I suggest that Judges should always be mindful that Hansard, along with otherparliamentary materials, can be deceptively alluring in the search for purpose in order toclarify meaning. The extrinsic aid cannot carry more weight than the section itself.
This focus on interpreting ―new employee‖ in the Court’s judgment also illustrates another dangerof legislative history: that parliamentary history may be false advertising. It is clear thatparliamentary speeches rarely do anything to persuade members opposed to the Bill to change theirminds; that is not the purpose of speeches in the House. Rather, the speeches are political and policy
arguments designed for public consumption and, in the case of government members, are made tojustify the contents of the Bill. Thus, the government argued that trial periods would only apply to―new employees‖ as a way to sell the Bill irrespective of the precise words of the statute. Similarly,
Part 6A of the Act, which provides that some employees may transfer to a new employer after
restructuring, was justified as a necessary protection of ―vulnerable employees.‖ In fact, theemployee transfer provisions do not apply to ―vulnerable employees‖ but to all employees who
provide services of the type listed in Schedule 1A of the ERA regardless of their individual pay orconditions. 27 Courts must be careful when cross-checking text with purpose that they are not taken
in by potentially misleading political labels such as ―new employee‖ or ―vulnerable employee‖.
The cross-checking of purpose and text is meant to allow purpose and text to inform each other, notfor one to overwhelm the other. Courts must disenthrall themselves of any notion that parliamentary
history can subsume the text. I would suggest that such caution is particularly appropriate inemployment law where the Act contains some lacunae that the Court must do its best to fill in, andexamination of purpose and legislative history can be useful sources for interpretation.
Parliamentary materials can, therefore, be an important guide in an area of law where sometimes the
signposts are few and far between. As Jeffrey Goldsworthy has argued, the literal meaning of aprovision is much less substantial than a meaning fleshed out by evidence of intention.28 However,parliamentary materials must be used carefully and as part of a holistic approach to interpretation
which relies, in the end, on the words of the statute, their statutory context and their purpose asgleaned from the statute and its legislative history.
The third difficulty with the use of legislative history that Stokes Valley exemplifies is what
Professor Jim Evans has described as the danger of ―confusing the meaning of the Legislature with
its views about application.‖29 The passages of legislative history cited by the Court lead the Court
to the conclusion that the legislative purpose of trial periods was to allow employers to take on risky
employees, that is, employees who may have had a difficult or non-existent employment history,
employees who were returning to the workforce or employees who had no relevant work
experience. Trial periods were to allow this employee to get a foot in the door and demonstrate hisor her capabilities. The Court then takes this purpose as informing the meaning of the trial period
provisions. However, that political justification and the related examples of benefitting employees
26John McGrath ―Purpose, Hansard, Rights, and Language‖ in Rick Bigwood (ed) The Statute: Making and Meaning(LexisNexis, Wellington, 2004) 227 at 231.
27
Matsuoka v LSG Sky Chefs New Zealand Ltd [2011] NZEmpC 44 at [52].
28
Jeffrey Goldsworthy ―Parliamentary Sovereignty and Statutory Interpretation‖ in Rick Bigwood (ed) The Statute:
Making and Meaning (LexisNexis, Wellington, 2004) 185 at 191.
29
Jim Evans ―Controlling the Use of Parliamentary History‖ (1998) 18 NZULR 1 at 26.

New Zealand Journal of Employment Relations 37(1): 70-81
do not require a meaning of s 67A(3) which exempts experienced employees from being subjected
to trial periods. In suggesting that this is the case, the Court is confusing the examples of theapplication of the Bill stated in the House with its meaning. As I have argued, the definition of
employees exempted from trial periods is clear; the application examples do not define the meaningof the definition, but merely provide examples of its effect. There is no other meaning of previously
employed by the employer available and, in the context of the remainder of ss 67A and 67B, thelanguage is unambiguous.
The fact that the meaning of the s 67A(3) definition of employee sweeps wider than the examples
given in the House is not surprising if the purpose of trial provisions is correctly understood. As afocus on the text of ss 67A and 67B makes clear, the purpose of those provisions is to exempt
employers from the personal grievance procedures in relation to employees who have not beenpreviously employed and who are, therefore, not known to the employer. The purpose of theprovisions is to remove the risk that an employee will be unproductive or unsatisfactory for theemployer and the associated risk that the employee will contest his or her dismissal. The examplesof risky employees given in the House are consistent with this purpose. The examples themselves,
however, are not the same thing as purpose or meaning. Interpreted as they must be in light of thetext and the purpose, trial periods may be agreed between employers and employees who have notbeen previously employed and are, therefore unknown, to the employer. While the House may havegiven examples of risky employees to justify trial provisions, the effect of those provisions is muchbroader and more than just risky employees may have trial provisions in their employment
agreements.
Again, it is important to point out that the Court’s decision to have recourse to legislative history iscorrect. Such history can provide valuable context to the interpretive task. However, as I haveargued, legislative history must be carefully used and its limits well qualified.

Relationship of Trial Provisions to the Remainder of the Act
This discussion and elucidation of the purpose of the trial provisions highlights the fact that the
ERA has been frequently amended by governments of various political hues and will likely be so
again. The Act itself is the latest in a long line of legislative attempts to regulate employment
relationships which have ranged from periodic revolution to tinkering with New Zealand’s
employment law. These acts have each had their own philosophical approaches and purposes. What
the recent amendments to the ERA indicate is that, within the same piece of legislation, different
parts of the Act may have different purposes. These purposes could even be seen as conflicting withthe purposes of other parts of the Act.
In itself, this would not cause any immediate theoretical difficulty. Section 5 of the Interpretation
Act 1999 allows for the meaning of an enactment to be interpreted from the text and in light of its
purpose. Thus, as in Stokes Valley, the meaning and purpose of an enactment is to be obtained fromthe text of the amending Act and the parliamentary material relating to that amending Act. Such an
approach respects the right of Parliaments to make changes to Acts which reflect the different
perspective of the new Parliament. Equally, however, once an amending Act is passed, its meaningdraws context from the surrounding Act which presumably embodies the purposes of the originallegislation. This is consistent with s 23 of the Interpretation Act 1999 which provides that an―amending enactment is part of the enactment that it amends.‖ As the English Court of Appeal has
noted: ―[W]hat is to be looked at is the amended statute itself as if it were a free-standing piece ofNew Zealand Journal of Employment Relations 37(1): 70-81
legislation and its meaning and effect ascertained by an examination of the language of thatstatute.‖30
In the area of employment law, philosophical and ideological differences that lead to changes to
employment law can be relatively stark. At the beginning of this paper, I noted that trial periods
were controversial. It can be expected that a change in government would likely lead to their
abolition and future governments may then act to reinstate them. At the present time, trial periods
sit somewhat uneasily with the requirements of the Act for employees and employees to act in goodfaith in all aspects of their relationship and for employers to justify both procedurally andsubstantively their decision to dismiss an employee. It could be said that the purposes of theremainder of the Act which, in the main, place significant burdens on employers and closely
regulate employers to address the inherent imbalance of power between employer and employees
are not consistent with the trial period provisions. These internal contradictions as to purpose may
make reconciliation of the meaning of the statute peculiarly difficult.
In Stokes Valley, the Court carefully relates the provisions of the trial periods to the remainder ofthe Act. As I have noted, the Court concluded that, despite trial period employers being exempt
from the requirements of s 120, Ms. Smith had a right to an explanation of the reasons for her
dismissal based on the duty of good faith. This gave effect to the good faith duties which pervade
the Act. In part, this is justified by an appropriately strict reading of the provision which affects theability of an employee to access the personal grievance procedure. However, notwithstanding astrict reading, this interpretation of the Act is justified because it reflects the continuing andsignificant obligations that exist despite the trial period exception. As s 67B(4) states, an employee
whose employment agreement contains a trial provision has all the rights of any other employee
except with respect to the two matters referred to in subsection 5. While the purpose of the trial
provisions was to remove the risk for employers of being subject to the personal grievanceprocedures in the first 90 days of employment, the text makes clear that good faith duties ofcommunication remained in place and trial employees are generally to be treated no differently thanother employees. It is notable that ss 67A and 67B make reference to other provisions of the Act
and this is a clear indication that Parliament intended the trial period provisions to sit alongside andinteract with existing provisions in the Act. In this respect, Stokes Valley’s careful elucidation of theeffect of an amending act on existing rights and duties under the principal act is a model as to how
to interpret future amending legislation in ways which resolve any potential tension between the oldand the new.

Conclusion
Appropriately, in this employment law context, the legal philosopher, Andrei Marmor, has
described courts working to interpret statutes as employees carrying out their duty in good faith fortheir employers, the legislature. Thus, it is possible to see that, in a ―moral-political sense, to someextent courts do work for the legislature, and thus, indirectly, for all of us.‖31 Of course, it would be
unwise to push this analogy too far, and perhaps detrimental to the rule of law to do so. In many
respects, courts act more like guardians of the law than employees of the legislature and this isespecially so when the courts restrain executive action and the executive’s interpretation of thelaw.32 As the recent Supreme Court decision in Hamed v R,33 which excluded evidence in someprosecutions related to the Urewera raids demonstrates, courts can be inconvenient employees.
30

Inco Europe Ltd v First Choice Distribution (a firm) [1999] 1 All ER 820 at 823.
Andrei Marmor Law in the Age of Pluralism (Oxford University Press, New York, 2007) at 204.
32
Sian Elias, Chief Justice of New Zealand ―Fundamentals: a constitutional conversation‖ (Harkness Henry Lecture
2011, University of Waikato, Hamilton, 12 September 2011).
33
Hamed v R [2011] NZSC 101.
31

New Zealand Journal of Employment Relations 37(1): 70-81
However, Marmor is on to something when he points out that at ―some point [courts] must act like a
good employee when instructions have run out: use your own judgment and solve the problem [ofstatutory interpretation] as best you can.‖34 After all, it is the function of the courts to say what thelaw is and, in this respect, it is not too far-fetched to describe courts as acting as an agent of thelegislature. In Stokes Valley, the Employment Court was faced, for the first time, with newlegislation which was complex and substantially affected employee rights. It appropriately resorted
to legislative history to create context and purpose for the text and to a strict reading to preserve
rights. The decision to use both approaches was correct and protective of both parliamentary
sovereignty and individual rights.
The criticisms in this paper have focused on the way legislative history and strict reading wereapplied. In particular, I have argued that there is no alternative meaning to the definition of
employees eligible for a trial period and a strict reading of that definition is impermissible. I havealso argued that the Court strayed too far from the text in interpreting the definition and confused
the meaning of the statute with the examples of its application envisioned by members of
Parliament. I have suggested that when courts make use of legislative history, as they should wheninterpreting statutes, they must be careful to contextualise parliamentary materials in a way which
does not undermine the text of the statute. Cautious, but appropriate use of legislative history canilluminate text and purpose. However, this paper has highlighted the limits of reasoning fromlegislative history and argued that recourse to parliamentary materials is not a straightforward
exercise but a complex dance between parliamentary and statutory texts, purpose and meaning.
At the same time, I have noted the valuable lessons of Stokes Valley. The case provides guidance as
to how to reconcile amendments to an act with the remainder of a principal act. Stokes Valley is also
an example of a court acting to strictly read the provisions of an act in a way protective of existing
legal rights. Finally, it should be noted that the Court got it right in Stokes Valley. Ms. Smith was
not eligible for employment under a trial period because she had already been previously employedby the employer. In that conclusion, the Court was itself acting as a good employee faithfullyreflecting the parliamentary intent of the legislature and the purpose and meaning of the statute. We
can all be grateful that we have such an independent, effective and judicious court as our employee.

34

Marmor, above n 31, at 204.

New Zealand Journal of Employment Relations 37(1): 82-89

Returning Dignity to Labour: Workplace Safety as a Human Right
JONATHAN BARRETT and LEIGH THOMSONAbstract
Universal human rights are derived from respect for human life and the inherent dignity of the person. As
signatory to all major United Nations‟ human rights instruments, New Zealand is a „human rights State‟.
However, New Zealand workers experience high levels of occupational accidents and workplace death,particularly in the mining industry where, it appears, profit commonly takes precedence over safety. The
Pike River mine explosion, in which 29 men were killed, is an egregious example of the quotidian risks
many New Zealand workers face. This subordination of human dignity and life to financial considerations is
incompatible with basic human rights principles. In this article, we argue that the current reasonably
practicable test for workplace safety is insufficient. If the dignity and lives of workers are to be taken
seriously, a benchmark akin to the proportionality test of human rights jurisprudence is indicated.

Introduction
Respect for human life and the inherent dignity of the person fundamentally inform statements of universal
human rights. In particular, the preamble to the Universal Declaration of Human Rights (UDHR) (1948)
provides that universal human rights are founded on “recognition of the inherent dignity and of the equal
and inalienable rights of all members of the human family”. Human dignity “is concerned with physical andpsychological integrity and empowerment”.1 Following the Vienna Declaration and Program of Action:2
All human rights are universal, indivisible and interdependent and interrelated … it is the duty ofStates, regardless of their political, economic and cultural systems, to promote and protect all
human rights and fundamental freedoms.
As signatory to all major United Nations‟ human rights instruments,3 New Zealand is a human rights State,and, therefore, required to promote human dignity in all aspects of its citizens‟ lives.
Despite this comprehensive rights commitment, workers in New Zealand experience high levels ofoccupational accidents and workplace death that seem inconsistent with respect for human dignity. Indeed,
the legislative system for occupational health and safety balances physical and psychological integrity
against costs of prevention. Indeed, in the resources industries, financial considerations appear to commonly
outweigh worker safety. The 2010 Pike River mine explosion, in which 29 men died, is an egregious
example of the quotidian hazards many New Zealand workers face and the ways in which health and safety
seem to be subordinate to profit.



Accounting and Law Centre, School of Business, Open Polytechnic of New Zealand.

An earlier version of this article was presented as a paper at the New Zealand Labour Law Society Inaugural Conference, Victoria
University of Wellington, Wellington, New Zealand, 2 December 2011. The authors would like to thank those who commented on
the paper, in particular, Dave Feickert.
1

Law v Canada (Minister of Employment and Immigration) [1999] 1 SCR 497 at [5] per Iacobucci J.
Vienna Declaration and Program of Action (25 June 1993), art 5.
3
Human Rights Commission “New Zealand and the International Instruments” (2008) <www.hrc.co.nz>.
2

New Zealand Journal of Employment Relations 37(1): 82-89
In this article, we argue that subordination of respect for human dignity and life to financial considerations
contravenes basic human rights principles, and that the reasonably practicable test for workplace safety usedin the Health and Safety in Employment Act (HSEA) shows insufficient respect for human dignity. If the
dignity and lives of workers are to be taken seriously, a benchmark akin to the proportionality test of humanrights jurisprudence is indicated. This would require express consideration of fundamental human rights
when workplace health and safety measures are instituted. The article is structured as follows: health andsafety issues in the New Zealand workplace are sketched. Then, the applicability of human rights principles
in the workplace is established, using the Pike River mine tragedy as an example. Further, a dignity-based
workplace health and safety test is proposed.

New Zealand’s Hazardous Work Environment
New Zealand has approximately 470,000 workplaces and two million workers (Statistics New Zealand,2010).4 In the 12 months to June 2011, 85 workplace deaths, 445 serious non-fatal injuries and 30,800
workers‟ compensation events were recorded.5 Around 9,600 incidents are reported to the Department ofLabour (DoL) annually. 6 Occupational disease is estimated to cause an additional 700-1,000 deaths, and
17,000-20,000 new cases occur each year.7 The Accident Compensation Corporation (ACC) pays out
approximately half a billion dollars a year for work related claims. 8 Injury statistics show certain industry
sectors have a high incidence of injury claims and fatalities, and the DoL, in its Workplace Heath and Safety
Strategy, has highlighted agriculture, forestry and fishing, construction and manufacturing in this regard.9(Mining was omitted to allow the Department to take into account the outcome of various official
investigations and the Royal Commission, 2011.) Underground mining epitomises a very hazardous industry
and has a history of “low frequency high consequence events” that result in multiple fatalities – 204 deaths
between 1850 and 1998 out of 1,096 deaths in the mining industry.10 While underground mining isuniversally hazardous, New Zealand‟s mining fatality rate is markedly worse than obvious comparators,
notably Australia and the United Kingdom. 11

Reasonably practicable test
Workplace health and safety in New Zealand legislation uses a basic criterion of practicability. HSEA
provides:12
In this Act, all practicable steps, in relation to achieving any result in any circumstances, means
all steps to achieve the result that it is reasonably practicable to take in the circumstances, having
regard to –(a) the nature and severity of the harm that may be suffered if the result is not achieved; and4

Statistics New Zealand “New Zealand Business Demography Statistics: At February 2010” (2010) <www.stats.govt.nz>.
Department of Labour “The State of Workplace Health and Safety in New Zealand” (2011) <www.dol.govt.nz>.
6
Ibid.
7
Tim Driscoll and others “The Burden of Occupational Disease and Injury In New Zealand” (2004) National Occupational Healthand Safety Advisory Committee <www.nohsac.govt.nz>.
8Department of Labour, above n 6.
9
Department of Labour “Workplace Health and Safety Strategy for New Zealand to 2015, National Action Agenda 2010-2013”2011 <www.dol.govt.nz>.
10
N Gunningham and D Neal “Review of the Department of Labour‟s Interactions with Pike River Coal Limited 4 July 2011”(2011) Department of Labour <www.dol.govt.nz>; K Warne “A Time to Remember, a Time to Question” (2011) 107 New
Zealand Geographic 36, 36-39.
11
National Occupational Health and Safety Commission Occupational Injuries – How Does Australia Compare Internationally?
(Canberra, 2004).
12
Health and Safety in Employment Act 1992, s 2(a)(1).
5

New Zealand Journal of Employment Relations 37(1): 82-89(b) the current state of knowledge about the likelihood that harm of that nature and severity will
be suffered if the result is not achieved; and(c) the current state of knowledge about harm of that nature; and(d) the current state of knowledge about the means available to achieve the result, and about thelikely efficacy of each of those means; and(e) the availability and cost of each of those means. [Emphasis added]
It is noteworthy that, first, despite establishing a practicable test, this benchmark is qualified andrendered a „reasonably practicable‟ test; and, second, cost is included in the same calculus as risk ofharm to human health or life.
The terms „practicable‟ and „reasonably practicable‟ are obviously different. Thus, in Marshall v Gotham Co
Ltd,13 Lord Reid observed “there may well be precautions which it is „practicable‟ but not „reasonably
practicable‟ to take…if a precaution is practicable it must be taken unless in the whole circumstances thatwould be unreasonable”. Following Asquith LJ in Edwards v National Coal Board:14„Reasonably practicable‟ … seems to me to imply that a computation must be made by theowner, in which the quantum of risk is placed on one scale and the sacrifice involved in themeasures necessary for averting the risk (whether in money, time or trouble) is placed in theother; and that if it can be shown that there is a gross disproportion between them – the risk
being insignificant in relation to the sacrifice – the defendants discharge the onus on them.
To reiterate, profits and the risk of workers‟ death or injury are elements of a calculus, and must bebalanced.
John Hansen J observed in Buchanans Foundry Ltd v Department of Labour,15 under a reasonably
practicable test, employers are not expected to provide “a certain, complete protection against all potential
hazards”. Furthermore, it is context specific so that:16…what is reasonably practicable for a large organisation employing safety officers or engineers
contracting for the services of a small contractor on routine operations may differ markedly fromwhat is reasonably practicable for a small shopkeeper employing a local builder on activities on
which he has no expertise. The nature and gravity of the risk, the competence and experience of
the workmen, the nature of the precautions to be taken are all relevant considerations.
Deciding whether a particular course of possible action is reasonably practicable involves a weighing of thecosts against the benefits, and will be a matter of fact in each situation. And so, while protection should be
provided against the ordinary risks associated with a particular, hazardous activity, 17 in Marshall v Gotham
Co Ltd,18 it was held that it was not reasonably practicable for the employer to strengthen mine workings toprotect against an unusual geographic fault when the cost would have closed the mine. In Department ofLabour v Hanham and Philp Contractors Ltd, Randerson and Pankhurst JJ, discussing the judge‟ssentencing notes in the District Court, observed:19

13

Marshall v Gotham Co Ltd [1954] AC 360 at 373.
Edwards v National Coal Board [1949] 1 KB 704 at 712.
15
Buchanans Foundry Ltd v Department of Labour [1996] 3 NZLR 112 at 116.
16
Department of Labour v Solid Timber Building Systems New Zealand Ltd HC Rotorua AP464/44/2003, 7 November 2003 at[31].
17
Akehurst v Inspector of Quarries [1964] NZLR 621.
18
Marshall v Gotham Co Ltd [1954] AC 360.
19
Department of Labour v Hanham and Philp Contractors Ltd [2008] 6 NZELR 79 at [95].
14New Zealand Journal of Employment Relations 37(1): 82-89…the cessation of mining in area B was a practical step available to Black Reef and one which
could have been simply taken. There would of course have been a cost involved but the financial
position of the company at that time was satisfactory for the next two years.
The critical point here is that the courts appear to have considered the financial position of the particularmine. If this is a correct consideration, the inference to be drawn is that employees of an undercapitalised
employer might expect lower safety standards than those of a better funded employer.

Dignity and Occupational Safety
Since the UDHR and derivative rights instruments are founded on respect for human dignity, this principle
must be the starting point for understanding the rights declared. This idea is recognised by the New Zealandgovernment. Thus, “[t]he main aim of human rights, whatever the form of government prevalent in any
particular state, is to protect the dignity of all human beings, no matter what their status or condition inlife”.20 Consequently, when UDHR provides that “[e]veryone has the right to…just and favourable
conditions of work”,21 this guarantee ought to be considered first from a perspective of respect for equal
human dignity, as should the right to safe and healthy working conditions guaranteed by the International
Covenant on Economic, Social and Cultural Rights (ICESCR).22 Naturally, then, the International Labour
Organization (ILO), which has become the United Nations‟ specialised agency for promoting human andlabour rights, espouses respect for human dignity. 23 Thus, according to Juan Somavia, ILO DirectorGeneral, “[t]he primary goal of the ILO today is to promote opportunities for women and men to obtaindecent and productive work, in conditions of freedom, equity, security and human dignity”.24
Cultural, economic and social rights were not expected to be immediately achievable. Nevertheless, asignatory State is obliged “to the maximum of its available resources” to achieve “progressively the full
realization of the rights recognized in the present Covenant by all appropriate means”. 25 However, thisbarely qualified obligation to promote dignity in the workplace appears to be diluted significantly by therelevant ILO Convention. Thus C155 Occupational Safety and Health Convention provides:26
Each Member shall, in the light of national conditions and practice, and in consultation with themost representative organisations of employers and workers, formulate, implement andperiodically review a coherent national policy on occupational safety, occupational health andthe working environment. [Emphasis added]
Furthermore:
The aim of the policy shall be to prevent accidents and injury to health arising out of, linked withor occurring in the course of work, by minimising, so far as is reasonably practicable, thecauses of hazards inherent in the working environment. [Emphasis added]

20

Ministry of Foreign Affairs and Trade The New Zealand Handbook on International Human Rights (Wellington, 2008) at 10.
Universal Declaration of Human Rights (10 December 1948), art 23(1).
22International Covenant on Economic, Social and Cultural Rights (opened for signature 16 December 1966, entered into force 3
January 1976), art 6.
23
For a history of the ILO, see M Wilson “ILO – Role of New Zealand Government: Reflections of a Former Minister of Labour”(2010) 35(3) NZJER 6.
24
International Labour Organization “Mission and Objectives” (1996-2011) <www.ilo.org>.
21

25

ICESCR, above n 23, art 2.
C155 Occupational Safety and Health Convention (opened for signature 3 June 1981, entered into force 11 August 1983), art
4(1).
26

New Zealand Journal of Employment Relations 37(1): 82-89
Thus, partly through the agency of the ILO, an all encompassing respect for human dignity in the workplaceis adulterated by what is reasonably practicable to achieve under national conditions. ILO conventions havedifferent roots from the UDHR;27 both are concerned with social justice, but the former is specifically about
workers‟ rights while the latter essentially concerns what it is to be a human being. Informed by the ILO
conventions, respect for dignity in the workplace tends to be reduced to the narrow sense of freedom frombullying or harassment.28 These are, of course, critical workplace issues, but health and safety is a far
broader consideration than those particular ways of devaluing human beings. Indeed, all employment
relations should start from respect for the human person. The most obvious way of devaluing a human being
in the workplace is to discount the worth of their life and health.
Writing from a Christian moral philosophical standpoint, specifically Roman Catholic theology, Angelini
outlines the moral principles that should inform measures to prevent occupational injuries and illnesses.29
These principles include: a precise concept of the worker as a human with dignity, not merely a means of
production; a clear acknowledgment of fundamental human rights including the right of workers to
employment in a production system that does not endanger their physical welfare or jeopardise their moral
integrity; and a complete vision of prevention including the capacity to find a balance between absolute
principles and concrete reality through the determination of acceptable risk.30 This approach, which isconsistent with the Thomist conception of interdependent, vulnerable individuals living in the society ofothers,31 appropriately captures respect for human dignity in a health and safety context. Similarly,
Papadopoulos et al. argue that health and safety must be approached as “the promotion and maintenance at
the highest degree of physical, mental and social well being of workers, and not only as retention of theirwork ability”. 32
We have argued so far that management, the holders of “command power”,33 must respect workers‟ dignity;
but workers must also protect and promote their physical and psychological integrity. For Kant, whose
conception of dignity predominates in European thought, “human beings are possessed of a will and arecapable of exercising it freely”.34 This capacity “is most fundamental to the dignity and worth of humanbeings because it distinguishes humans from other animals and elevates them above the realm of causally
determined nature”.35 Consequently, in the context of workplace health and safety, the worker must behave
as an autonomous bearer of human rights, and this expectation has, to some extent, been incorporated into
the HSEA.
Two further issues are worthy of consideration in relation to autonomy. The first is an apparent “false
consciousness” around the naturalness of certain risks in the mining industry. Hall identifies an “economicsof risk theme” in which cost and productivity considerations have a necessary and ongoing influence on thetype and level of risks that both managers and miners “voluntarily” accept.36 Second, workers‟ own
disregard for self may lead to a degree of paternalism being incorporated into the reasonably practicable test.
Thus, the duty requires employers to anticipate “irrational, unwitting, intentional or unthinking” behaviour

27

Contrast Wilson, above n 24; J Maritain The Rights of Man and Natural Law (trans Doris C Anson) (G, Bles, London, 1945).
See Department of Premier and Cabinet “M2007-02 Dignity and Respect: Policy and Guidelines on Preventing and Managing
Workplace Bullying” (2011) <www.dpc.nsw.gov.au>.
29
M Angelini “Ethical Behavior for the Prevention of Injuries in the Workplace” (1987) 30 Ergonomics 231-237. The influenceof social Catholic thinking on human rights instruments is significant: see Maritain, above n 28.
30
Angelini, above n 30, cited in E Kapp and K Parboteeah “Organizational Ethical Climate and Safety Performance” (2008) 53(7)Professional Safety 28-31.
31
D Bigongiari (ed) The Political Ideas of St Thomas Aquinas (Hafner Press, New York, 1953).
32
G Papadopoulos and others “Occupational and Public Health and Safety in a Changing Work Environment: An Integrated
Approach for Risk Assessment and Prevention” (2010) 48 Safety Science 943-949.
33
O Kahn-Freund Labour and the Law (2 ed, Stevens & Sons, London, 1977) at 9.
34
S Mulhall & A Swift Liberals and Communitarians (Blackwell, Oxford, 1995) at 43.
35
Ibid.
36
A Hall “The Ideological Construction of Risk in Mining: A Case Study” (1996) 22 Critical Sociology 93-116.
28

New Zealand Journal of Employment Relations 37(1): 82-89
by employees,37 and to protect employees from “temptation”.38 Such self-disrespect and reactive paternalism
cannot be reconciled with a model of the dignified, autonomous worker.

Towards a Proportionality Test
If workplace health and safety were approached from a human rights perspective rather than a practicability
perspective, some form of proportionality test would be more appropriate than the current reasonably
practicable test. Proportionality testing, which assesses the rationality of measures adopted to pursue alegitimate objective, has already been incorporated into New Zealand‟s human rights jurisprudence.39
Consideration is given to impairment of rights, and to the justifiability of any deleterious effects arising fromthe course of action.40
In a context of workplace health and safety, pursuing a legally permitted business activity may be presumed
to be a legitimate objective. However, then focus must turn to the impact on individuals‟ rights(encapsulated in respect for dignity) and the justifiability of, say, risks posed to workers by carrying on thebusiness activity. In particular, alternatives should be considered. These alternatives may include refraining
from the particular activity if workers‟ rights are disproportionately affected. This would be the fundamental
distinction in practice between practicability and proportionality: when human rights are taken seriously,
profit cannot outweigh concerns for human dignity and life. The analogy may be drawn here with a supreme
court in a jurisdiction with an entrenched bill of rights, which may strike down a disproportionate law; so a
disproportionately risky activity would not be permitted.41
How would the proportionality test work in practice? Let us assume that Alpha Ltd wishes to engage inunderground mining in an area of geological instability in the West Coast of New Zealand. The reasonably
practicable test would require consideration of harm; knowledge, means available, their availability and cost.
It is well known that underground mining presents extraordinary risks, and that New Zealand mines havelower safety standards than, for example, Queensland mines which “set a higher benchmark and [require]higher standards in the terms of operations, especially in regard to safety and health”.42 However, if the best
available safety measures were implemented, Alpha might not be profitable and so would not carry on theactivity. Under the practicability test, it seems that Alpha must do the best it can within its means, even if
this results in workers facing greater risks than they would if Alpha had more capital or if the mining
activity were carried on in, say, Queensland. In contrast, a proportionality test would focus on the impact onhuman rights. A conclusion that Alpha cannot afford Queensland-style safety standards but may still carryon its activities would appear to have a disproportionate effect on workers‟ basic human rights.
Despite its focus on rights, proportionality testing does not operate in an abstract realm where money andbudgetary constraints do not exist.43 However, when dignity is taken seriously, human beings can never beconsidered a means to an end, or a mere factor of production.

Possibilities
37

See, for example, Mair v Regina Ltd DC Dunedin CRN-304-500-4405, 4 March 1994.
See, for example, Tranz Rail Ltd v Department of Labour [1997] ERNZ 316.
39
M Taggart “Proportionality, Deference, Wednesbury” [2008] NZ Law Review 423.
40
R v Oakes [1986] 1 SCR 103.
41
Trade unions have similarly supported a safety case regime requiring regulatory approval before a mine could commence
operation: see Department of Labour “Summary of Public Submissions of Discussion Paper: Improving Health and Safety Hazard
Management in the Underground Mining Industry” (2008) <www.dol.govt.nz>.
42
Royal Commission on the Pike River Coal Mine Tragedy “Transcript of Phase Two Hearing Held on 6 September 2011 at
Greymouth” (2011) at 1121 <http://pikeriver.royalcommission.govt.nz>.
43
On the right to life-saving treatment in the face of finite health budgets: see, for example Soobramoney v Minister of Health(KwaZulu Natal) 1998 (1) SA 765 (CC).
38

New Zealand Journal of Employment Relations 37(1): 82-89

For Helen Kelly, Council of Trade Unions president, the rate of workplace injuries and deaths in New
Zealand is “shocking” and “appalling”, especially in the mining sector.44 The Pike River mine disaster haslaid bare the risks that workers in the mining industry, in particular, face. Peter Sattler, an Australian mining
safety specialist described New Zealand health and safety processes as “backward” compared with
Australia, and, on complaining to Pike River mine management was told, “you‟re not in Australia, you‟re in
New Zealand” where, for example, “there were no strict rules limiting who could touch anything electrical,
despite the increased fire risk in a coalmine”. 45 Sattler also observed that “monitoring systems to detect
highly-explosive methane gas were lacking, and Queensland‟s compulsory tube bundling system, which„sniffs‟ the air to find out what kind of gases are present, didn‟t exist at Pike River”. 46 A previous minemanager had proposed a tube bundling system for the Pike River mine at a purchase cost of $980,000$1,000,000 and then investigated a leasing alternative, but the proposals were deferred for consideration by
the company to April 2011 because of budgetary issues. 47 Media reports overwhelmingly indicate that thetragedy resulted from cost concerns trumping workers‟ health and safety. 48 It is also notable that the laxity at
the Pike River mine does not appear to be anomaly: both Burkes Creek mine and Roa mine were shown not
to comply with health and safety.49
Kelly attributes New Zealand‟s high rate of occupational death and injury to a culture of “deference” toemployers; she says “[w]orkers don‟t challenge, don‟t ask. They shut up because they are grateful for ajob”.50 Such subordination would undermine health and safety: as Haworth observes, “the employee
participation dimensions of the [HSEA] are particularly important for building a workplace-level cooperative partnership around [health and safety]”.51
Dave Feickert, a mines safety consultant, argues that the critical health and safety problem is structural
rather than inter-personal:52
The tragedy at Pike River will come to be seen as another market failure, I believe. The
professional mines inspectorate and the regulatory system that we inherited from the UK, alongwith Australia, was abolished in the 1990s, along with the worker safety inspectors, elected by
the men from among experienced miners. The industry was moved to self-regulation. Pike River
represents a spectacular failure of self-regulating companies in a high-risk industry. Why weallowed an economic theory of business competition to persuade us that competing companies
would co-operate on mine safety is something else I will never fathom.
Both Kelly‟s and Feickert‟s conclusions can also be explained by insufficient respect for basic human rights
principles. On the one hand, everyone‟s dignity ought to be respected “no matter what their status orcondition in life”,53 but, if workers must trade off their safety for the sake of employment, that fundamental
equality imperative is discounted. On the other hand, the dominance of market imagery and theory leads to
work
and,
indeed,workers
themselves,
becoming
conceivedas44

J Weir “Rate of Workplace Injuries and Deaths Falls, but Still Shocking, Says Union Leader” The Dominion Post (New
Zealand, 20 October 2011) at C1.
45
T McLean “Aussie Miner „Shocked‟ by Doomed NZ Mine” The Sydney Morning Herald (Australia, 16 June 2011).
46
Ibid.
47
Royal Commission on the Pike River Coal Mine Tragedy, above n 43, at 1186, 1189 and 1192.
48
See, for example, O Carville “Pike River Mine‟s Safety Systems Failed Repeatedly” (2011) Stuff <www.stuff.co.nz>.
49
B Garland and T Watson “Mine Safety - Audit Report Burkes Creek Mine” (2011) Department of Labour <www.dol.govt.nz>;
B Garland and T Watson “Mine Safety - Audit Report Roa Mine” (2011) Department of Labour <www.dol.govt.nz>.
50
Weir, above n 45.
51
N Haworth “Beyond the Employment Relationships Act: The Wider Social Agenda for Employment Relations and Social
Equity in New Zealand” in E Rasmussen (ed) Employment Relationships: New Zealand’s Employment Relations Act (Auckland
University Press, Auckland, 2004) at 198.
52
D Feickert “Mine Safety Policy Failed Us” The New Zealand Herald (New Zealand, 12 July 2011).
53
Ministry of Foreign Affairs and Trade, above n 21, at 10.

New Zealand Journal of Employment Relations 37(1): 82-89
a commodity like any other and obey[ing] exactly the same rules” of supply and demand.54 It is noteworthy
that the Declaration of Philadelphia 1944 concerning the aims and purposes of the ILO declared as its firstprinciple, “Labour is not a commodity”.55 Respect for human dignity demands that people lives and healthare excluded, as far as possible, from a market calculus.
A conceptual shift in the focus of workplace health and safety from practicability to respect for dignity andproportionality is not, in itself, likely to dramatically impact on occupational injuries. By analogy, citizens ofcountries with entrenched bills of rights do not necessarily enjoy more freedoms and protections than those
without recourse to charters. That depends greatly on the institutions of government, and respect for andenforcement of the rule of law. 56 Likewise, without fundamental attitudinal and behavioural shifts, aproportionality test might prove no more effective than a reasonably practicable test. Conversely, areasonably practicable test might be formulated that appropriately subordinates the role of money. Thus,
Australia‟s Model Work Health and Safety Bill provides:57
In this Act, reasonably practicable, in relation to a duty to ensure health and safety, means thatwhich is, or was at a particular time, reasonably able to be done in relation to ensuring health andsafety, taking into account and weighing up all relevant matters including:(a)the likelihood of the hazard or the risk concerned occurring; and(b)the degree of harm that might result from the hazard or the risk; and(c)what the person concerned knows, or ought reasonably to know, about:(i)the hazard or the risk; and(ii)ways of eliminating or minimising the risk; and(d)the availability and suitability of ways to eliminate or minimise the risk; and(e)after assessing the extent of the risk and the available ways of eliminating or
minimising the risk, the cost associated with available ways of eliminating or
minimising the risk, including whether the cost is grossly disproportionate to the risk.
[Emphasis added]
Nevertheless, just as bills of rights “translate into discernible differences in the shape and potency of humanrights discourse in terms of its capacity to defend and extend human rights values”, 58 so of respect for humandignity and life as a starting point for employment relations would inform all discourse on workplace healthand safety.

Conclusion
Having the 23rd worst workplace death rate among developed countries, 59 New Zealand‟s general
performance in protecting its workers‟ physical and psychological integrity is self-evidently poor; in theunderground mining sector, it is appalling. Despite certain progressive features, notably employee
involvement, the HSEA, in using its particular reasonably practicable test, facilitates the subordination ofhuman dignity to profit. This outcome is incompatible with New Zealand‟s obligations as a human rights
State. Commitment to international human rights conventions requires respect for human dignity to inform
employment relations, especially workplace health and safety. Replacing the current reasonably practicable
test with a proportionality benchmark would be a significant step towards meeting that commitment.
54

W Hutton The State We’re In (Jonathan Cape, London, 1995) at 99.
Wilson, above n 24, at 6.
56
J McLean “Legislative Invalidation, Human Rights Protection and s 4 of the New Bill of Rights Act” [2001] New Zealand Law
Review 421-448.
57
Model Work Health and Safety Bill 23 June 2011 (Cth), cl 18.
58
L McNamara Human Rights Controversies: the Impact of Legal Reform (Routledge-Cavendish, Abingdon, 2007) at 262.
59
P Hämäläinen, KL Saarela and J Takala “Global Trend According to Estimated Number of Occupational Accidents and Fatal
Work-Related Disease at Region and Country Level” (2009) 40(2) Journal of Safety Research 125-139.
55

New Zealand Journal of Employment Relations 37(1): 90-99

New Zealand and the Proposed Australian Model Workplace Healthand Safety Act
LEEANNE TEMPLER*
Introduction
This paper compares the scope and coverage of the proposed Australian Model Workplace Healthand Safety Act (MWHS Act) with the New Zealand Health and Safety in Employment Act 1992
(HSE Act). It contrasts broader coverage of “workers” and “others” under the primary duties of the
MWHS Act, including volunteers, children and other people in the workplace with coverage underthe HSE Act. It identifies other key points of difference, including:(a) Key “General” or “Primary” Duties of the HSE and MWHS Acts;(b) The Requirement for Risk Management;(c) Directors’ and Officers’ Duties; and(d) Consultation, Worker Participation and Discrimination / Victimisation.

The Scope of “General” or “Primary” Duties
Key General or Primary Duties
The MWHS Act imposes very broad duties in comparison with the HSE Act, some of which seemvery open-ended and undefined.1 The new duties pursuant to the MWHS Act will be held by a“Person Conducting a Business or Undertaking” (PCBU) rather than an “Employer” pursuant to the
HSE Act.
The “General” or “Primary” Duties are to protect the health and safety of “employees” (in the HSEAct) or “workers” (in the MWHS Act), framed in terms of what is “reasonably practicable.”
Section 19 of the MWHS Act provides that a PCBU must ensure, as far as is reasonably practicable,
the health and safety of workers who are: 2(a) directly engaged to carry out work for their business or undertaking;(b) placed with another person to carry out work for that person; or(c) influenced or directed in carrying out their work activities by the person, while workers areat work in the business or undertaking.
Pursuant to s 19(2), a PCBU must also ensure, as far as is reasonably practicable, that the health andsafety of other persons is not put at risk from work carried out as part of the business orundertaking. The employer’s primary duty under the HSE Act does not extend to “other persons”*

LLM Student, Faculty of Law, Victoria University of Wellington
Section 16 of the HSE Act limits general duties to a warning for some non-employees. See also Department of Labourv Berryman [1996] DCR 121; River Valley Adventures v Maritime NZ HC Palmerston North CRI 2010-454-15, 17
December 2010; Department of Labour v Dominion Bookbinders Ltd DC Manukau CRI 2009-092-503893, 31 March
2010. See also ss 16 and 18 HSE Act regarding contractors, subcontractors and their employees.
2
SafeWork Australia “Explanatory Memorandum – Model Work Health and Safety Bill 2010” (2010) at [77]<www.safeworkaustralia.gov.au>.
1New Zealand Journal of Employment Relations 37(1): 90-99
like the duty in the MWHS Act. Rather, s 15 of the HSE Act merely sets out that every employer
shall take “all practicable steps” to ensure that no action or inaction of any employee while at workharms any other person.
The key things a person must do to satisfy the duty of care are listed, and includes providing andmaintaining a work environment without risks to health and safety, and provision and maintenanceof safe systems of work and safe plant and structures. The phrase “put at risk” is similar to “expose
to risks.” A United Kingdom case applying duties not to “expose [the public] to risks” has held thatbacteria causing legionnaire’s disease which escaped from a cooling tower could expose membersof the public within 450 metres to risks to their health and safety. The prosecutor did not have toshow that members of the public actually inhaled the bacteria, it was sufficient that there was a risk
the bacteria were in the 450m range.3 The HSE Act would probably not allow this outcome as therequirement is that the hazard does not harm any person therefore, actual harm must be proven.
A limiting factor in the MWHS Act may be the Object of the Act of “protecting workers and others
against harm…through the elimination and minimisation of risks.” This may be interpreted as
requiring actual harm to be shown in order to obtain a remedy pursuant to the MWHS Act. Section
17 of the MWHS Act sets out that a duty imposed on a person to ensure health and safety requires
the person to eliminate risks to health and safety so far as is reasonably practicable, and if it is notreasonably practicable to eliminate risks to health and safety, to minimise those risks as far as isreasonably practicable.
Duty of a “Person Who Controls a Place of Work”
Pursuant to s 20 of the MWHS Act, a “person with management or control of a workplace” mustensure so far as is reasonably practicable that the workplace, the means of entering or exiting theworkplace and anything arising from the workplace are without risks to the health and safety of any
person. Section 20 also makes it clear that the duty holder may control the place of work in whole
or in part.
Section 16 of the HSE Act provides considerable divergence from the levels of protection under the
MWHS Act. Pursuant to s 16, a person who controls a place of work must take all practicable steps
to ensure that no hazard that is or arises in the place harms people in the vicinity of the place(including people in the vicinity of the place solely for recreation or leisure) or people who arelawfully at work in the place. People who are at the place of work with the express or implied
consent of the person who controls the place of work, and have paid the person to be there orundertake activity there, or are there to undertake activities that include buying or inspecting goods,
are protected in the same way as people lawfully at work in the place.
A person who controls a place of work must only take all practicable steps to warn other people
who have been expressly authorised to be in the place of work; and people who are working at theplace of work under the authority of any enactment of any significant hazard that is or arises in theplace of work. This hazard must also arise from work that is or has been carried out for gain or
reward in the place of work and not, in the ordinary course of events, be reasonably expected to be
in or likely to arise in a place of work of that type. The person controlling a place of work musthave also oral advice of the presence of the above people.
There is no duty in respect of any person who is in the place of work solely for the purposes ofrecreation and leisure. This leads to the odd situation in which people in the vicinity of the place of
3

Richard Johnstone “Paradigm Crossed? The Statutory Occupational Health and Safety Obligations of the Business
Undertaking” (1999) 12 AJLL 73 at 82.

New Zealand Journal of Employment Relations 37(1): 90-99
work are offered greater protection than to those working at the place of work pursuant to anenactment or who have been expressly authorised to be there, and those people who are there solely
for the purposes of recreation and leisure.
The original s 16 imposed on every person, who controlled a place of work (not being a home
occupied by the person), a duty to take all practicable steps to ensure that people in the place ofwork and people in the vicinity of the place of work were not harmed by any hazard that was orarose in the place of work.4 Following the case of Department of Labour v Berryman, there wasconcern about the extent of farmer liabilities. In that case, a farmer was prosecuted under the HSE
Act after a beekeeper was killed when his truck went through a bridge maintained by the
Berrymans. Hughes points out that there is now a lacuna in protection given to children andvolunteers.5
He makes the point that a farmer would not usually be liable to warn authorised recreational visitorsof “natural” hazards which do not arise from work, but would be liable to warn such people ofsignificant hazards created through work activity, such as spray drift. He notes that trespassers,
visitors to public facilities such as council parks, reserves and public hospitals and school grounds
outside school hours are excluded. He also comments that children are not generally protectedunder the HSE Act while visiting workplaces. 6
The limiting requirement for “control” pursuant to the HSE Act
The definition of “control” also limits the general duties under the HSE Act. Cases such as River
Valley Adventures v Maritime New Zealand7 and Department of Labour v Diveco Limited8 havestrictly interpreted the “control” requirement in the duty held by persons controlling a place of work
pursuant to s16. In the River Valley Adventures case, an experienced river rafting guide drowned
after two rafts collided in a set of dangerous rapids. One of the charges against River Valley
Adventures was not “being in control of a workplace and failing to take all practicable steps toensure that no hazard arose which harmed people.”
In relation to the latter charge, the Court referred to the case of Department of Labour v Diveco
Limited in which a diver supplied by the defendant company suffered decompression illness aftercollecting sediment samples from the seabed. The Court of Appeal held that controlling a place ofwork requires something more than mere occupation of a particular area for a short period of timein circumstances where the occupier does not assert and has no right to exclude others from thearea.9In reliance on the authority of the Diveco case, the Court in River Valley held that the length andnature of occupation of the place and the fact that River Valley did not and could not control theflow or conditions or who used or went through the rapid were relevant considerations. River
Valley did not control the rapid as it could not give directions in relation to it, nor exercise authority
over it.10

4

John Hughes, “Public Safety in Places of Work” [1998] ELB 46. See also John Hughes “Volunteers under the Healthand Safety in Employment Act 1992” [2003] ELB 43 at 45.
5
Ibid at 48.
6
Ibid at 50.
7River Valley Adventures v Maritime New Zealand HC PMN CRI 2010-454-15, 17 December 2010.
8
Department of Labour v Diveco Limited (2004) 2 NZELR 72 (CA).
9River Valley Adventures v Maritime New Zealand HC PMN CRI 2010-454-15,17 December 2010 at [28].
10Ibid, at [45]-[46]. However see also Department of Labour v Dominion Bookbinders Ltd DC Manukau CRI 2009092-503893, 31 March 2010.

New Zealand Journal of Employment Relations 37(1): 90-99
However in contrast to the above decisions, Department of Labour v Dominion Bookbinders Ltd11
held that a gate was a place of work under the control of the defendant. In that case, the young
child of a part-time cleaner at the defendant’s premises was killed when a gate fell on her.
Dominion Bookbinders was charged under s 15 with failing to take all practicable steps to ensurethat no one was harmed by any action or inaction of one of its employees while at work. Dominion
Bookbinders argued that the gate was not under its control because the gate was not the employee’s
place of work, and Dominion Bookbinders only had the right to use the gate under the terms of its
lease. Further, it was argued that since the first defendant was not legally obliged to maintain thegate, it could not be said to have been “in control” of it.12
The decision in Berryman was notable since the gate was not a “transitory” place but a fixedlocation and subsequent legislative amendments widened the definition. The Diveco decision was
also notable since the emphasis on exclusive possession or occupation in that decision was seen tohave stemmed again from the transitory nature of the seabed. However, the Court held that, because
the gate was intended as part of the first defendant’s lease, it could be deemed to be a lessee of thegate. As occupier, the first defendant had the right to use the gate and to pass through it. In addition,
there was physical control over the gate and an element of exclusivity arising from possession of a
key and the power to prevent passage through the gate and entry to its premises. The gate was held
to be a place of work, over which the first defendant had control for the purposes of the HSE Act.
In Australia, the position is quite different. As stated above, s 20 of the MWHS Act makes it clearthat a duty holder may control the place of work in whole or in part. The cases on the definition ofcontrol confirm that more than one person may have control over a workplace at one time andcontrol may shift from one person to another.13 In addition, a workplace is defined in s 8 as
including a vehicle, vessel, aircraft or other mobile structure and any waters and any installation onland, on the bed of any waters or floating on any waters. Therefore, the decisions in the Diveco andRiver Valley cases would probably be quite different had the incidents occurred in Australia.
Application of the HSE Act to volunteers
In 2002, amendments to the HSE Act created two classes of volunteers. The first is volunteers
doing regular work to whom s 3C of the HSE Act applies and who have limited coverage as“deemed employees.” The second is “other volunteers” who are covered by an unenforceable “dutyof care” under s 3D.14
Under subs (1), s 3C applies if a volunteer does work for another person (i.e: an employer or selfemployed person) with that other person’s knowledge or consent, and the volunteer does the workfor that other person on an “ongoing and regular basis” and the work is an integral part of thebusiness of the other person. The relevant aspects of the HSE Act that apply are ss 6-12, covering
the employer’s general duties in relation to the provision of a safe workplace, s 19 which covers theemployee’s duties in relation to safety, and Part IV, concerning, amongst other things, enforcement.

11

Department of Labour v Dominion Bookbinders Ltd DC Manukau CRI 2009-092-503893, 31 March 2010.
Anderson and others (eds) Mazengarb’s Employment Law (looseleaf ed, LexisNexis) at 6002.15.4.
13Inspector Dall v Brambles Australia Ltd [2006] NSWIRComm 213. National Review into Model Occupational
Health and Safety Laws “Second Report to the Workplace Relations Ministers’ Council” (January 2009) at 70. See
also McMillan Britton & Kell Pty Ltd v WorkCover Authority (NSW) (1999) 89 IR 464 at 480, WorkCover Authority(NSW) (Inspector Callaghan) v Rowson (unreported, Industrial Relations Commission, NSW,CT93/1156, 30 June
1994), referred to in McMillan Britton & Kell Pty Ltd v WorkCover Authority (NSW) (1999) 89 IR 464 at 479;
WorkCover (NSW) v Rowson [1994] NSWIRC 76.
14John Hughes “Volunteers under the Health and Safety in Employment Act 1992” [2003] ELB 43 at 45.
12

New Zealand Journal of Employment Relations 37(1): 90-99
Section 3C does not apply to a volunteer participating in a fundraising activity or assisting withsports and recreation for a sports club, a recreation club, an educational institution, assisting withactivities for an educational institution outside the premises of an educational institution orproviding care for another person in the volunteer’s home. These people are covered by s 3D,
together with volunteers who fail the test of “ongoing and regular” work under s 3C (1).15
The application of the MWHS Act to volunteers
Pursuant to s 7(1) a “worker” is defined as carrying out work in any capacity for a person
conducting a business or undertaking, including work as a volunteer. However, pursuant to s 5 (9)of the MWHS Act, a volunteer association does not conduct a business or undertaking for the
purposes of that Act. A volunteer association is defined in s 5(8) as a group of volunteers working
together for one or more community purposes where none of the volunteers, whether alone or
jointly with any other volunteers, employs any person to carry out work for the volunteer
association.
Therefore, the situation in Australia is quite different; there is no lacuna in protection for people
whose volunteer work is not “ongoing and regular” when voluntary work is done for a PCBU. The
authors of a leading text on the MWHS Act believe that it should be amended to provide clearer
guidance as to when a charitable, social or sporting organisation may be considered to be a PCBU.
They believe that provision for an exemption for an organisation or specific activities may be one
way of achieving an appropriate balance between the need to ensure safety at work while notdiscouraging charitable or social activities.16

The Requirement for Risk Management
Both the definition of “all practicable steps” in the HSE Act and the general duties under that Act
have been held by the courts to require “risk assessment”.17 Risks arising from the organisation ofwork, stress and peoples’ behaviour must be assessed as well as those arising from physicalhazards. However, risk management encompasses controlling and preventing the risk and not justassessing it.18 This seems to have been accepted in Gilbert v Attorney-General19 where the Court
stated ss 7 – 10 of the HSE Act set out a minimum hierarchy of action in relation to the eliminationof hazards in the workplace and that complements the general duty to take “all practicable steps.”
The requirement for risk management is likely to be confusing and unclear to many employers as
the word “risk” is not used in the HSE Act, and neither is the risk management process made clear.
A clearer approach is taken under the MWHS Act. The management/elimination of risks is referred
to in sections 17 and 19. Although it does not specify or require a process of hazard identification
or risk assessment in the Act, it seems to be accepted that the general duties in all Australian
workplace safety acts effectively require duty holders to engage in systematic OHS [risk]
15

Ibid at 45.
Barry Sherriff and Michael Tooma Understanding the Model Work, Health and Safety Act (CCH Australia, 2010) at
23.
17McKee Fehl Constructors Ltd v Department of Labour HC Wellington AP 180/97, 25 September 1997; Cadrona Ski
Resort Ltd v Department of Labour HC Invercargill CRI-2009-425-000016, 11 Sept 2009 at 21.
18
Elisabeth Bluff and Richard Johnstone “The Relationship Between Reasonably Practicable and Risk Management
Regulation” (2005) 18 AJLL 25 at 5.
19
Gilbert v Attorney-General [2000] 1 ERNZ 332; Attorney-General v Gilbert [2002] NZCA 55 at 131. The
requirement for risk assessment and management in cases of workplace stress was further clarified in Rosenberg v Air
New Zealand ERA Auckland, AA 311/09 50500651, September 2009 at [196]; Alo v NZ Customs Service [2012]
NZEmpC 47.
16

New Zealand Journal of Employment Relations 37(1): 90-99
20

management. The legislation instead allows for a process to be established via regulation withguidance from a code of practice.21 The Code of Practice is clear and provides the sort of guidance
that would also assist duty holders in New Zealand.

Directors’ and Officers’ Duties
Pursuant to s 56 of the HSE Act, any directors or agents of a corporate body who “directed,
assented to, acquiesced in, or participated in” any failure to comply with the provisions of the Act isa party to and guilty of the failure.22 The Department of Labour has indicated that they may
prosecute any officer, director or agent of a company “primarily where the person(s) in question had
clear knowledge that the situation in question was unsafe or otherwise contrary to the health andsafety legislation”.23
Cases which have resulted in convictions under this provision include Department of Labour v
Latham Construction,24 Department of Labour v Dominion Bookbinders Ltd,25 and Department ofLabour v Ian Roebuck Crane Hire Ltd.26 The duties of officers and directors are much more
stringent under the MWHS Act than the HSE Act. Clause 27 imposes a positive duty on officers ofa PCBU to exercise “due diligence” to ensure that a PCBU complies with any duty or obligation
under the Act.27 Due diligence is defined in s 4 of the MWHS Act and requires active steps to betaken by the director or officer, taking reasonable steps:(a) To acquire and keep up-to-date knowledge of occupational health and safety matters;(b) To gain an understanding of the nature of the operations of the trade, business or other
undertaking of the corporation and generally of the hazards and risks associated withthose operations;(c) To ensure that the corporation has available, for use and uses, appropriate resources andprocesses to eliminate or minimise risks to health and safety from work carried out aspart of the conduct of the trade, business or other undertaking of the corporation;(d) To ensure that the corporation has appropriate processes for receiving and considering
information regarding incidents, hazards and risks and responding in a timely way to that
information;(e) To ensure that the corporation has and implements processes for complying with any
duty or obligation of the corporation under the relevant provisions of the Act.
However, there have been divergent decisions on the liability of Directors, in Workcover
Authority of NSW (insp Dowling) v Barry John Coster,28 and Inspector Ken Kumar v David
Aylmer Ritchie.29
20

National Review Into Model Occupational Health and Safety Laws “Second Report to the Workplace Relations
Ministers’ Council” (January 2009) at 31.
21
Ibid at 171.
22
Mazengarb above n 12 at 6000.11.
23
Department of Labour Keeping Work Safe 2009.
24
Department of Labour v Latham Construction (2004) Ltd DC Auckland CRN 07004503883, 12 March 2009.
25
Department of Labour v Dominion Bookbinders Ltd DC Manukau, CRI 2009-092-503893, 31 March 2010.
26
Department of Labour v Ian Roebuck Crane Hire Ltd DC New Plymouth CRI-2009-043-1927, 25 November 2009.
27
SafeWork Australia Explanatory Memorandum – Model Work Health and Safety Bill 2010<www.safeworkaustralia.gov.au/ABOUTSAFEWORKAUSTRALIA/WHATWEDO/PUBLICATIONS/Pages/ExplanatoryMemorandum.aspx> at 119.
28
Workcover Authority of NSW (insp Dowling) v Barry John Coster [1977] NSWIRComm 154.
29
Inspector Ken Kumar v David Aylmer Ritchie [2006] NSWIRComm 323. See also National Review into Model
Occupational Health and Safety Laws, above n 20 at 60, quoting M Tooma Tooma’s Annotated Health and Safety Act(2 ed, Thomson Reuters, Sydney, 2004) at 130.

New Zealand Journal of Employment Relations 37(1): 90-99

Consultation, Representation and Discrimination
Both the HSE and MWHS Acts make provision for employee participation through (inter alia) the
election of Health and Safety Representatives (HSRs) and formation of Health and Safety
Committees. This section of the paper will focus on:(a) Consultation requirements;(b) The powers of HSRs; and(c) Discrimination, victimisation and coercion.
The nature and extent of consultation under the HSE and MWHS Acts
Consultation under the HSE Act
The consultation provisions of the HSE Act are included in the section covering general worker
participation. Pursuant to s 19B, there is a general duty to involve employees in health and safety
matters. Pursuant to subs (1), every employer must provide reasonable opportunities for theemployer’s employees to participate effectively in ongoing processes for improvement of health andsafety in the employees’ places of work.
Subs (5) defines reasonable opportunities. Pursuant to s 19C organisations with less than 30 staff
must only have an employee participation system if one or more employees or a union representing
them requires the development of an employee participation system. Unlike the MWHS Act, the
HSE Act does not define the nature of consultation. This has been established by case law. 30 The
Maritime Union case considered consultation requirements. Chief Judge Colgan stated: 31
The length of the consultative process, the numbers of meetings, the discussion of the object
and content of the intended policy, the correspondence between the parties on these topics
and the employer’s preparedness to alter aspects of the policy as suggested by the union, allpoint together to a sufficient consultation, both statutory and contractual. The initial
formulation of the policy by the employers does not mean that there was a failure of
consultation.
Chief Judge Colgan considered that, having consulted about the issue, the defendants were entitledin law to decline to agree with the union’s proposal for ownership of the policy.32
In New Zealand Steel v New Zealand Amalgamated Engineering Printing and Manufacturing
Union Inc,33 the new requirements pursuant to the HSE Act were taken into account. The fact thatthe HSE Amendment Act 2003 extended hazard to include a person’s behaviour was noted. The
Employment Relations Authority was satisfied NZ Steel did not have a fixed mind in relation to thefinal content of the drug and alcohol policy. This was supported by the changes made to theoriginal document and the fact is that the summary of changes set out in the minutes from the final
30

Maritime Union of New Zealand Inc v TLNZ (2007) 5 NZELR 87; NZ Steel Ltd v NZ Amalgamated Engineering
Printing and Manufacturing Union Inc ERA Auckland, BC200770511, 24 July 2001; NZ Amalgamated Engineering
Printing and Manufacturing Union v Air New Zealand Ltd (2004) 2 NZELR 5 at [143]. Both former cases applied
the Air New Zealand case in which the Court agreed to the reasonableness of drug and alcohol testing provisions
depending on whether employees were engaged in safety sensitive areas or operations but left the identification ofthese employees to the parties to determine in consultation.
31
Maritime Union of New Zealand Inc v TLNZ (2007) 5 NZELR 87 at [25].
32
Ibid, at [49].
33
NZ Steel Ltd v NZ Amalgamated Engineering Printing and Manufacturing Union Inc ERA Auckland, BC200770511,
24 July 2001.

New Zealand Journal of Employment Relations 37(1): 90-99
meeting of the joint consultation committee show there were at least 10 key changes made from theoriginal document.34
However, the result in Corrections Association of NZ v Chief Executive of the Department ofCorrections was quite different.35 The case involved the Corrections Department’s decision to
introduce a new roster pattern and other arrangements for staff at Mt Eden and Auckland Central
remand prisons. The Employment Relations Authority held the evidence and established that any
consultation that may have occurred with the Corrections Association was clearly inadequate andthat it was not given a reasonable opportunity to consider the proposal.
On the basis of the preceding decisions, the Courts do not consider the decision whether or not drug
test in safety sensitive areas at all should be a matter for consultation, rather that consultation shouldtake place about which areas of a safety sensitive business should drug test. On the other hand, theCourts have held that any substantial changes to rosters in the prison sector should be the subject of
employee consultation.
Consultation under the MWHS Act
Part 5 of the MWHS Act covers consultation, representation and participation. Employee
participation measures are set out in Division 3-6 relating to Health and Safety representatives.
Pursuant to s 46 of the MWHS Act, if more than one person has a duty, they must consult and cooperate with all other persons who have a duty in relation to the same matter. This duty of“horizontal engagement” is subject to the qualifier of what is reasonably practicable, as defined in s
17 of the MWHS Act.36 Section 47 sets out the duty of a person conducting a business orundertaking to consult so far as is reasonably practicable… with workers who carry out work for thebusiness or undertaking who are, or are likely to be, directly affected by a matter relating to work
health or safety. Both of these duties are enforceable by way of penalties.
Section 48 sets out the nature of consultation, including that relevant information is shared withworkers; workers are given a reasonable opportunity to express their views and raise health orsafety issues in relation to the matter and are able to contribute to the decision making process inrelation to the matter, that workers views are taken into account and they are advised of the outcome
in a timely manner. Pursuant to s 48 (2), consultation must involve the HSR if workers are
represented by one.
This is basically a codification of consultation requirements illustrated in case law. The
requirement to consult does not mean that a PCBU has to reach agreement with other workplaceparticipants on the actions they take for compliance.37 Section 49 sets out the health and safety
matters in respect of which consultation is required. These are:a. when identifying hazards and assessing risks to health and safety arising from thework carried out or to be carried out by the business or undertaking;b. when making decisions about ways to eliminate or minimise those risks;c. when making decisions about the adequacy of facilities for the welfare of workers;
d. when proposing changes that may affect the health or safety of workers;
e. when making decisions about the procedures for:34

Ibid at [63].
Corrections Association of NZ v Chief Executive of the Department of Corrections ERA Auckland AA488/10
5324954, 18 November 2010.
36
Sherriff, above n 16, at 74.
37
Sherriff above n 16 at 68. Cases illustrating the requirement to consult include TVW Enterprises v Duffy (1985) 62
ALR 63; Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union
of Australia and Others v Queensland Rail and Others (2010) 268 ALR 514.
35

New Zealand Journal of Employment Relations 37(1): 90-99
i.
ii.
iii.
iv.

consulting with workers; orresolving work health or safety issues at the workplace; ormonitoring the health of workers; ormonitoring the conditions at any workplace under the management or controlof the person conducting the business or undertaking; orv. providing information and training for workers; orf. when carrying out any other activity prescribed by the regulations for the purposes ofthis section.
This differs from previous legislation and the HSE Act, in that duties to consult under the HSE Act
apply to employers and employees, therefore, excluding people who are outside this relationship.
The HSR has a right to stop unsafe work and to issue provisional improvement notices pursuant to
the new Act. In Western Australia, employers have an obligation to protect the health and safety of
employees through drug testing. The issue was considered in BHP Iron Ore Ltd v Construction,
Mining Energy etc Union of Australia, Western Australian Branch.38
The powers of Health and Safety Representatives
The functions of health and safety representatives are set out in Part 2 (2) of Schedule 1A of the
HSE Act. They include identifying and bringing to the employer’s attention hazards in the place ofwork and discussing with the employer ways the hazards may be dealt with. The MWHS Act gives
broad powers to HSRs under s 68 aimed at facilitating effective consultation and issue resolution,
monitoring the compliance of the PCBU, inspecting the workplace, investigating complaints frommembers of the work group relating to health and safety and inquiring into the risks to the healthand safety of workers in the work group arising from the conduct of the business or undertaking.39
Discrimination
Section 104 of the Employment Relations Act (ERA) 2000 provides that, for the purposes of s103(1)(c) of the ERA, a person is discriminated against (inter alia), or if they refuse to do work
under s 28A of the HSE Act 1992 or involved in the activities of a union. Section 107 sets out thedefinition of involvement in the activities of a union for the purposes of s 104, and this includes an
employee who is representing employees under the HSE Act 1992, whether as a health and safety
representative or otherwise, is to be treated as if he or she were a delegate of other employees forthe purposes of s 107(1)(g).40
The MWHS Act prohibits discrimination in s 104, sets out prohibited reasons in s 106, and what
constitutes discriminatory conduct is set out very clearly in s 105. Discriminatory conduct includes
when a person dismisses a worker, terminates a contract for services, puts a worker to theirdetriment in the engagement of the worker, alters the position of a worker to the worker’s detrimentand fails or refuses to engage a potential worker. Prohibited reasons include the person being,
having been or proposing to be a HSR.41

38

BHP Iron Ore Ltd v Construction, Mining Energy etc Union of Australia, Western Australian Branch [1988]
WAIRComm 130.
39
Sherriff, above n 16, at 82.
40
In Yukich v Carter Holt Harvey [2004] 1ERNZ 78, the plaintiff successfully claimed unjustified constructive
dismissal, although he did not succeed in his discrimination claim.
41
A case which involved discrimination against an Authorised Union Representative and Health and Safety
Representative was Michael Watts v Australia Post [2002] AIRC 1141.

New Zealand Journal of Employment Relations 37(1): 90-99

Conclusion
The WHS and HSE Acts are designed to provide protection from industrial or commercial hazards
and risks that stem from workplaces. Pursuant to these statutes, duties are imposed to protect healthand safety framed in terms of what is “reasonably practicable.” Both statutes protect employees but
the extent to which other types of workers, volunteers and other members of the public areprotected differs markedly. The employer’s primary duties under the HSE Act do not extend to“other persons” like the duty in the MWHS Act. Section 16 creates a complicated and confusing
hierarchy of duties to non-employees. Children and recreational visitors to public facilities are
excluded from coverage pursuant to the HSE Act. Volunteers whose work is not “ongoing or
regular” are excluded from coverage under the HSE Act whereas volunteers are included in thedefinition of worker under the MWHS Act.
While a positive step in many respects, the MWHS Act has been criticised for the resulting
uncertainties created by the wide duties it imposes. The new definition of PCBU together with thebroad approach to what is “workplace related” in the MWHS Act, mean the liabilities of duty
holders will be much wider than under the HSE Act. The MWHS Act explicitly covers work thattakes place in rivers and the sea whereas the HSE Act has been held not to, due to a requirement for
exclusive occupation and control. The MWHS Act also makes it clear a duty holder may control aplace of work in whole or in part. The position in New Zealand is less clear about partial control ofa workplace, although it does depend on the extent of exclusivity of control.
The MWHS Act places greater emphasis on risk management and clarifies this process with acomprehensive regulation and code of practice. The MWHS Act imposes more stringent “duediligence” requirements than the HSE Act on all directors and officers, irrespective of whether they
are directly involved in the management of the company. Consultation and employee participation
are important components of the WHS and HSE Acts. The HSE Act sets out clearly what must be
taken into account when determining reasonable opportunities for employees to participate in the
improvement of health and safety processes at work. The MWHS Act defines the nature of
consultation whereas in New Zealand this has been established by case law. The requirements
under the MWHS Act to consult with multiple duty holders may prove overly onerous andcomplicated.
HSRs in Australia have a function that encompasses greater monitoring of and liaison with PCBUs
whereas the HSE Act includes identification and monitoring of hazards as a HSR function.
Although both the HSE Act and MWHS Act prohibit discrimination against HSRs, the MWHS Act
sets out what constitutes discriminatory conduct more clearly in s105. Australian Courts have also
been historically prepared to enforce anti-discrimination provisions.

New Zealand Journal of Employment Relations 37(1): 100-117

An Evaluation of Whether New Zealand’s Occupational Health and
Safety Law Adequately Addresses the Risks to Workers Exposed to
Nanotechnology and Nanoparticles
JENNIFER MOORE*Introduction
Nanotechnologies use processes to create novel materials and particles sized between one to 100
nanometers, although this metrology is not uncontested.1 Nanoparticles (NPs) have different physical,
chemical and biological properties from their equivalent macro counterparts. There is concern that the
special properties of some nanoscale materials will present unforeseen human and environmental
health and safety risks. 2 Nanoparticles can be categorised as natural or engineered/manufactured.
Naturally occurring NPs include particles in our atmosphere such as salt at the beach. Engineered NPs
are the newer phenomenon of intentionally/deliberately created manufactured nanomaterials (mNMs).
This article is concerned with mNMs.
The key issue explored in this paper is whether New Zealand (NZ) occupational health and safety(OHS) legislation provides adequate protection for workers who are exposed to NPs. I evaluate thesuitability of NZ regulation of NP exposure in the workplace and the current scientific data on
occupational disease attributed to NPs.
Approximately NZ$6 million of public money per annum is invested in nanotechnology research anddevelopment.3 Nanoparticles are used in a broad range of consumer products (nanoproducts) such as
cosmetics, sunscreens, food packaging, paints, textiles and herbal remedies. 4 There are over 1000
manufacturer-identified nanoproducts currently on the market and new nanoproducts are entering themarket at a rapid pace.5 An estimated US$2.6 trillion worth of manufactured goods are expected toincorporate manufactured nanomaterials (mNMs) by 2014.6 The increasing numbers of nanoproducts
are creating occupational exposures, some of which may be harmful to human health.

*

Dr Jennifer Moore is a Research Fellow in the Faculty of Law, University of Otago and a barrister and solicitor of the
New Zealand High Court.
Dr Moore and Associate Professor Colin Gavaghan co-authored the New Zealand government commissioned report on theability of New Zealand‟s regulatory systems to manage the possible impacts of manufactured nanomaterials. This paper isbased on that report.
1

Scientific Committee on Emerging and Newly Identified Health Risks (SCENIHR) Risk Assessment of Products ofNanotechnologies (SCENIHR, EU, January 2009) at 7; Melanie Auffan and others “Towards a Definition of Inorganic
Nanoparticles from an Environmental, Health and Safety Perspective” (2009) 4 Nature Nanotechnology 634.
2
Milind Kandlikar, Ramachandran Gurumurthy and Andrew Maynard “Health Risk Assessment for Nanoparticles: A
Case for Using Expert Judgment” (2007) 9 Journal of Nanoparticle Research 137; Andrew Maynard “Nanotechnology:
The Next Big Thing or Much Ado About Nothing?” (2007) 51 Annuals of Occupational Hygiene 1; Andrew Maynard“Safe Handling of Nanotechnology” (2006) 444 Nature 267; Eva Oberdorster and others “Nanotoxicology: An Emerging
Discipline Evolving from Study of Ultrafine Particles” (2005) 113 Environmental Health Perspectives 823.
3
Ministry of Research, Science and Technology Nanoscience and Nanotechnology Roadmap (MORST, Wellington, 2006)at 28.
4
For further examples of products containing nanomedicines see Nanotechnology Project “Consumer Products: An
Inventory of Nanotechnology-based Consumer Products Currently on the Market” (2011) Woodrow Wilson International
Centre for Scholars <www.nanotechproject.org >.
5
Ibid.
6
Lux Research The Nanotechnology Report (4 ed, 2006).

New Zealand Journal of Employment Relations 37(1): 100-117
Given the potential market for nanoproducts, the occupational exposures and the growing evidence
that “certain applications of nanotechnology will present risks unlike any we have encountered
before”,7 it is important to have adequate regulation of NP exposure in the workplace in order toprevent or minimise adverse public health ramifications.
Workers involved at any point throughout the lifecycle of nanoproducts (from laboratories tomanufacturing facilities) are potentially being exposed to NPs. The exact size of the exposed
workforce in NZ, Australia or the United States (US) is currently unknown, but studies are being
conducted.8 Numerous organisations have highlighted the OHS concerns raised by NPs. For example,
the European Agency for Safety and Health at Work recently identified NPs among the top ten
emerging risks from which workers need protection. 9 The US National Nanotechnology Advisory
Panel concluded that OHS is the most serious and immediate health and safety concern raised by
mNMs.10 The NZ Council of Trade Unions,11 the Australian Council of Trade Unions 12 and theAustralian Manufacturing Workers Union13 have demanded nano-specific regulation of NP exposureand more research into the health risks of NP exposure. Non-government organisations such as the
Friends of the Earth (FoE) have called for a moratorium on the research, development andmanufacture of NPs.14
FoE has warned that nanotechnology could present “a repeat of the asbestos tragedy”15 and,specifically that carbon nanotubes (CNTs), a new form of carbon molecule, may be the newasbestos.16 The Department of Labour‟s annual report on OHS identifies asbestos related cancer as
one of the most prevalent occupational diseases with the highest toll. 17 The similarity between someNPs and asbestos fibres could, therefore, present a significant potential OHS burden.
Despite these potential risks, NZ regulation of workers‟ exposure to hazardous materials does notaddress the specific risks associated with NP exposure in the workplace. Other jurisdictions such as
Australia and the United States face similar regulatory challenges. Reviews initiated by governments

7

Andrew Maynard and ED Kuempel “Airborne Nanostructured Particles and Occupational Health” (2005) 7 Journal of
Nanoparticle Research 587.
8Paul Schulte “Progress in Understanding and Preventing Work Related Disease and Injury from Nanomaterials” (paper
presented to the Global Regulation of Nanotechnologies Conference, Northeastern University United States, 7 May 2010);
Michael Methner and others “Nanoparticle Emission Assessment Technique (NEAT) for the Identification andMeasurement of Potential Inhalation Exposure to Engineered Nanomaterials – Part B: Results from 12 Field Studies”(2010) 7 Journal of Occupational and Environmental Hygiene 163; Kaspar Schmid and others “Nanoparticle Usage andProtection Measures in the Manufacturing Industry – A Representative Survey” (2010) 7 Journal of Occupation andEnvironmental Hygiene 224.
9European Agency for Safety and Health at Work “Report: Expert Forecast on Emerging Chemical Risks Related to
Occupational Safety and Health” (Belgium, 2009) <http://osha.europa.eu >.
10
President‟s Council of Advisers on Science and Technology (Podcast) “The National Nanotechnology Initiative at Five
Years: Assessment and Recommendations of the National Nanotechnology Advisory Panel” (2005) <www.nano.gov>.
11
Letter from the NZ Council of Trade Unions to Jennifer Moore regarding the regulation of workers‟ exposure to NPs (12October 2010).
12Australian Council of Trade Unions “Factsheet: Nanotechnology – Why Unions are Concerned” (2009)<www.actu.org.au >; Hall Ashley “Nanotechnology is the Next Asbestos, Union Says” (2009) ABC News
<www.abc.net.au >.
13
W Birnbauer “Nano Could be a Huge Future Health Crisis” Sunday Age (Melbourne, Australia, 30 October 2005) at 4.
14
Friends of the Earth Australia and Friends of the Earth United States Nanomaterials, Sunscreens and Cosmetics: Small
Ingredients, Big Risks (Friends of the Earth, Sydney, 2006) at 5.
15
Georgia Miller “Nanotechnology Risks a Repeat of the Asbestos Tragedy” Friends of the Earth Australia<www.foe.org.au>.
16
Friends of the Earth Australia Mounting Evidence that Carbon Nanotubes may be the New Asbestos (Friends of the
Earth, Melbourne, Australia, 2008).
17
Department of Labour “The State of Workplace Health and Safety in New Zealand” (2011) <www.dol.govt.nz>.

New Zealand Journal of Employment Relations 37(1): 100-117
in several jurisdictions (the United States,18 England,19 the European Union, 20 Australia21 and NZ22)
have recommended changes to the existing legislation to ensure that the instruments adequately
regulate nanoproducts. Likewise, other commentators have reviewed the suitability of the legislative
status quo and called for amendments. 23
In contrast to the “do nothing” regulatory and policy approach,24 I argue that the inadequacy of thecurrent regulatory regimes for safeguarding human health has been demonstrated. Existing regulations
will “function only as a filter – allowing particles smaller than the relevant pore size to escape throughthe regulatory process”.25 This often occurs because some legislative triggers fail to fire when applied
to workers‟ exposure to NPs.

What are NPs and their potential risks?
Nanoparticles
A NP is a particle with all three external dimensions in the nanoscale: 1-100 nanometers. One
nanometre is one billionth of a metre. Scientists have been working with nanoscale materials for
centuries but the relatively recent development of special microscopes, capable of displaying tiny
particles, has improved researchers‟ ability to work with these materials.
Due to their tiny sizes, NPs have a high surface area to volume ratio. There is an increase in thepercentage of atoms at the surface and, therefore, more sites for bonding or reacting with surrounding
materials. The considerably larger surface area per unit mass increases their potentials forbiopersistence (how long it exists in living tissue) and reactivity. All nanoparticles are „nanosized‟(small) but they are not all the same. They can differ in actual size, shape (some are tubes, others
spheres etc), surface properties (e.g: charge and porosity) and biopersistence. The nano features ofthese particles include not only size, but also other parameters such as shape, surface chemistry,composition, solubility and aggregation.
Approximately 44 elements in the periodic table are commercially available in nano form. 26
Nanoparticles, because of their size and the effect that size has on their other properties, exhibit
different properties from their bulk counterparts. In science, a „property‟ describes how a material acts
18

Food and Drug Administration Nanotechnology – A Report of the US Food and Drug Administration Nanotechnology
Task Force (FDA, Washington DC, 2007); Environmental Protection Agency EPA Nanotechnology White Paper (EPA,
Washington DC, 2007).
19
Quasim Chaudhry and others Final Report: A Scoping Study to Identify Gaps in Environmental Regulation for the
Products and Applications of Nanotechnologies (Department for Environment, Food and Rural Affairs, London, 2006).
20
European Commission Regulatory Aspects of Nanomaterials: Summary of Legislation in Relation to Health, Safety andEnvironment Aspects of Nanomaterials, Regulatory Research Needs and Related Measures (Commission of the European
Communities, Brussels, 2008).
21
Karinne Ludlow, Diana Bowman D and Graeme Hodge A Review of Possible Impacts of Nanotechnology on Australia’s
Regulatory Framework (The Monash Report) (Monash Centre for Regulatory Studies, Melbourne, Australia, 2007).
22
Colin Gavaghan and Jennifer Moore A Review of Possible Impacts of Manufactured Nanomaterials on New Zealand’s
Regulatory System (Faculty of Law University of Otago, New Zealand, 2011) <www.msi.govt.nz>.
23
George Kimbrell “Nanomaterial Consumer Products and FDA Regulation: Regulatory Challenges and Necessary
Amendments” (2006) 3 Nanotechnology Law and Business 329; JC Davies Managing the Effects of Nanotechnology(Woodrow Wilson International Center for Scholars, Washington DC, 2006).
24
Joel D‟Silva and Diana Megan Bowman “To Label or Not to Label? – It‟s More than a Nano-Sized Question” (2010) 4
EJRR 420 at 427. See also LB Moses “Regulating Beyond Nanotechnology: Do Nano-specific Problems Require Nanospecific Solutions?” (2010) IEEE International Symposium on Technology and Society 68, for arguments against enacting
nano-specific legislation.
25
Karinne Ludlow “Nanoregulation – Filtering Out the Small Stuff” (2008) 2 Nanoethics 183 at 184.
26
ETC Group “No Small Matter II: The Case for a Global Moratorium, Size Matters!” 7(1) Occasional Paper Series,(Action Group on Erosion, Technology and Concentration, Canada, April 2003) <www.etcgroup.org>.

New Zealand Journal of Employment Relations 37(1): 100-117
under certain conditions. Examples of properties are: optical (e.g: colour transparency), electrical (e.g:conductivity), physical (e.g: hardness, melting point), chemical (e.g: reactivity). For instance, in termsof optical properties, bulk gold appears yellow whereas nanosized gold appears red. Also, gold as abulk material is nontoxic, but gold particles below two nanometres have shown unexpectedly hightoxicity in a variety of cell lines.27
Examples of mNMs include fullerenes (C60 or Buckyballs), carbon nanotubes and metal oxides. Theseare examples of first generation nanoproducts.28 Subsequent generations of nanoproducts may change
in response to electric fields, light or in the presence of specific molecules. Subsequent generations ofmNMs will create further regulatory challenges because the OHS regulations are not designed to deal
with the novel properties of these new particles, nor are the standard methodologies adequate fortesting nanotoxicity in the workplace.
Defining Nanotechnology – Legislative Drafting Difficulties
Nanotechnology has been touted as the “next industrial revolution”. 29 Defining nanotechnology isdifficult 30 but most commentators describe „nanotechnologies‟ as a multidisciplinary andheterogeneous field involving molecular engineering. It can have many applications in, for example,
medicine, food, and electronics.
Definitions are crucial to the operation of legislation as they assist in establishing the subject matter tobe regulated and the regulatory scope. The heterogeneity of nanotechnology and NPs has presented
problems for the drafters of legislation. There is no generally accepted definition within theinternational community. No jurisdiction has a definition for nanotechnology or NPs in OHS
legislation.
The EU is one of the few jurisdictions that include a legislative provision that defines nanomaterials,
but this does not appear in OHS law. The EU is attempting to regulate particular product areas inwhich mNMs are used; specifically, foods and cosmetics. The EU‟s Regulation on Novel Foods
proposes a nano-specific provision which states that “novel food should include foods derived fromplants and animals, produced by non-traditional breeding techniques, and foods modified by new
production processes, such as nanotechnology and nanoscience, which might have an impact onfood.”31 The EU Cosmetics Directive 2009 defines NM as “an insoluble or biopersistent andintentionally manufactured material with one or more external dimensions, or an internal structurefrom 1-100 nanometres”.32

27

Willi Jahnan-Dechent and Ulrich Simon “Function Follows Form: Shape Complementarity and Nanoparticle Toxicity”(2008) 3 Nanomedicine 601 at 602.
28
MC Roco “Nanoscale Science and Engineering: Unifying and Transforming Tools” (2004) 50 AIChE Journal 890.
Roco‟s conceptualization of nanotechnologies as generations has been influential.
29
Robert Sparrow “Talkin‟ „Bout a (Nanotechnological) Revolution” (2008) 2 IEEE Technology and Society Magazine
37.
30
Reaching agreement on fundamental terms such as „nanotechnology‟, nanoscale‟, „nanomaterial‟ and „nanoparticle‟ iscomplex and contested. For example, see Graeme Hodge, Diana Bowman and Karinne Ludlow “Introduction: Big
Questions for Small Technologies” in Hodge, Bowman and Ludlow (eds) New Global Regulatory Frontiers in Regulation:
The Age of Nanotechnology (Edward Elgar, Cheltenham, 2007) at 10; Graham Hunt “Nanomaterials: Nomenclature,
Novelty and Necessity” (2004) 56 Journal of Materials 13; Diana Bowman, Joel D‟Silva and Geert van Calster “Defining
Nanomaterials for the Purpose of Regulation within the European Union” (2010) 2 The European Journal of Risk
Regulation 115; WG Kreyling, MK Semmler-Behnke and Qasim Chaudhry “A Complementary Definition of
Nanomaterial” (2010) 5 Nano Today 165.
31
Regulation (EC) 258/97 concerning Novel Foods and Novel Food Ingredients.
32
EU Cosmetics Directive 2009 76/768/EEC, Article 2(1)(k).

New Zealand Journal of Employment Relations 37(1): 100-117
In November 2011, the New Zealand Environmental Protection Authority (NZEPA) released its
Proposals for Amendments to the Cosmetic Products Group Standard (the Standard). 33 The NZEPA
may issue group standards under section 96B of the New Zealand Hazardous Substances and New
Organisms Act 1996 (HSNO). The Standard follows the definition of NM that is used in the EU
Cosmetics Directive. Proposal 3 proposes introducing a labelling requirement for nanomaterials whichis in line with Article 19 of the EU Cosmetics Directive (76/768EEC).34 These definitions of NM are
not perfect; for example, they focus on size instead of including other physio-chemical characteristics
such as shape, charge and surface properties. These provisions represent the first attempt by aParliament to define nanotechnology or mNMs. It is possible that legislative instruments in otherjurisdictions will be similarly amended to include nano-specific provisions. In my opinion, nanospecific legislative provisions should be drafted to help protect NZ workers from the risks of exposure
to NPs.
Characterisation and Measurement of NPs Pose Regulatory Challenges
In addition to the regulatory difficulties in defining NPs, these tiny particles also present other hurdles
in terms of characterisation and measurement. Effective regulation of NP exposure involves the ability
to accurately describe and measure the matter being regulated. Under NZ‟s Hazardous Substances and
New Organisms Act 1996, hazardous substances such as chemicals are conceptualised as „new‟ or„existing‟.35 How should the nanoscaled version of a chemical be categorised? For example, should
nanoscaled carbon be distinguished from macroscale carbon? The nanosized version exhibits different
properties from its macro counterpart; therefore, in my opinion, it should be considered „new‟.
However, the difficulty is that even within one form of nanoscale carbon, there are an array of forms
and shapes including tubes and spheres. These different surface properties can generate different
behaviours. To what extent can and/or should any legislative definition include these finer
distinctions? There is an urgent need for the development of standardised reference NMs. Thesepersistent difficulties in the description and definition of NPs will continue to hinder effective
regulation and risk assessment.
Another regulatory challenge is the difficulties in measuring NPs. The story of asbestos regulation
also includes difficulties caused by measurement. Inadequate measurement devices should not delay
the introduction of nano-specific OHS provisions. It is preferable to prevent harm to workers rather
than to wait for measurement techniques to become available. Also, like asbestos-related disease,
there may be a long latency (possibly of many decades) before disease symptoms appear.
NPs and Potential Risks to Workers’ Health
Detailed discussions about the health risks and toxicity 36 of NPs have been undertaken in theacademic literature. Not all NPs are the same, nor are they all potentially harmful to human and
33

NZEPA “Proposed Amendments to the Cosmetic Products Group Standard” (2011) <www.epa.govt.nz>.
NZ Environmental Risk Management Authority “Group Standards” <http://archive.ermanz.govt.nz>.
35
HSNO Act, ss 28 and 28A(2)(a).
36
Andrew Maynard Nanotechnology: A Research Strategy for Addressing Risk (Woodrow Wilson Project on Emerging
Technologies, Washington DC, 2006); RJ Aitken, KS Creely and CL Tran Nanoparticles: An Occupational Hygiene
Review (Institute of Occupational Medicine for the Health and Safety Executive, London, 2004); Therapeutic Goods
Administration A Review of the Scientific Literature on the Safety of Nanoparticulate Titanium Dioxide and Zinc Oxide in
Sunscreens (Therapeutic Goods Administration, Canberra, 2006); Ken Donaldson and others “Nanotoxicology” (2004) 61
Occupational Environmental Medicine 727; Eva Oberdorster “Manufactured Nanomaterials (Fullerenes, C60) Induce
Oxidative Stress in the Brain of Juvenile Largemouth Bass” (2004) 112 Environmental Health Perspective 1058; MC
Powell and MS Kanarek “Nanomaterial Health Effects – part 1: Background and Current Knowledge” (2006) 2 Wisconsin
Medical Journal 16; MC Powell and MS Kamarek “Nanomaterial Health Effects – part 2: Uncertainties andRecommendations for the Future” (2006) 2 Wisconsin Medical Journal 18; Joel D‟Silva and Geert van Calster “Taking
34

New Zealand Journal of Employment Relations 37(1): 100-117
environmental health and safety. There is growing evidence that the novel properties of some NPs
will bring unforeseen human and environmental health and safety risks. 37 The large surface area andrelated increased reactivity of some NPs may mean unpredictable and different reactions withbiological systems. Generally, the smaller the particles, the more reactive and toxic are their effects. 38
The smaller size of NPs means that they can deposit deeper in the respiratory tract than larger
particles. Nanoparticles may take longer to settle in the air and, therefore, have more chance to traveland spread in the workplace, thereby coming into contact with workers.
Carbon nanotubes have been identified as a particularly troubling type of mNM. There are many
variants of CNTs but they have been broadly categorised as single-walled (consisting of a single layerof carbon atoms arranged in a cylinder) and multi-walled (comprising multiple concentric layers of
single walled tubes with diameters up to tens of nms). 39 Although further evidence is required,preliminary research on CNTs suggests that their structural similarity and low solubility may exhibit
similar pathology to asbestos.40 CNTs are increasingly used in industry because they are 100 times
stronger than steel but very light. They are, thus, useful in electronics and display devices such as
LCDs. The size and fibre shape of CNTs may lead to health effects similar to asbestos.41 CNTs cancause adverse health effects such as infammation and fibrosis (scarring). 42 However, the lack of dataon exposure pathways of certain NPs, combined with uncertainty about the suitability of someexisting testing methods, is widely recognised as a barrier to the effective implementation ofregulations. 43

NZ OHS Regulation
The Legislative Framework
NZ workers‟ OHS is regulated by the Health and Safety in Employment Act 1992 (HSE Act), theApproved Code of Practice for the Management of Substances Hazardous to Health in the Place ofWork 1997 (the Code) and the Hazardous Substances and New Organisms Act 1996 (HSNO Act).
The HSE Act applies to places of work. Duties are imposed on employers (and others) to take allpracticable steps to ensure healthy and safe workplaces. The concept of „hazard‟ is central to the Act.
Employers must identify hazards and eliminate, isolate or minimise them. Employers must follow thisTemperature – A Review of European Union Regulation in Nanomedicine” (2009) 16 European Journal of Health Law
249.
37
Milind Kandlikar, Ramachandran Gurumurthy and Andrew Maynard “Health Risk Assessment for Nanoparticles: A
Case for Using Expert Judgment” (2007) 9 Journal of Nanoparticle Research 137; Andrew Maynard and others “SafeHandling of Nanotechnology” (2006) 444 Nature 267; Eva Oberdorster and others “Nanotoxicology: An Emerging
Discipline Evolving from Study of Ultrafine Particles” (2005) 113 Environmental Health Perspectives 823.
38
US National Institute of Environmental Health Sciences research presented in a paper by T Hampton “Researchers Size
Up Nanotechnology Risks” (2005) 294 JAMA 1881 at 1882.
39
Robert J Aitken and others “Regulation of Carbon Nanotubes and Other High Aspect Ratio Nanoparticles: Approaching
this Challenge from the Perspective of Asbestos” in Hodge, Bowman and Maynard (eds) International Handbook on
Regulating Nanotechnologies (EE, 2010) 205.
40
CA Poland and others “Carbon Nanotubes Introduced into the Abdominal Cavity of Mice Show Asbestos-like
Pathogenicity in a Pilot Study” (2008) Nature Nanotechnology 423.
41
EE Knowles “Nanotechnology: Evolving Occupational Safety, Health and Environmental Issues” (2006) Professional
Safety 20 at 24; Robert Service “Nanotechnology‟s Public Health Hazard?” (2008) Science Now<http://news.sciencemag.org>; CL Tran, SM Hankin, B Ross An Outline Scoping Study to Determine Whether High
Aspect Ratio Nanoparticles (HARN) Should Raise the Same Concerns as do Asbestos Fibres (Institute of Occupational
Medicine, Edinburgh, 2008).
42
CW Lam and others “Pulmonary Toxicity of Single-Wall Carbon Nanotubes in Mice 7 and 90 days after Intratracheal
Instillation” (2004) 77 Toxicological Science 126.
43
Robert Falkner, Linda Breggin, Nico Jaspers, John Pendergrass and Read Porter “International Coordination andCooperation: The Next Agenda in Nanomaterials Regulation” in Graeme Hodge, Diana Bowman and Andrew Maynard(eds) International Handbook on Regulating Nanotechnologies (Edward Elgar, Cheltenham, 2010) at 513.

New Zealand Journal of Employment Relations 37(1): 100-117
process for hazards, whether or not the hazards involve NPs. The Code applies to all workplaces inwhich hazardous substances are being used or produced, whether or not they contain NPs.
The HSE Act and the Code are administered by the Department of Labour (DoL). Under section 20 of
the HSE Act, the Minister may approve codes of practice. Compliance with codes is not mandatory
but they have “powerful persuasive authority”.44 One of the DoL‟s roles is to ensure that the HSNO
Act is complied with in workplaces. The HSNO Act‟s stated purpose is “to protect the environment,
and the health and safety of people and communities, by preventing or managing the adverse effectsof hazardous substances and new organisms”.45 The Act applies to everyone who imports,
manufactures, uses or stores hazardous substances. The HSNO Act‟s provisions relating to hazardous
substances have the most significance for OHS.
Section 14 of the HSNO Act provides for the establishment of the Environmental Risk Management
Authority (ERMA). However, following the recent introduction of the Environmental Authority
Protection Act 2011 (EPA Act), ERMA was disestablished and the Environmental Protection
Authority (EPA) was established.46 The EPA will now administer the HSNO Act.
Regulating ‘Hazard’, ‘Risk’ and ‘Exposure’
Various workplace tasks, such as working with NMs in liquids without adequate protection, will
increase exposure to NPs. Seven young female Chinese workers developed severe lung damage (andtwo died) after inhaling nanoparticles produced in their factory. 47 However, the US National Institutefor Occupational Safety and Health contended that the tragedy could have been avoided by the use ofproper industrial hygiene procedures.48 Debate continues about whether the deaths of the workers canbe directly linked to their exposure to nanoparticles.
Such incidents have generated increasing debate about the risks to human health posed by NPs andhow they should be regulated.49 In NZ, the regulation of occupational exposures involves quantifying
and evaluating scientific risk by assessing the relationship between a person‟s exposure and the harmcaused by that exposure. Risk management involves identifying hazards, assessing exposure and risk,
and managing those risks.
Hazard identification and characterisation refers to the toxicology of NPs. Although there is limited
information about the adverse occupational human health effects of NPs, there is cause for concern
about the health effects of NMs on the basis of three main streams of evidence. Firstly, research on
inhaled dusts and fibres recognises their potential respiratory toxicity. 50 There is a difference between
large and nano-sized particles. Air pollution epidemiological studies show that particles less than 2.5
μm are responsible for respiratory and cardio effects. Research on industrial fibres, such as asbestos
has established that fibres longer than 15-20 μm with diameters less than 3μm and are biopersistent in
44

Richard Rudman New Zealand Employment Law Guide (CCH, Auckland, 2009) at 234.
HSNO Act, s 4.
46
Environmental Protection Authority Act 2011, s 7.
47
See Y Song, X Li and X Du “Exposure to Nanoparticles is Related to Pleural Effusion, Pulmonary Fibrosis andGranuloma” (2009) 34 European Respiratory Journal 559; Alok Dhawan and Vyom Sharma “A Cautious Approach to
Nanotechnology” Cosmos Online (2011) <www.cosmosmagazine.com>; Reuters “Deaths, Lung Damage Linked to
Nanotech” (2009) Stuff <www.stuff.co.nz>.
48
Reuters “Deaths, Lung Damage Linked to Nanotech” (2009) Stuff <www.stuff.co.nz>.
49
Royal Commission on Environmental Pollution Novel Materials in the Environment: The Case of Nanotechnology(London, RCEP, 2008); Royal Society and Royal Academy of Engineering Nanoscience and Nanotechnologies:
Opportunities and Uncertainties (London, RSRAE, 2008).
50
Robert Aitken and others “Regulation of Carbon Nanotubes and Other High Aspect Ratio NPs: Approaching thisChallenge from the Perspective of Asbestos” in Graeme Hodge, Diana Bowman and Andrew Maynard (eds) International
Handbook on Regulating Nanotechnologies (Edward Elgar, Cheltenam, 2010) 205.
45

New Zealand Journal of Employment Relations 37(1): 100-117
the lungs, are hazardous to human health. 51 Hazard identification and assessment needs to consider therole of particle size, chemical properties, shape and dose. Secondly, some familiar materials, whennanoscaled, demonstrate heightened biological reactivity. The United States National Institute for
Occupational Safety and Health (NIOSH) has indicated that low solubility NPs are more toxic thanlarger particles on a mass for mass basis. 52 Thirdly, initial animal inhalation studies of engineered NPs
have shown findings of pulmonary fibrosis, granulomas, inflammation, lung cancer, mesotheliomalike effects and cardiovascular effects. 53 In these studies, NPs have been shown to translocate from thenose to the brain and from the lungs to other organs. 54
This research provides evidence of the potential occupational hazards of some NPs, but there will only
be risks to human health if there is exposure at levels in which harm can occur. The most likely routeof exposure to NPs is through inhalation, 55 but ingestion and dermal penetration may also occur.56
Detailed discussion of exposure routes has been outlined elsewhere. 57 There are currently no
occupational exposure limits governing workplace exposure to NPs. Therefore, NPs present new
challenges to understanding, predicting and managing potential health risks to workers. It is likely, forexample, that current personal protective equipment will be of limited effectiveness in reducing
dermal exposure to NPs because NPs will “more readily be able to penetrate the material from which
the protective clothing is made than macro-sized particles.”58
Studies are being conducted to establish the workforce‟s exposure.59 It is possible that workers are
currently experiencing relatively low levels of exposure, but because the toxicity of all NPs is
unknown, even low exposure could be potentially harmful to human health. Dose metrics besides
mass concentration may be a better measure when evaluating the health effects of exposure to NPs.
Currently commercially available air sampling instrumentation can characterise nanoscale aerosols
based on a number of metrics, but none are sufficiently small to be worn by workers to allow theestimation of NP concentration in their personal breathing zone. 60 Information on exposure remains
basic and there are many outstanding knowledge gaps. 61
What are the procedures to minimise exposure? At present, there are no standardised or validated
methodologies or equipment to enable routine measurement of NPs in the workplace. However, it isgood public health practice to keep exposures to new and uncharacterised particles as low as possible.
The NIOSH recently published the results of 12 field studies using the Nanoparticle Emission
51

National Institute of Occupational Safety and Health (NIOSH) “Workplace Safety and Health Topics: Nanotechnology”
Centres for Disease Control and Prevention (CDC) <www.cdc.gov>.
52
NIOSH “Strategic Plan for NIOSH Nanotechnology Research and Guidance: Filling the Knowledge Gaps”<www.cdc.gov>.
53
AA Shvedova and others “Unusual inflammatory and fibrogenic pulmonary responses to single-walled carbon
nanotubes in mice” (2005) 289 American Journal of Physiology L698.
54
Tracy Hampton “Researchers Size Up Nanotechnology Risks” (2005) 294 JAMA. 2005 1881.
55
CC Daigle and others “Ultrafine particle deposition in humans during rest and exercise” (2003) 15 Inhalation.
Toxicology 539.
56
Sally Tinkle and others “Skin as a route of exposure and sensitization in chronic beryllium disease” (2003) 111
Environmental Health Perspectives 1202; James Brown and others “Ultrafine particle deposition and clearance in thehealthy and obstructed lung” (2002) 166 American Journal of Respiratory Critical Care Medicine 1240.
57
Karinne Ludlow “One Size Fits All? Australian Regulation of Nanoparticle Exposure in the Workplace” (2007) 15
Journal of Law and Medicine 136 at 142.
58
Ibid.
59
Paul Schulte “Progress in Understanding and Preventing Work Related Disease and Injury from Nanomaterials” (paper
presented to Global Regulation of Nanotechnologies conference, Northeastern University United States, 7 May 2010);
Methner, above n 8; K Schmid, B Danuser and M Riediker “Nanoparticle Usage and Protection Measures in the
Manufacturing Industry – A Representative Survey” (2010) 7 Journal of Occupation and Environmental Hygiene 224.
60
D Brouwer, J Gijsbers, and M Lurvink “Personal exposure to ultrafine particles in the workplace: Exploring samplingtechniques and strategies” (2004) 48 Ann Occup Hyg 439.
61
CDC “Strategic Plan for NIOSH Nanotechnology Research and Guidance: Filling the Knowledge Gaps.”<www.cdc.gov>.

New Zealand Journal of Employment Relations 37(1): 100-117
Assessment Technique to characterise emissions during processes where engineered nanomaterials
were produced or used.62 The NIOSH believes that there is sufficient evidence to suggest that it istheoretically possible to control workplace exposure to NPs, but that there will be costs involved. 63 A
precautionary approach to the prevention and control of workplace exposures should be adopted.64 It
may be a challenge adopting such an approach because of the way that NZ regulations define andaddress occupational health risks.
Application of Legislative Instruments to Nanoparticles
HSNO Act(1) The „substance‟ threshold
Before any particular form of mNM or object containing mNMs will require EPA approval, it mustsatisfy three separate criteria, each of which poses certain challenges with regard to mNMs. The threecriteria are: 1) is it a „substance‟? 2) is it „hazardous‟? 3) does it present a „new‟ hazard? The HSNO
Act applies only to “substances” that are “hazardous” and both of those criteria have been subject tointerpretation and controversy. A “substance” is defined as: 65a) any element, defined mixture of elements, compounds or defined mixture of compounds,
either naturally occurring or produced synthetically, or any mixtures thereof;b) any isotope, allotrope, isomer, congener, radical, or ion of an element or compound which
has been declared by the Authority, by notice in the Gazette, to be a different substancefrom that element or compound;c) any mixtures or combinations of any of the above;d) any manufactured article containing, incorporating, or including any hazardous substancewith explosive properties.
A substance will be considered hazardous if it meets or exceeds one of the thresholds set down in the
Hazardous Substances (Minimum Degrees of Hazard) Regulations 2001 for any of the relevant
properties. These relate to:66
i.
ii.
iii.
iv.
v.
vi.

explosiveness;
flammability;
a capacity to oxidise;corrosiveness;
toxicity (including chronic toxicity);
ecotoxicity, with or without bioaccumulation.

Where it is possible that a substance may trigger more than one threshold, it should be evaluatedagainst the thresholds established for each hazardous property, e.g. a substance that may have both
flammable and toxic properties must be evaluated against both relevant thresholds.
If a substance does not trigger any of the section 2 thresholds, it is not “hazardous” and does not need
an approval from the Authority. However, if a substance does trigger a threshold level, then it cannot
be imported or manufactured in NZ other than in accordance with an approval from the Authority.

62

Methner and others, above n 8.
Ibid.
64
N Jackson and others “Engineered Nanomaterials: Evidence on the Effectiveness of Workplace Controls to Prevent
Exposure” (2009) < http://nanotech.law.asu.edu/?rgn=cau>.
65
HSNO Act, s 2.
66
HSNO Act, s 2.
63

New Zealand Journal of Employment Relations 37(1): 100-117
The manufacture or importation of a hazardous substance without an approval is an offence. 67 Some
nano-chemicals will trigger the legislative thresholds and be deemed hazardous.
However, the existence of quantity-based regulatory triggers is a significant regulatory gap. The
Monash Report reached the same conclusion and its opinion has led the National Industrial Chemicals
Notification and Assessment Scheme, the Australian industrial chemicals regulator to propose “toadministratively exclude nanomaterials which are new chemicals from low volume/low concentration
exemptions, thereby shifting a post-market audit activity to a pre-market assessment (i.e. newnanomaterials to be assessed under permit or certificate categories prior to commercialisation).”68
The quantity-based exception under the HSNO Act relates to „small-scale use of hazardous substancesin research and development or teaching‟. 69 The adequacy of training and practice within laboratoryenvironments to ensure safe handling of mNMs is critical. Research conducted by Canterbury
University in 2009 suggested that complacency in this regard should be avoided. 70 The report
identified a number of issues of potential concern, specifically: 71
 There is limited information on the effectiveness of engineering controls and personal
protective clothing to minimise exposure to unbound NPs.
 Ensuring that researchers have access to best practice safety information for working withnanomaterials and that risk or safety assessments are completed.
 A lack of documented training for new researchers in safe practices for working withnanomaterials.
 Not all nanomaterials research is undertaken in dedicated facilities. A mechanism is needed toensure that other researchers in shared facilities are aware of any hazards and associatedprecautionary measures.
 The lack of readily available funding for upgrading research facilities to meet health and safety
requirements.
(2) Is the substance „new‟?
Even if something is agreed to be a “hazardous substance”, an application will only be required if it
has not already received approval. The question inevitably arises as to whether a nano-form of apreviously approved substance would be regarded as a new substance, requiring its own approval, or
alternatively, would be deemed to be covered by the existing approval. The Monash Report referred tothis as “possibly the most significant potential gap”, pointing out that “uncertainty exists as to whether
the nanoentity would be considered as „new‟ or „different‟ from or as the same as its‟ [sic]conventional counterpart.”72 The Australian toxic dust Senate Committee inquiry recommended that
there be an urgent consideration of whether materials already classified as safe at the macroscale
should be reassessed to see if they are safe at the nanoscale. 73
Similar uncertainty may be said to apply to applications for nanoforms of substances already present
in NZ. As ERMA has said:

67

HSNO Act, s 25(1).
NICNAS Proposal for Regulatory Reform of Industrial Nanomaterials. Public Discussion Paper (NICNAS, November2009).
69
HSNO Act, s 33.
70
Sally Gaw Identification of Potential Health and Safety Issues Associated with MacDiarmid Institute Funded
Nanomaterial Research in University Laboratories (MacDiarmid Institute, Wellington, 2009).
71
Ibid.
72
Ludlow and others, above n 21, at 92.
73
Recommendation 13, Senate Community Affairs References Committee Workplace Exposure to Toxic Dust (May2006).
68

New Zealand Journal of Employment Relations 37(1): 100-117
if the hazards of the nanomaterial are the same as the „conventional‟ substance, then they arecovered by the approval for the „conventional‟ substance. It is only where the hazards differ
between the „conventional‟ substance and the nano substance that the nano substance would
need to be treated differently under HSNO. 74
A question inevitably arises as to how a nanoform of an existing substance will be classified where
there is uncertainty about the hazard profile. Should it be assumed that the hazards are identical until
data exists to prove otherwise? Or should the default position be that the nano-form may have distinct
hazardous properties, meriting a separate approval? These issues raise the question of where theburden of proof should lie and what standard of proof should be required. These regulatory gaps in
HSNO may mean that workers exposed to hazardous substances and NPs are not receiving adequate
protection. These gaps could potentially be addressed by the regulators without need to amend thelegislation. EPA could, for example, modify its Group Standards 75 to require that nano-forms ofexisting substances could be subject to new assessments, or at least that they must be notified to EPA.
HSE Act
The HSE Act enacts an extensive statutory regime to ensure the health and safety of employees andother people in the workplace. The Act is less concerned with prescribing how to make workplaces
safe and more concerned with putting obligations on employers and employees to ensure thatworkplaces and work practices meet defined standards of health and safety. NZ has a „no fault‟
scheme for dealing with accidental injury.
The HSE Act‟s object is to promote the prevention of harm to all persons at work as well as others in,
or in the vicinity of, a place of work. 76 The Act covers „places of work‟ which is given a broad
definition in section 2. Therefore, the HSE Act will apply to places of employment whether or not
those workplaces involve employees working with mNMs or exposed to NPs. The Act applies to
employers, employees, self-employed people, contractors and subcontractors77 and will, therefore,
apply to all these people whether or not they work with mNMs.
The Act imposes duties on employers to ensure the safety of employees at work. Most duties underthe HSE Act are not absolute, but require “all practicable steps”78 to have been taken. This phrase
recurs throughout the Act. The “all practicable steps” requirement is interpreted strictly. 79 It isreasonable to expect an employer to do anything that it is practicable to do. 80 Employers are expected
to be proactive in identifying both existing and potential hazards and taking steps to prevent harm toworkers. Employers may be expected, therefore, to be proactive in identifying potential hazards
associated with mNMs and NPs.
An assessment of whether or not all reasonable steps have been taken analyses: 81
 the nature and severity of the harm that may be suffered if the result is not achieved;
 the current state of knowledge about the likelihood that harm of that nature and severity will besuffered if the result is not achieved;
 the current state of knowledge about harm of that nature;74

Letter from ERMA Chief Executive to Colin Gavaghan and Jennifer Moore regarding HSNO Act (9 July 2010).
ERMA, Cosmetic Products Group Standard (ERMA, 2006).
76
HSE Act, s 5.
77
HSE Act, s 2.
78
HSE Act, ss 2A and 6.
79
Rudman, above n 41, at 242.
80
Ibid.
81
HSE Act, s 2A.
75

New Zealand Journal of Employment Relations 37(1): 100-117
 the current state of knowledge about the means available to achieve the result and the likely
efficacy of those means; and the availability and cost of each of those means available.
A person required by the Act to take all practicable steps is required to take those steps only in respectof circumstances that the person knows or ought reasonably to know about.82 Therefore, a person isrequired to take all practicable steps to ensure the safety of employees working with NMs or exposed
to NPs only in respect of circumstances that the person knows or ought reasonably to know about. The
issue is whether a person required by the Act to take all practicable steps would be aware of thepresence of NPs and their potential health risks.
There is a potential regulatory gap in that the “current state of knowledge”83 regarding harm attributed
to some mNMs is preliminary. Although initial studies indicate that adverse health consequences are
possible from some mNMs and NP use and exposure, some of the OHS implications of mNMs and
NPs are currently unknown. 84
The HSE Act sets out specific duties on employers in relation to hazards in the workplace. Employers
must identify hazards;85 take all practicable steps to eliminate them; 86 and if they cannot bepracticably eliminated, isolate hazards. 87 If hazards cannot be isolated, they must be minimised.88
Employees exposed to them must be monitored.89 The general language of the Act requires a broad
approach by employers to potential hazards. It is clear that employers must identify specific hazards
and then do whatever they can to ensure that the hazards do not cause harm.
The concept of „hazard‟ is vital to the working of the Act. Hazard means any activity, arrangement,
circumstance, event, occurrence, phenomenon, process, situation, or substance that is an actual or
potential cause or source of harm, whether it arises or is caused within or outside a workplace. 90“Substance” means a thing that is an organic material, whether living or not. 91 The definition of
hazard in the HSE Act is broad and may be physical, biological or mental.
“Significant hazard” means a hazard that is an actual or potential cause or source of: 92
 serious harm; harm (that is less than trivial) for which the severity of the effect on a person depends on theextent or frequency of the person‟s exposure to the hazard; or harm that does not usually occur or that is not easily detectable until a significant time after the
exposure to the harm.
“Harm” means illness, injury or both and includes physical or mental harm caused by work-related
stress.93 “Serious harm” means death or some other harm declared to be serious harm by the82

HSE Act, s 2A(2).
HSE Act, s 2A.
84
Scientific Committee on Emerging and Newly Identified Health Risks (SCENIHR) Risk Assessmentof Products of Nanotechnologies (European Commission, Brussels, 2009); SCENIHR Opinion on the Appropriateness of
the Risk Assessment Methodology in Accordance with the Technical Guidance Documents for New and Existing
Substances for Assessing the Risks of Nanomaterials (European Commission, Brussels, 2007); Safety of Nano-Materials
Interdisciplinary Research Centre (SnIRC) <www.snirc.org>.
85
HSE Act, s 7.
86
HSE Act, s 8.
87
HSE Act, s 9.
88
HSE Act, s 10.
89
Ibid.
90
HSE Act, s 2.
91
Ibid.
92
Ibid.
93
Ibid.
83

New Zealand Journal of Employment Relations 37(1): 100-117
Governor-General. 94 Any illness, injury, physical or mental harm, or death, whether or not attributable
to exposure to NPs may be caught by these definitions, provided that the harm caused is deemedsufficiently serious. The current gaps in public health knowledge about NP hazards and exposuremean that some NPs may not be considered a significant hazard. Also, there may be a prolonged
latency period between first exposure to NPs and onset of the first symptoms of the disease,particularly for CNTs with their asbestos-like pathogenicity. If the deficiencies in nanotoxicology
prevent a potentially harmful NM from being identified as a significant hazard, this is a significant
regulatory gap. However, significant hazard is defined in the HSE Act as an actual or potential cause
or source of serious harm. 95 If the mNM is deemed a potential cause of harm, it could theoretically be
identified as a significant hazard and, therefore, trigger the hierarchy of action.
This definition of „hazardous‟ raises the question of standard of proof. How compelling must theevidence be before such triggers are activated? Whether carbon nanotubes, for example, should be
deemed “hazardous substances” within the terms of the HSNO Act seems at present to be uncertain. 96
For some commentators with whom I spoke during the review, existing evidence about CNTs issufficient to justify a moratorium on their use, or at least on certain uses to which they could be put
while for others, the studies published to date are preliminary and inconclusive.
The limited state of current knowledge about the risks posed by some NPs presents a number of
obstacles to any attempt to regulate in this area. Regulatory triggers requiring “significant hazard” tobe demonstrated may fail to fire for some NPs. It is obviously important that regulators remain
apprised of the most recent reliable information with regard to the possible hazards presented by NPs.
More challenging, however, is the question of how to proceed in situations of uncertainty. With regard
to burden of proof, should regulators assume that a nanoform of an existing product is safe until
reliable evidence shows otherwise? Or should they operate on the contrary assumption: that a new
product is unsafe until the contrary can be demonstrated?
Some regulatory frameworks offer some guidance in this regard. The HSNO Act, for example, adopts
a “precautionary approach”, which emphasises “the need for caution in managing adverse effects
where there is scientific and technical uncertainty about those effects”.97 However, a range of opinions
can be found as to how „caution‟ is to be understood. ERMA‟s view is that “while the HSNO Act
provides for decisions to be precautionary where there is scientific or technical uncertainty … it does
not empower ERMA to act when there are suspicions but little or no evidence.”98 This understandingof the precautionary remit is likely to be controversial, not least because it may be thought that manyof the situations in which there is „scientific or technical uncertainty‟ will arise precisely because„there are suspicions but little or no evidence‟.
This is far from a straightforward matter. As one leading commentator on the regulation of emerging
technologies has said, “there is scope for endless argument about just how strong the evidence needs
to be before precaution kicks in.”99 Insofar as existing OHS regulations are not specific about the levelof proof that would be required to trigger regulatory action, this is a regulatory gap which may
compromise workers‟ health.
“Health” and “healthy” have restricted meanings; they simply mean unharmed. 100 The definition ofhealth under the HSE Act is different from the broad World Health Organisation definition of health.
94

Ibid.
Ibid, my emphasis.
96
As per correspondence with Sustainability Council, 30 November 2010, and ERMA, 21 December 2010.
97
HSNO Act, s 7.
98
Letter from ERMA to Gavaghan and Moore about HSNO Act (10 August 2010).
99
Roger Brownsword Rights, Regulation, and the Technological Revolution (Oxford University Press, Oxford, 2008) at
106
100
HSE Act, s 2.
95

New Zealand Journal of Employment Relations 37(1): 100-117
Health, according to the WHO, is a state of complete physical, mental and social well-being and not
merely the absence of disease or infirmity. 101 The legislative definition of healthy has implications forthe level of protection available to workers exposed to NPs. Given the uncertainties, risks assessors
and regulators could address the issue by “considering the lowest toxic dose values, and/or a worstcase exposure scenario, to be on the safe side.”102
The Code 1997
The Code is a statement of preferred work practices and arrangements. The Code is a practical guideon how to comply with the applicable sections of the HSE Act and Regulations 1995 in order tominimise the risk of occupational illness or injury due to exposure to substances hazardous tohealth. 103 The Code applies to all workplaces in which substances hazardous to health are used or
produced and to all persons with potential exposure to substances hazardous to health in those
workplaces.
The Code does not apply to asbestos and materials containing asbestos because asbestos is covered byother regulatory instruments. Given the potential structural and pathogenic similarity between someNPs and asbestos, and the potential adverse health effects, it may be prudent to draft a nano-specific
Code or include nano-specific provisions in the HSE Act, The Code and/or the HSNO Act.
A substance hazardous to health is defined as any substance, or product containing a substance, to be
used or produced in a workplace that is known or suspected to cause harm to health.104 This includes:
105





Those substances that are classified as hazardous under the HSNO Act, excluding microorganisms;
Scheduled toxic substances under the HSNO Act; andThose substances that are listed in the Workplace Exposure Standards publication currently
applicable in New Zealand.

Therefore, many substances that may be or may incorporate NMs such as paints, heavy metals andsolvents will trigger The Code.
Under The Code there is no provision for formal approval of hazardous substances from DoL prior to
supply, sale, use or import because such approval is covered by the HSNO Act. In order to achievecompliance with sections 6 and 8 to 10 of the HSE Act, The Code provides a hierarchy of prevention
and control measures. Where a significant hazard has been identified, the HSE Act requires that thehazard be managed by considering the following hierarchy of action:
 Elimination;106 then
 Isolation;107 and finally Minimisation. 108

101

World Health Organisation <www.who.int>
Quasim Chaudhry and others “The Current Risk Assessment Paradigm in Relation to the Regulation of
Nanotechnologies” in Hodge G, Bowman D, Maynard A (eds) International Handbook on the Regulation of
Nanotechnologies (Edward Elgar, Cheltenam, 2010).
103
The Code, at 8.
104
The Code, p 10.
105
OSH “Workplace Exposure Standards” (1994, revised in 2002) <www.osh.govt.nz>.
106
HSE Act, s 8.
107
HSE Act, s 9.
108
HSE Act, s 10.
102

New Zealand Journal of Employment Relations 37(1): 100-117
If NPs are identified as a significant hazard, they could be eliminated, isolated or minimised. A
potential regulatory gap may exist if the deficiencies in nanotoxicology prevent a potentially harmful
NP from being identified as a significant hazard.
Minimisation of the risk of substances hazardous to health may be achieved by a variety of practices
such as personal protective equipment (PPE). However, it is likely that NPs will be able to penetrate
the material from which the protective clothing is made more readily than macro particles. 109 Anotherregulatory gap is that, under The Code there, is no legal requirement for the supplier of a substancehazardous to health to provide specific health and safety information under the requirements forlabelling and SDS under the HSNO Regulations. The Code states that suppliers should have SDS
available for all substances hazardous to health that they supply. 110
The SDS describes the identity of the substance, relevant health hazard information, precautions foruse and safe handling, disposal and emergency response information. Identification of the hazardous
substance requires suppliers to detail the chemical identity and CAS Number of the substance. This
identification will not necessarily reflect the fact that the chemical is in nanoform. The Code does not
expressly distinguish between nano and conventional forms of substances.
The physical and chemical properties of the substance are to be included. The supplier could describe
the particle size of the substance in these sections of the SDS, but the supplier is not required to do so.
Toxicological information is required but the deficiencies in the toxicological data for NPs,
particularly for chronic exposure, may preclude inclusion of such information. In addition to SDS,
The Code states that suppliers should ensure that any container supplied for use in a place of work
carries sufficient information for the safe use of the product it contains, and is labelled in a way thatallows for positive identification of the product. The HSNO Act requirements are now applicable.
Labelling requirements will apply to containers of hazardous substances whether or not they
incorporate NMs. However, whether users are alerted of the presence of NPs depends on whether the
product name, number or identifier used on the label references nano and there are currently no
requirements to do so.
Nano-specific labelling is a contentious topic. 111 The EU recently legislated for compulsory labellingof cosmetics containing mNMs112 while a proposal to require nano-specific labelling of novel foods iscurrently the subject of conciliation proceedings involving the EU Parliament, Council andCommission.113 At present, the only potential nano-specific labelling requirement in NZ is the
proposed amendment to the NZ Cosmetic Products Group Standard discussed earlier.114 This proposal
has not been approved. This lack of labelling could be argued, in some contexts, to be a regulatory
gap. In relation to OHS regulation, for example, lack of nano-specific labelling could compromise
workers‟ health and safety. Due consideration would have to be paid to the appropriate wording of
any such labels if they are to impart genuinely useful information to workers without causing
unjustified alarm.

Challenges in Safety Assessment for NPs
109

Ludlow, above n 54, at 142.
The Code, at 34.
111
Joel D‟Silva and Diana Bowman “To Label or Not to Label? – It‟s More than a Nano-sized Question” (2010) 4 EJRR
420.
112
Council of the European Union “Regulation of the European Parliament and of the Council on cosmetic products”(2009) <www.europa.eu>.
113
European Union Committee : Environment, Public Health and Food Safety “MEPs flag potentially hazardous
substances in electrical and electronic equipment” (press release, 2 June 2010) <www.europa.eu>.
114
See the section on „Defining Nanotechnology‟.
110New Zealand Journal of Employment Relations 37(1): 100-117

The HSE Act does not specify a particular method of hazard identification. Various hazard
identification methods are used in industry. Information from manufacturers, designers, safety data
sheets, product labelling should be reviewed as part of the hazard identification process.
Risk assessment, including hazard identification methods, may not be appropriate for NPs. It may benecessary to amend the Safety Data Sheets (SDS) and labelling systems to recognise that NPs havedifferent properties from their bulk counterparts. This presents a challenge to effective risk assessmentof NPs because current regulatory requirements for risk assessment are based on knowledge ofbulk/conventional particles. The toxicity of NPs is related to properties such as surface area rather
than weight. Current processes may not consider the high surface area and increased reactivity of NPs.
The relationship between volume of material and exposure (used in chemicals regulation such as the
HSNO Act) is not appropriate for assessing the risks of NPs. Therefore, the current methods andprocedures will be inadequate for the safety of workers. Hazard assessments for NPs need to consider
shape, chemical properties, functionality, and the role of particle size.
There are further difficulties in protecting New Zealand workers from adverse health effects ofnanoparticle exposure. Firstly, there is no national or international agreed definition to describe
nanoparticles. There are, however, attempts to develop an international terminology for
nanotechnology. 115 Secondly, equipment and methods to enable routine measurements ofnanoparticles are not yet available. The tiny size of NPs poses special challenges of exposure. NPs canpenetrate deep into the lungs when inhaled and may circulate throughout the human body when they
enter a single part of the body. When NPs get into the environment it “may be impossible to containthem.”116
The HSE Act includes provisions for recording, reporting, reviewing and monitoring hazards inworkplaces and workers‟ health and safety. For example, Workplace Exposure Standards enable
monitoring. When sufficient nanotoxicological and exposure data become available, nano-specificworkplace exposure standards should be developed. The HSE Act confers powers on inspectors who
may monitor conditions in workplaces. 117 It is important that these monitoring and reporting
procedures enable the timely and proper collection of information about exposure to NPs which has
caused harm, incidents and injuries.
The Code describes an assessment process for employers to meet their duty to manage substances
hazardous to health. The assessment aims to achieve compliance with section 7 of the HSE Act. The
purpose of an assessment is to gain adequate information on the use of substances hazardous to healthin the workplace. 118 The assessment process involves:
1. Identifying substances hazardous to health in the workplace;
2. Reviewing the information about the hazards they pose to health;3. Determining the degree of exposure;
4. Assessing the risk to health; and5. Reviewing the assessment.
There are currently no effective methods available in the workplace to measure nanoparticles or
exposure to nanoparticles, nor are there currently effective methods for assessing particle surface area.
Therefore, the assessment process described in The Code will be difficult for hazardous substancesthat contain NMs or for nanoparticles. The Code describes a process if the outcome of an assessment
115

International Organisation for Standardisation on Nanotechnology <www.iso.org.>
Davies J Clarence “A New Approach to Regulating Nanotechnology Products” in Graeme Hodge, Diana Bowman,
Andrew Maynard (eds) International Handbook on Regulating Nanotechnologies (Edward Elgar, Cheltenam, 2010).
117
HSE Act, s 33(1).
118
The Code, at 16.
116

New Zealand Journal of Employment Relations 37(1): 100-117
is uncertain. If an assessment indicates that harm to health may result from exposure to substances
hazardous to health, but there is some uncertainty about the degree and extent of the exposure, thenfurther work such as monitoring, workplace exposure monitoring 119 and biological exposure
monitoring120 is required.
Assessments should be revised at least every two years, or if: 121
 The process, plant or substance related to exposure to the substances hazardous to health ismodified; New information on the hazards of substances becomes available;
 Monitoring indicates inadequate exposure control…
Hazardous substances containing NPs may trigger a revision if the substance is modified or if new
information on the substance becomes available. For instance, new epidemiological information onhuman exposure and nanotoxicological data may prompt a revision.
The Code also provides for health surveillance as a measure directed at controlling exposure to
substances hazardous to health to ensure the health and safety of people at work. 122 Therefore,monitoring is required, but this depends on the assessment showing that monitoring and surveillanceis required. The current deficiencies in public health knowledge about NPs mean it is unclear whether
assessments will identify NPs. Further, this limited knowledge means that health surveillance andmonitoring processes under The Code may not be suitable or adequate for NPs.

Suggestions for the Nano-specific Regulation
Given that workers are being exposed, it is important that Parliament acts now. There should becompulsory reporting of any incidents of adverse health outcomes experienced by workers exposed toNPs. Such a reporting scheme should be national and use standardised identification and hazard
assessment processes. Any OHS legislation provision which defines NP should refer to size and otherrelevant physio-chemical properties such as shape. The definition should be sufficiently flexible toallow for adaptation as nanoscience develops and new public health data on NPs and their healtheffects becomes available.
At the time of writing, neither ERMA nor the EPA had formally assessed the potentially hazardous
nature of CNTs, as no application involving them has been under the HSNO Act. There is merit in thesuggestion that, for the time being, CNTs be classified “as if” they are hazardous, thereby bringing
them within the remit of the relevant legislation and regulator.123

Conclusion
Although more work is needed to measure the health and safety risks that NPs pose to NZ employees,
workers are currently being exposed. This paper has demonstrated that NZ‟s OHS regulation of NPs
contains the following specific regulatory gaps:

119

The Code, at 29.
The Code, at 28.
121
The Code, at 22.
122
The Code, at 27 and 39.
123
Mark Phillbric “An Anticipatory Governance Approach to Carbon Nanotubes” (2010) 30 Risk Analysis 1708.
120

New Zealand Journal of Employment Relations 37(1): 100-117








Legislative thresholds such as “significant hazard” and “current state of knowledge” may not
be triggered because of the current limited public health data on exposure to NPs;NZ OHS regulations are not specific about the level of proof that would be required to trigger
regulatory action for hazardous substances or particles and this regulatory gap may
compromise workers‟ health;Despite the risks posed by some NPs, there is not necessarily any requirement for the special
properties of NPs to be identified in the occupational context;
The regulatory deficiencies presented by SDS, labelling and PPE pose health risks to workers
exposed to NPs;
The quantity based thresholds under the HSNO Act are inappropriate for NPs;
The uncertainty about whether a nano-form of a substance will be considered „new‟ or„existing‟ may mean that workers exposed to hazardous substances and NPs are not receiving
adequate protection; andThere is no NZ regulatory definition of NP, despite the potential need for a definition to ensure
effective oversight of occupational exposure to NPs.

The deficiencies identified in NZ OHS law are particularly troublesome for NPs because of theirfundamental differences from standard particles, and due to their unpredictable behaviours wheninteracting with the human body and (in the case of some CNTs) their structural and pathogenic
similarity to asbestos.
There is current uncertainty in the scientific literature and limited occupational exposure data.
However, preliminary research does highlight the need to adopt a precautionary approach. NZ‟sregulatory risk assessment approach tends to deal retrospectively with well-established occupational
hazards. We could learn from the regulatory story of asbestos and, without delay, use the steadily
emerging evidence of the potential asbestos-like pathogenicity of some CNTs to enact OHS law to
help protect NZ‟s exposed workforce.

Acknowledgements
Thank you to John Hughes (an expert on the HSE Act) for his feedback on the HSE Act analysis. I am
grateful to the Department of Labour and ERMA (now the EPA) for their assistance while I workedon the NZ review of the impact of mNMs on our regulatory environment. I also wish to thank DrDavid Robinson for his excellent comments on earlier drafts.

New Zealand Journal of Employment Relations 37(1): 119-150

Hunting for Happy Feet in Honolulu: The Elusive Struggle for Pay Equity –A Comparative View
JOHN GODDARD*
Introduction
The National-led Government campaigned during the 2008 election campaign on closing the income gap
with Australia.1 Shortly after being elected as Prime Minister, John Key stated:2
I am horrified that the gap between our wages and those in Australia are now wider than they
have been in our history – at more than 35 per cent. How can we hope to hold on to our young
people, the educated, the talented, the motivated, if on the Monday you can earn $50,000 for
doing one job and on the Friday earn $80,000 by simply moving across the ditch?
As part of their confidence and supply agreement, the National Party and the Act Party agreed on the“concrete goal of closing the income gap with Australia by 2025.”3 In furtherance of this goal, the 2025
Taskforce (the Taskforce) was established to make recommendations on policy that would enable the New
Zealand Government to close the income gap with Australia.4 None of the Taskforce‟s recommendations
included changing any legislative or executive measures in relation to pay equity between men and womenand none have been adopted. Another way for the New Zealand labour market to compete more effectively
with our Australian counterparts would be to implement effective measures that promote pay equity.
The purpose of this paper is to consider whether, and to what extent, the three branches of government in
New Zealand have complied with their international obligations in relation to pay equity by comparing theactions and omissions of the legislative, executive and judicial branches of government with the actions andomissions of their Australian counterparts. It is suggested that competing effectively with Australia requires
the New Zealand government to take much more positive steps to achieve pay equity.
In Part II of this paper, “pay equity” will be defined and the rationale for implementing measures that
promote pay equity will be evaluated. In Part III, a comparative analysis of the relevant acts and omissionsof the legislative, executive and judicial branches of government will be undertaken.
In New Zealand, the median hourly rate of pay that women receive is 89.4% of the remuneration that men
receive. The median weekly wage of women in full-time employment equates to 86% of the median malewage. The median hourly earnings of women in fulltime employment amounts to 93.2% of the male rate.5
These improvements in the remuneration of women represent the culmination of 116 years of struggle.
Describing the history of pay equity is beyond the scope of this paper. 6 However, the struggle for pay equity
in New Zealand and Australia has been broadly similar, at least until 2009.

*

1

BA/LLB (Hons).

New Zealand Centre for Political Research “Prosperity or Poverty” (2009) <www.nzcpr.com>.
John Key provided the inspiration for the title when he stated that the Green Party‟s Equal Pay Amendment Bill had “as muchchance of being considered as Happy Feet the penguin having a holiday in Honolulu” Otago Daily Times “Pay Equity Bill on Ice”
<www.odt.co.nz>.
3
National-Act Confidence and Supply Agreement (2008) <www.act.org.nz>.
42025 Taskforce “Answering the $64,000 Question: Closing the income gap with Australia by 2025” (2009)<www.2025taskforce.govt.nz>. As at 4 June 2011, the Taskforce was disestablished.
5
Statistics New Zealand New Zealand Income Survey: June 2010 Quarter (2010).
6
A brief summary of the history of pay equity in New Zealand is contained in Appendix A.
2

New Zealand Journal of Employment Relations 37(1): 119-151
The current position is that New Zealand women have comparatively better rates of pay than their Australiancounterparts. However, this gap is likely to narrow because Australia has recently introduced a range ofmeasures at state and federal level that have the potential to reduce the gender pay gap. In addition,
Australian women currently receive higher wages than their New Zealand counterparts because
remuneration in Australia is approximately one third higher than in New Zealand.

The Rationale for Pay Equity
The purpose of this part is to establish whether there are sound reasons for promoting and achieving pay
equity. If there are, then effective measures should be introduced by domestic governments to provide forpay equity. If there are not sound reasons, then the international obligations requiring measures that promote
pay equity should be reconsidered. Before the merit of rationales for promoting pay equity can be evaluated,
it is necessary to establish a working definition of pay equity for the purposes of this paper.
A Definition of Pay Equity“Pay equity”, “comparable worth” and “equal pay for work of equal value” all describe a principle of fairand equitable remuneration. However, their meanings require clarification in order to determine what
measures would suffice to achieve the principle that they represent. “Pay equity” is not defined in any
current New Zealand legislation. However “equal pay” is defined in s 2 of the Equal Pay Act 1972 (theEPA) as “a rate of remuneration for work in which rate there is no element of differentiation between male
employees and female employees based on the sex of the employees”. “Employment equity” was defined in
the Employment Equity Act 1990 (the EEA) as:7
the elimination from all forms of paid employment of –…
(b) Inequality of remuneration for women:
However, the EEA was repealed two months after being enacted. Accordingly, there is no current legislative
guidance in relation to the meaning of “pay equity”.
New Zealand has ratified a number of international instruments that shed more light on the principle. The
International Covenant on Economic, Social and Cultural Rights (ICESCR) requires State parties to provide
just and favourable conditions of work which include: 8[f]air wages and equal remuneration for work of equal value without distinction of any kind, inparticular women being guaranteed conditions of work not inferior to those enjoyed by men, withequal pay for equal work.
The International Labour Organisation (ILO) Convention on Equal Remuneration for Work of Equal Valuedescribes pay equity as “the principle of equal remuneration for men and women workers for work of equalvalue.”9 This is wider than the principle of equal pay for equal work. The ILO has subsequently expanded on
this principle:10
7

Employment Equity Act 1990, s 2. Note that the EEA was repealed in December 1990 just two months after its introduction.
International Covenant on Economic, Social and Cultural Rights (opened for signature 16 December 1966, entered into force 3
January 1976), art 7.
9
ILO Equal Remuneration Convention 1951 (opened for signature 29 June 1951, entered into force 23 May 1953). Hereafterreferred to as ILO (100).
10Gender Equality at the Heart of Decent Work ILC98, 98th sess, ILC98-VI[2008-12-0081-1(Rev.1)]-En (2009).
8

New Zealand Journal of Employment Relations 37(1): 119-151[t]he scope and implications of “work of equal value” are poorly understood. The notion goes beyond
equal remuneration for “equal”, the “same” or “similar” work: it also encompasses work of an entirely
different nature, but nevertheless of equal value. This concept is essential in order to address
occupational segregation where men and women often perform different jobs, in different conditions,and even in different establishments.
Last year, the ILO noted that “the concept of „work of equal value‟ goes beyond „similar work‟ andencompasses work that is of an entirely different nature, but which is nevertheless of equal value.”11 These
provisions require a new definition of “pay equity” that is consistent with the international obligations that
New Zealand has ratified. For this reason in itself, new pay equity legislation is required. In 2002, theMinistry of Women‟s Affairs noted that:12[e]qual pay for work of equal value means that women get the same pay as men for doing acomparable job – that is, a job involving comparable skills, years of training, responsibility, effort
and working conditions. This is often referred to as pay equity … In the USA and Canada, equal pay
for work of equal value is called comparable worth.
Thus, the New Zealand government has recognised a wider concept of equal remuneration that includes
comparable worth and is synonymous with the concept of equal pay for work of equal value. The next stepfor the New Zealand government will be express recognition of the wider concept in legislation.
The wider concept has been recognised in Australian legislation. The New South Wales Legislature has
defined “pay equity” as “equal remuneration for men and women doing work of equal or comparable
value”.13 In federal legislation, “equal pay for work of equal or comparable value” is defined as “equal
remuneration for men and women workers for work of equal or comparable value.”14 This definition appears
circular in that the definition closely resembles the defined term. Nevertheless, it serves to incorporate thebroader concept of pay equity.
For the purposes of this paper, “pay equity” refers to equal remuneration for work of equal or comparable
value. The work may be different in nature provided that its value is equal or of comparable value. In otherwords, the interpretation suggested by the ILO is adopted.
Formative or Substantive Equality?
Equal remuneration may be provided for in both formal and substantive ways. It is suggested that bothformal and substantive equality are required to close the gender pay gap. It is necessary to distinguishbetween measures that appear to promote pay equity and measures that actually do so. This requires
developing an understanding of the concepts of formal equality, substantive equality and transformativeequality.
Hepple refers to each of these concepts, identifying their distinguishing features. He suggests that formativeequality does not adequately address indirect discrimination. 15 The United Nations Committee on Economic,
Social and Cultural Rights (the Committee) states that formal equality assumes that equality will result if
11

Conference Committee on the Application Of Standards: Extracts from the Record Of Proceedings ILC99, 99th sess, 2010-090040-2-En (2010).
12
Ministry of Womens Affairs “Next Steps Towards Pay Equity: A Discussion Document” (2002) <www.mwa.govt.nz>.
13
Industrial Relations Act 1996 (NSW), s 4.
14
Fair Work Act 2009 (Cth), s 302.
15
B Hepple Equality: The New Legal Framework (Oxford and Portland, Oregon, 2011) at 18.

New Zealand Journal of Employment Relations 37(1): 119-151
measures treat men and women in a neutral way and typically maintain existing and inherent disadvantage. 16
Caldwell notes that formative equality is derived from the Aristotelian concept that like should be treatedalike. 17 She criticises this “normative aspiration” as presenting barriers to social justice in the context ofanti-discrimination law by providing remedies which are limited to direct discrimination.18 Butler suggeststhat both direct and indirect discrimination should be proscribed by anti-discrimination provisions.19
Substantive equality has been described by the European Union as “full equality in practice” and emphasises
providing individuals with equal opportunities. According to the Committee, substantive equality intends tomitigate the effects experienced by inherently disadvantaged groups.20 This concept encompasses provisionof remedies for indirect discrimination by focussing on procedural equality. 21 Hepple notes that indirectdiscrimination focuses on the effects to the individual as opposed to equal treatment. Undervaluing of
women‟s work through occupational segregation is an example of indirect discrimination. Providing forequal pay for work of equal value requires implementing measures that address indirect discrimination as
well as direct discrimination. It is suggested that state parties fulfil their obligations under international
instruments by providing for substantive equality.
Transformative equality aims to ensure that there exists among individuals an “equality of capabilities”.22
This is achieved by the dismantling of systemic inequalities and the “eradication of poverty anddisadvantage”.23 Under the transformative principle, institutions are burdened with a positive obligation toremove barriers faced by disadvantaged groups and to provide them with resources as required. Laugesen
argues that only a transformative approach will result in the narrowing of the gender pay gap.24 Whether
transformative equality is attainable in the current social, economic and political climate is beyond the scopeof this paper.
Having clarified these categories of equality, it is appropriate to consider the merit of the rationale for
adopting measures that promote pay equity.
Why Should the New Zealand or Australian Governments Adopt Pay Equity Measures?
The purpose of this part is to explore the rationale underlying the current policy directions of the twojurisdictions. It is suggested that there are four key justifications for promoting pay equity: (1) a normativebasis which is supported by broad concepts of economic and social justice; (2) a merit-based rationale
whereby employees are remunerated according to their worth; (3) an economic justification that employees
should be remunerated according to the value of their work in contradistinction to remuneration which is
influenced by direct or indirect discrimination; and (4) political justifications based on both the ratificat ionof international instruments by Australia and New Zealand that require those countries to ensure that
employees receive equal pay for work of equal value in combination with the enactment of domestic
legislation that goes some way towards meeting international obligations in relation to pay equity.
16

Committee on Economic, Cultural and Social Rights Substantive Issues Arising in the Implementation of the International
Covenant on Economic, Social and Cultural Rights: General comment No. 16 UN ESC, 34th sess, at [7], E/C 12/2005/4 (2005).
17
N Caldwell “Workplace Appearance Standards: Undressing the Law” (2009) 15 Canta LR 1 at 25.
18
Ibid.
19
A Butler & P Butler The New Zealand Bill of Rights Act: A Commentary (LexisNexis NZ Limited, Wellington, 2005) at 502503.
20
Committee on Economic, Cultural and Social Rights, above n 16.
21
Hepple, above n 15, at 18-19.
22
A Sen Development as Freedom (Oxford University Press, Oxford, 1999).
23
Hepple, above n 15, at 22.
24
Ruth Laugesen “All Aboard” New Zealand Listener (New Zealand, 27 August 2011) 18 at 23. Laugesen argues that “only[when flexible jobs become respectable in the workplace], when women and men are seeking the same things from their work andtheir lives, will there be real hope that the gender gap can close.”

New Zealand Journal of Employment Relations 37(1): 119-151

The Normative Rationale
The justification of the normative rationale is derived from the concept of human worth and dignity.
Pursuant to this justification, promotion of pay equity assists in affirming the concept of human dignity. As
Barak observes:25[m]ost central to all human rights is the right to dignity. It is the source from which all other rights
are derived. Dignity unites the other human rights into a whole.
Thomas J observed that “the dignity and worth of the human person is the key value underlying the rights
affirmed in the Bill of Rights.”26 Affirming human dignity has the potential to improve the quality of humanexperiences. Promoting pay equity is a part of this. Any initiatives that affirm and strengthen human dignity
are justified. To the extent that pay equity achieves this, it is justified.
Alternatively, pay equity should be promoted as a means of eliminating direct and indirect discrimination in
relation to the remuneration of employees. Employees should be remunerated based on the value of theirwork in contradistinction to their gender or other characteristics which are generally immutable.
Discrimination “assails a person‟s dignity” and erodes a person‟s sense of their worth.27 Therefore,
discriminatory practices are inherently unfair, counter-productive and should be abandoned.
In short, pay equity measures provide opportunities to both affirm human dignity and to eliminate and/or
minimise conduct that erodes human dignity. For these reasons, there exists a normative justification for
implementing pay equity.
The Merit-based Rationale
Merit as a concept is complex and contested. It may be argued that currently the recognition ofqualifications, skills and experience by employers is merit-based. It follows that any interference withcurrent remunerations practices will distort the current meritocracy. Proponents of the liberal meritocracy
suggest that affirmative action programmes or attempts to redefine merit will distort practices that are fair,transparent and market-driven. Accordingly, it is possible for a meritocracy to maintain the status quo andthe inherent inequality of disadvantaged groups. For this reason, the merit-based rationale may support orundermine pay equity. Therefore, merit-based arguments require careful analysis.
To measure the cogency of this argument, it is necessary to define the concept of merit. The Oxford
Dictionary defines “merit” as the “quality of deserving well; excellence, worth”. Thornton suggests that thetwo components of merit (excellence and deserts) have become conflated.28 Merit appears to provide an
objective means for defining remuneration so that remuneration based on merit cannot be discriminatory.
The problem is defining the objective criteria that guide merit-based decision making. According toThornton, merit is constructed by an “essential subjectivity”.29 The lack of a definition of merit allows every
decision-maker the opportunity to choose characteristics and attributes to construct his or her version of25

A Barak The Judge in a Democracy (Princeton University Press, New Jersey, 2006) at 85.
Brooker v Police [2007] NZSC 30; [2007] 3 NZLR 91 at [180].
27
Ibid.
28
M Thornton “Otherness‟ on the Bench: How Merit is Gendered” [2007] SydLawRw 16.
29
M Thornton, “Affirmative Action, Merit and the Liberal State” (1985) 2(2) Australian Journal of Law and Society 28, 33.
26

New Zealand Journal of Employment Relations 37(1): 119-151
merit.30 The amorphous nature of the concept gives rise to the possibility of “arbitrary” and “idiosyncratic”
selections of personal attributes in determining the merit of particular employees. In the context of judicial
appointments, Thornton argues that the “masculinist” construction of merit makes it extremely difficult for
women to meet the standard.31 Malleson has observed that “[t]he criteria are rarely articulated and often
unconscious, and may vary”.32 Williams and Davis assert that “merit” cannot be a neutral phenomenon33 andBartlett questions whether the construction of merit can either be said to be neutral or objective. 34 Malleson
agrees with Thornton that the concept of merit is influenced by the relevant social context and suggests that
constructing merit is a “reflexive and dynamic” process.35
For the purposes of this paper, the question is whether remuneration based on merit is free fromdiscrimination or sufficiently objective to ensure that employees will not be undervalued on account ofgender. It is suggested that merit is such a flexible concept that the possibility that remuneration according to
merit is discriminatory cannot be eliminated. The meritocratic approach has the tendency to maintain thestatus quo because decisions based on merit must follow precedent if they are to be justified. The practicalconsequence is that work that has historically been undervalued will continue to be undervalued.
Thornton observes that decisions based on merit are inherently uncertain because they represent future
predictions based on past performance.36 It follows that merit-based remuneration may not be optimal
remuneration and re-constructing merit or modifying merit-based remuneration is a viable alternative. In thislight, the contention that pay equity measures distort merit-based remuneration is weak because it is
impossible to measure the discriminatory or inequitable nature of merit-based remuneration.
In short, “[w]hat is merit? Don‟t ask Alice… ask the March Hare… because women are not good enough.
Lacking the magic quality, merit, women do not rate.”37 Accordingly, it is suggested that the rationale for
implementing pay equity measures is not weakened by the suggestion that such measures amount to a
distortion of fair, merit-based remuneration. Further, merit should be reconstructed so that merit-based
arguments support the principle of pay equity.
The Economic Rationale
It is acknowledged that equal remuneration programmes are implemented in an economic context. While
programmes provide benefits, they require resources. Costs could potentially outweigh the benefits. On thisbasis, economic arguments are made in opposition to the implementation of pay equity programmes. Thesearguments flow from the notion that the sanctity of the free market is, and should be, paramount. If womenare undervalued and/or discriminated against in the workplace, this will be remedied by the operation ofmarket forces because the pressures of supply and demand will ensure that employees are appropriately
remunerated. In a competitive marketplace, an employee who was insufficiently remunerated would simply
choose to work for an employer who would provide the employee with more competitive remuneration. For
this reason, if women are undervalued, then the cause cannot be free market economic policy. 38 Therefore,
30

R Davis & G Williams “Reform of the Judicial Appointments Process: Gender and the Bench of the High Court of Australia”[2008] MULR 12.
31
Thornton, above n 28, at 33.
32
Kate Malleson, “Rethinking the Merit Principle in Judicial Selection” (2006) 33 Journal of Law and Society 126 at 127.
33
Ibid.
34
F Bartlett “Model Advocates or a Model for Change? The Model Equal Opportunity Briefing Policy as Affirmative Action”[2008] MULR 12.
35
Kate Malleson, “Diversity in the Judiciary: The Case for Positive Action” (2006) 33 Journal of Law and Society 376, at 391.
36
Thornton, above n 28.
37
J Scutt “No merit to endemic sexism in legal system” The Australian (Australia, 19 July 2000) at 13.
38
New Zealand Treasury Treasury Comments on the Report of the Working Group on Equal Employment Opportunities andEqual Pay, Toward Employment Equity.(Wellington, 1990) at 3.

New Zealand Journal of Employment Relations 37(1): 119-151
the causes of unequal remuneration must be interference with free market policies. This could result, forexample, when a professional group is able to maintain a monopoly or when monopsonistic employment
practices are followed. 39
According to this neo-liberal analysis, policies that implement pay equity may have undesirable
consequences by distorting the labour market. Unsurprisingly, the Treasury concluded that the Working
Group‟s proposal for pay equity could potentially reduce “efficiency, flexibility and responsiveness”, resultin increased unemployment of women and provide a perverse incentive for employers to discriminate
against women. 40
These economic arguments lack merit. The period of greatest shift to free market policies existed during thedecade when the Employment Contracts Act 1991 was in force. In 1990, women in New Zealand received
81% of men‟s average hourly earnings and 77.6% of men‟s average weekly earnings. By 2001, these figures
had increased to 84.3% and 86% respectively. To the extent that market forces improved the remunerationof women, the improvement was negligible. 41 The Working Group found that it was impossible to provide
an effective remedy for the gender pay gap without targeted legislation. 42 Failure to address pay equity
requires inherently disadvantaged groups to bear the costs of discriminatory employment practices. The
reality is that the market is inherently unfair. This explains why the sanctity of the free market is anineffective mechanism for mitigating the adverse effects of unfair outcomes.
Free market forces are limited in a number of ways in New Zealand. For example, the Fair Trading Act 1986
and the Credit Contract and Consumer Finance Act 2003 are two examples of legislation that protects
consumers. Bodies such as the Commerce Commission and the Securities Commission have been created toregulate the market. The illusion of the sanctity of free market principles has been starkly revealed by thecollapse of a number of finance companies in New Zealand and by the recession that occurred as a result of
the global financial crisis.
The Government has intervened in financial markets on several occasions. These include becoming asignificant shareholder in Air New Zealand, repurchasing shares in New Zealand Rail, bailing out South
Canterbury Finance at substantial cost and providing state-funded compensation to owners of leakybuildings. More recently, the Government has enacted the Financial Markets Authority Act 2011 that hasestablished the Financial Markets Authority (FMA). The main objective of the FMA is “to promote andfacilitate the development of fair, efficient, and transparent financial markets.”43 Its functions include
ensuring compliance with specified legislation. 44 This analysis shows that intervention in the market occurs
when it is shown to be necessary.
In the employment context, the Employment Relations Act 2000 (the ERA) has introduced good faithindustrial relations. This includes creation and recognition of a mutual statutory duty of good faith between
employees and employers. 45 The object of the Act is to build productive employment relationships and one
39

A monopsonist is a very dominant buyer.
New Zealand Treasury, above n 38, at 15.
41
Ministry of Womens Affairs, above n 12, at 6.
42
Working Group on Equal Employment Opportunities and Equal Pay Towards Employment Equity : Report of the Working
Group on Equal Employment Opportunities and Equal Pay (Wellington, 1988) at 23. This position is supported by theconclusions of the Human Rights Commission in their recently released report Tracking Equality at Work (2011) at 29 and theCommission‟s drafting of a Pay Equality Bill which is incorporated into the report.
43
Financial Markets Authority Act 2011, s 8.
44
Financial Markets Authority Act 2011, s 9 and Schedule 1.
45
Employment Relations Act 2000, s 4. The duty is a positive duty and requires parties to an employment relationship to “beactive and constructive in establishing and maintaining a productive employment relationship” and requires the parties to be“responsive and communicative”. The duty amounts to a limitation on freedom of contract in the labour market.
40

New Zealand Journal of Employment Relations 37(1): 119-151
way of achieving this is “by acknowledging and addressing the inherent inequality of … power in
employment relationships”.46 Thus, the Act seeks to remedy the “inherent inequality” by intervening in thelabour market. This demonstrates that there are no barriers to state intervention in labour markets incircumstances where intervention is required.
Any argument based on economic grounds needs to balance the costs and benefits of implementing andachieving pay equity. A recent report concluded that the cost to the Australian economy of maintaining thegender pay gap was $93 billion. 47 Given that the arguments in favour of implementing pay equity are
powerful, any economic argument that had the effect of delaying or preventing the implementation of pay
equity would need to be compelling. In the absence of compelling arguments, economic considerations
ought not to prevent the implementation of pay equity programmes.
Historically, the Employers Federation relied on economic arguments to argue that pay equity would be too
expensive for the private sector. However, the Treasury established that the Federation‟s costings were
unjustified and provided economic arguments in favour of equal pay that were “totally convincing”.48
Consequently, economic considerations did not prevent the enactment of the EPA. Further, the closer New
Zealand and Australia come to implementing pay equity, the smaller the costs are for employers inproviding pay equity for their employees. Economic considerations have not prevented the Australianfederal government and the New South Wales and Queensland state governments from introducing pay
equity measures.
In any event, economic considerations may be relevant in terms of devising the appropriate means of
implementing pay equity measures. However, it is suggested that they cannot be relied on to prevent the
introduction of effective measures.
The Political Rationale
The justifications for implementing pay equity measures are also political. There are international anddomestic limbs to this rationale. Pursuant to the international limb, if countries have undertaken to
implement programmes that promote pay equity, then that undertaking should be honoured. Pursuant to thedomestic limb, if domestic measures have been shown to be weak or ineffective, they should be modified.
Both New Zealand and Australia have ratified the key international instruments that promote equal pay forwork of equal value: the ICESCR, the Convention for the Elimination of All Forms of Discrimination
Against Women (CEDAW) and ILO 100. New Zealand ratified the ICESCR in 1978, ILO 100 in 1983 andthe CEDAW in 1985. Australia ratified ILO 100 in 1974, the ICESCR in 1975 and the CEDAW in 1983.
Both countries have consistently undertaken to provide for pay equity. Although it is acknowledged thatstate parties are afforded a margin of appreciation which entitles them to meet their international obligations
in different ways, 49 the obligations should be effectively discharged even if this is achieved using different
mechanisms.

46

Employment Relations Act 2000, s 3.
NATSEM Report to the Office for Women, Department of Families, Community Services, Housing and Indigenous Affairs: The
Impact of a Sustained Gender Wage Gap on the Australian Economy (2010) at 5 <www.eowa.gov.au>.
48
Trade Union History Project 50 Years of Struggle: The Story of Equal Pay (Trade Union History Project, Wellington, 1997) at
16. Note that economic concerns can be met by implementing equal pay initiatives in stages. The GSEPA was implemented overthree years and the EPA was implemented over five years.
49
See Huang v Minister of Immigration [2009] 2 NZLR 700 (CA) at 714. For example, the EEA relied on legislative intervention
whereas the Plan of Action was based on conducting reviews and implementing recommendations.
47

New Zealand Journal of Employment Relations 37(1): 119-151
Incorporation of international obligations requires domestic legislation. 50 Therefore, the political rationale
for implementing pay equity is strengthened if domestic legislation has been enacted to ensure performanceof international obligations. Accordingly, it is worthwhile to consider relevant domestic legislation. In New
Zealand, while the New Zealand Bill of Rights Act 1990 (BORA) provides for civil and political rights,
there is no specific legislation in respect of social and economic rights. However, there is specific legislationin relation to equal pay and discrimination as well as general employment legislation.
The specific legislation relating to equal pay includes the Government Service Equal Pay Act 1960
(GSEPA) and the Equal Pay Act 1972 (EPA). The principle of equal remuneration is recognised in the long
title to the EPA: “to make provision for the removal and prevention of discrimination based on the sex of theemployees, in the rates of remuneration of males and females in paid employment”. This purpose
demonstrates the intention of Parliament to meet its international obligations.
The specific legislation relating to discrimination includes s 19 of BORA and ss 20I and 22 of the Human
Rights Act 1993 (HRA). The long title to BORA relevantly provides: “to affirm New Zealand‟s commitment
to the International Covenant on Civil and Political Rights (ICCPR).”51 Section 19 of BORA, the long title
to the HRA and ss 20I and 22 illustrate Parliament‟s intention to fulfil its international obligations. 52 In otherwords, the cumulative effect of the NZBORA and the HRA is to incorporate New Zealand‟s international
obligations into domestic law. This effect is underlined by s 104 of the Employment Relations Act 2000
which provides that an employee may bring a personal grievance claim against her or his employer based on
discrimination in employment on any of the prohibited grounds contained in s 21 of the HRA. 53
In Australia, the same international instruments have been ratified. These instruments have been
incorporated into domestic federal legislation in a number of ways. The Industrial Relations (Reform Act)
1993 enabled the Australian Industrial Relations Commission (AIRC) to make orders to provide for equal
remuneration for work of equal value. “Equal remuneration” was defined as remuneration without
discrimination based on sex. 54 Subsequently, the Work Relations Act 1996 continued similar equal
remuneration measures and aligned the Australian definition of equal remuneration with the definition
contained in ILO 100. The Workplace Relations Amendment (Work Choices) Act 2005 makes references tothe concept of equal remuneration for work of equal value and the international instruments from which theconcept is derived. The current federal legislation is the Fair Work Act 2009. This legislation recognises thewider principle by making repeated references to “the principle of equal remuneration for work of equal orcomparable value”.55
The Australian federal domestic legislation has expressly recognised a principle of equal remuneration thatis consistent with that country‟s obligations pursuant to the relevant international instruments to implement
pay equity policies. Consequently, the ratification of the ICESCR, CEDAW and ILO 100 and the enactmentof domestic legislation in Australia and New Zealand constitutes a very persuasive political rationale for
implementing effective pay equity programmes. In the words of the Human Rights Commission, “[t]hatbattle [for the right to equal pay for work of equal value] has been won”.56

50

Attorney-General for Canada v Attorney-General for Ontario [1937] AC 326 (PC) at 347.
International Convention on Civil and Political Rights (opened for signature 16 December 1966, entered into force 23 March
1976) art 26.
52
New Zealand Bill of Rights Act 1990, s 19 and Human Rights Act 1993, ss 20I and 22.
53
Employment Relations Act 2000, s 104.
54
Industrial Relations (Reform) Act 1993 (Cth), s 21.
55
Fair Work Act 2009 (Cth), s 302.
56
Human Rights Commission Tracking Equality at Work (2011) at 29 <www.hrc.co.nz>.
51

New Zealand Journal of Employment Relations 37(1): 119-151
Having considered the merits of normative, merit-based, economic and political rationales, it is clear thatboth New Zealand and Australia ought to implement programmes that promote pay equity. The remainder ofthis paper will assess the effectiveness of the pay equity implemented by the legislative, judicial andexecutive branches of the New Zealand and Australian governments.

Assessing the Effectiveness of Pay Equity Measures
The effectiveness of pay equity measures will be assessed in New Zealand and Australia. This will be doneby considering (1) the relevant legislation and case law; and (2) measures adopted by the executive.
Legislation and Case Law in New Zealand
The first piece of legislation is the Government Service Equal Pay Act (GSEPA). The GSEPA has three
sections and only one substantial section. It provided for equal pay for women in the public sector to be
implemented in three annual stages.57 It is difficult to assess the difference the GSEPA made to pay equity
because statistics are unavailable prior to 1972 but its effect is likely to have been significant while fallingshort of eradicating the gender pay gap in the public sector. For example, it has been shown that womensocial workers currently receive 9.5% less than their male counterparts.58 The review of workers in the
education sector revealed that female support staff were also undervalued. 59 Since 2005, 38 reviews havebeen conducted of public service departments. In 37 reviews, gender pay gaps were identified ranging fromthree to 35%.60 Despite the enactment of the GSEPA, a gender pay gap remains in the public sector. No caselaw arose under the GSEPA. The GSEPA remains in force.
The Equal Pay Act 1972 (the EPA) is credited with bringing about the most significant erosion of the gender
pay gap from 69.9 per cent to 78.8 per cent between 1972 and 1978.61 The EPA has resulted in theelimination of separate pay rates for men and women performing the same work but has not addressed thewider concept of equal pay for work of equal value.62 The purpose of the EPA is: 63
to make provision for the removal and prevention of discrimination, based on the sex of theemployees, in the rates of remuneration of males and females in paid employment.
This purpose appears to be sufficiently broad to encompass pay equity. However, the provisions of the EPA
appear to favour a narrow interpretation. For example, “equal pay” is defined as:64
a rate of remuneration for work in which rate there is no element of differentiation between male
employees and female employees based on the sex of the employees.
Therefore, the provision eliminates differentiation in rates of pay but does not allow for comparisons ofcomparable work. Section 3 provides for the criteria to be applied in relation to making determinations
57

Government Service Equal Pay Act 1960, s 3.
Letter from Ministry of Social Development, 18 June 2010. The Review into the pay of social workers found that female staff
were paid 9.5 percent less than male staff.
59
Tripartite Steering Group Pay and Employment Equity Review: Compulsory Schooling Sector Project Report (2008) Ministry of
Education <www.minedu.govt.nz>.
60
Public Service Association “Stalling on Pay and Employment Equity” in the PSA journal (June 2009) at <www.psa.org.nz>.
61
Working Group, above n 42, at 43.
62
See NZ Clerical Administrative etc IAOW v Farmers Trading Co Ltd [1986] ACJ 203 [Clerical Workers case].
63
Equal Pay Act 1972, long title.
64
Equal Pay Act 1972, s 2.
58

New Zealand Journal of Employment Relations 37(1): 119-151
under the EPA. A distinction is drawn between work which is exclusively or predominantly performed byfemale employees and work that is not exclusively or predominantly performed by female employees. It
follows that the EPA recognises two labour markets: a predominantly male labour market and a
predominantly female labour market. Yet, the outcome of a literal interpretation of the EPA is that
employees in the predominantly female labour market are unlikely to obtain a remedy even if their work isundervalued and the undervaluing of their work is caused by discriminatory employment practices. Since themajority of women work in women-dominated industries, once different pay rates for the same work havebeen eliminated, the EPA is unlikely to further reduce the gender pay gap.
Other relevant provisions are ss 6, 9, 17 and 18. Section 6 provides for the elimination of differentiation inrates of pay in five annual steps. Section 9 enables the court to state the principles for the implementation ofequal pay. If “equal pay” only refers to equal rates of pay, then this provision is an empty vessel because
separate female rates have ceased to exist since 1978. Given that the Arbitration Court interpreted “equalpay” narrowly, then it is not surprising that the Court (or its successors) has not stated any principles inrelation to the implementation of equal pay either of its own motion or on the application of a party toproceedings. Section 17 requires employers to keep records of all equal pay determinations made by theemployer under the EPA. Under section 18, it is an offence to fail to comply with the provisions of the EPA.
Coleman argues persuasively that the EPA applies to pay equity claims based on a purposive approach to thelegislation. 65 Even if this is correct, it remains an untried remedy. In practical terms, the authors ofMazengarbs Employment Law identify four scenarios where provisions of the EPA may be invoked: (1) an
employment agreement complies with the EPA but a female employee has not been paid at the specified
rate; (2) an employee brings a claim against an employment agreement that does not comply with the EPA;
(3) an employee brings a claim because even though her employment agreement complies with the EPA, asuperimposed ruling rate does not;66 and (4) the written employment agreement complies with the EPA but
an additional oral agreement does not.67 In short, remedies are limited.
The Working Group concluded that eradication of discrimination required legislative intervention and that
the EPA was insufficient to provide an adequate remedy. The Human Rights Commission has recently
concluded that: “[c]urrent legal remedies have not resulted in systemic change”. 68 The EPA has failed tofulfil its purpose of removing and preventing discrimination based on sex. This failure has made claims
under the EPA very difficult. This failure is illustrated by the Clerical Workers’ Case.69
In the Clerical Workers Case, the applicant applied for a declaration that the terms of settlement of an award
did not comply with the EPA on the grounds that 90 per cent of clerical workers were female whereas mostemployees in comparable occupations were male. The Court declined to make a declaration on the groundthat it lacked jurisdiction to do so. Judge Finnigan stated:70[i]t is thus our view that the choice of the Equal Pay Act 1972 as the vehicle for remedy of theperceived problems in the present case is an error of law. The Equal Pay Act 1972 contains nopowers or other provisions by which the Court can address the issue raised by the union and65

Martha Coleman “The Equal Pay Act 1972: Back to the Future” (1997) 27 VUWLR 517, 521-528. This will be discussed ingreater depth below.
66
A ruling rate is a rate of pay for work in excess of work contemplated in the employment agreement.
67
Mazengarbs Employment Law (online looseleaf ed, LexisNexis) at [1803]. Note that most remedies are made pursuant to s 131of the Employment Relations Act 2000.
68
Human Rights Commission, above n 55, at 29.
69
Clerical Workers Case, above n 61.
70
Clerical Workers Case, above n 61, at 207.

New Zealand Journal of Employment Relations 37(1): 119-151
gives no powers to the Court to do what the union asks. The Court can take no action on thepresent application and that must be the end of the matter.
In other words, the Court‟s jurisdiction under the EPA was limited to circumstances where an award
contained different rates of pay for the same work. It did not extend to different rates of pay for comparable
work. This was because the Court only had jurisdiction where an instrument made separate provision for
remuneration of female employees or where an instrument made provision for female employees only. The
fact that the female employees were undervalued could not assist them in this case.
Coleman suggests that the case no longer represents the law since the decision is confined to theimplementation of awards and the enactment of the ECA deregulated the labour market. 71 She argues
persuasively that a broad approach to interpreting the EPA should be favoured on the following grounds: (1)that a correct interpretation of s 3(1) of the EPA does not oust jurisdiction; (2) that the EPA is human rights
legislation requiring purposive interpretation; (3) that there are external indications; (4) that such an
approach achieves consistency with international instruments; (5) that the approach achieves consistency
with NZBORA; and (6) that such an approach is consistent with international trends in interpreting equalpay provisions.72
Generally, Coleman is correct. An interesting question arises if we assume that the literal meaning of s 3
ousts jurisdiction to determine comparable worth claims whereas the long title of the EPA appears torecognise them. In a similar scenario, the Court observed: 73[s]ection 5(1) of the Interpretation Act 1999 says that the meaning of an enactment must be
ascertained from its text and in the light of its purpose. Obviously, the purpose of s 66 is to provide amechanism for clearance of acquisitions which fall outside s 47, and to provide that no clearance
should be given to an acquisition which falls foul of s 47 or in respect of which there is doubt as towhether it falls foul of s 47. In order to achieve that purpose, it is necessary to interpret the words„would be likely‟ as „would not be likely‟.
Even if the Court was literally correct that s 3 of the EPA ousted jurisdiction, a purposive interpretation
would have enabled the Court to make a determination. This approach is supported by clear authority. 74 In
terms of BORA, the provisions of BORA apply to any acts done by the judiciary. 75 This imposes a positive
obligation on the court. Cooke P stated:76[s]ection 3 also makes it clear that the Bill of Rights applies to acts done by the Courts. The
Act is binding on us, and we would fail in our duty if we did not give an effective remedy to aperson whose legislatively affirmed rights have been infringed.
In 2011, a court would be under a positive obligation to ensure that the right to freedom from discrimination
was protected. This positive obligation requires “discrimination” to include “indirect discrimination”.
Clearly, such an interpretation would be open to a court. Therefore, a court would have jurisdiction unless it
considered s 3 of the EPA to be a reasonable limitation on the s 19 right. It would be absurd for a statute
whose purpose is expressed as being “the removal and prevention of discrimination” to be interpreted as alimitation on the right to freedom from discrimination. This interpretation supports the view that the71

Coleman, above n 65, at 533.
Ibid, at 534-544.
73
Brambles New Zealand Ltd v Commerce Commission (2003) 10 TCLR 868 (HC), at 878.
74
See R v Cara (2004) 21 CRNZ 283 at [142] and McKenzie v Attorney-General [1992] 2 NZLR 14 (CA) at 17.
75
New Zealand Bill of Rights Act 1990, s 3.
76
Simpson v Attorney General [1994] 3 NZLR 667; (1994) 1 HRNZ 42 (CA), at 676.
72

New Zealand Journal of Employment Relations 37(1): 119-151
Arbitration Court failed to give effect to the purpose of the EPA. In so doing, it breached New Zealand‟spositive obligations as a member of a branch of the New Zealand government under ILO 100, CEDAW andthe ICESCR.
Even if Coleman is correct and claims can be brought under the EPA, it would still be preferable to haveexpress legislation in unequivocal terms that provides for pay equity, gives clear guidance to courts andprovides substantive redress to claimants. 77 Similar concerns resulted in the enactment of the Employment
Equity Act (the EEA).
The Employment Equity Act 1990 (EEA) is the most impressive legislative attempt to provide for pay
equity. The proposed introduction of the EEA was based on the Report of the Working Group which was
informed by two equal pay studies.78 Between 1988 and 1990, there was a vigorous debate in response to theWorking Group‟s Report and the proposed introduction of the Employment Equity Bill. Participants to thedebate included the Business Roundtable, the Human Rights Commission, the New Zealand Treasury, theEmployers Federation, the PSA and the Economic Development Commission. In many ways, this period
was the golden era of the struggle for pay equity in New Zealand.
As a result of a change in government following the general election in November 1990, the EEA wasrepealed in December 1990, just two months after its enactment. It contained four parts. Part I concerned theestablishment of an Employment Equity Commissioner. Part II provided for equal employment
opportunities. Part III provided for pay equity and Part IV contained miscellaneous provisions.
“Employment equity” was defined as including: “the elimination from all forms of paid employmentof…inequality of remuneration for women”. 79 In relation to pay equity, the EEA contained three objects: (1)to provide a system which would enable gender-based discrimination to be identified and removed; (2) toprovide for additional pay equity payments to be included in industrial awards and agreements; and (3) toprovide for implementation over a period of time that accounted for the economic conditions of New
Zealand as a whole and the ability of employers to pay. 80
The EEA provided for a procedure for unions, employers or 20 or more female workers in a female
occupation to lodge a claim for pay equity. 81 Any of these parties could make a request to the Employment
Equity Commissioner (the Commissioner) for a pay equity assessment.82 The Commissioner would
determine whether an occupation was a female occupation and whether to carry out a pay equity assessment
after receiving submissions from interested parties.83 At the conclusion of the assessment, the Commissioner
would provide a copy of the report to the interested parties. 84 If a report concluded that female employees
were underpaid, then a pay equity claim could be lodged in the form of supplementary pay equity
payments.85 If parties are unable to settle a claim within 60 days, the claim could be referred to the
Arbitration Commission (AC) for determination. 86 Then the AC would have held a hearing where interested

77

Note that the Human Rights Commission has drafted a Pay Equality Bill which would address these concerns. The bill isreproduced in full in Appendix C.
78
Working Group on Equal Employment Opportunities and Equal Pay, above n 42; Urban Research Associates Equal Pay Study:
Phase One Report (1987); and the Equal Pay Steering Committee Equal Pay Study: Phase Two Report (1987).
79
Employment Equity Act 1990, s 2.
80
Employment Equity Act 1990, s 37.
81
Employment Equity Act 1990, s 38.
82
Employment Equity Act 1990, ss38 and 39.
83
Employment Equity Act 1990, ss 40,41 and 46.
84
Employment Equity Act 1990, s 54.
85
Employment Equity Act 1990, s 56.
86
Employment Equity Act 1990, s 57. The Arbitration Commission would have consisted of the Commissioner and two lay
members who had expertise in the pay equity field.

New Zealand Journal of Employment Relations 37(1): 119-151
parties could make submissions.87 The AC would have based any determination on the Commissioner‟sreport and any evidence presented by the interested parties. 88 The AC would have made a further
determination in relation to the timeframe and manner of implementation. 89
This procedure had the potential to provide an effective remedy for the gender pay gap. However, theeffectiveness of the procedure was never tested. Hyman observes that both proponents and opponents of the
EEA had their doubts as to its effectiveness and makes express references to “loopholes” in the EEA.90
However, if the EEA was ineffective, any deficiencies could have been cured when the EEA wasreviewed. 91 In any event, the EEA was likely to be much more effective than either the EPA or the Human
Rights Commission Act 1977 (the HRCA). 92 The threat it posed to employers probably explains why it was
repealed so soon after the National government was elected in November 1990.
Since it was difficult to obtain remedies under the specific equal pay legislation, claimants turned to antidiscriminatory legislative provisions. These included the HRCA (until it was repealed in 1994) and the
Human Rights Act 1993 (the HRA). The Human Rights Commission Act 1977 (HRCA) outlawed
discriminatory employment practices 93 and outlawed discrimination by subterfuge. 94 This meant that the
HRCA was more likely to provide a remedy in relation to discriminatory employment practices that did not
result in any differentiation of rates of pay. In Proceedings Commissioner v Air New Zealand Limited,95 theEqual Opportunities Tribunal approved the following comment from an earlier case: 96[w]e observe in passing that if any act ever called for a liberal and enabling interpretation, the
Human Rights Commission Act must be it.
If this approach had been taken to the Clerical Workers case, the outcome may well have been different. The
Air New Zealand case deserves some comment. In that case, the Equal Opportunities Tribunal (EOT) heldthat Air New Zealand had failed to afford or offer the female cabin crew the same promotional opportunities
that were offered or afforded to male cabin crew who had substantially the same qualifications. The EOT
made a declaration that Air New Zealand was in breach of s 15(1)(b) of the HRCA and ordered the airline totake steps to place each complainant in her appropriate position of seniority. 97 The EOT had to consider
whether the HRCA encompassed continuing discrimination that had commenced before the HRCA was inforce. The EOT approved the following statement from an earlier case: 98[i]n our view, the treatment of women in the workplace should be no less fair and enlightenedin New Zealand than elsewhere in the common law world. Had we felt obliged to record anarrow and restrictive interpretation of the legislation, we would have regarded such a result
as out of step with the temperament of modern society.
The EOT held that the HRCA applied to continuing discrimination. Notwithstanding this decision, theWorking Group considered that the HRCA was insufficient to provide an adequate remedy. The HRCA was87

Employment Equity Act 1990, s 60.
Employment Equity Act 1990, s 62.
89
Employment Equity Act 1990, s 63.
90
P Hyman Women and Economics: A New Zealand Feminist Perspective (Bridget William Books, Wellington, 1994) at 87.
91
Employment Equity Act 1990, s 74.
92
This is discussed below.
93
Human Rights Commission Act 1977, s 15.
94
Human Rights Commission Act 1977, s 27.
95
Proceedings Commissioner v Air New Zealand Limited (1988) 7 NZAR 462 (EOT).
96
H v E (1985) 5 NZAR 333 (EOT).
97
Proceedings Commissioner v Air New Zealand Limited, above n 96, at 483.
98
H v E , above n 96, at 347.
88

New Zealand Journal of Employment Relations 37(1): 119-151
repealed by the Human Rights Act 1993 (HRA). 99 The HRA has been described as “no ordinary statute”.100
According to its long title, the purpose of the HRA is “to provide better protection of human rights in New
Zealand in general accordance with United Nations Covenants or Conventions on Human Rights.”
According to the High Court,101[i]t is the responsibility of the Commission, the Tribunal and, on appeal, this Court to give full
effect to what Thorp J … called “the special nature and purpose of human rights legislation”.
It is special because it bears on the very essence of human identity.
The substantive provision of the HRA relating to employment is s 22. This provision outlaws employmentrelated discrimination by reason of any of the prohibited grounds of discrimination. Sex is one of theprohibited grounds. 102 “Discrimination” is not defined in the HRA but has been defined in subsequent caselaw as “difference of treatment in comparable circumstances”.103 It is not necessary for a claimant to provethat discrimination was intended but he or she must establish a causal connection between a particular
ground and the discriminatory conduct.
A claimant or the Proceedings Commissioner may bring civil proceedings in the Human Rights Review
Tribunal (HRRT) once a complaint has been made to the Commissioner. 104 In Lewis v Talleys Fisheries
Ltd105, the HRRT appeared to limit the scope for claims. On appeal, the High Court adopted a broader viewand stated:[i]n our view the need to approach the statute in a generous sense and to adopt an approachthat facilitates its important purposes cannot be questioned.
In Lewis,106 the High Court allowed an appeal against a decision of the HRRT which held that the distinct
jobs of trimming and filleting fish were not substantially similar and that the appellant had not been
discriminated against by reason of her sex. 107 The Court noted that it was beyond question that human rights
statutes require a generous and purposive interpretation. 108 The Court proceeded to identify an essential
similarity between the two positions in that both filleting and trimming involved the use of a knife, both
positions required limited training and both roles are performed to a higher standard with experience. 109
Accordingly, the Court held that the appellant succeeded in proving that she was appointed to a lower-paid
position by reason of her sex. 110
This case is an example of indirect discrimination. The employer could have argued that the plaintiff was not
paid less by reason of her sex but because she was employed as a trimmer. A strict application of the “butfor” test would have resulted in her claim failing. Further, the respondent‟s motive or intent was not an

99

Human Rights Act 1993, s 146.
Director of Human Rights Proceedings v New Zealand Thoroughbred Racing Inc [2002] 3 NZLR 333 (CA) at 339.
101
Director of Human Rights Proceedings v Cropp HC Auckland AP7-SW03, 12 May 2004 at [18].
102
Human Rights Act 1993, s 22.
103
Quilter v Attorney-General [1998] 1 NZLR 523 (CA).
104
Human Rights Act 1993, s 92B.
105
Lewis v Talleys Fisheries Ltd 18/7/05, HRRT 019/05; HRRT54/02; HRRT03/03.
106
Talleys Fisheries Ltd v Lewis (2007) 8 HRNZ 413; (2007) 4 NZELR 447 (HC).
107
Trimmers were predominantly female employees whereas filleters where predominantly male employees andfilleters were remunerated at a higher rate.
108
Talleys Fisheries Ltd v Lewis, above n 106, at [32].
109
Ibid, at [43].
110Ibid, at [52].
100New Zealand Journal of Employment Relations 37(1): 119-151
element of discrimination requiring proof. This illustrates that the Court followed through in adopting apurposive interpretation of s 22 of the HRA. 111
However, a complicating feature of claims based on discrimination is that the definition of discrimination
remains uncertain. The leading case on discrimination is Quilter v Attorney General.112 In that case, theCourt of Appeal issued five separate judgments. Tipping, Thomas, Gault and Keith JJ provided different
definitions of discrimination. Thomas J described discrimination as “a nebulous and complex concept”.113
Unfortunately, the precise meaning of the nebulous and complex concept has not been clarified. This could
present a significant barrier to potential claimants in that the definitional uncertainty makes the assessmentof whether a claim is likely to succeed more difficult. For this reason, the HRA remedy is not significantly
more effective than remedies that were available under the previous legislation.
General employment legislation enables claimants to lodge personal grievance claims based on
discrimination. The Employment Contracts Act 1991 (ECA) effectively deregulated the labour market in
New Zealand by providing for individual employment contracts and making membership of unions
voluntary.114 Hyman suggested that the ECA has made pay equity claims more difficult and that making aclaim under the HRA is more attractive than making claims under the discrimination provisions of the ECAor under the EPA. 115 Wright considered that the effects of the ECA included reducing the size of groups
suitable for job evaluation comparisons and placing responsibility for bringing claims on employees. 116
These effects probably operated as barriers to achieving pay equity. Hume considered that the enactment of
the ECA made the introduction of pay equity legislation less likely. 117 Between 1991 and 2001, women‟saverage hourly earnings increased from 81% to 84%.
The leading discrimination case brought under the ECA is Trilford v Car Haulaways Limited.118 In that case,
the Employment Court overruled a decision of the Employment Tribunal which held that the plaintiff had
not been discriminated against in circumstances where an application for promotion had been refused
because the position was “more male oriented”. The Court held that this was a case of direct discriminationand that in any event, s 28(1) of the ECA encompassed indirect discrimination. 119 In adopting this approach,the Court favoured a purposive approach over a narrow, literal approach.
Coleman criticises the Court‟s endorsement of Sarita120 where the Labour Court held that an employer‟sintention and motive was relevant in relation to whether discrimination has occurred. In addition, Coleman
highlights practical difficulties in implementing the “but for” test in relation to indirect discrimination.121
These criticisms have merit although they should be viewed in the context that the Court recognised that
discrimination had occurred, provided the affected employee with a remedy and has subsequently
reconsidered its stance in relation to the causal requirement for proving discrimination. 122

111

It is a matter of concern that the HRRT, a specialist tribunal, failed to do so.
Quilter v Attorney General, above n 103.
113
Ibid, at 530.
114
Employment Contracts Act 1991, ss 6,18 and 19.
115
Employment Contracts Act 1991, s 28 and the Equal Pay Act 1972, ss 2A, 4 and 13.
116
Fran Wright “Equal Pay and the Employment Contracts Act 1991” (1993) 7 AULR 501 at 507.
117
Rochelle Hume “Paid in Full? An Analysis of Pay Equity in New Zealand” (1993) 7 AULR 471 at 481.
118
Trilford v Car Haulaways Limited [1996] 2 ERNZ 351 (EmC).
119
Ibid, at 377.
120
New Zealand Workers IUOW etc v Sarita Farm Partnership [1991] 1 ERNZ 510 (EmC).
121
Coleman, above n 65, at 538-539.
122
Kelly v Tranz Rail Ltd [1997] ERNZ 476 (EmC) at 497.
112

New Zealand Journal of Employment Relations 37(1): 119-151
The Employment Relations Act 2000 (ERA) repealed the ECA. 123 The ERA does not contain any pay equity
provisions. However, discrimination on the grounds of sex may entitle an employee to bring a personal
grievance against an employer.124 A breach of the EPA may entitle an employee to be paid arrears. 125
Significantly, the ERA heralded the introduction of good faith employment relations. Good faith
employment relations are expressly provided for by the statutory duty of good faith which requires parties toan employment relationship to be “active and constructive” in maintaining the employment relationship andrequires the parties to be “responsive and communicative”.126 This is relevant because under the statutory
duty, an employer may be required to provide an employee with information in relation to wages so that an
employee can assess whether he or she is being discriminated against. 127 Once an employee requests
increased remuneration to achieve pay equity with other employees, it may be difficult for an employer torefuse his or her request unless there is a genuine reason for disparity in remuneration.
Good faith employment relations work effectively because if an employer dismisses an employee without
good cause, the employer runs the risk that an employee will make a personal grievance claim against theemployer if the dismissal was unjustified. Similarly, if the employer asks the employee for an explanation in
response to allegations of serious misconduct, the employee may fail to provide an explanation. However, if
this happens, the employee risks being dismissed. In contrast, if an employer fails to offer an employee
equal remuneration for work of equal value, the employee has a choice of accepting unequal remuneration
or lodging a claim which is unlikely to succeed. In this scenario, the employee carries the risk and there islittle incentive for employers to review remuneration practices. Therefore, a risk analysis underlies the needfor effective legislative intervention.128
Case law concerning other legislation may also promote pay equity. In two decisions, the Employment
Court considered whether remuneration of a community support worker should conform to the requirementsof the Minimum Wage Act 1983 (MWA) when a worker was engaged in a sleepover in a community home.
In its first decision, the Court held that “sleepovers” were work in terms of the MWA because the employer
imposed constraints on the worker‟s freedom that were “significant and substantial” such as preventing himfrom carrying on a normal family life, socialising with friends and limiting his privacy. Accordingly, thesleepovers were work in terms of the MWA. 129 In a subsequent decision, the Court held by a majority thatan employer was required to pay every employee at a rate no less than the minimum rate for every hour
worked.130 Both decisions have been upheld on appeal although the Supreme Court has granted leave toappeal. 131
The decisions potentially affect large numbers of employees. Community support workers are
predominantly female so that if the decision is implemented, the employees‟ wages of a predominantly
female workforce are likely to increase. 132 The Government has responded by placing Idea Services Limited
into statutory management, questioning how the expected $500 million in back pay could be funded and123

Employment Relations Act 2000, s 241.
Employment Relations Act 2000, ss 104 and 105.
125
Employment Relations Act 2000, s 131.
126
Employment Relations Act 2000, s 4.
127
See for example Vice-Chancellor of Massey University v Wrigley [2010] NZEmpC 37 where the Court held that an employer
was required to provide an employee information about other employees in the context of restructuring.
128
This view is supported by EEO Commissioner Dr Judy McGregor in her article “Confidentiality Deals Targeted in Move for
Equal Employment Opportunities” The Dominion Post (Wellington, 4 July 2011).
129
Idea Services Ltd v Dickson [2009] ERNZ 116; (2009) 9 NZELC 93,305; (2009) 6 NZELR 666 (EmC) at [71] and [83].
130
Idea Services Ltd v Dickson [2009] ERNZ 372; (2010) 9 NZELC 93,403; (2009) 7 NZELR 121 (EmC), at [100]. Note that in
his dissent, Judge Travis would have allowed averaging of wages based on a purposive interpretation of the MWA.
131
Idea Services Limited v Dickson [2011] NZCA 14, at [24] and [52] and Idea Services Ltd v Dickson [2011] NZSC 55.
132
K Burke & S Nicholls “Underpaid Female Workers Win Big Pay Rise” The Sydney Morning Herald <www.smh.com.au>.
124

New Zealand Journal of Employment Relations 37(1): 119-151
awaiting the outcome of the Supreme Court appeal. 133 This litigation highlights that pay equity is not solely
a women‟s issue. In this litigation, the defendant employee was a male community support worker.
In summary, this analysis reveals the extent of the limitations of New Zealand legislation. The EPA ensured
the elimination of a separate female rate of pay. In this way, the EPA has eliminated direct discriminationand provided for formal equality. In addition, between 1972 and 1978, the EPA provided for substantive
equality by significantly reducing the gender pay gap. After 1978, the EPA ceased making a substantive
difference to pay equity. From 1986 onwards, the New Zealand government was aware that more legislation
was required in order to achieve substantive equality. This awareness increased until the EEA was passed.
Despite doubts of both its supporters and critics, the EEA had the potential to provide for substantive
equality. However it was repealed before it could deliver any benefits.
In 1990, the incoming National government was not under an obligation to implement the EEA. It could
have provided for pay equity in a different way. For example, the EPA could have been amended toencompass the wider principle or pay equity provisions could have formed part of the ECA. The repeal of
the EEA combined with the failure of any government to enact similar legislation post-repeal has made
implementing pay equity measures problematic.
Anti-discrimination measures remain in the HRA, the EPA and the ERA but these may only be invoked byindividuals. The deregulation of the labour market has virtually guaranteed that these provisions will haveno more than a negligible effect on the gender pay gap. Human rights legislation does not directly address
pay equity. In fact, the discrimination provisions appear to be more closely aligned with ILO 111 than ILO
100.134 There are no provisions in human rights legislation that provide for equal pay for work of equalvalue.
The current legislative framework consisting of the GSEPA, the EPA, the ERA and the HRA is noteffective. This has prompted the Human Rights Commission to draft a Pay Equality Bill. The Bill has meritin that it would provide disadvantaged employees with substantive remedies. However, the Bill could be
simplified by adopting the relevant provisions in the Fair Work Act 2009 and would be more effective if it
was drafted as an amendment to the ERA because this would result in the provisions being interpreted
consistently with the statutory duty of good faith. The prospects of the Bill being supported seem remote. 135
The limited effectiveness of legislative provisions constrains the judiciary from giving full recognition to theprinciple of pay equity. Within these limitations, the judiciary has largely recognised New Zealand‟sinternational obligations in respect of equal pay for work of equal value. The most striking exception is the
Clerical Workers Case which was clearly decided incorrectly. It is also concerning that the Employment
Tribunal and the HRRT failed to interpret discrimination provisions correctly. Both the High Court and the
Employment Court have recognised that discrimination includes indirect discrimination and have provided
substantive redress in response to discrimination. In this respect, the judicial branch of Government hasrecognised and implemented the pay equity principle. However, this judicial recognition has been limited by

133

Stuff “IHC Firms in Statutory Management” <www.stuff.co.nz>. Subsequently, the government has settled the claim.
ILO 111 refers to the Discrimination (Employment and Occupation) Convention, 1958 and requires parties to provide for
equality of treatment and equality of opportunity (Article 2). New Zealand ratified ILO 111 in 1983.
135
To date, only the Green Party has indicated that they will support the Bill. The Green Party drafted a similar Bill and Prime
Minister John Key remarked that it had “as much chance of being considered as Happy Feet the penguin has of a holiday in
Honolulu” Otago Daily Times “Pay Equity Bill on Ice” <www.odt.co.nz>. Note that the Bill has received some strong support in
G Barhava Monteith and S Wilshaw-Sparkes “Bridging the Pay Divide” The Business Herald (Auckland, 29 July 2011) at 14 as
well as strongly-worded criticisms. “Caution Vital over Gender Pay Reforms” New Zealand Herald (Auckland, 11 July 2011) at
10.
134

New Zealand Journal of Employment Relations 37(1): 119-151
the inadequacy of the legislation. Further, it is suggested that the Clerical Workers Case should be revisitedat the earliest opportunity.
The Executive in New Zealand
The executive branch of Government has played a critical role in New Zealand. Many of these initiatives
featured in New Zealand‟s Third Periodic Report to the United Nations Committee on Economic, Social
Cultural and Rights. They included the establishment of the Pay and Equity Employment Unit in the
Department of Labour, the implementation of a Plan of Action and the completion of pay and employment
equity reviews in the public sector.136 In addition to these initiatives, a considerable volume of research has
been undertaken at different times in New Zealand by the executive government. 137 However, there has been
limited research since 2003. For example, there is no research about recent developments in Australia or theUnited Kingdom. 138
The establishment of the Human Rights Commission has contributed to countering the effects of
discrimination generally. However, the HRC lacks authority to address pay equity issues. Under the EEA,
the establishment of the office of the Equity Employment Commissioner and the Arbitration Commission
was promising but their potential was never fulfilled due to the swift repeal of the EEA.139
In 2004, the Government established the Pay and Employment Equity Unit (PEEU). The PEEU had
responsibility for implementing the Pay and Employment Plan of Action (the Plan). The purpose of the Plan
was to ensure that remuneration of women in New Zealand was free of gender bias. The Plan was to be
implemented in three phases. In the first phase, pay equity reviews were carried out in the public sector,
public health and public education. The second phase would have extended the reviews to state-owned
enterprises and Crown entities. The third phase would have extended the programme to private
employers. 140
In the first phase, 27 Pay and Employment Equity Reviews were completed. They revealed that the average
gender pay gap in public bodies ranged from 18% to 30%. The gap in starting rates ranged from 3% to136

New Zealand Government Third Periodic Reports Submitted by States Parties under Articles 16 and 17 of the Covenant: New
Zealand UN ESC, E/C.12/NZL/3 (2009) at [151] – [152]. In 1999, the Committee of CEDAW recommended “…further efforts bygovernment, including considering development of a strategy for equal pay for work of comparable value” cited in Ministry of
Women‟s Affairs, above n 13, at 15. In response to New Zealand‟s Second Periodic Report submitted in 2001, the Committee
recommended an intensification of programmes to reduce gender-based inequality in employment: New Zealand Government,
above n 136 at [150].
137
See for example Equal Pay in New Zealand, Report of the Commission of Enquiry (1971), Progress of Equal Pay in New
Zealand (1975), Equal Pay Implementation in New Zealand (1979), Equal Pay Study: Phase One Report (1987), Equal Pay Study
Phase Two Report (1987), Towards Employment Equity : Report of the Working Group on Equal Employment Opportunities andEqual Pay (1988), Gender Wage Gap : Scenarios of the Gender Wage Gap : Report (1997), Gender Wage Gap : An Assessmentof the Relative Impact of Each Industry : Report for Ministry of Women’s Affairs (1997), Performance Pay Systems and Equity : A
Research Report (1999), Next Steps Towards Pay Equity : A Background Paper on Equal Pay for Equal Work of Equal Value(2002), Next Steps Towards Pay Equity : A Discussion Document (2002), Report on Public Submissions to Next Steps Towards
Pay Equity : A Discussion Document (2003), Report of the Taskforce on Pay and Employment Equity in the Public Service and
the Public Health and Public Education Sectors (2004)137 and Working Towards Pay and Employment Equity for Women in
Public Health, Public Education and Public Service (2006).
138
Recently, the Human Rights Commission released Tracking Equality at Work, above n 56 which contained a Pay Equality Bill.
However, the report was a general report on equality and did not consider recent developments overseas.
139
The EEA was repealed under urgency on 19 December 1990 while the Ministry of Women‟s Affairs was holding a Christmas
party: M Cook Just Wages : History of the Campaign for Pay Equity, 1984-1993 (Colation for Equal Pay, Wellington, 1994) at
35.
140
Queensland Industrial Relations Commission “Pay Equity: Time to Act” (2007) at 89-90 <www.qirc.qld.gov.au>.

New Zealand Journal of Employment Relations 37(1): 119-151
5%.141 Phases two and three were never implemented. In 2009, the Government terminated the Plan,
disbanded the PEEU and abandoned two pay and employment equity investigations. 142 The
recommendations in the phase one reviews were not implemented.
In 2007, the Queensland Industrial Relations Commission noted the “renewed energy and commitment”
shown by the New Zealand government. However, the Commission noted that the effectiveness of the Plan
was limited by the low number of public sector employees (18%) and the threat to the Plan and the PEEU
posed by a change in Government.143 It is suggested that the Plan would have been more effective if it wasgiven statutory recognition and an equal remuneration principle had been adopted. Without legislation, it
was an easy task for the incoming Government to dismantle the well-intentioned initiatives embodied in thePlan.144 The failure of the National-led government to give any reasons for disbanding the PEEU,
terminating the pay equity initiatives and to provide alternative solutions to remedy the gender pay gap
amounts to a breach of New Zealand‟s international obligations. This breach is compounded by the fact that,in relation to public employees, the Government has the dual role of being an employer in addition to its
broader governance role.
The initiatives undertaken between 2004 and 2009 demonstrated an intention on the part of the New Zealandgovernment to provide for equal remuneration. However, the scope of the initiatives was limited and theoutcomes were ultimately disappointing. The plethora of pay equity research has failed to deliver
substantive outcomes. There is a dearth of current academic research and no specialist body promoting pay
equity in New Zealand. The Government has not only failed to intensify its pay equity programmes but hasabandoned them. In this respect, the Government is in breach of this country‟s international obligations.
Legislation and Case Law in Australia
Currently, Australia has effective pay equity legislation and a landmark case has recently been released. 145
However, this state of affairs is the culmination of many years of struggle. Before any legislation wasenacted, the principle of equal pay was promoted as a result of case law affecting industrial awards. The
cumulative effect of the 1969 Equal Pay Case, the National Wage and Equal Pay Cases 1972 and the
National Wage Case, 1974 was that equal pay for equal work was introduced in three stages. 146 Thisreplicated the position in New Zealand in 1978.
In Re Private Hospitals and Doctors’ Nurses (ACT) Award 1972,147 the Australian Conciliation andArbitration Commission affirmed that the equal pay principle could be enforced in all industrial awards inwhich it was not recognised by invoking the anomalies provisions in the Principles of Wage determination.
In effect, this broadened the application of the equal pay principle and led to successful equal pay claims
brought by nurses, dental therapists, social workers and childcare workers.148
Since 1993, federal legislation has expressly recognised the wider principle in four separate enactments.
These are the Industrial Relations (Reform) Act 1993 (IRRA), the Workplace Relations Act 1996 (WRA),
141

Public Service Association “Its Time: Pay and Employment Equity – Five Years On” (2008) <www.psa.org.nz>.
These concerned the education sector and social workers.
143
Queensland Industrial Relations Commission, above n 140, at 92.
144
The government could still have repealed the legislation but at least there would have been more public discussion and scrutiny
before this occurred.
145
Fair Work Act 2009 (Cth) and the Equal Remuneration Case [2011] FWAFB 2700.
146
1969 Equal Pay Case (1969) 127 CAR 1142; National Wage and Equal Pay Cases 1972 (1972) 147 CAR 172; and National
Wage Case, 1974 (1974) 157 CAR 293.
147
Re Private Hospitals and Doctors’Nurses (ACT) Award 1972 (1986) 13 IR 108.
148
Equal Remuneration Case, above n 145 at [196].
142

New Zealand Journal of Employment Relations 37(1): 119-151
the Workplace Relations Amendment (Work Choices) Act 2005 (WRAWCA) and the Fair Work Act 2009
(FWA).
The IRRA empowered the Australian Industrial Relations Commission (AIRC) to make orders to provide
for equal remuneration for work of equal value. 149 These provisions were largely unaffected when the WRA
was enacted three years later.150 However, claimants struggled to obtain remedies under the WRA because
before a claim could succeed, it was necessary to establish that discrimination was a cause of wage
inequalities, there was uncertainty around the meaning of “discrimination” and there were difficulties inapplying the test of discrimination. 151 It followed that these claims were rarely successful despite the“considerable promise” of the legislation to deliver substantive remedies. 152 For example, in Automotive,
Food, Metals, Engineering, Printing and Kindred Industries Union v HPM Industries, 153 the AIRC rejecteda claim that female process workers and female packers were underpaid because the claimants failed tosatisfy the AIRC that their lower remuneration was caused by discrimination notwithstanding that they were
paid at a different rate than male employees who performed similar work.
In Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union v David Syme & Co
Ltd,154the AIRC struck out a claim by female clerical employees on the discrimination ground on the basisthat an alternative remedy was potentially available and the claimant‟s failure to refute the employer‟ssubmission that a successful claim would result in inequities between male and female clerical workers. 155
The WRAWCA limited the equal remunerations further by requiring applicants to explicitly refer to acomparator group in an application and ousting jurisdiction where the effect of equal remuneration orders
would be to increase minimum wage orders. WRAWCA gave the Australian Fair Pay Commission (AFPC)
jurisdiction to determine minimum wages. The AFPC made no adjustments or variations to pay scales on thebasis of equal remuneration and no pay equity claims were brought under the legislation. 156
The FWA attempts to remedy the defects of its predecessors. According to its explanatory memorandum: 157
The principle of equal remuneration for men and women workers for work of equal or comparable
value requires there to be (at a minimum) equal remuneration for men and women workers for thesame work carried out in the same conditions. However, the principle is intentionally broader thanthis, and also requires equal remuneration for work of comparable value. This allows comparisons to
be carried out between different but comparable work for the purposes of this Part. Evaluatingcomparable worth (for instance between the work of an executive administrative assistant and a
research officer) relies on job and skill evaluation techniques.
The Bill also removes the current requirement for the applicant to demonstrate (as a thresholdissue) that there has been some kind of discrimination involved in the setting of remuneration.
Instead, an applicant must only demonstrate that there is not equal remuneration for work ofequal or comparable value.

149

Industrial relations (Reform) Act 1993 (Cth), s 21.
See Workplace Relations Act 1996 (Cth), ss 620 -634.
151
Fair Work Australia Research Report 5/2011 Review of Equal Remuneration Principles (2011) at 22-23 <www.fwa.gov.au>.
152
Ibid, at 22.
153
Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union v HPM Industries (1998) 94 IR 129.
154
Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union v David Syme & Co Ltd (1999) 97 IR 374.
155
Ibid, at 380.
156
Equal Remuneration Case, above n 145, at [201].
157
Fair Work Bill 2008 (Cth), Explanatory Memorandum, at [1191] to [1192].
150

New Zealand Journal of Employment Relations 37(1): 119-151
Equal remuneration orders are provided for in Part 2-7 of the FWA. 158 Section 302 confers power on Fair
Work Australia (FW Australia) to make equal remuneration orders, defines equal remuneration for work ofequal or comparable value and provides for employees, employee organisations or the Sex Discrimination
Commissioner to apply to FW Australia for equal remuneration orders.159 An equal remuneration order may
increase but must not decrease rates of remuneration.160 An equal remuneration order may be implemented
in stages.161 Contravention of an equal remuneration order gives rise to a civil claim. 162
It seems likely that the FWA will fulfil the promise that its predecessors failed to deliver. In so doing, theAustralian Federal Legislature has enacted effective legislation that is likely to reduce the gender pay gap.
The FWA is superior to the EPA and comparable to the repealed EEA but more efficient than that legislation
would have been.
The trend of unsuccessful litigants has come to an abrupt halt in the recently released Equal Remuneration
Case.163 The scale of the case is nothing short of impressive. There were 22 parties to the litigation
represented by 46 counsel. FW Australia heard submissions over a nine month period in Melbourne,
Brisbane, Perth, Sydney, Ballarat and Adelaide either in person or via video link. There was extensive
witness evidence and it was estimated the decision would affect up to 153,000 employees. 164
The case concerned an application made by the Australian Municipal, Administrative, Clerical and Services
Union (ASU) for an equal remuneration order for employees of non-government employers in the social,community and disability services industry throughout Australia (SACS). 165 The ASU sought an order on
the same terms as the Queensland SACS award. 166 Relevant features of the application included increased
remuneration for sleepovers and higher commencement rates for employees with tertiary qualifications andother specified qualifications. 167
Fair Work Australia (FW Australia) made a number of important findings. Firstly, FW Australia has adiscretion to make Equal Remuneration Offers (ERO). Even if unequal remuneration exists, orders are notmandatory.168 Secondly, gender-based undervaluation may be established by reference to a male comparatorgroup. However, the absence of a male comparator is not fatal to a claim. 169 Thirdly, even though theessence of a successful claim is that wage rates are discriminatory, claimants are not required to prove that
discrimination occurred because this requirement would have been “difficult to prove” and “somewhat
artificial” in the present context.170 Fourthly, SACS employees are predominantly female and remunerated ata lower rate than employees employed by state or local authority organisations. Accordingly, FW Australia
concluded that there is not equal remuneration for male and female employees for work of equal orcomparable value and a relevant factor, but not the only factor, is gender-based undervaluation of work.171

158

Fair Work Act 2009 (Cth), ss 302-306. See Appendix B.
Fair Work Act 2009 (Cth), s 302(3).
160
Fair Work Act 2009 (Cth), s 303.
161
Fair Work Act 2009 (Cth), s 304.
162
Fair Work Act 2009 (Cth), s 305.
163
Equal Remuneration Case, above n 145.
164
Ibid, at [18] and [225].
165
Ibid, at [1].
166
Ibid, at [5].
167
Ibid, at [4].
168
Ibid, at [227].
169
Ibid, at [232]. This was relevant because the ASU did not rely on a male comparator group in its submissions.
170
Ibid, at [233].
171
Ibid, at [285].
159

New Zealand Journal of Employment Relations 37(1): 119-151
FW Australia invited the parties to make further submissions in relation to the appropriate form of the
ERO.172
This decision appears to remove many barriers that have previously prevented claims from being successful.
There is no longer a requirement to prove that discrimination has occurred or to identify a male comparatorgroup. In reaching its decision, FW Australia considered key developments in state jurisdictions, especially
New South Wales and Queensland. In particular, Equal Remuneration Principles (ERPs) and decisions madein accordance with ERP‟s were significant.173 To date, librarians, 174 dental assistants,175 childcare
workers,176 social, community and disability services industry employees 177 and disability support
workers178 have successfully pursued equal remuneration claims.
This analysis reveals that the judiciary recognised the equal pay for equal work principle at a relatively earlystage. However, recognising the wider principle of equal remuneration was more difficult. Between 1993
and 2009, the federal jurisdiction appeared to falter in the face of seemingly insurmountable difficulties.
During this period, equal pay provisions were much more effective in Queensland and New South Wales. 179
Since 2009, there has been a sudden and dramatic change that may herald “a new dawn for pay equity” byproviding for substantive equality. 180
A.

The Executive in Australia

The executive branch of the Australian federal government has recently played an active role in promoting
pay equity. While there has not been much research at federal level, pay equity enquiries have been initiatedby state governments in New South Wales, Tasmania, Queensland, Western Australia and Victoria between
1998 and 2005. 181 In February 2011, Fair Work Australia released its report on equal remuneration
principles. The report is comprehensive and provides current information, including historical andinternational perspectives. 182
Fair Work Australia appears to be performing a wide degree of functions including conducting research,hearing equal remuneration claims and providing information to employers, employees and the public. The
federal government has established the office of the Fair Work Ombudsman (FWO) and expanded the roleof the Sex Discrimination Commissioner.183 The purpose of the FWO is “to promote harmonious,

172

Ibid, at [286].
See Appendices D and E.
174
Re Crown Librarians, Library Officers and Archivists Award Proceedings – Applications Under the Equal Remuneration
Principle (2002) 111 IR 48; (2002) EOC 93-197.
175
Liquor, Hospitality and Miscellaneous Union (Qld Branch) v Australian Dental Assoc (Qld Branch) (2005) 180 QGIG 187;
(2005) EOC 93-414; [2005] QIRComm 139.
176
Liquor, Hospitality and Miscellaneous Union, Queensland Branch, Union of Employees v Children’s Servicers Employers
Association (2006) 182 QGIG 318 and Re Miscellaneous Workers Kindergartens & Child Care Centres Etc (State) Award (NSW)(2006) 150 IR 290; (2006) EOC 93-434; (2006) NSWIRComm 64.
177
Queensland Services, Industrial Union of Employees v Queensland Chamber of Commerce and Industry Ltd (2009) 191 QGIG
19.
178
Australian Workers’ Union of Employees, Queensland v Queensland Community Services Employers Association Inc (2009)
192 QGIG 46.
179
Meg Smith & Andrew Stewart “A New Dawn for Pay Equity? Developing an Equal Remuneration Principle under the Fair
Work Act” [2010] AJLL 12.
180
Ibid.
181
Equal Remuneration Case, above n Error! Bookmark not defined. at [202].
182
Fair Work Australia, above n 145.
183
Fair Work Act 2009 (Cth), s 302.
173

New Zealand Journal of Employment Relations 37(1): 119-151
productive and cooperative workplace relations and ensure compliance with Commonwealth workplace
laws.”184
To date, the federal government has not adopted an equal remuneration principle (ERP) although two ERPs
have been developed at state level. 185 Smith and Stewart acknowledge that there is no necessity for anational ERP. However, the authors suggest that adoption would be desirable. 186 There is no necessity
because the two main benefits of an ERP are that an ERP could clarify that there is no requirement to provesex-based discrimination and that comparison with a male group is not essential. These two features havebeen established in the Equal Remuneration Case.187 Recently, the federal government stated that it
would:188
support the development of an appropriate equal remuneration principle for the federal
jurisdiction drawing on the Queensland Equal Remuneration Principle of 2002 andexplanatory notes and relevant New South Wales jurisprudence.
The development of a federal ERP is expected. This analysis shows that since 2009, the federal government
has implemented a broad range of measures to provide for pay equity in fulfilment of its international
obligations. The federal jurisdiction is making significant progress towards substantive equality.

Conclusion
There is a compelling rationale for the Australian and New Zealand governments to implement measuresthat promote pay equity. Historically, New Zealand has been seen as “progressive” in its approach to pay
equity.189 However, this view should be revisited given the repeal of the EEA and the abandonment of thePlan. In contrast, Australia is becoming increasingly progressive.
In response, the New Zealand government should amend the ERA to enable the employment institutions tomake EROs. This could be achieved by allowing an employee, an employee‟s organisation or the EEO
Commissioner to bring a claim for personal grievance on the grounds that an employer‟s failure to provide
equal remuneration based on equal or comparable value amounts to an unjustified disadvantage.190 The
employment jurisdictions could be expected to interpret the amendment generously given its fundamental
importance and the requirement for employment institutions to acknowledge and address “the inherent
inequality of … power in employment relationships”.191 The New Zealand government should also develop
an ERP to express its intention to honour New Zealand‟s international obligations and to provide guidance
to the employment institutions.192 The role of the EEO Commissioner should be expanded and sufficiently
resourced to encompass monitoring implementation of pay equity measures and should report to government
on a regular basis. If these measures were adopted, the New Zealand government would achieve compliancewith its international obligations under ILO 100, CEDAW and the ICESCR.

184

Fair Work Ombudsman “About Us” (2012) <www.fairwork.gov.au>.
An ERP is a statement of principle that provides guidance in terms of disputes concerning equal remuneration. See appendices
D and E.
186
Smith and Stewart, above n 179.
187
Equal Remuneration Case, above n 145.
188
Australian Government cited in Smith and Stewart, above n 179.
189
Queensland Industrial Relations Commission, above n 14040, at 88.
190
Employment Relations Act 2000, s 103.
191
Employment Relations Act 2000, s 3.
192
Examples of ERP‟s are located in Appendices D and E.
185

New Zealand Journal of Employment Relations 37(1): 119-151
Until that happens, the gender pay gap is likely to widen in New Zealand and to narrow in Australia.
Accordingly, the Key government has failed to fulfil its mandate and to honour New Zealand‟s international
obligations. For women in New Zealand to achieve pay equity, the most effective short-term strategy
appears to be emigration to Australia. If New Zealand women follow this course of action, the Prime
Minister‟s horror will become a self-fulfilling prophecy.

Postscript
Recently, Chief Executive of the Employers and Manufacturers Association (EMA), Alasdair Thompson,has provoked outrage by suggesting that one of the reasons for the gender pay gap is that women are lessproductive because they take more time off work due to period-related illness. 193 In defence, Thompson
stated that he supported equal pay for equal work. This comment has been repeated like a mantra as ajustification for the present arrangements in New Zealand. The subtext is that because the EPA is on thebooks, New Zealand is fulfilling its international obligations and no further actions are required. If that is themessage, it is out-dated and plainly incorrect.
The dictum of Lee J is apposite:194
It is well known that lay people often wrongly conclude that because a person has repeatedly
said that something has occurred therefore it must for that reason be true. They are often
inclined to the view that mere assertion, particularly if repeated, necessarily means that what
is asserted is true. Lewis Carroll‟s statement in “Hunting of the Snark” that “What I tell you 3
times is true”, is quite incorrect. Merely saying something does not necessarily make it so.
Thompson has subsequently resigned. The EMA has not altered its position on pay equity.

193
194

New Zealand Herald “Alasdair Thompson Walks Off Interview Over „Sexist‟ Claims” <www.nzherald.co.nz>.
R v Robinson [1998] QCA 50 at 70.

New Zealand Journal of Employment Relations 37(1): 119-150
Appendix A

TimelineoftheHistory

Harvestercase setsmale wage
rates (1907)

Women
receive 54%of the malewage (1919)

1890

1910

National
Council of
Women
decides infavour ofequal payfor equal
work (1897)

Arbitration
Court setsa lowerrate forfemaleworkers(1903)

ofthe

Struggle

Women
receive
75% of thebasic wage
(1960)

1930

1950

Minimum
wage forwomen setat 47 % of
the malerate (1936)

Arbitration
Court sets
femalewage at
70% of themale rate(1949)

forA trilogy of cases
establish theprinciple of equalpay for equal work
(1969-1974)

1960

GSEPA
passed –equal
pay inthepublicsector(1960)

1970

EPA
passed –equal pay
extended tothe private
sector(1972)

Pay

EquityPay equity claims
processed throughthe anomalies
provisions of theWage Fixing
Principles (1980‟s)

1980

Femalerates haveincreased
to 78 % of
the malerate (1978)

inAustralia

and

Equal
remuneration
for work ofequal value
recognised inlegislation(1993)

Despitelegislation,nosuccessful
pay equity
claims arelodged(2005-2009)

1990

2000

EEA
enactedandrepealed
just twomonthslater(1990)

Pay & Employment
Equity Unitestablished and thePlan of Action is
implemented (20042009)

New

Zealand

FWA enacted, Fair
Work Australia isestablished, researchis published and theEqual Remuneration
Case is decided(2009 – 2011)

2010

PEEU
abolished andpublic sector
pay equity
reviews are
discontinued(2009).

New Zealand Journal of Employment Relations 37(1): 119-151

Appendix B
Division 2—Equal remuneration orders
302
FWA may make an order requiring equal remuneration
Power to make an equal remuneration order(1) FWA may make any order (an equal remuneration order) it considers appropriate to ensure that, for employees towhom the order will apply, there will be equal remuneration for work of equal or comparable value.
Meaning of equal remuneration for work of equal or comparable value(2) Equal remuneration for work of equal or comparable value means equal remuneration for men and women workers forwork of equal or comparable value.
Who may apply for an equal remuneration order(3) FWA may make the equal remuneration order only on application by any of the following:(a) an employee to whom the order will apply(b) an employee organisation that is entitled to represent the industrial interests of an employee to whom the order
will apply;(c) the Sex Discrimination Commissioner.
FWA must take into account orders and determinations of the Minimum Wage Panel(4) In deciding whether to make an equal remuneration order, FWA must take into account:(a) orders and determinations made by the Minimum Wage Panel in annual wage reviews; and(b) the reasons for those orders and determinations.
Restriction on power to make an equal remuneration order(5) However, FWA may make the equal remuneration order only if it is satisfied that, for the employees to whom the order
will apply, there is not equal remuneration for work of equal or comparable value.
303

Equal remuneration order may increase, but must not reduce, rates of remuneration(1) Without limiting subsection 302(1), an equal remuneration order may provide for such increases in rates of
remuneration as FWA considers appropriate to ensure that, for employees to whom the order will apply, there will beequal remuneration for work of equal or comparable value.
(2) An equal remuneration order must not provide for a reduction in an employee‟s rate of remuneration.
304

Equal remuneration order may implement equal remuneration in stages

An equal remuneration order may implement equal remuneration for work of equal or comparable value in stages (asprovided in the order) if FWA considers that it is not feasible to implement equal remuneration for work of equal orcomparable value when the order comes into operation.
305 Contravening an equal remuneration order
An employer must not contravene a term of an equal remuneration order.
Note: This section is a civil remedy provision (see Part 4-1).

306 Inconsistency with modern awards, enterprise agreements and orders of FWA
A term of a modern award, an enterprise agreement or an FWA order has no effect in relation to an employee to the extent
that it is less beneficial to the employee than a term of an equal remuneration order that applies to the employee.

New Zealand Journal of Employment Relations 37(1): 119-151

Appendix C
Pay Equality BillA Bill to make provision for equality through the removal and prevention of discrimination in rates of pay of males andfemales in paid employment to promote observance in New Zealand of the principles underlying International Labour
Convention 100 on Equal Remuneration and the United Nations Convention on the Elimination of all Forms ofDiscrimination Against Women.

1. Short Title

This Act may be cited as the Pay Equality Act.
2. Objects
The objects of the Act are –(1) To provide for the inclusion in all employment agreements, individual and collective, of an equality clause;(2) To identify equal work and provide for equal pay for equal work and work of equal value;(3) To provide for the right to be free from the discrimination of inequality of pay.
3. Interpretation
In this Act, unless the context otherwise requires, –“Agreement” means –(a) a contract of employment;(b) an individual employment agreement entered into by one employer and one employee who is not bound by acollective agreement;(c) a collective agreement as defined in the Employment Relations Act.
“Authority” means the Employment Relations Authority constituted under the Employment Relations Act 2000
“Court” means the Employment Court constituted under the Employment Relations Act“Employee” includes a person who has entered into or works under a contract of employment or apprenticeship with an
employer“Employer” includes a person employing any employee or employees“Labour Inspector” means an employee of the department designated under section 223 of the Employment Relations Act
to be a Labour Inspector“Pay” includes the salary or wages actually paid and legally payable and includes bonus and other special payments,
allowances, fees, commissions, and any other benefits or privileges whether paid in money or not“Union” means a union registered under Part 4 of the Employment Relations Act“Work of Equal Value Unit” means a unit established within the Department of Labour with persons qualified andexperienced in the Gender-Inclusive Job Evaluation Standard (P8007/2006)
4. Application of the Act
The Act will apply to both the public and the private sectors.
5. Equal Work
(1) For the purposes of this Act, A‟s work is equal to that of B if it is(a) like B‟s work,(b) rated as equivalent to B‟s work,(c) of equal value to B‟s work.
(2) A‟s work is like B‟s work if(a) A‟s work and B‟s work are the same or broadly similar; and(b) Such differences as there are between their work are not of practical importance in relation to the terms of
their work.

New Zealand Journal of Employment Relations 37(1): 119-151(3) A‟s work is rated as equivalent to B‟s work if a job evaluation study(a) gives an equal value to A‟s job and B‟s job in terms of the demands made on an employee, or(b) would give an equal value to A‟s job and B‟s job if the evaluation did not include values different for men
from those set for women.
(4) A‟s work is of equal value to B‟s work if it is(a) neither like B‟s work nor rated as equivalent to B‟s work, but(b) nevertheless equal to B‟s work in terms of the demands made on A by reference to the Gender-Inclusive Job
Evaluation Standard (P8007/2006).
6. Equality Clause(1) Every employment agreement, individual and collective, shall be deemed to include an equality clause.
(2) An equality clause is a provision that provides for equal work as defined in section 5 and has the following effect(a) if a term of A‟s agreement is less favourable to A than a corresponding term of B‟s agreement, A‟s term is
modified so as to have the same effect as the term in B‟s agreement;(b) if A does not have a term which corresponds to a term of B‟s that benefits B, A‟s terms are modified so as toinclude such a term.
7. Defence of Material Factor(1) The equality clause in A‟s terms has no effect in relation to a difference between A‟s term and B‟s terms if it is shownthat the difference is because of a material factor, reliance on which(a) does not invoke treating A less favourably because of A‟s sex than B is treated, and(b) if the factor is within subsection (2), is a proportionate means of achieving a legitimate aim.
(2) A material factor is within this subsection if A shows that, as a result of the factor, A and persons of the same sex doing
work equal to A‟s are put at a particular disadvantage when compared with persons of the opposite sex doing work equal
to A‟s.
(3) For the purpose of subsection (1), the long-term objective of reducing inequality between men and women‟s work isalways to be regarded as a legitimate aim.
(4) A material factor includes evidence that a Job Evaluation Scheme that is consistent with the Gender-Inclusive Job
Evaluation Standard (P8007/2006) has been undertaken and implemented by the employer.
8. Obligation to Provide Information(1) Every employer must at all times keep a record showing that all employees are paid in accordance with the equality
clause.
(2) Every employer must record any differences in the remuneration of male and female employees.
(3) Any clause in any individual or collective agreement that prevents or restricts the disclosure of information relating toremuneration is unenforceable against the individual who wishes to disclose the information in the course of establishingdiscrimination in the rates of pay on the grounds of sex inequality.
(4) A Labour Inspector (or person authorised by a Labour Inspector to do so) may serve on an employer a demand notice,
if an employee makes a complaint to the Labour Inspector or the Labour Inspector believes on reasonable grounds, that an
employee has not received pay or other money payable by the employer under the Pay Equality Act.
(5) Before issuing the demand notice the procedure laid down in section 224 of the Employment Relations Act must be
followed.
(6) A Labour Inspector may commence an action in the name and on behalf of an employee to recover any money payable
under the Pay Equality Act.
9. Assessment of Whether Work is of Equal Value(1) This section applies to proceedings before the Authority on a complaint relating to a breach of an equality clause.
(2) Any party to an employment agreement, individual or collective, may lay a complaint for breach of the equality clause.

New Zealand Journal of Employment Relations 37(1): 119-151(3) Where a question arises in the proceedings as to whether A‟s work is equivalent to B‟s work or A‟s work is of equalvalue to B‟s work, the Authority may, before determining the question, require the Department of Labour (Work of Equal
Value Unit) to prepare a job evaluation study that is consistent with the Gender-Inclusive Job Evaluation Standard(P8007/2006) on the question.
(4) If the determination of the complaint requires a comparator occupational group to be identified, the Authority will
require the Department of Labour (Work of Equal Value Unit) to identify an appropriate comparator group and prepare a
job evaluation study consistent with the Gender-Inclusive Evaluation Standard (P8007/2006). The comparator
occupational group(s) may be identified within the enterprise itself, or from another enterprise or the same or anotherindustry. The comparator groups are to have same or comparable job evaluation points as determined in accordance with
the Gender-Inclusive Job Evaluation Standard (P8007/2006).
(5) If the Authority requires the preparation of a study, it must not determine the question unless it has received the job
evaluation study.
(6) On receipt of the job evaluation study the Authority will make it available to the parties and after receiving submissions
from the parties will determine the matter.
10. Inclusion of Equality Clause in Collective Agreement(1) A collective agreement has no effect unless it contains an equality clause.
(2) The form and nature of the equality clause may be negotiated through the collective bargaining process in accordancewith the provisions of the Employment Relations Act.
(3) In the event of dispute over the form and nature of the equality clause the matter will be referred to the Department ofLabour (Work of Equal Value Unit) for a job evaluation study consistent with the Gender-Inclusive Job Evaluation
Standard (P8007/2006).
(4) The job evaluation study will be referred to the parties but if agreement cannot be reached the matter may be referredby one or both of the parties to the Authority for a determination that will be binding.
11. Jurisdiction(1) The Authority has jurisdiction to determine a complaint relating to or arising out of a breach of the equality clause.
(2) Where an employee would be entitled to make a complaint under the Human Rights Act 1993, the employee may
choose to pursue a complaint under the Pay Equality Act or the Human Rights Act but not both.
(3) The Authority has jurisdiction to determine an application for a declaration as to the rights of an employee or
employees or employer or employers in relation to a dispute about the effect of an equality clause.
(4) The Authority may, at any time, before or during the hearing or before delivering its decision, on the application of any
party to the proceedings or on its own motion, state a case for the opinion of the Employment Court on any question of law
arising in any proceedings before the Tribunal.
(5) The Employment Court shall hear and determine any question submitted to it under this section, and shall remit thecase with its opinion to the Authority.
12. Remedies(1) If the Authority is satisfied on the balance of probabilities that the defendant has committed a breach of the equality
clause, the Authority may grant 1 or more of the following remedies:(a) a declaration that the defendant has committed a breach of the equality clause;(b) an order restraining the defendant from continuing or repeating the breach, or from engaging in, or causing
conduct of the same kind as that constituting the breach, or conduct of any similar kind specified in the order;(c) an order that the defendant perform any acts specified in the order with a view to redressing any loss ordamage suffered by the complainant;(d) an order that the defendant undertake any specified training or programme, or implement any specified policy
or programme, in order to assist or enable the defendant to comply with the provisions of this Act.
(2) Any order made under this section of the Act may be filed in any District Court, and shall be then enforceable in thesame manner as an order made or judgment given by the District Court.

New Zealand Journal of Employment Relations 37(1): 119-151

13. Offences(1) Every person commits an offence against this Act and is liable on summary conviction to a fine not exceeding $5000
who, either alone or in combination with any other person or group or body of persons, does any act with the intention of
defeating any provision of the Act.
(2) Every person commits an offence who, wilfully obstructs or hinders any Inspector in the performance of the functions
under section 8 of this Act.
14. Codes of Practice(1) The Authority may issue codes of practice(a) that ensure or facilitate compliance with a provision of the Act;(b) that ensure or facilitate the provision of an equality clause in a collective agreement.
(2) The Department of Labour shall issue a code of practice that is consistent with the Gender-Inclusive Job Evaluation
Standard (P8007/2007) for the identification of appropriate comparator occupational groups to facilitate the determinationof complaint(s) relating to work of equal value.
(3) The Human Rights Commission shall establish procedures for the advocacy and promotion of pay equality byeducation and publicity and the dissemination of information.
15. Department of Labour
The Act is to be administered by the Department of Labour.

Appendix D
New South Wales Equal Remuneration and Other Conditions Principle
15

Equal Remuneration and Other Conditions(a)Claims may be made in accordance with the requirements of this principle for an alteration in wage rates or otherconditions of employment on the basis that the work, skill and responsibility required or the conditions under which thework is performed have been undervalued on a gender basis.
(b)
The assessment of the work, skill and responsibility required under this principle is to be approached on a gender
neutral basis and in the absence of assumptions based on gender.
(c)
Where the undervaluation is sought to be demonstrated by reference to any comparator awards or classifications,the assessment is not to have regard to factors incorporated in the rates of such other awards which do not reflect the valueof work, such as labour market attraction or retention rates or productivity factors.
(d)
The application of any formula, which is inconsistent with a proper consideration of the value of the work
performed, is inappropriate to the implementation of this principle.
(e)
The assessment of wage rates and other conditions of employment under this principle is to have regard to thehistory of the award concerned.
(f)
Any change in wage relativities which may result from any adjustments under this principle, not only within theaward in question but also against external classifications to which the award structure is related, must occur in such a way
as to ensure there is no likelihood of wage leapfrogging arising out of changes in relative positions.
(g)
In applying this principle, the Commission will ensure that any alteration to wage relativities is based upon thework, skill and responsibility required, including the conditions under which the work is performed.
(h)Where the requirements of this principle have been satisfied, an assessment shall be made as to how theundervaluation should be addressed in money terms or by other changes in conditions of employment, such asreclassification of the work, establishment of new career paths or changes in incremental scales. Such assessments will

New Zealand Journal of Employment Relations 37(1): 119-151
reflect the wages and conditions of employment previously fixed for the work and the nature and extent of theundervaluation established.
(i)
Any changes made to the award as the result of this assessment may be phased in and any increase in wages may
be absorbed in individual employees‟ over award payments.
(j)Care should be taken to ensure that work, skill and responsibility which have been taken into account in any
previous work value adjustments or structural efficiency exercises are not again considered under this principle, except tothe extent of any undervaluation established.
(k)
Where undervaluation is established only in respect of some persons covered by a particular classification, theundervaluation may be addressed by the creation of a new classification and not by increasing the rates for theclassification as a whole.
(l)
The expression „the conditions under which the work is performed‟ has the same meaning as in Principle 6, Work
Value Change.
(m)

The Commission will guard against contrived classification and over classification of jobs. It will also consider:(i)the state of the economy of New South Wales and the likely effect of its decision on the economy;(ii)

the likely effect of its decision on the industry and/or the employers affected by the decision; and(iii)

the likely effect of its decision on employment.

(n)Claims under this principle will be processed before a Full Bench of the Commission, unless otherwise allocatedby the President.
(o)Equal remuneration shall not be achieved by reducing any current wage rates or other conditions of employment.

Appendix E
Queensland Industrial Relations Commission’s Equal Remuneration Principle
EQUAL REMUNERATION PRINCIPLEThis principle applies when the Commission:(a)makes, amends or reviews awards;(b)

makes orders under Ch 2, Pt 5 of the Industrial Relations Act 1999;(c)arbitrates industrial disputes about equal remuneration; or(d)values or assesses the work of employees in „female‟ industries, occupations or callings.

In assessing the value of work, the Commission is required to examine the nature of work, skill and responsibility required
and the conditions under which work is performed as well as other relevant work features. The expression „conditions
under which work is performed‟ has the same meaning as in Principle 7 „Work Value Changes‟ in the Statement of Policy
regarding Making and Amending Awards.
The assessment is to be transparent, objective, non-discriminatory and free of assumptions based on gender.
The purpose of the assessment is to ascertain the current value of work. Changes in work value do not have to be
demonstrated. Prior work value assessments or the application of previous wage principles cannot be assumed to havebeen free of assumptions based on gender.

New Zealand Journal of Employment Relations 37(1): 119-151
In assessing the value of the work, the Commission is to have regard to the history of the award including whether there
have been any assessments of the work in the past and whether remuneration has been affected by the gender of theworkers. Relevant matters to consider may include:(a) whether there has been some characterisation or labelling of the work as „female‟;(b) whether there has been some underrating or undervaluation of the skills of female employees;(c) whether remuneration in an industry or occupation has been undervalued as a result of occupational segregation orsegmentation;(d) whether there are features of the industry or occupation that may have influenced the value of the work such as thedegree of occupational segregation, the disproportionate representation of women in part-time or casual work, low rates ofunionisation, limited representation by unions in workplaces covered by formal or informal work agreements, theincidence of consent awards or agreements and other considerations of that type; or(e) whether sufficient or adequate weight has been placed on the typical work performed and the skills and responsibilities
exercised by women as well as the conditions under which the work is performed and other relevant work features.
Gender discrimination is not required to be shown to establish undervaluation of work. Comparisons within and between
occupations and industries are not required in order to establish undervaluation of work on a gender basis. Suchcomparisons may be used for guidance in ascertaining appropriate remuneration. The proper basis for comparison is not
restricted to similar work.
Where the principle has been satisfied, an assessment will be made as to how equal remuneration is to be achieved.
Outcomes may include but are not limited to the reclassification of work, the establishment of new career paths, changes toincremental scales, wage increases, the establishment of new allowances and the reassessment of definitions anddescriptions of work to properly reflect the value of the work.
There will be no wage leapfrogging as a result of any changes in wage relativities arising from any adjustments under thisprinciple. The Commission will guard against contrived classifications and over classification of jobs.
The Commission may determine in each case whether any increases in wages will be absorbed into overaward payments.
Equal remuneration will not be achieved by reducing current wage rates or other conditions of employment. The
Commission may decide to phase in any decision arising from this principle. Any affected employer may apply to haveany decision phased in. The merit of such application will be determined in the light of the particular circumstances ofeach case and any material relating thereto will be rigorously tested.
Claims brought under this principle will be considered on a case by case basis.

New Zealand Journal of Employment Relations 37(1): 152-160

Time, Work, and Law: a New Zealand Perspective
AMANDA REILLY*
Abstract
New Zealand is popularly perceived as a laid back place where individuals might choose to live to enjoy aslower paced life style. However, the reality is that New Zealanders work some of the longest days and themost hours per annum in the OECD.
In this article, it is argued that existing legal mechanisms for limiting work time are rooted in increasingly
obsolete work patterns premised on strong unions and a workforce of permanent full-time employees whoare supported by an unpaid female workforce who carry the burden of reproductive care work. However, in
New Zealand, as elsewhere, these legal mechanisms have been undermined by de-unionisation, theemergence of precarious work and the growing numbers of women in the workforce. Consequently, theability of workers to limit their work time has been significantly compromised. In the final part of the article,
it is suggested that a Guaranteed Basic Income could, given the changing nature of work, be a more effective
and flexible mechanism for controlling working time than current law.

Introduction
New Zealand claims to be the first country in the world to introduce the eight hour working day dating from1840 when carpenter Samuel Parnell went on strike insisting he would only work eight hours a day on acarpentry job. He famously said
There are twenty-four hours per day given us, eight of these should be for work, eight for sleep,
and the remaining eight for recreation and in which for men to do what little things they want to
do for themselves.
To this day, New Zealand is popularly perceived as a laid back place where individuals might choose to live
to enjoy a slower paced life style. However, the reality is that New Zealanders work some of the longest
days and the most hours per annum in the OECD. 1 One survey indicates that 40% of New Zealanders havesome or a lot of difficulty getting the work life balance they want and 46% experience some degree of worklife conflict.2 A recent Department of Labour study into those who work long hours reported that 22.68% of
the total workforce work long hours (defined as 50 hours per week.) Notably, the longest working hours arefound among the poorest working people with income distribution skewing downwards among thoseworking over 60 hours a week.3 20.1% of those working 60 or more hours a week report themselves as
dissatisfied or very dissatisfied with their work-life balance. 4
Historically, legal norms and mechanisms have operated to allow people to exercise control over their timeby limiting working hours. This article proposes that a Guaranteed Basic Income (BI) might be a better
option than existing labour and employment law mechanisms (i.e. informal workplace norms, collective*

1

Lecturer in Law, School of Accounting and Commercial Law, Victoria University of Wellington

Organisation for Economic Co-Operation and Development “Clocking In and Clocking Out: Recent Trends in Working Hours,
Policy Brief” (2004) <www.oecd.org>.
2
New Zealand Department of Labour “Work-Life Balance in New Zealand: A Snapshot of employee and employer attitudes andexperiences” (2006) <www.dol.govt.nz>.
3
L Fursman “Working Long Hours in New Zealand: A Profile of Long Hours Workers Using Data from the 2006 Census” (2008)
New Zealand Department of Labour <www.dol.govt.nz>.
4
Statistics New Zealand Survey of Working Life March 2008 Quarter (2008) at 19.

New Zealand Journal of Employment Relations 37(1): 152-160
bargaining and restrictions on working time embodied in statute and regulation) in terms of allowing
workers to limit and control their time working time.
As a preliminary, it is necessary to define BI. One definition is that it is “an income unconditionally granted
to all on an individual basis without means test or work requirement.”5 This idea may seem somewhat
radical but it is an idea with a long lineage and it is a concept that has been the subject of much discussioninternationally6 in recent times.7 A variety of ways of structuring this entitlement have been proposed, but
most fall under one of two categories: the Basic Income or the Negative Income Tax. Advocates proposethat it should be set at a level sufficient to sustain “a modest but decent standard of living”. 8 The idea has
been raised in New Zealand, 9 most recently in Gareth Morgan‟s “Big Kahuna” proposal that everybody
should get a basic income of $10,000 regardless of whether they are employed or not.10
The article is structured in three parts: in the first section the main legal mechanisms for controlling work
time are located within a historical context, in the second section it is suggested that the emergence of postFordist work patterns and the subsequent growth in precarious work and the increasing participation of
women in the paid workforce make these mechanisms less effective than previously. In the second and final
section, the suggestion is made that a BI could be a more effective and flexible mechanism than current lawof allowing workers to limit their working time. In particular, it is suggested that a BI could be a better
alternative in terms of allowing individuals to regain control of their time by virtue of:1) The bargaining power a BI would confer on individuals in their working lives.
2) The options a BI might provide with regard to the distribution of reproductive work.
3) The enhanced ability a BI would potentially confer to participate in the wider political sphere.
The legal mechanisms for controlling work time in New Zealand are now located in their historical context.
Following that, they are critiqued within the present day context which is characterised by firstly postFordist work patterns and an associated growth in precarious work and secondly increased participation of
women in the paid workforce.

A Brief History of Time and Law
In pre-industrial times “reproductive” work, that is the work of caring for dependants and the physical needsof a household, and “productive work,” which is market work, were not separate conceptually,geographically or temporally. 11 To a great extent, the rhythm of work varied according to natural timecycles (day, season, life).
In New Zealand, prior to colonial contact, the Māori concept of time was rooted in Māori cosmology.
Traditional beliefs delineated three periods of time from which emerged man beginning with Te Kore i.e. thenothingness. This was a necessary period of chaos where order was neither evident nor required, from there
Te Po, which was an evolution from nothingness into darkness. This was, in turn, followed by the broad
5

This is the definition adopted by the Basic Income Earth Network <http//www.basicincome.org/bien/>.
For example, see John Cunliffe and Guido Erreygers (eds) The Origins of Universal Grants: an Anthology of Historical Writings
on Basic Capital and Basic Income (Palgrave Macmillan, Basingstoke, 2004).
7
For a bibliography containing more than 2000 books and articles relating to a guaranteed basic income see the US Basic Income
Network: Bibliography <http://www.usbig.net/bib.html>
8Carole Pateman “Freedom and Democratisation: Why Basic Income is to be Preferred to Basic Capital” in K Dowding, J De
Wispelaar and S White (eds) The Ethics of Stakeholding (Palgrave MacMillan, London England, 2003).
9
M Goldsmith “Universal Basic Income and the Concept of Citizenship” (1997)9 Social Policy Journal 45; K Rankin “Revisiting
the UBI” (1998) 7(2) New Zealand Political Review 12.
10
Gareth Morgan “What to Watch Out for in 2010” New Zealand Listener (New Zealand, 6 February 2010).
11
See J Williams “From Difference to Dominance to Domesticity: Care as Work, Gender as Tradition” (2001) 76 Chicago Kent
Law Review 1441 at 1443.
6

New Zealand Journal of Employment Relations 37(1): 152-160
daylight of Te A Marama. Associated with this cosmology the Māori sense of time and the Māori way of life
and work ethic is rooted in lunar cycles and the growing periods of plants and the fertility cycles of fish andmammals. Time in a Māori sense is not necessarily chronological. Its measurement is established by themeaning of related events rather than the period between events with periods of birth and death requiring
specific responses according to tribal lore and tradition. 12
However, Enlightenment thinking posited humans as ecologically distinct from the natural world and as aconsequence time perceptions, in Western culture, became “increasingly mechanised in both physical andconceptual representation”. 13 This process of mechanisation of time was continued and exacerbated with theadvent of the industrial revolution where the transition to Industrial Capitalism and wage labour imposed
work patterns characterised by regularity. Thompson describes this as movement from task orientation to
timed work as the labouring classes were forced to assume new time compliant working habits. 14 In
conjunction with this, productive work and reproductive work begin to be conceived as separately gendered
activities. As certain types of production were time disciplined, and moved into factories, they were
gendered masculine. Other types of production (such as production of food and clothing) were coded as“caring” rather than “work” and were gendered feminine.15
This transition was not an instantaneous one. Thompson states “in the first stage we find simple resistance.
But in the next stage, as the new time discipline is imposed so the workers begin to fight not against time but
about it.”16 Thus, for much of the nineteenth century, working time was a central focus of political and legal
struggle. 17 This struggle resulted in the implementation of a number of measures aimed at shaping time forthe benefit of workers and, in particular restricting work hours.
Although there were aspects unique to New Zealand‟s particular cultural mix and history, the local
mechanisms that evolved to regulate time were similar to those which evolved internationally, i.e. customarynorms, norms derived from collective bargaining which operate alongside standardised limits on theworking day/week/year or limits on working hours embodied in statute and regulations. 18 The nature ofthese protections can best be illustrated by a brief overview of how they operated historically in New
Zealand:Samuel Parnell, as mentioned above, is credited with being the driving force behind the introduction of theeight hour day to New Zealand. This norm was perhaps less than ideally enforced by means of a dunking in
Wellington Harbour for any who worked longer than eight hours but subsequently, albeit informally, theeight hour day became the standard working day. To the present day, relatively informal workplace norms
play a role in limiting working time and may in some circumstances be given legal recognition and enforcedby the courts. 19
Unions have historically also been very important in terms of negotiating and enforcing limits on the hours
workers could be required to work. For example, in 1936, the Industrial Conciliation and Arbitration Act
required that the Court of Arbitration should fix at not more than 40 the maximum number of hours,
12

Gail Whitford and Mike Barnes “Te Ao Hurihuri New Zealand‟s First Time in W Pental and A Harvey et al (eds) Time Use
Research in Social Science (Springer, New York, 1999) 212 at 214.
13
Ibid at 216.
14
EP Thompson Customs in Common: Studies in Traditional Popular Culture (Merlin Press, London, 1991) at 383.
15
See Williams, above n 11, at 1443.
16
Thompson , above n 14, at 388).
17
J Conaghan “Time to Dream? Flexibility, Families, and the Regulation of Working Time” in J Fudge and R Owens (eds)
Precarious Work, Women, and the New Economy (Hart Publishing, Oxford, 2006) 101 at 111.
18
For discussion of international developments see G Bosch “Working Time: Tendencies and Emerging Issues (1999) 138 “International Labour Review 135; Conaghan, above n 17, 102.
19
NZ Amalgamated Engineering Printing and Manufacturing Union Inc v The Christchurch Press, A Division of Fairfax New
Zealand Ltd [2005]1 ERNZ 288 is an example of where the courts gave formal legal recognition to an informal work custom anddid not allow Christchurch press to require employees to work longer night shifts as this would be contrary to a custom of 30
years standing.

New Zealand Journal of Employment Relations 37(1): 152-160
exclusive of overtime, to be worked in any one week by any worker bound by the award (i.e. unionnegotiated agreements concerning terms and conditions of employment). With this, the 40-hour five-day
week became almost universal at least for a time.
Statutory protections are another key legal mechanism that has evolved to control and restrict working time.
In New Zealand, perhaps more than other countries, collectivisation and union negotiated awards were
historically the central source of these protections.20 However, in more recent years statutory protections
restricting working time have become more significant. 21
It is important to note that the protective mechanisms described above have never benefited all workers. As
well as serving a protective purpose, labour and employment law has a gate keeping function; it provides
rights to some workers and then it limits access to those rights. In general, the legal status of “employee” isan important prerequisite to accessing rights to statutory protection and the right to legally strike orcollectively bargain. 22 Those who cannot fit themselves within the definition of employee, such as the selfemployed cannot access these rights. 23 Furthermore, in New Zealand unions have, at least historically,
generally operated for the benefit of union members, i.e. predominantly male full-time breadwinners rather
than for the benefit of all workers.24
For a long time, however, the legal mechanisms for regulating time were, if not perfect, arguably goodenough in terms of outcome for a majority of workers in New Zealand. However, two critical changes inorganisation and distribution of work have emerged over the past years which make these mechanisms
increasingly less effective at allowing workers to control their time. These are:a) The trend towards post-Fordist patterns of production and the corresponding rise in precarious workb) The increasing participation of women in paid work
The Trends towards Post-Fordist patterns of production
Post-Fordism, as the next stage after Industrial Capitalism, entails a different mode of production: one that ismore flexible and specialised, where employers respond to market conditions by retaining a core of skilledemployees supplemented on an as-needed basis by a periphery of less secure workers who may be part-time,short term contract or casual employees together with subcontractors, agency temps and the self-employed
who provide flexibility. In New Zealand, as elsewhere, 25 a growing number of workers now find themselvesin what is known as precarious or contingent work, i.e. jobs characterised by insecurity, low wages, and few
benefits. 26 These jobs are also characterised by variable hours that can make day-to-day time management
and long-term planning extremely problematic.

20

For example, historically, there was no statutory right to sick leave until a three day entitlement was mandated by Section 30 of
the Holidays Amendment Act 1991. Nonetheless, most workers would effectively have had a right to sick leave by virtue of theapplicable union negotiated award. M Wilson “The Employment Relations Act: A Framework for a Fairer way” in E Rassmussen(ed) Employment Relationships: New Zealand’s Employment Relations Act (Auckland University Press, Auckland, 2004) 9 at 11.
21
Some examples are s 11 of the Minimum Wages 1983; The Parental Leave and Employment Protection Act 1987; the Holidays
Act 2003; the Employment Relations (Flexible Working Arrangements Amendment Act 2007; the Employment Relations (Rest
Breaks, Infant feeding and Other Matters) Amendment Act 2009.
22
These rights which are established by the Employment Relations Act 2000 are only available to employees who fall within thedefinition of s 6.
23
For example under the Holidays Act 2003, only employees are entitled to at least four weeks paid annual holidays a year.
Similarly for employees, there is a minimum provision of five days‟ paid sick leave after the first six months of continuous
employment.
24
For some historical discussion see S Robertson “Women Workers and the New Zealand Arbitration Court” (1991) 61 Labour
History 30.
25
J Fudge and R Owens (eds) Precarious Work, Women, and the New Economy (Hart Publishing, Oxford, 2006).
26
D Tucker “Precarious Non-Standard Employment- A Review of the Literature” (2002) New Zealand Department of Labour at
66 <www.dol.govt.nz>.

New Zealand Journal of Employment Relations 37(1): 152-160
Data on the extent of precarious work in New Zealand is thin however, the number is not insignificant with
one study suggesting that at least one third of New Zealand employees are in non-standard jobs.27 Suchworkers are frequently un-unionised, 28 have low awareness of any legal rights they may have29and limited
ability to use legal processes to resolve employment related disputes. 30
While existing legal mechanisms for limiting working time may work adequately for employees in secure,long-term permanent employment, they are necessarily less effective for those on the low paid, casualised
periphery of the workforce who are either not entitled to legal rights due to their legal status,31 or not in aposition to enforce the rights they are theoretically entitled to. Mechanisms which limit working time
pertaining to the status of employee are also not accessible to the self-employed and here it should be notedthat New Zealand has relatively high levels of self-employment. 32
Customary norms have in the past operated as a mechanism for controlling and restricting work time,
whether formally or informally enforced. However, such norms can only develop in work sites populated bypermanent, long-term employees. They are a product of stability and ongoing association between workers
and employers. Long standing customs concerning limitation of working hours can neither develop nor be
enforced in workplaces staffed by transient, casualised workers.
Collective bargaining, too, is problematic as a means of controlling working hours. The substantial decline
in union membership that began in the 1990s has not been reversed. Although the Employment Relations
Act 2000 has the stated objective of promoting collective bargaining, 33collective bargaining is at an historic
low,34 and union membership is particularly low in sectors where the incidence of casual and temporary
employment is high. 35 While the union movement is making commendable efforts to extend the benefits ofcollective bargaining to these excluded workers,36 it must be said that the grim scenario regarding union
membership in New Zealand reflects world wide trends of falling union membership. The reasons arecomplex but the fact that workers tend to be more transient and insecure, and workplaces and jobs more
fluid in a post-Fordist environment as opposed to under industrial capitalism does not make organisation ofunions easy. 37 All things considered, failing some other drastic intervention, collective bargaining, for mostworkers, cannot be seen as a mechanism to rely on in terms of restricting working hours in the current
conditions.
27

C Allan and others “From Standard to Non Standard Employment: Labour Force Change in Australia, New Zealand and South
Africa” (2001) 22 International Journal of Manpower 735.
28
Tucker, above n 26, at 49.
29
Ibid, at 45.
30
New Zealand Department of Labour “Casual and Temporary Employment: Report on Phase One Research” (2007)<www.dol.govt.nz>.
31
The self-employed are generally unable to access statutory rights to time away from work. However, employees in precarious,
short-term, irregular work may also not be able to access statutory protection. For example, under the Holidays Act 2003, there isa minimum provision of five days paid sick leave after the first six months of continuous employment. The Employment Relations(Flexible Working Arrangements) Amendment Act 2007 provides certain employees with a statutory right to request a variationof their working arrangements, including hours of work and days of work if they are responsible for the care of any person.
However, as with sick leave this is only an option after six months of continuous employment).
32
A recent survey reports that, of the people employed in the March 2008 quarter, 12% were self-employed and not employing
others. Statistics New Zealand, above n 4.
33
Employment Relations Act 2000, s 3(a)(iii).
34
In 1990, public sector bargaining density was 97% and private sector density 48%. In 2009, public sector density is 49% andprivate sector density is 9%: Stephen Blumenfeld, Peter Ryall and Graeme Kiely Employment Agreements: Bargaining Trends
and Employment Law Update 2008/2009 (Victoria University of Wellington Industrial Relations Centre 2008/2009) at 14.
35
New Zealand Department of Labour, above n 30, at 12.
36
For New Zealand Council of Trade Unions proposals for legal and union change to improve the availability of collective
bargaining to currently unionised, marginalised workers see Helen Kelly “Union Change” (paper presented to Unions Creating
Alternatives Biennial Conference, October 2009).
37
For discussion of the problems facing unions in the new working environment engendered by post-Fordism see Katherine Stone
From Widgets to Digits: Employment Regulation for the Changing Workplace (Cambridge University Press, Cambridge, 2004)
196.

New Zealand Journal of Employment Relations 37(1): 152-160
Statutory protection of working hours tied to the status of employee is also problematic in the more
precarious working environment engendered under post-Fordist norms. Increasing numbers of workers do
not fit the legal criteria of employee as workplaces are organised along more flexible lines. 38 This problem isexacerbated by the fact that some employers camouflage employees as contractors to cut costs bycircumventing the statutory protections employees are entitled to. Even those workers who may theoreticallybe entitled to the rights pertaining to employees will frequently not have the backing of a union to assist in
enforcing these rights.
All in all, the trends towards post-Fordist working patterns leave increasing numbers of workers unable toaccess legal mechanisms which limit working time. The problem of difficulty in accessing legal protectionof time is compounded by the fact that more and more New Zealand women now work in the paid
workforce which puts greater time pressure on individuals and families. This point is now discussed ingreater depth.

The Increasing Participation of Women in Paid Workforce
While there is no doubt that, in general, collective bargaining and statutory control of work time historically
succeeded in reducing working hours or at least contributed towards shaping them in accordance withworkers desires, they are not unproblematic. Supiot suggests that the legal regulation of time reinforced an
idea of time as an objective commodity capable of regulation. Effectively, this ratified “the economic fictionthat work is detachable from the worker” and it effectively created a false dichotomy between working timeand free time.39 The distinction between working time and free time is, however, artificial. Even though
reproductive work occurs in so-called free time, it is essential that it occurs for the worker to take his or her
place in the workforce. Indeed paid work is parasitic on reproductive work. Most obviously, if one is to be
productive in the workforce, washing will have to be done, meals prepared and eaten, and health (bothemotional and physical) maintained. Dependants, young and old, must also be cared for.
Under the model of industrial capitalism, the apparent dichotomy between work and free time resulted in
reproductive work being unvalued and invisible. There was no need to take reproductive work into accountin work design and time regulation as it was invisibly taken care of elsewhere. This distinction, while
problematic in many respects, 40 was perhaps tenable under historic social norms. These were predicated ona “gender contract” whereby women took care of the reproductive work in return for men assuming thebreadwinner role. 41
However, reproductive work and paid work can no longer be treated as dichotomised worlds where never
the twain shall meet. For a variety of reasons, increasing numbers of women have joined the paid workforce.
In New Zealand in 1959, approximately 29% of working age women participated in the job market. By
contrast in March 2008, the female participation rate was 61.7%.42 Reproductive work still needs to be done
38

The legal concept of employee is widely viewed as problematic in the new working environment. For discussion see H Collins“Independent Contractors and the Challenge of Vertical Disintegration to Employment Protection Laws” (1990) Oxford Journal of
Legal Studies 10; J Conaghan “Labour Law and „New Economy‟ Discourse” (2003)16 Australian Journal of Labour Law 9; B
Creighton “Employment Security and Atypical Work in Australia” (1994-1995) Comparative Labor Law Journal 16; P Spoonley“Is Non Standard Work becoming Standard? Trends and Issues” (2004) NZJER 29; G Standing, “The Australian Charter of
Employment Rights: the Missing Dimensions” (2008) JIR 355.
39
Alain Supiot Beyond Employment: Changes in Work and the Future of Labour Law in Europe (Oxford University Press,
Oxford, 2001) 64.
40
See generally M Waring If Women Counted: A New Feminist Economics (Harper Collins, San Francisco, 1988); J Williams
Unbending Gender (Oxford University Press, New York, 2000).
41
See Judy Fudge “A New Gender Contract? Work/Life Balance and Working Time Flexibility in J Conaghan and K Rittich (eds)Labour Law, Work and Family (Oxford University Press, Oxford England, 2005) at 261 for discussion of this concept and its
evolution.
42
New Zealand Department of Labour “Female Labour Market Fact Sheet” (2008) <www.dol.govt.nz>.

New Zealand Journal of Employment Relations 37(1): 152-160
but with more women involved in the workforce, there is no longer an invisible unpaid workforce standing
ready to undertake this. Increasingly, it must be fitted in around paid work. Inevitably, there is less time inwhich to carry it out, which creates time pressure on individuals and families.
New Zealand has introduced some positive initiatives to attempt to manage the intrusion of the needs ofreproductive life onto working life and no doubt these have helped some women and families. 43 However,these concessions largely remain the preserve of employees, i.e. those already privileged in permanent
positions who have the confidence to ask employers for them. They do little for those at the periphery of theworkforce, i.e. the struggling self-employed, or the casual on-call non-unionised worker hoping to be offeredenough work to make the rent. For example, at present, new mothers who can establish that they haveworked a certain number of hours for the same employer in the immediate preceding 12 months are entitledto 52 weeks of unpaid extended leave. 44 The precarious worker is likely to struggle to meet the necessary
criteria of having worked a minimum hours for the same employer in the immediate preceding 12 months;
and for the low waged or the self-employed individual trying to get a business of the ground, taking a year
off work may not be remotely financial feasible.
It thus seems that the legal mechanisms of informal norms, collective bargaining and statutory right tied tothe status of employee are not sufficiently addressing the issues of work and time. Arguably, this is because
they are rooted in increasingly obsolete work patterns premised on strong unions, a workforce of permanent
full employees, supported by an unpaid female workforce who carried the burden of reproductive work andcaring for dependents. These mechanisms have been undermined by de-unionisation, the emergence of
precarious work and the growing numbers of workers unable to access the protections pertaining toemployees as well as by the growing numbers of women in the workplace.
It is possible that ways might be sought to reinvent existing mechanisms for controlling time and tosomehow extend statutory protection and collective bargaining to those workers who are currently excluded.
4546
However, here a more radical option is explored and a question is posed: Could a BI be a better option?
Would BI be a Better Option?
In this section it is suggested that a BI could be a better, more flexible alternative to existing labour andemployment law mechanisms in terms of allowing individuals to regain control of their time in the newworking environment by virtue of:1) The bargaining power a BI would confer on individuals in their working lives.
2) The options a BI might provide with regard to the distribution of reproductive work.
3) The enhanced ability a BI would potentially confer to participate in the wider political sphere.

Bargaining PowerThe idea of flexibility and variation in working time is not a bad thing. The primal, pre-industrial rhythms of
seasons and of birth, life and death are still inherent to human life despite the more recent overlays of thework patterns and the rules associated, firstly, with industrial capitalism and latterly post-Fordism. The
reality is that the patterns of rural working time, following seasonal imperatives, are different from those of43

i.e The Parental Leave and Employment Protection Act 1987; the Holidays Act 2003; the Employment Relations (Flexible
Working Arrangements Amendment Act 2007; the Employment Relations (Rest Breaks, Infant feeding and Other Matters)
Amendment Act 2009.
44
The Parental Leave and Employment Protection Act 1987
45
The extension of paid parental leave to the self-employed under the Paid Parental Leave Act is an example where this occurred.
46
See for example the ideas discussed in Helen Kelly “Union Change” (paper presented to Unions Creating Alternatives Biennial
Conference, October 2009).

New Zealand Journal of Employment Relations 37(1): 152-160
urban commuters or to the patterns of caregivers of babies and small children. At various life stages people
may have different preferences as to how they wish to organise their working time; parents with young
children require a different life rhythm to that of a collective of late-night jazz musicians. Overly rigid time
regulation such as a hypothetical law or a union negotiated contractual term requiring everyone to down
tools at 5pm cannot take account of the varying needs of different institutional settings and of different
lives.47
As long as there is ample freedom to choose and to move between rhythms of life, arguably individuals andthe community are better served by encouraging diversity and freedom of choice rather than by enforcing
repressive conformity to one constructed time. What is important is that the ideal of flexibility is not
permitted to operate solely for the benefit of employers or the powerful driven solely by the needs ofproduction. What is needed by workers is bargaining power. Historically, informal norms, unions andstatutory regulation provided this to a majority of workers but, as has been suggested above, too many
workers are, in real terms, unable to access these provisions in the new working environment.
If, however, a BI sufficient to live on at a modest yet decent standard was available as of right, regardless ofparticipation in the labour market, then exiting the labour market would become a viable option for workers.
48
A worker with a guaranteed BI who needs to negotiate reduced hours or more flexible hours or moreregular hours or time away from work is inherently in a stronger bargaining position than one who is solely
dependent on their wage for the support of themselves and their families.
A BI also has the benefit of assisting not just employees as existing legal mechanisms predominantly do,
but potentially also those who are not employees to manage their time in accordance with their own
particular needs and wishes. For example, a struggling small self-employed dairy owner in receipt of a BI
would, should she choose, be able to close up her shop and take a day off safe in the knowledge that her
ability to pay that weeks rent would not be compromised. Hence, the evidential and legal difficulties
surrounding the shoehorning into, or the exclusion of workers from, the category of employee could becircumvented as the ability to control ones working time becomes the right of all workers.
A BI will also have the advantage of a being a mechanism that will most often more easily allow for
individualised negotiations and solutions crafted to suit individual circumstances than any general law could
hope to be. While not a return to a pre-industrial lifestyle, a BI would make it more possible for individuals
to live their lives in ways in keeping with the rhythms of the seasons. It could also potentially create spaces
for individuals to respond appropriately to significant events such as birth and death rather than such events
having to be fitted into a timeframe constructed around the demands of the workplace and the imperative offinancially supporting oneself and one‟s dependents
A further advantage of a BI is that it has the advantage of improving the likelihood of compliance with any
specific law that seeks to limit work hours for particular public policy or safety reasons. Legal limitations ofworking hours are of no use if individuals do not have the power to insist on compliance. A restriction on
the number of continuous hours a truck driver can drive without a rest stop is meaningless if the truck driveris un-unionised, vulnerable and financially dependent on an unscrupulous employer who does not care about
the law. Studies have shown that those in precarious, insecure jobs tend to risk their health and safety inorder to maintain good relationships with their employers. 49 The same individual in receipt of a BI has thepower to walk away from unsatisfactory, unsafe arrangements or to insist on the need for adherence to theletter of the law.

47

Todd Rackoff A Time for Every Purpose: Law and the Balance of Life (Harvard University Press, Cambridge, 2002) at 163.
On the potential of a Basic Income to enhance bargaining power by securing the ability to exit the labour market place see R
Jubb “Basic Income, Republican Freedom, and Effective Market Power” (2008) 3(2) Basic Income Studies 4.
49
P Spoonley “Is Non Standard Work becoming Standard? Trends and Issues” (2004) NZJER 29.
48

New Zealand Journal of Employment Relations 37(1): 152-160

Addressing the Issue of Reproductive WorkA solution addressing the problem of lack of time for workers must take into account the reproductive work
which underpins participation in the paid workforce. Existing legal mechanisms attempted to address thesebut they are limited in their ability to address the varied needs of workers and families. For example, theHolidays Act 2003 provides that, for most employees, there is a minimum provision of five days sick leave
after the first six months of continuous employment. This may be a generous allowance for a single healthy
adult but for a solo parent responsible for a child with serious health problems, five days would be woefully
inadequate. The point is that family and individual circumstances are subject to vast variation and it is hard
to see how any law could adequately accommodate this.
By contrast, a BI could be a very useful means of enabling individuals and families to manage the essential
reproductive work which underpins participation in paid work in a flexible way that genuinely takes accountof each family‟s and each individual‟s actual needs and desires. 50 If set at a high enough level, a BI would
make reducing to part-time work or periods away from the paid workforce a practical option for money andtime pressed individuals or families without driving them into poverty.
Finally, for some families and individuals, a BI might enable some greater redistribution of some
reproductive work such as child care and meal preparation, to the market. While not all such work is capableof commodification the option of being able to commodify some of it could reduce time pressure on manyfamilies.

Political Power
Thus far, discussion of the legal mechanisms designed to limit working time has focused primarily on the
direct controls on individual working relationships. In fact, this is not the only mechanism available tocontrol working time. Legal regulation of time outside individual work relationships is also an option.
Supiot suggests that while it is important to allow for the possibilities of diversity, creativity, and thepossibility of social experimentation, there are larger societal interests at stake in the regulation of working
time, so it should not be entirely determined by negotiations between individuals. 51 He expresses thisconcern because he is concerned that fragmentation of time may come at a cost to communal time. 52 Civic
involvement is a collective endeavour. Individuals not only need leisure time in which to become involved,
but they need shared leisure time, that is, similarly co-ordinated schedules. With all its faults, the regulated
working time associated with earlier industrial collectivism gives a sort of collective tempo to life. For
example, after-work socialising could be expected to occur in the evening as the majority were understood
to be employed 9 to 5. Under a more individualised and subjective system of apportioning working time,
there is a danger that time devoted to all forms of social and civic life, already under pressure, will besqueezed even further as everyone struggles with different schedules.
One possibility which would limit work time is the introduction of more statutory public holidays. 53 Indeed,
if the goal is purely to limit working time it would be theoretically possible to impose draconian legal
50

For an overview of the various strands in Basic Income literature on the effect of a BI on the distribution of reproductive worksee I Robeyns “Introduction: Revisiting the Feminism and Basic Income Debate” (2008)3(3) Basic Income Studies 1.
51
Alain Supiot Beyond Employment: Changes in Work and the Future of Labour Law in Europe (Oxford University Press,
Oxford, 2001) 93.
52
Ibid, at 90.
53
For example, in New Zealand, there has been some discussion about creating a mid-winter public holiday celebrating Matariki
which is the time at which the Pleiades star cluster is visible and which traditionally established the correct time to plant crops.

New Zealand Journal of Employment Relations 37(1): 152-160
measures such as the compulsory enforced closing of all businesses, shopping malls, libraries, swimming
pools and other public facilities on Sunday. The question would then become whether this would really be agenuine quality of life improvement and whether rigidly enforced time norms such as these are fair to people
who, for whatever personal reasons, want to, for example, work 80 hour weeks or keep their business open
over the weekend?
Law alone cannot resolve such questions. The issues are complex and there are many competing interests.
What is required is discussion and debate in the wider political sphere. 54 However, a prerequisite ofparticipation in such discourse is the time in which to do so; too little free time results in disempowerment
and civic disengagement.55 Overworked and overtired workers will struggle to participate in any political
dialogue about time, yet theirs are the voices that most need to be heard.
A mechanism is needed for ensuring that the demands of work are not permitted to crowd out the right andopportunity to participate politically in the dialogue surrounding time norms. Could a BI provide such amechanism? Arguably, a BI could potentially enhance participation in social and political life as it will bepossible, at least for those who wish it, to reduce working hours somewhat so that fitting in such activity
around working life will no longer require heroic efforts.56 57As such, a BI would seem to be a mechanism
ideally suited to enabling workers to take part in the political processes and dialogues that will shape thetime norms that they will live by both now and in the future.

Conclusion
Time, work and law are intimately connected. As the organisation of work changes, the tools for limiting
working time must change and evolve. In this article it has been argued that just as a transition occurredfrom pre-industrial working patterns to industrial working patterns, new working patterns that existing legal
mechanisms are not adjusting adequately to are also emerging. The poorest working people are working thelongest hours and unable to access the protections that the law purports to provide. The result of this is that
improving individuals‟ ability to limit their work time is an issue that needs to be addressed. It has beensuggested that BI could be a better method of achieving this than existing legal mechanisms: A BI would bea more flexible way than law to empower individuals to manage their working time in ways that takes
account of the varying needs of both different institutional settings and of different life stages; a BI alsooffers more promise than law as a way of allowing individuals to negotiate how to manage the reproductive
work that underpins paid work; a BI would also potentially allow otherwise time pressed individuals to takepart in the political discourses surrounding the development and implementation of any agreed on communal
time norms.
All that said, it must be conceded that while there is some interest in the idea of a BI in New Zealand it is
not a concept likely to be taken seriously in the current political environment. Of the political parties
currently represented in Parliament, only the minority Green Party have expressed openness to the concept.
Their stated policy is that they “support…a full and wide ranging public debate on…[BI]”.58 New Zealanddoes, however, have a history of innovation and progressiveness; for example, it was the first country in theworld to introduce women‟s suffrage, the eight hour day and to legalise collective bargaining, so a time may
come when the arguments presented here might be seriously entertained.
54

Todd Rackoff A Time for Every Purpose: Law and the Balance of Life (Harvard University Press, Cambridge, 2002) 183.
Ibid, at 47–48.
56
This point is frequently argued in Basic Income literature. For example, see Carole Pateman “Freedom and Democratisation:
Why Basic Income is to be Preferred to Basic Capital” in K Dowding, J de Wispelaar and S White (eds) the Ethics of
Stakeholding (Palgrave MacMillan, London, 2003) 15.
57
For a recent work on the possibilities of linking basic income to participation in civil and political society see Guy Standing
Work After Globalization: Building Occupational Citizenship (Edward Elgar, Cheltenham, 2009)58
Sue Bradford Income Support Policy (Green Party of Aotearoa New Zealand 2008)<http://www.greens.org.nz/policy/incomesupport>
55

New Zealand Journal of Employment Relations 37(1): 161-166

Equality and family responsibilities: a critical evaluation of New
Zealand law
AMANDA REILLY *Abstract
The causes of women‟s persistent inequality in the workplace are complex but work-family conflictand gendered patterns of care-giving undoubtedly play a role. This paper describes existing New
Zealand law designed to prevent discrimination against those with family responsibilities and utilises
regulatory scholarship to critically evaluate it. It concludes that stronger enforcement mechanisms
and positive duties to promote workplace cultures where those with family responsibilities are notdisadvantaged would be helpful additions to the existing legal framework.

Introduction
New Zealand women earn less than New Zealand men. Statistics New Zealand recently reported thatthe median weekly wage of women in full-time employment equates to 86% of the median malewage.1 Measured by average hourly earnings, the gender pay gap has persisted at 12% for the last 10
years. 2 There are a number of reasons for this pay gap which include systemic under compensation of
female dominated occupations and overt sex discrimination. This paper concentrates on one aspect of
the underlying causes of the pay gap, i.e. work-family conflict and gendered patterns of care giving,and it evaluates New Zealand‟s legal responses thereto.
The paper is structured as follows: In the first part, the relationship between women‟s disadvantage inthe workplace and the ideal worker norm is discussed. In the second part, some concepts drawn from
regulatory scholarship are summarised with a few examples providing criteria against which toevaluate New Zealand law. In the third part, New Zealand law is analysed and found wanting.

How do gendered care work norms contribute to women’s disadvantage?
Williams argues that women will remain disadvantaged and marginalised in workplaces for as long as
the norm of the ideal worker is someone unconstrained by care-work responsibilities, i.e. somebody
who is able to work 40 hours or more a week, all year round with no career breaks. 3 As long as thisnorm prevails, anyone who deviates from it will find themselves disadvantaged.
The ideal worker norm is problematic because it does not sufficiently take account of care-work.
Historically, this work was largely carried out, unpaid, in the private sphere by women. However, as
increasing numbers of women have moved into paid work, the need for care-work has not diminished.
Care-work is intrinsic to the continuation and sustenance of human life. The labour intensive nurtureof babies and children is the most obvious manifestation of this but it is not the only one. Childless,single people have care-giving calls on their time too, more particularly if they have elderly relatives
for whom they are responsible. Moreover, the current understanding of work as work-for-pay or as*

1

Lecturer in Law, School of Accounting and Commercial Law, Victoria University of Wellington

Statistics New Zealand “New Zealand Income Survey: June 2010 Quarter” (2010) <www.stats.govt.nz>.
Human Rights Commission “Tracking Equality at Work” (2011) at 26 <www.hrc.org.nz>.
3
Joan Williams Unbending gender: Why Family and Work Conflict and What to Do About it (Oxford University Press,
Oxford, 2000).
2

New Zealand Journal of Employment Relations 37(1): 161-166
employment rather than as the whole sum of the labour it takes to keep a household functioning ishighly artificial. Paid work is, in fact, parasitic on care-work. Most obviously, if one is to be
productive in the workforce, washing will have to be done, meals prepared and eaten, and health (bothemotional and physical) maintained.
Mere formal equality for women to compete as an ideal worker can never promote substantive
equality for women because care-work is simply not going to disappear. Somebody will have to do it
and that person is most often a woman. 4 The fact that women carry this burden is a major contributor
to their disadvantaged and marginalised status in the workplace. While individual women‟s decisions
to de-prioritise workplace participation in order to accommodate care-work are often framed as aconsequence of individual choice, gender equality is not an individual issue. It is a social andstructural issue linked to women‟s disproportionate responsibility for family care-work.
The current distribution of care-work and ideal worker norm also impacts on men. As noted byWilliams:5
Hegemonic masculinity [has come to be] defined in terms of work roles…masculine
dignity is linked with success at work…Gender pressures on men are a key reason for the“stalled revolution” in work and family life…a key to jump starting the revolution is tochange gender pressures on men by changing the way we define the ideal worker.
The idealisation of the unencumbered worker contributes to pressure on men to fulfil the primary
breadwinner role. Overseas studies suggest that men who compromise their paid work participation totake on a greater share of family responsibility care work are more disadvantaged than their female
equivalents as they are punished for deviating from established gender roles. 6 As long are men are
effectively discouraged from taking on a greater share of care-work, women will continue to carry thisload and accordingly be disadvantaged in the workplace.
The heart of the problem is the fact that workplaces are structured around an ideal worker who is not acare-worker.7 This, in conjunction with gender role expectations, means that all too frequently men
and women end up respectively in ideal worker and marginalised care-worker roles. 8 As a matter offairness this needs to change; workplaces should be structured in ways that allow individuals to meetthe legitimate needs of those dependent on them as well as their own needs. In order to achieve this,the norm of the ideal worker, as one unencumbered with responsibilities, must be replaced by thenorm of the worker with care-work responsibilities.
While shifting entrenched norms is difficult and complex, Smith suggests that “around the world law
is being used to provide worker rights designed to challenge the ideal worker norm and facilitate theintegration of workers who have family responsibilities.”9 The question posed here is how well New
Zealand law is adapted to meeting this challenge? In the next section, some concepts drawn from
regulatory theory on what makes law effective are summarised with a view to providing some criteria
against which New Zealand law can be analysed.

4

Around two-thirds of unpaid work in English-speaking countries is performed by women, see Human Rights
Commission, above n 2, at 10.
5
Joan Williams “From Difference to Dominance to Domesticity: Care as Work, Gender as Tradition” (2001) 76 Chicago
Kent Law Review 1441 at 1444.
6
Belinda Smith “Not the Baby and the Bathwater: Regulatory Reform for Equality Laws to Address Work-Family
Conflict” (2006) 28 Sydney Law Review 689.
7
Williams, above n 5, at1474.
8
Ibid, at 1471.
9
Smith, above n 6, at 691.

New Zealand Journal of Employment Relations 37(1): 161-166

What makes law effective?
The mere fact that a law prohibiting discrimination exists is not enough to ensure that people withfamily responsibilities are not discriminated against or disadvantaged as a consequence of deviatingfrom the ideal worker norm. As Murray states “law does not work by automatic fiat, but requires somekind of internalisation to ensure its effectiveness.”10 There are a range of strategies regulators can use
to make law effective and to ensure that the law‟s goals are internalised by individuals andorganisations. 11 Ayres and Braithewaite most influentially developed the idea of an enforcement
pyramid that reflects the range of regulatory strategies.12
At the bottom of the pyramid is “soft touch” mechanisms designed to educate and persuadeorganisations to adopt desired behaviours. In the case of work family issues, this might include
making both the moral and business case for equality for people with care-work responsibilities. At
the next level, reporting requirements on practices and initiatives encourage both organisationalreflection and accountability external stake holders. Reporting can also encourage comparisons andlearning between organisations.
Effectively, the law and state institutions at the bottom of the pyramid help organisations to selfregulate. However, the soft persuasive tools at the bottom of the pyramid are most effective when, at
the top of the pyramid, there are also punitive sanctions. The regulator must have access to “a big stick”
and the ability to punish those on whom the softer approaches have proven ineffective. These might
include penalties for non-compliance or, where appropriate, corrective orders which require anorganisation to self review and develop and report upon a compliance programme.
Another relevant development in regulatory theory that is reflected in the legislative provisions inother jurisdictions is a movement towards imposing positive duties on employers and institutions toproactively promote equality. 13 This trend is a response to weaknesses identified in the individualcomplaints led model based around negative rights such as the right not to be discriminated against.
Some of these weaknesses, as summarised by Fredman, are as follows. 14 Individual actions alleging
discrimination are not suited to achieving significant or systematic progress towards gender equality
goals. In order for an individual complainant to succeed, they must be able to prove a perpetrator,
however, inequality is largely institutional and not necessarily the fault of any particular person. Even
if claim is successful and while this may provide compensation of individuals, it will not trigger any
ongoing obligations to correct the institutional structure. Furthermore, reliance on individualcomplainants to bring an action puts excessive strain on the victim as the process can be lengthy,
expensive and uncertain. Courts can only intervene on random and ad hoc basis as many individuals,
especially if un-unionised, will be unable to pursue claims.

Critical Evaluation of New Zealand Law
New Zealand has various strategies from the bottom of the regulatory pyramid (i.e. soft tools of
education and persuasion) in place concerning the need for gender equality and family-friendly workplace practices in place. These include the Department of Labour‟s Work-Life Balance project which
10

Jill Murray “Corporate Social Responsibility: An Overview of Principles and Practices: Working Paper No 34” (2004)
International Labour Organisation at 5 <www.ilo.org>.
11
This summary draws heavily on Smith‟s discussion (Smith, above, n 6, at 705-707).
12
I Ayres and J Braithewaite Responsive Regulation: Transcending the Deregulation Debate (Oxford University Press,
Oxford, 1992).
13
For discussion, see Human Rights Commission, above n 2, at 27.
14
Sandra Fredman “Changing the Norm: Positive Duties in Equal Treatment Legislation” (2005) 12 Maastricht Journal of
European and Comparative Law 369.

New Zealand Journal of Employment Relations 37(1): 161-166
makes a number of Best Practice Resources available on its website. 15 The Human Rights
Commission, in partnership with the EEO Trust, also works to promote equal employment
opportunities by disseminating information and resources to interested parties.16 Such initiatives may
well have achieved some normative change in individual work-places and are not to be disparaged.
However, as discussed earlier, according to Ayres and Braithwaite, effective regulation requires a
regulator with access to a full pyramid of regulatory responses with the possibility of punitive
sanctions for those who fail to respond to soft law initiatives. Here, New Zealand‟s legal framework
falls short. Beyond provision of information, these bodies have limited capacity to motivate or prompt
commitment from employers. No regulatory agency in New Zealand has access to punitive sanctions
with which to punish employers who discriminate against workers with family responsibilities.
Individuals who have been discriminated against because they are responsible for children or otherdependents may have a remedy against their employer under the Human Rights Act. 17 This is sowhether the discrimination is direct or indirect. Direct discrimination would include being denied ajob, equal pay or opportunities for progression on the grounds of prejudices or stereotypes. A failure
to reasonably accommodate a person‟s family and caring responsibilities by agreeing to flexible hours
may amount to indirect discrimination. 18 The Employment Relations Act also allows employees tobring a personal grievance against an employer where they have been discriminated against on family
status grounds.19
However, the fact that complaints have to be initiated and pursued by the individual victims of
discrimination limits the value of these provisions in terms of their ability to effect systemic change as
discussed above. The value of these provisions is also limited by the fact that complaints against
employers under both the Human Rights Act and the Employment Relations Act are directed at first
instance to mediation, the proceedings of which are not widely reported on or freely available in the
public domain.
The Human Rights Commission reports that in the period 2005-2010 6.1% of the discrimination
complaints they received concerned family responsibilities discrimination. 20 Clearly, the law is being
utilised to a limited extent by individuals, but the paucity of recent reported cases on family
responsibilities discrimination suggests that these complaints are largely being settled at mediation. 21
While mediation may have some advantages in terms of keeping the costs of litigation down, it also
has disadvantages. Employers who discriminate against workers with family responsibilities run little
risk of being publically identified. Fiss argues that the primary purpose of adjudication is thereiteration of societal norms by authoritative decision makers; 22 if there were widely publicised court
decisions on family responsibilities discrimination, this would both punish individual employers fordiscriminatory practices and raise awareness of the need to avoid such practices among other
employers. Such decisions would also feed into a broader societal dialogue and inform various civil
15

Department of Labour “Work-life balance in New Zealand” <www.dol.govt.nz>.
National Equal Opportunities Network “About Us” (2012) <www.neon.org.nz>.
17
Proceedings Commissioner v Howell [1993] 2 ERNZ 130, (1993) 4 NZELC 98,210 establishes that discriminating
against a woman with children because of her childcare responsibilities amounts to discrimination on the grounds offamily status.
18
Drfyhout v New Zealand Guardian Trust Ltd (1997) 3 HRNZ 572
19
Employment Relations Act 200, s 103(1)(c). Section 105 (1)(l) mirrors the prohibited grounds of discrimination set out
in section 21(1) of the Human Rights Act 1993.
20
Human Rights Commission, above n 2, at 20.
21
The only recent reported case is Claymore Management Ltd v Anderson [2003] 2 NZLR 537(HC) which concerned theresignation of a part time-legal employee who had family care responsibilities. The appellant employer successfully argued
the resignation was not caused by direct or indirection family status discrimination. However, the court commented thatthe case was unsuitable to set precedent as the Tribunal had not discussed family status.
22
Owen Fiss “Against Settlement” (1984) 93 Yale Law Journal 1073.
16

New Zealand Journal of Employment Relations 37(1): 161-166
groups who would in turn be better placed to be involved in the monitoring and enforcement ofappropriate standards
There are other legislative provisions which provide individual workers with rights intended toenhance their ability to participate in the work place. 23 Part 6AA of the Employment Relations Act
provides certain employees with the care of any person a right to request a variation of their working
hours. It also set out a process employers must follow in terms of considering the request. If following
this an employee is unhappy he or she must first approach a Labour Inspector from the Department ofLabour before it is possible to proceed to mediation. After this, there is a possibility of an application
to the Employment Relations Authority; however, there is no possibility of appeal to the Employment
Court. The maximum penalty the Authority can order is $2000, which is payable to the employee
concerned.
This provision may be helpful to some employees. However, the fact that any complaint must be
individually driven by an individual (who is almost certainly time-pressed) and the lack of any
significant penalty or possibility of name and shaming of employers who fail to follow correct process
must limit its efficacy. The extent to which carers are aware of this right is also questionable. A recent
survey found that most PSA women (59%) were not familiar with the legislation. 24
New Zealand does not impose any positive duty on employers to actively implement policies whichassist workers with family responsibilities. The exception to this is the good employer obligation in
the Crown Entities Act.25 This requires each Crown Entity to operate a personnel policy that complies
with the principle of being a good employer which takes into account the employment requirements ofwomen. The Human Rights Commission has identified seven key elements of the personnel policiesof good employers; element four is as follows:
4. Flexibility and Work Design
Workplace design and organisation takes account of the need to assist employees to balance
work with the rest of their lives and ensures managers relate to employees in a respectful andflexible way, considering the employment requirements of all groups including parents andother carers.
In addition to operating a personnel policy which complies with the good employer obligation, Crown
entities have annual reporting requirements. The EEO Commissioner assesses these annual reports
looking for references to being a good employer, EEO and the seven key good employer elements.
The combination of a positive duty to be a good employer and the requirement to report on progressgo some way towards encouraging Crown entities to self regulate to create family-friendly working
environments where those who have family responsibilities are not discriminated against. However,this initiative does not go far enough. Neither the good employer duty nor the associated reporting
requirements apply to the private sector which employs around 80% of the workforce. The Human
Rights Commission has recommended that the Employment Relations Act (2000) be amended toinclude a positive duty to be a good employer in both the public and private sectors and this would bea significant improvement on the existing state of affairs. 26
23

See for example, the Parental Leave and Employment Act 1987. This is not discussed here as this paper is concernedwith the accommodations needed for care givers in general across a life cycle rather than the specific needs arising out ofpregnancy, child birth and breast feeding.
24
Sarah Proctor-Thomson, Noelle Donnelly, Geoff Plimmer Constructing Workplace Democracy: Women’s Voice in New
Zealand Public Services (Industrial Relations Research Centre and Management School Victoria University of Wellington
April 2011) at 21-22.
25
Crown entities with employees are required to be „good employers.‟ See Crown Entities Act 2004, ss 118 and 151 (1)(g).
26Human Rights Commission, above n 2, at 4.

New Zealand Journal of Employment Relations 37(1): 161-166

However, more is needed. McCrudden identifies it as a pre-condition of effective reflexive regulationthat there be some mechanism whereby firm and public bodies are required to engage with otherstakeholders.27 He comments on the experience of Northern Ireland where, under the equality duty
public, authorities are required to engage with civil society in detailed ways. He concludes that forced
engagement with a “truculent and well-informed civil society” is fundamental to the operation ofreflexive regulation. This suggests that reporting requirements should be more extensive than they
currently are so that a wide range of interested parties can play a role in rewarding good employers
and pressurising bad employers.

Conclusion
A common thread runs through New Zealand law with regard to the prevention of family
responsibilities discrimination and integrating care-givers into the workforce: there is no big stick.
Employers who do not respond to education and persuasion need not fear punishment or public
shaming. While individual workers have rights, it is up to these individuals to enforce these rights,
which may come at a high personal cost and which, at best, will provide individual compensation
rather than systemic change. The lack of effective enforcement mechanisms weakens the impact ofsoft law educative mechanisms as it reduces incentives for employers to change their behaviours. The
lack of publicised cases and of strong visible enforcement mechanisms also detrimentally impact on
consciousness raising in wider civil society which is, thus, stymied in terms of being able to put
pressure on organisations to adopt policies which give those with family responsibilities a fair deal.
The vast majority of employers are not subject to positive duty to create non discriminatory, familyfriendly work places. Law change is necessary if the ideal worker norm is to be replaced in New
Zealand workplaces. Until such time as this happens, New Zealand women are likely to remain
disadvantaged in the workplace and will probably continue to earn less than men.

27

Christopher Mc Crudden “Equality Legislation and Reflexive Regulation: a Response to the Discrimination Law
Review‟s Consultative Paper” (2007) 36 Industrial Law Journal 255 at 265.

New Zealand Journal of Employment Relations
Best Article Competition for Postgraduate Students
The purpose of the New Zealand Journal of Employment Relations Best Article Competition
is to support postgraduate students studying in the area of Employment Relations and whowish to publish a paper based on their research undertaken in 2012. Prizes will be awarded tothe top three papers submitted to the New Zealand Journal of Employment Relations by the
1st February, 2013.
First prize of $1,000 will be awarded to the best judged paper and the next two best papers
will be awarded $500 each.

Criteria are as follows:The competition is open to full-time and part-time students who are enrolled in a thesisor dissertation component of a research Honours, Masters, or PhD degree;
The submitted paper must be located in the discipline of Employment Relations(including Human Resource Management) and be relevant to New Zealand.
The paper must conform to the New Zealand Journal of Employment Relations’Submission Guidelines (see the website http://www.nzjournal.org/)
Applications will not be accepted after the closing date of 1st February, 2013.

Selection
Submitted papers will be considered by a selection panel from the editorial board of the New
Zealand Journal of Employment Relations. No prizes will be awarded if the panel is of theopinion that there is no paper of sufficient merit. Prize winners will be notified by the Editorsof the New Zealand Journal of Employment Relations and it is expected that winning papers
will be published in one of the forthcoming issues of the New Zealand Journal of
Employment Relations.