JUNE 2004

VOLUME 29 NUMBER 2

New Zealand Journal of

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Anderson, G. (1991), The Employment Contracts Act 1991: An Employers’ Charter? New Zealand
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Fox, A. (1974), Beyond Contract: Work, Power and Trust Relations, London, Faber.
Kumar, P., Coates, M.L., and Arrowsmith, D. (1987), The Current Industrial Relations Scene in Canada,Kingston, Queens University.
Sulong, S. (1965), Aspects of Trade Union Government in New Zealand, MA thesis, Victoria Universityof Wellington.
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JUNE 2004  VOLUME 29 NUMBER 2

CONTENTS................................................................... ...............

A Study of Union Mergers: The Strange Case of the Police Federationof Australia.
MICHAEL LYONS and JENNY FLEMING

1................................................................... ...............

Estimating the Other Party’s Preferences and Trust in Trade Union
and Employer Negotiations: A Comparison between New Zealandand Sweden
EVA ZELLMAN and SIMON KEMP

17................................................................... ...............

Casualisation Friend or Foe? A Case Study Investigation of two
Australian Hospitals
CLARE LUMLEY, PAULINE STANTON and TIMOTHY BARTRAM

33................................................................... ...............

Reluctant Managers: Nurses Surviving Despite the Bottom LineRICHARD GOUGH and MAREE FITZPATRICK

49................................................................... ...............

Bullying in the Health Sector: A Study of Bullying of Nursing Students
BARRY FOSTER, BETH MACKIE and NATASHA BARNETT

67................................................................... ...............

Chronicle: February 2004-May 2004
ERLING RASMUSSEN and COLIN ROSS

85................................................................... ...............

New Zealand Journal of Employment Relations (2004), 29(2): 1

A Study of Union Mergers:
The Strange Case of the
Police Federation of Australia.
MICHAEL LYONS* & JENNY FLEMING**

Abstract
During the 1990s trade unions in Australia were involved in an unprecedented amountof mergers that resulted in a signiﬁcant reduction in the number of unions. Most of
this merger activity consisted of either amalgamations or absorptions, and has been
subjected to considerable research scrutiny. The merger of ﬁve separate police unions
created the Police Federation of Australia. However, the Federation is unique among theunion mergers in this period because it evolved from a federally registered police union,
the Australian Federal Police Association, altering its rules to grant it coverage of allpolice in Australia. This paper examines the formation of the Federation, and suggeststhat both the form of the merger and the merger process are not easily explained by theexisting literature. This is partly due to the limited attention past studies have paid tounion federations, party due to the circumstances of police unions in Australia, and partly
due to the novel method by which the merger was conducted.
In the recent past, much academic interest has been visited on trade union mergers
in Australia. This interest has been generated by the policy of the Australian Councilof Trade Unions (ACTU) in the late 1980s and 1990s, and promoted by legislation of
the federal Labor government, to encourage a reduction of the number of trade unions
and structure unions on an industry basis. This domestic interest in union mergers has
explored the motivating inﬂuences (Tomkins, 1999) and the costs and beneﬁts (Bodman,
1998; Davis, 1999; Wooden, 1999). While the Australian studies have examined thereasons for mergers and their effect, few have analysed how mergers occur or profferedreasons for the merger outcomes with Campling and Michelson (1998) and Hose andRimmer (2002) being notable exceptions.

* Michael Lyons is the Senior Lecturer of the School of Management at the University of Western Sydney, Australia.
** Jenny Fleming is a member of the Regulatory Institutions Network (RegNet), the Research School of Social Sciences,
Australian National University, Australia.
The authors would like to thank Grant Michelson and Joan Corrie for their helpful comments on drafts of the paper,
members of the Grifﬁth University School of Industrial Relations for the feedback supplied when the paper was presented
to a School seminar, the staff at the Australian Industrial Registry and the Noel Butlin Archives Centre Australian National
University for their cooperation, and the staff and ofﬁcers of the Australian Federal Police Association and the Police
Federation of Australia for their very generous assistance.

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2 Michael Lyons and Jenny Fleming

The Police Federation of Australia (‘the Federation’) ofﬁcially came into being in 1997.
The formation of the Federation warrants analysis for a number of reasons. One, itis the ﬁrst time in Australian history that a national organisation has been established
as a vehicle to represent the industrial interests of staff engaged by the various police
services. This aspect alone is remarkable given that police services are constituted,organised and ﬁnanced at a State level. Two, union merger ‘theory’ does not adequately
explain the motivations for the creation of the Federation, and its structure. And three,
the formation of the Federation in many respects represents a shift in emphasis ofpolice unionism from being purely industrial organisations to something more closely
resembling a ‘professional’ association. While the Federation national organisation
could be described as a professional association, the constituent branches still pursue
industrial objectives and under the rules of the Federation are completely autonomousfrom interference by the national body. Yet the more intriguing feature of the formation of
the Federation is that the impetus for its creation appears to have come from one of thesmallest and most constrained police unions in Australia: the Australian Federal Police
Association (‘the Association’). Without the Association the Federation could not havecome into existence, for this merger was a result of the Association changing its rules
rather than the traditional union combination of union merger activity. In one sense, thesmallest police union in Australia ‘absorbed’ the other larger police unions.
This paper examines the formation of the Federation in the context of both theory andpractice. In doing so the paper pays considerable attention to the role played by the
Association. In analysing the ‘urge to merge’ among police unions in Australia thefollowing questions are investigated: what were the primary motivating factors causing
the formation of the Federation; what were the political and institutional factors that
permitted the Federation to be established; and what impact does the Federation haveon the effectiveness of police unions in Australia? In answering these questions the paper
identiﬁes a gap in the union merger literature regarding mergers other than complete
amalgamations and absorptions. Indeed, the four necessary elements required toconstitute a union merger proffered by Michelson (2000) are difﬁcult to detect in the caseof the Police Federation of Australia.

Union mergers
Union merger literature proposes a number of motivating inﬂuences for merger activity
by unions: membership decline, ﬁnancial difﬁculty, technological change and employer
reorganisation in workplaces they cover, competing jurisdictional union coverage, thedesire to achieve economics of scale, and the desire to improve bargaining inﬂuence(Stratton-Devine, 1992: 134; Michelson, 2000; Hose and Rimmer, 2002). Often merger
parties can have differing motivations particularly when a small union desires to beabsorbed by a larger union (Black et al, 1997: 137). The motivating factors for ‘defensive’
mergers are different to those for ‘aggressive’ or ‘consolidatory’ mergers (Undy, 1999;
Michelson, 2000), unions can have ‘multiple – and sometimes conﬂicting – reasons for

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Union Mergers 3

amalgamations’ and other mergers (Davis, 1999: 11). These different and competing
motivations seem to be apparent in the merger process which culminated in the formationof the Federation.
According to Campling and Michelson (1998: 582-84) the ‘urge to merge’ is a strategic
decision based on external factors. But, interests of a union’s leadership cannot be
overlooked when analysing the internal reasons to merge or not to merge and the ﬁnal
shape of any merger activity (Hose and Rimmer, 2002; Michelson, 1997; Stratton-Devine,
1992: 138). Merger structures which protect the power, prestige and jobs of the existing
leadership will be more attractive than those that do not (Conant and Kaserman, 1989:
246).
There is some uncertainty about whether or not mergers have patterns or common
features (Waddington, 1994). Chaison (1982a: 199) suggests that all union merger
activity is somehow ‘idiosyncratic’, and for this reason ‘there is no general theoreticalmodel which can be applied to the merger process’ (Chaison, 1982a: 198; cf. Chasion,1986). The different forms of mergers only emphasise the idiosyncratic nature of union
merger activity: amalgamations that involve the merger of two or more unions to form a‘new’ organisation, and absorptions (or acquisitions) that involve the merger of one union
into another (Waddington, 1994: 452). Even with these broad categories uniformity is notguaranteed (Hose and Rimmer, 2002), as some absorptions can be closer to an afﬁliation
rather than a total assimilation (Chaison, 1982a: 201), and some amalgamations may not
result in total fusion of the merging unions (Chaison, 1982b: 141). Neither the process offormation nor the ﬁnal structure of the Federation ﬁts neatly into these categorisations.
A barrier to union mergers can be the interests of particular groups of workers and members
being subsumed by the new union structure (Black et al, 1997: 138-39). The image
or identity of small, autonomous, white-collar or ‘professional’ unions may be jealously
guarded by the membership and thus be hostile to merger proposals (McClendon et al,
1995: 13). McClendon et al (1995: 19) argue that the leadership of such unions need toreassure the members that any merger will not result in a loss of membership inﬂuencein decision-making processes relevant to their interests. In addition, the target of themerger needs to be compatible with the image the membership have of their union and/or their occupation or profession (Devine and Reshef, 1998: 529-30). The formation ofa federation by Australian police unions which retained the unions’ separate identity andautonomy would, therefore, have attractions over other possible merger structures.
Less than complete forms of integration seem to have been neglected by the literature.
The attraction of an alliance (or afﬁliation) over a more complete merger (amalgamation
or absorption) is that it can supply all the beneﬁts of a proper merger without many of theassociated disadvantages (Chaison, 1982a: 202-3): ‘loose’ federations are examples ofsuch alliances (Chaison, 1982b: 142). In one critical respect, then, federations may retainthe ‘identity’ of the constituent unions which can be a major incentive for the membershipto agree to any merger proposal (Stratton-Devine and Reshef, 1992: 134; McClendon et

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4 Michael Lyons and Jenny Flemingal, 1995: 11).
The effect of regulation must be considered with any analysis of trade union mergers.
Regulation that prescribes the manner and form of mergers will help shape the outcomeof merger activity, as will regulation on the general conduct of unions (Waddington, 1988:
419). In any examination of merger activity in Australia the role of state regulation iscentral to the analysis because of the ‘complexity of union structures that arise fromthe federal nature of the industrial relation system’ (Michelson, 2000: 110), and thealmost complete regulation of union governance and conduct. Regulation was of major
signiﬁcance in the formation of the Federation.
According to Willman and Cave (1994: 402) unions which place a priority on administrative
effectiveness (low-cost operations) will be drawn to become dependent on employers fora range of facilities and thus their representative effectiveness is potentially reduced.
While it is trite to state that the objectives of trade unionism (addressing the interestsof members and potential members) should not become subservient to the means topursue those objectives (administrative effectiveness), inadequate ﬁnances, resources,
and staff will be harmful to a union’s capacity to achieve its industrial objectives (Davis,
1999: 15). Yet the logic of trade union administrative effectiveness (ﬁnancial viability)
is that the vast majority of members continue to pay for union representation but rarely
consume individual (as opposed to collective) services (Willman and Cave, 1994: 403).
With police unions the existence of legal defence funds for members increases thelikelihood that members will consume union services (Fleming and Peetz 2005).
For reasons mentioned earlier, Australian trade unions have in the last decade or soundergone considerable merger activity (Jadeja and Maidment, 1995), which resulted
in the number of unions declining from 323 in 1985 to just 132 in 1996 (Davis, 1999:
4).1 External political and institutional inﬂuences on unions, the policies of the ACTU
and federal Labor government in particular, have been found to be the dominant forces
shaping merger activity, over internal factors such as a lack of administrative effectiveness(Tomkins, 1999: 70-72). Axiomatically, the formation of the Federation is partly a result of
these union merger pressures in Australia in that period.
In summary, the union merger literature proposes a number of reasons for the Association
to merge because of its small union status, limited organising base and accompanying
administrative shortcomings. So the expectation would be that the formation of theFederation addressed these issues. But on the other hand the literature also proposes anumber of reasons that would act as obstacles to a merger, particularly for the Associationand perhaps even the other police unions in Australia. While the following examinationof the process that resulted in the formation of the Federation does not directly challenge
the union merger literature in these respects, it does detect something of a gap in theliterature in terms of motivations and outcomes.

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Union Mergers 5

The Rise and Demise of the Australian Federal Police
Association?
Prior to the formation of the Federation, the Association was the only federally registeredpolice union in Australia. The Association came into being as a result of the restructuring
of Commonwealth (federal government) law enforcement administration under theAustralian Federal Police Act 1979 (Cth) which created the Australian Federal Police(AFP). Prior to the commencement of the 1979 Act, federal policing arrangements werelargely divided between two separate organisations: the Commonwealth Police Force andthe Australian Capital Territory (ACT) Police Force. Two separate unions represented theindustrial interests of staff within the two agencies. The union covering Commonwealth
Police staff was the Commonwealth Police Ofﬁcers’ Association, and the union covering
ACT police was the Federal Police Association (Davies, 1980: 20). In 1981 the two police
unions agreed to a merger. The Industrial Registrar held it was in the ‘public interest’ tohave only one union covering AFP ofﬁcers, and ofﬁcially established the Association as aregistered union on 27 August 1982. The Association’s membership base was expanded
in 1990 by an order of the Australian Industrial Relations Commission (AIRC), under its‘demarcation powers’, to grant it exclusive coverage rights for all staff employed by the
AFP (AIRC, 1990a), and not just ‘sworn’ police.
The formation of the Federation
The Association’s national executive committee endorsed the concept of a national law
enforcement union in 1986 (AFPA, 1986: 21). The ‘umbrella’ police organisation thenin existence, the Police Federation of Australia and New Zealand (PFANZ), was not aregistered trade union under any industrial legislation in Australia, and had a purpose
akin to a lobby group. Despite this, the October 1988 PFANZ federal council meeting
resolved that a ‘police federation’ be registered under the federal industrial statute (AIRC,
1992: 2). Instead of attempting to register a new union, the means adopted was theAugust 1991 rule change application of the Association. The substance of the application
was the alterations to the union’s industry description (Rule 2) and membership eligibility
criteria (Rule 3) to give it national coverage (see AIRC, 1993). To assist the creation ofan ‘industry’ union for police, the federal department of industrial relations approved a
grant, to further the government’s workplace reform and union rationalisation polices, of$125,000 to help with the establishment of the national police union.2
A police ‘super union’ with a potential membership base of all personnel working in thepolice services of Australia was, perhaps not unexpectedly, considered by some police
unions as a threat to their own membership base and even organisational autonomy,
if not survival. For example, the union representing commissioned police ofﬁcers in
Queensland argued that it would be ‘at risk’ if the rule variation was approved by the
AIRC (AIRC, 1992: 3). A ‘terms of settlement’ was negotiated among the Associationand State police unions. Objections from non-police unions were withdrawn after the

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6 Michael Lyons and Jenny Fleming

Association agreed to vary the proposed rules so that it was made clear that the newRule 3 referred to only sworn State police ofﬁcers and not ‘civilian’ employees.
The withdrawal of the objections by the unions did not, however, mean that theapplication was unopposed. The governments of New South Wales and Queensland
lodged formal objections as did the police commissioners from the Northern Territory
and New South Wales, while the governments of Victoria and Western Australia and thechief commissioner of police in Victoria were granted leave to intervene in the hearings.
Importantly, the AFP management also made formal objections to the application. On 15
November 1993 the AIRC approved the Association’s application in the modiﬁed form.
Soon after the 1993 decision the objectors indicated their willingness to lodge appeals
to the full bench of the AIRC and a ‘stay order’ was issued against the decision (AIRC,
1994). The appeal by the State governments against the Association’s rule alterations
was ﬁnally decided in March 1997 and the 1993 decision was afﬁrmed (AIRC, 1997a).
The ﬁnal phase in the formation of the Federation was the formal change of name of the
Association to the Federation. In order to facilitate this a ‘Deed of Agreement’ between
the Association and the State police unions concerning the structure and membershipof the federation was negotiated in late 1996.3 In April 1997 the Association’s national
council unanimously resolved that the union change its name to the Police Federationof Australia by making another rule alteration application under s.204 of the Workplace
Relations Act 1996 (Cth).4 The application was lodged on 5 June and attracted no
opposition from other unions, police managements or the States, and was therefore
approved on 19 August 1997 (AIRC, 1997b). With this decision the Federation cameinto existence.
The role of the state
Two important related factors resulted in the formation of the Federation: the role ofthe state in the process and the institutional arrangements in Australia regarding theregistration of trade unions. The role of the state was also critical to the initial step of
the union to expand its coverage to include ‘civilian’ employees within the AFP (AIRC,
1990a). So without the intervention of the state the transformation of the Associationfrom essentially an occupational union dealing with the one employer in the early 1980s
to – in a legal sense at least – a national police union in the late 1990s would have been
unlikely. For instance, the 1991 rule change application was justiﬁed on the basis thatthe union had to conform to the statutory policy (s.193 Industrial Relations Act 1988) ofreducing the number of ‘small organisations’ registered under the Act (see Jadeja andMaidment, 1995).5 Moreover, the legislative policy of encouraging the establishmentof industry-based unions and union rationalisation provided the Association with arelatively easy path to achieve its objective. The application was made pursuant to s.204of the Industrial Relations Act 1988, which supported the creation of ‘industry-based’
unions. The legislative policy of the Act was central to the application being approved,
for the registration of the PFANZ as a new union would have been ‘cumbersome and1 Lyons & Fleming 9 Dec 04.indd 6

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Union Mergers 7time consuming’ and ‘contrary to the spirit of the legislation’ with a logic of reducing thenumber of trade unions in Australia (AIRC, 1993: 153). And ironically, the union ‘deamalgamation’ provisions of the Workplace Relations Act 1996 (Cth) were central to theﬁnal agreement among police unions over the Federation’s structure as the existence of
these provisions supplied an ‘exit option’ to the constituent unions. But on the other hand
it could equally be argued that the state was as much a hindrance as it was a help to the
Association: it took almost six years for the rule changes to be ﬁnally approved from thetime of lodgment in August 1991.
The Association’s urge to merge
One of the suggested motivations for union merger activity is a decline in potential and/or
actual membership. Table 1 shows the membership density of the Association during theperiod of the merger. Despite its limited membership base (only those staff employedby the AFP) the Association has a membership density that would be envied by othersectors of the labour movement. So while the proportion of staff who are members of theunion has declined over the last decade, due perhaps to the unwillingness of non-sworn
staff to join, the share of the workforce who are members would not suggest that this is a
motivating factor for merger activity. A density rate of over 70 per cent would not usually
be considered as a catalyst to merge, even if this did represent a decline. 6
TABLE 1: Australian Federal Police Association membership, selected years.

Sources: AFP Annual Reports (1998; 1999; 2001); AIRC (1993); AFPA National Executive minutes.
Note: excludes temporary staff.

However, an issue connected with the membership level might have induced the merger
activity of the Association: ﬁnances. For example, in 1995 the Association leadership
acknowledged that for the period 1990-94 its expenses were greater than its income, andthat situation was likely to continue in the future.7 Arguably, the main reason for this was
the legal assistance fund for members.
The rules of the Association permit legal assistance to be granted for acts or omissions
done or allegedly done ‘in the execution of a member’s duty’ (Association Rule 69(c);now Federation Rule 113). Access to the fund is discretionary as the union ‘may’ furnish
assistance but is not obliged to (Association Rule 69(b); Federation Rule 113(b)). The
existence of the fund places a high degree of uncertainty over union ﬁnances as thecosts of the fund cannot be forecast with precision. A number of public inquiries into

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8 Michael Lyons and Jenny Fleming

police operations in Australia during the 1990s identiﬁed numerous instances of alleged
misconduct by AFP staff. The legal assistance fund was used to ﬁnance the defence ofthe resulting terminations and/or criminal charges of its members (see, for example, Alan
Taciak v Commissioner of the Australian Federal Police). To cover the costs of some very
expensive cases the Association resorted to selling assets. In order to limit the costs ofthe fund not only are the merits of the individual applications assessed, but so too is theimpact the case would have on the ﬁnancial position of the Association.8 In addition, theunion now requires members to pay an ‘excess’ to limit both the number of applications
and costs of the fund.9 While one could assume that the discretionary nature of thefund would go some way to limit the exposure of the union to ﬁnancing legal matterson members’ behalf, this is not always the case. For example, one member who wasdenied legal assistance was successful in suing the union for breaching its obligations
to members.10 So, lack of economies of scale may have motivated the merger activityof the Association.
The Association after the merger
With the alteration of its rules the Association was transformed from a single employer
union to an industry based union. However, it would be a mistake to conclude from theofﬁcial public record that changes to its legal status under the federal industrial statutehas also meant changes to the Association’s conduct. In a very real respect little haschanged to the Association’s coverage and functions. Under the rules of the Federation
the union representing the industrial interests of staff employed by the AFP is just one
branch of the national police union. While under the rules the union’s ofﬁcial title is
the Police Federation of Australia and referred to in the rules as ‘The Federation’ (Rule1), the federal (Australian Federal Police Association) branch is still deﬁned as ‘The
Association’ (Rule 1A). The rules grant the Federation’s federal council the authority tomake policy and alter the rules except in the case of branch policy or rules (Rules 14,
15(a) (b)). Importantly, even the council’s powers are not extended to the policy andrules of the ‘Australian Federal Police Association Branch’ as Rules 15 and 111 makeit clear that the powers of the Federation federal council are limited with respect to the
Association. Further, the rules of the ‘federal organisation’ provide for a high degree ofbranch autonomy by including an entrenchment provision (Rule 35(a)), and the rulesof the Australian Federal Police Association branch contain a ‘double’ entrenchment
provision (Rule 54(a)). Therefore, in all practical respects, the Federation is what theobjectors to the 1991 rule change application claimed it would become: an ‘associationof associations’ rather than a ‘real’ national police union (AIRC, 1993: 152).11 So,
notwithstanding the long process of changing the rules, structure and name of the only
federally registered police union in Australia, the federal branch still operates in the samemanner as the Association did prior to the merger.
The fact that the legal changes to the Association have resulted in no real practicaldifferences to the function of the Australian Federal Police Association branch, evaluating
the ‘merger’ process in terms of the literature becomes problematic. The motivations often

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Union Mergers 9cited as inﬂuencing the ‘urge to merge’ – particularly for ‘defensive’ mergers (Tomkins,
1999: 62) – do not appear to have been overcome by the formation of the Federation. The
Australian Federal Police Association branch is still restricted to its limited membership tostaff employed by the AFP. One indication that the formation of the Federation has not
resolved any of the factors that induce a defensive merger can be seen with the plan of
the Association in July 2001 to introduce a ‘bargaining fee’ for non-members (see Orr,
2001).12 In short, the merger activity of the Association in the 1990s has failed to address
any of the issues usually considered factors inducing a merger. Arguably this outcome isalso found with many of the union mergers in Australia in the 1990s, but for signiﬁcantly
different reasons (Grifﬁn, 2002).
With little or no change having been made to the practical situation of the Association,
it is possible to argue that this process has not only failed to address the administrative
problems common to small unions but instead has placed the Association in a more
vulnerable position. Potentially, the only assets that the Federation has are those of theAustralian Federal Police Association branch. Consequently the legal and constitutional
issues surrounding the so called ‘Moore v Doyle problem’ – State based branches offederally registered unions operating in parallel with State registered unions – indicatethat the assets and membership of the State branches of the Federation are those of
the State unions and not the Federation (see Michelson, 1997). The fact that all the
branches of the Federation except for the Association have exemptions from reporting to
the Industrial Registrar because they ‘did not have any ﬁnancial affairs in a ﬁnancial year’(s.271A Workplace Relations Act 1996 (Cth)) supports this view. In short, the assetsof the Association may be under some threat of control by the federal council of theFederation, the entrenching provisions notwithstanding. The prospect that the federal
council of the Federation could control the policy, ﬁnances and assets of a branch is themain reason why the Queensland and Western Australian police unions did not – at thetime of the merger – afﬁliate as branches of the Federation.13
The risk that at some time in the future the Association branch could be fully absorbedby the Federation, did not go unnoticed by the leadership of the Association. In orderto protect the union from such an eventuality it has entertained the prospect of creating
separate entities to shield its assets from the Federation federal council, and to expand
its organising base. One such entity, the Australian Law and Justice Association (ALJA),
was initially designed to defend the union from ‘asset striping’ by the Federation.14 The
ALJA was also conceived as a vehicle with which to expand the union’s organising
activity and act as an additional source of revenue.15 The ALJA was designed to be ‘aspecialist industrial and professional organisation’ in the ﬁeld of federal law enforcement,
and assist ‘outside agencies, minor like unions and individuals’ which are outside thecoverage of the Association: customs ofﬁcers, protective services, and other federal
criminal investigative and intelligence gathering agencies.16 It should be noted that thecurrent roles of ALJA are signiﬁcantly different from those originally conceived. In short,the Association has pursued a range of measures to improve its administrative and1 Lyons & Fleming 9 Dec 04.indd 9

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10 Michael Lyons and Jenny Fleming

representative effectiveness even after the formation of the Federation. This implies
that the merger activity of the Association cannot be easily conceptualised within theframework of union merger literature, in terms of motivating factors or outcomes.
The role of the Federation
At the time the Association’s rules were altered to allow the formation of the Federation
the national president of the Association outlined to the membership why this particular
structure for the national police union was adopted:…the structure that will now be created is totally different from the Police Super Union originallyproposed…By using the AFPA Rules we intend to create an alternative choice that protects our
ﬁnancial and industrial autonomy whilst expanding our political inﬂuence…we intend to create apeak lobbying body…to lobby and inﬂuence politicians and the public in the interests of national &international [sic] law enforcement (Hunt-Sharman, 1997: 1, emphasis in the original).

Under the rules of the Federation it has the potential to be a powerful industrial andpolitical inﬂuence in the ﬁeld of law enforcement (see Figure 1). In 2001 the Federation
reported a membership of 31,430 and with the afﬁliation of the Queensland and Western
Australian police unions as branches its membership will constitute over 90 pre centof the more than 47,000 sworn police in Australia (O’Rourke, 2003).17 It would appear
however, that industrial unionism is not the main function of the Federation as a national
entity. Rather it seems that its purpose is that of a professional association for police andlaw enforcement personnel, while industrial activities are left to its autonomous branches
and/or the State police unions (Fleming and Lyons, 2002). This much becomes clear as
status, standards and professionalism objectives were added to the Federation’s rules
during the merger process (see Rules 4 (u), (w), (x) and (aa)). These objectives have
all the hallmarks of an organisation which functions as a professional association forpolice and not one that operates as an industry based union. The fact that the Federation
also pursues ‘professional issues’ on behalf of the New Zealand Police Association
strengthens this conclusion (Burgess, 2004).

Discussion and Conclusions
In analysing the formation of the Federation in the context of a union merger somethingof a gap in the literature can be identiﬁed. In a review of the union merger literature
Michelson (2000: 111) concludes that for a merger to take place it must contain fourfeatures:a) a combination of two or more separate trade unions;b) the combination has legal status;c) a loss of autonomy and control for at least for one of the unions, even if this is
only slight; andd)this loss of autonomy and control can be identiﬁed as occurring at some point
in time either during the combination or shortly after.

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Union Mergers 11

As to the ﬁrst feature, point (a), this is uncertain. While in a formal sense the State police
unions combined to form a federation, in a practical sense they still function within therespective State industrial relations systems, are still registered organisations under theState industrial statutes, and have no federal industrial instrument regulating the working
conditions of their memberships. To that end, it does not appear that the ﬁrst feature has
been fully satisﬁed.
As to the second feature, point (b), this is again uncertain. Clearly the date of the formationof the Federation can be identiﬁed, either the date when the AIRC refused the appeals
to the Association’s 1991 rule variation application or when it approved the change ofname to the Federation. But again it is doubtful that a legal combination had taken place.
Rather, it was the Association which expanded its membership coverage by changing its
rules. The State based police unions had no formal part in the legal process because
State based unions are not recognised by federal industrial law. Or as AIRC Deputy
President Williams put it: ‘there is no organisation currently registered which purports torepresent the area of membership covered by the application’ (AIRC, 1993: 133). To that
end, it does not appear that the second feature has been has been fully satisﬁed.
As to the third feature, point (c), any loss of autonomy – even if only minor – is hard to
detect. The rules of the Federation make it quite clear that the branches are autonomous,and the double entrenching provision found in the rules of the ‘Australian Federal Police
Association branch’ only emphasises this point. To that end, the third feature does notappear to be satisﬁed.
And as to the last feature, point (d), this is a matter of conjecture. While the rules of
the Federation contain the possibility that the autonomy provisions could be changed atsome time in the future, it would need the concurrence of the Australian Federal Police
Association branch ((Rule 54(a)), the concurrence of the other branches to reduce theirown autonomy (Rule 35), the concurrence of the federal council (Rule 15), and ﬁnally the
concurrence of the Industrial Registrar to change the objectives of the Federation (Rule4(z)). While it is the view of the Association that the potential for such an outcome exists(see earlier), the likelihood of all four hurdles being cleared is slim. To that end, the fourthfeature does not appear to be satisﬁed.
But to argue that no real merger took place would imply the rule changes of the Association
were of little or no consequence. The objections to the rule changes from the State police
unions, other unions, the State police managements, the State governments, and the AFP
management during the process obviously suggest that they were of consequence (see
AIRC, 1992; 1993; 1997a; 1997b). Just as Michelson (2000: 108-10) notes that someunion merger studies fail to differentiate between amalgamations and absorptions andthus skew our understanding of merger activity – and too quickly to make generalisations(Hose and Rimmer, 2002: 540) – it may be that the Federation represents a form ofmerger that has rarely been scrutinised: an afﬁliation or alliance (Chaison, 1986: 59).

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12 Michael Lyons and Jenny Fleming

While Chaison (1986: 59-61) indicates that afﬁliations are an alternative to other mergers(amalgamations or absorptions), the form of merger produced by the Federation must
be classiﬁed as something stronger than an alliance among police unions in Australia
because of the single union structure (see Chaison, 2001: 248-50). It is for thesereasons the formation of the Federation cannot be easily explained by the union merger
literature.
Turning to the motivations to merge (or afﬁliate), the usual reasons discussed in theliterature have not been addressed as far as the Association is concerned. The factthat the union has considered other means to overcome the administrative and ﬁnancial
difﬁculties it does face, the establishment of the ALJA and non-member bargaining
fees for example, suggest that other reasons need to be found. In the search for thesereasons it would be impossible to dismiss the institutional arrangements and legislative
policy operating in Australia at the time the application to change its rules was made in1991. Certainly there was some fear within the Association that the union would not meetthe minimum membership threshold of 10,000 for registration that then prevailed under
the federal industrial statute (Hose and Rimmer, 2002). The State police unions might
have been motivated by the prospect that a non-police union, with federal registration,
could have sought to alter its rules to have constitutional coverage for State police andemergency service personnel under the legislation (for example, AIRC, 1990b).
In that context, the form of the merger, a federation, becomes easier to understand(Chaison, 1986: 61). For the State police unions, the danger that a more complete formof merger represented to their separate identity and, perhaps more importantly, theirpower and inﬂuence over State government policy making helps explain the federated
structure (see AIRC, 1993: 149-50; Fleming and Lafferty, 2001). And as alreadydiscussed, potential loss of organisational autonomy and its (aspirational) identity asa specialist in federal law enforcement inﬂuenced the Association. However, with thisanalysis it is a demanding task to try to categorise the merger activity process leading
to the formation of the Federation. There is some evidence to suggest that the police
union merger activity was defensive (at least for the Association), or consolidatory (forthe State police unions), or even aggressive (for the largest police union in Australia – thePolice Association of New South Wales) (Fleming and Lyons, 2002). Nevertheless, thefact that the outcome of the merger has resulted in no identiﬁable change to the conductof the individual police unions implies that it may not have been any of the above. It also
could be argued that the formation of the Federation does more to highlight the barriers
to union mergers than advance our understanding of reasons for them.
Therefore the importance of the Federation for trade union merger ‘theory’ is that
more innovative methods of analysing union merger behaviour are required, otherwise
signiﬁcant developments in union structures might be overlooked. In the context of thiscase study of the Police Federation of Australia, the importance of more subtle forms ofmerger activity needs to be recognised: ‘The merger agreement should be viewed as a

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Union Mergers 13

compromise solution to often conﬂicting goals of economy, and the preservation of theinterests of union members, ofﬁcers, and staff’ (Chaison, 1982b: 149).
This case study not only has lessons for the form or ‘what’ of union mergers, but it
also has lessons for the ‘why’. Certainly external-environmental factors were inﬂuential
but they alone are insufﬁcient to explain all merger behaviour. As this case study hassuggested, the union rationalisation and industry based union polices of the ACTU andthe federal Labor government might have prompted the ‘urge’, but it was mostly theinternal union considerations (fear of loss of autonomy and identity) which explain theactual ‘merge’. In that sense the integrated strategic choice-resource dependency modelof Campling and Michelson (1998) goes a long way in helping us to understand theprocess that resulted in the Federation. The police unions desired ‘agency’, but theirchoices were restricted by the desire to retain control of the resources critical to survival(autonomy and identity). Put simply, both external and internal factors helped shape themerger process that concluded with the formation of the Federation.
In conclusion, this study also has lessons for unions in their efforts to balance administrativeand representative effectiveness, and how they adopt the most appropriate structure forthis balance. In many respects the Association should be a union in a high state ofvulnerability. It is small, it has a very conﬁned membership base, and it lacks economies
of scale. Yet it is in a position that other unions would envy; a membership density ofover 70 per cent. What ﬁnancial difﬁculties it does have do not appear to be due to its‘vulnerabilities’, but are a unique feature of being a police union with a legal assistancefund. Moreover, the union, in its efforts to craft a niche for itself as a specialist industrialorganisation in the ﬁeld of federal law enforcement has identiﬁed these vulnerabilities not
as weaknesses but as strengths (AFPA, 2002). In their study of a small trade union Blacket al (1997: 146) conclude that a union is not automatically weakened by being small if it
fosters a sense of community between the membership and the union; this could equally
apply to the Association.

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14 Michael Lyons and Jenny Fleming

FIGURE 1: Structure of the Police Federation of Australia* In the process of becoming a branch of the Federation at the time of writing.

Notes
1
2
3
4
5
6
7
8
9
10
11
12

13

14
15
16
17

The Australian Bureau of Statistics ceased collecting trade union statistics in 1996 (Grifﬁn, 2002).
Noel Butlin Archives Centre, ANU, Australian Federal Police Association National Executive Minutes File N137/568;
National Executive meeting 14-15 May 1992, item 4.23.
Australian Industrial Registry File 200V, Australian Federal Police Association ﬁle 13, folio 605.
The Industrial Relations Act 1988 was signiﬁcantly amended in 1996 by the Workplace Relations and Other Legislation
Amendment Act 1996 (Cth), and it also restyled the Act to the Workplace Relations Act 1996.
Australian Industrial Registry File 200V, Australian Federal Police Association ﬁle 8, folio 436; letter from J.G. Brown dated
6 June 1991.
Australian Federal Police Association National Executive Committee meeting minutes 30 July 1998, item 8.
Australian Federal Police Association National Council Committee ﬁles, National Council Committee meeting 30-31 March
1995.
Australian Federal Police Association National Executive Committee ﬁles, National Executive Committee meeting minutes,
20-21 February 1996, item 14.11; see also National Executive Committee meeting minutes, 26-27 August 1997, p. 4.
Australian Federal Police Association National Executive Committee ﬁles, National Executive Committee meeting minutes,
19-20 October 2000.
Australian Federal Police Association National Executive Committee ﬁles, National Executive Committee meeting minutes:
19-20 February 1998, item 5; 11-12 March 1998, p. 2.
Australian Federal Police Association National Executive Committee ﬁles, letter from Phillips Fox Solicitors to AFPA nationalpresident (J. Sharp), dated 28 July 1995.
Australian Federal Police Association National Council Committee ﬁles, Special National Council Committee meeting
minutes, 23-24 July 2001, p. 6. The insertion of s.298Z into the Workplace Relations Act by the Workplace Relations
Amendment (Prohibition of Compulsory Union Fees) Act 2003 has placed an effective prohibition on non-union member
bargaining fee clauses in federal collective agreements.
Australian Industrial Registry File 200V, Australian Federal Police Association ﬁle 13, folio 613; letter from Gilshenan and
Luton Solicitors on behalf of the Queensland Police Union of Employees to the Industrial Registrar, 14 August 1997. The
Western Australian Police Union of Workers formally joined the Federation in 2003. At the time of writing the Queensland
Police Union of Employees is in the process of joining.
Australian Federal Police Association National Executive Committee ﬁles, 1996 discussion paper ‘Making the Most of
Opportunities’; National Executive Committee meeting minutes, 12 May 1997, p. 1.
Australian Federal Police Association National Council Committee meeting minutes, National Council Committee meeting,
17-18 October 1996, report by Principal National Industrial Ofﬁcer ‘Agenda for AFPA Renewal’, pp. 5-6.
Australian Federal Police Association National Executive Committee ﬁles, National Executive Committee meeting minutes,‘Conﬁdential Report to the National Executive Meeting of 15 July 1997: National President’s Report’.
The New Zealand Police Association is an ‘afﬁliate’ of the Federation and not a branch. There are about 7,000 sworn policein New Zealand (New Zealand Police, 2003).

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Union Mergers 15

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Amendment Bill 2002’, 4 June.
AIRC (Australian Industrial Relations Commission) (1990a), Decision – Federal Police Operations, Matter C No. 27031 of 1989,
Williams, Cohen JJ & Oldmeadow C, 1 November 1990, M Print J5280.
AIRC (1990b), Decision – Federal Fireﬁghter’s Union, Matters R 81, 82, and 83 of 1988, Moore DP, 28 March 1990, S Print
J1879.
AIRC (1992), Reasons for Decision – Australian Federal Police Association, Matter D No. 30008 of 1991, Williams DP, 21 October
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Black, J., Greene, A. and Ackers, P. (1997), ‘Size and effectiveness: a case study of a small union’, Industrial Relations Journal,
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Burgess, M. (2004), Personal communication, Chief Executive Ofﬁcer, Police Federation of Australia, 29 June.
Campling, J.T. and Michelson, G. (1998), ‘A strategic choice-resource dependence analysis of union mergers in the British andAustralian broadcasting and ﬁlm industries’, Journal of Management Studies, 35 (5): 579-600.
Chaison, G. (1986), When Unions Merge, Lexington: D.C. Heath and Company.
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Labor’s Quest for Relevance in the Twenty-First Century, Ithaca: Cornell University Press.
Chaison, G.N. (1982a), ‘A note on the critical dimensions of the union merger process’, Relations Industrielles, 37 (1): 198-206.
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Devine, K. and Reshef, Y. (1998), ‘Union merger support. A tale of two theories’, Relations Industrielles, 53 (3): 517-532.
Fleming, J. and Lafferty, G. (2001), ‘Police unions, industrial strategies and police inﬂuence: some recent history’, International
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Union and Employer Preference Estimation 17

Estimating the Other Party’s
Preferences and Trust in
Trade Union and Employer
Negotiations: A Comparison
between NZ and Sweden
EVA ZELLMAN* & SIMON KEMP**

Abstract
The article reports on a study in which one hundred and thirty-six New Zealand andSwedish union and employer negotiators anonymously responded to a questionnaire
containing a hypothetical negotiation scenario which depicted a variety of employment
agreement issues, and required the negotiators to indicate how important they believed
the issues were to the other party and to themselves. Union and employer negotiatorsfrom both countries made inaccurate estimates about the importance the other party
placed on the issues. However, Swedish negotiators were signiﬁcantly more accurate intheir estimations and were more trusting of the other party than New Zealand negotiators,
as predicted from the history of employment relations in the two countries.

Introduction
Negotiation is the behaviour of two or more independent parties who are making joint
decisions, but do not have identical preferences across decision alternatives (Pruitt,1981). It has been suggested that negotiation is a rational process that leads to optimal
outcomes, and that negotiators might behave in a rational manner by systematicallysearching all possible alternatives and objectively evaluating them to reach the optimal
outcome (Nash, 1950; Raiffa, 1982). However, research shows that parties often failto resolve disputes despite compatible interests, and outcomes are often sub-optimal(Bottom & Paese, 1997; Nisbett & Ross, 1980).

*Eva Zellman, Graduate Human Resources Consultant, Brannigas Human Capital, Christchurch.
** Simon Kemp, Associate Professor, Psychology Department, University of Canterbury.
The authors gratefully acknowledge assistance from Lynley Mulrine, Mike Dawson, Ged O’Connell, Hamish Seaward,
Teresa Schwellnus, Verne Pere, and the Zellman and Eek families in carrying out this research. The research was
originally carried out as a project for the ﬁrst author’s M.Sc. degree, and we acknowledge ﬁnancial assistance from thePsychology Department of the University of Canterbury.

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18 Eva Zellman and Simon Kemp

Assessing the other party’s within-issue preferences.
Sub-optimal outcomes may arise when negotiators do not have complete knowledge
about their opponents’ priorities because the necessary information has not beencommunicated or has been misunderstood (Pinkley, Grifﬁth, & Northcraft, 1995). When
judgements are inaccurate, the negotiation process tends to be distributive rather thanintegrative. In distributive bargaining, negotiators expect that their interests are opposedto those of the other party, and that the issues most crucial for themselves are also themost crucial for the other party. This is likely to result in sub-optimal win-lose outcomes or
impasse. In contrast, integrative bargaining is a cooperative process where negotiators
make trade-offs that may result in win-win outcomes, where each party gains what ismost important to them (Bazerman & Neale 1992; Bazerman & Carroll, 1987; Olekalns,
1999; Pinkley et al., 1995; Walton & McKersie, 1991).
Each party in a negotiation usually has a settlement range, which is a range of possible
outcomes that a party considers acceptable (Deeks & Rasmussen, 2002). It is common
in employment relations negotiations that there is more than one issue to be negotiated.
Some issues may have overlapping settlement ranges; other issues may not. To establish
whether there are overlapping settlement ranges for different issues, the negotiators
must assess the importance that the other side places on each issue, the “within-issue
preference” (Pinkley et. al., 1995; Thompson & Hastie, 1990). Negotiators are more
likely to reach optimal agreements and need less time to reach a settlement when withinissue preferences are clearly stated before the onset of negotiation (Keltner & Robinson,
1993; Neale & Bazerman, 1983; Thompson & Hastie, 1990; Thompson, Peterson, &Brodt, 1996). Thus, it might be beneﬁcial for all parties to reveal their preferences andinterests prior to bargaining. However, negotiators often fail to communicate and identify
compatible interests (Harinck, De Dreu & Van Vianen, 2000; Thompson & Hastie, 1990;
Thompson et al., 1996) because they tend to overestimate the transparency of theirpreferences. That is, negotiators presume their preferences and interests are more
readily apparent to the other party than is in fact the case (Vorauer & Claude, 1998).
Research also indicates that parties do not generally seek information from each othereven if there are opportunities to do so (Thompson & Hrebec, 1996). It is important tonote that highly experienced negotiators are generally more accurate in their estimationsof the other party’s within-issue preferences than those with little experience, and thatnegotiators tend to become more accurate in long-term bargaining relationships where
the parties are frequently interacting with each other (Bazerman, Magliozzi, & Neale,
1985; Gulati, 1995).
When negotiators are not aware of the other side’s priorities they tend to rely on theirown preferences as a cue to the other side’s priorities and expect that the other party’s
preferences will be completely opposed to their own. Research has investigated theability of individuals to correctly assess opposing parties’ within-issue preferences inideological conﬂicts over such issues as abortion, racism and the death penalty, bymeasuring the ideological opponents’ opinions on an issue and also their estimation of

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Union and Employer Preference Estimation 19

the opposition’s view. Results from these studies show that opposing parties believe theopposition to hold more extreme views than it does, and hence, they overestimate theextent of their disagreement (Keltner & Robinson, 1993, 1997; Robinson, Keltner, Ward,& Ross, 1995).
The prevalence of inaccurate within-issue preference judgments in employment relations
negotiations has been investigated (Howells & Brosnan, 1972; Howells & Woodﬁeld,
1970; Robinson & Friedman, 1995). Howells and Brosnan (1972) found that New
Zealand union ofﬁcers and managers in the woollen and worsted milling industry madeinaccurate judgements about their employees’ interests. Employers and union ofﬁcers
overestimated employees’ concern for wages and underestimated their concern forsafety and staff training. Robinson and Freidman (1995) examined whether union andemployer negotiators in an actual employment relations negotiation in the USA wereable to accurately estimate the other party’s within-issue preference on different issues.
In this study, the union negotiators overestimated the employer negotiators’ concern
for issues such as proﬁt, control of the workers and work rules, and underestimatedtheir concern for wages and beneﬁts. Employer negotiators overestimated the unionnegotiators’ concern for wages, control of union membership and work rules. Thus,
union and employer negotiators do not always make accurate judgements about theother party’s within-issue preferences.
The present study investigated whether the incorrect judgements about within-issue
preferences that were found in Robinson and Friedman’s (1995) study could be
generalised to negotiations between union and employer negotiators in New Zealandand Sweden. We hypothesised that union and employer negotiators would often makeinaccurate judgements about the level of importance the other party places on different
issues presented in a hypothetical scenario.
New Zealand and Swedish negotiators
The different social climate between union and employer negotiators in New Zealandand in Sweden might affect negotiators’ ability to estimate the other party’s within-issue
preferences. It appears that Swedish union and employer negotiators are more likely
to have a cooperative relationship which facilitates mutual trust and information sharing(Sidorenko & Sklyarenko, 1999; Stjernholm, 1995), while the relationship between New
Zealand union and employer negotiators is more competitive and adversarial (Deeks &Rasmussen, 2002).
Before 1938, the employment relations climate in Sweden was traditionally conﬂictoriented with many strikes and a high level of mistrust. In that year, an agreement called
the “Saltsjöbadsavtalet” was signed between the Swedish Confederation of Trade Unions(LO) and the Swedish Employers’ Federation (SAF). This agreement started what istoday internationally recognised as the ‘Swedish model’. This framework agreement
established a system where negotiations were made on a central level between the LO

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20 Eva Zellman and Simon Kemp

and the SAF who negotiated on behalf of their member organisations. The frameworkagreements were then modiﬁed to suit different industries and organisations at regional
and local levels. There was a kind of power balance between the two parties and there
was little government involvement. The key to the Swedish model was that it encouraged
union and employer interactions to be collaborative and adversarial behaviours, such as
strikes and lockouts, were not approved. For this reason, the conﬂict-orientated climatechanged to a relationship with greater solidarity and trust. There were many reasons forthe two parties to collaborate. By working together they could keep inﬂation down, ensure
full employment and remain competitive on the international export market. In addition,
strikes and lockouts were very costly for both parties (Lundh, 2002; Stjernholm, 1995). In
recent years, there has been a trend towards decentralisation and greater independence
of individual unions due to technological and economical changes, and movement to an
economy based on the service industry and multinational companies (Abrahamsson,
1996; Kuruvilla, 1993; Lundh, 2002). Lundh (2002) argues that the relationship between
unions and employers has become more competitive today. However, Swedish unions
are still relatively powerful and union membership rate is among the highest in the world(Kjellberg, 2001; Sidorenko & Sklyarenko, 1999). Swedish unions and employees also
have a strong inﬂuence on decisions made by employers. For example, unions haveaccess to virtually all company documents; local unions may appoint representatives tothe board of directors of most companies with more than 25 employees; and unions are
represented in many advisory bodies within companies (Sidorenko & Sklyarenko, 1999).
In summary, Sweden has a long history of cooperative union-employer relationship,
which appears to have contributed to greater mutual trust and solidarity between the twoparties (Swedish Institute, 2001).
In contrast, Deeks et al. (1994) characterise the employment relations climate in
New Zealand as predominately conﬂict-based. Despite efforts by the New Zealandgovernment to promote collaboration and mutual trust, there has never been a wellestablished model of cooperation as in Sweden and there is little union involvement
in organisational decision making. The Industrial Conciliation and Arbitration Act wasestablished in 1894 to reconcile and regulate the competing interests of employers andunions. Industrial disputes were settled by conciliation and arbitration to avoid strikes
and lockouts. Wage negotiations were undertaken on a national level between unions
and employer federations, and the unions were very powerful because they received
certain privileges in return for some restrictions and scrutiny of their activities by thegovernment. In addition, union membership was compulsory for employees between
1936 and 1962. As a consequence of this structure, the relationship between unions andemployers was competitive and the two parties often mistrusted one another (Rudman,
1994; Scollay & St John, 1996). This did not change when the Employment Contracts Act
was introduced in 1991. This Act emphasised efﬁciency in the labour market to ensure
productivity and stability between the two parties (Deeks & Rasmussen, 2002; Scollay& St John, 1996). Negotiations were decentralised and employers and employees
could bargain directly with each other without the necessity of union involvement. The

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Union and Employer Preference Estimation 21

government’s involvement in the wage negotiation was removed and the power of unions
weakened (Deeks et al., 1994; Rudman, 1994; Scollay & St John, 1996). The Act aimed
to settle disputes through peaceful negotiation or mediation, but disputes were often
settled through adjudication and Court hearings, which may have adversely affected
relationships between employees and employers (Deeks et al., 1994).
The Employment Relations Act of 2000 was another attempt to build a relationship ofmutual trust and cooperation between employees and employers (Deeks & Rasmussen,2002). Under this Act, the unions have regained some power and collective bargaining
is encouraged. Mediation is the preferred option and, as a rule, ‘employment relationshipproblems’ should be dealt with in compulsory mediation before matters may be referred to
the Employment Relations Authority and the Employment Court. In addition, negotiation
between the two parties must be in ‘good faith’. That is, the parties may not mislead or
deceive each other and all relevant information must be supplied on request (Rudman,2003). In summary, the new legislation aims to change the traditionally adverse
relationship between employers and unions to a relationship of cooperation and trust.
It is yet to be seen whether this objective will be achieved as it takes time to change
peoples’ attitudes and perceptions (e.g., Smith & Mackie, 2000).
There are two key areas of difference between the New Zealand and the Swedish
employment relations systems which might inﬂuence union and employer negotiators’ability to assess the other party’s within-issue preferences. Firstly, it appears that Swedish
unions interact more with employers and have a stronger inﬂuence on the decisions
made by employers than New Zealand unions. Research indicates that the greater
the frequency of contact between opposing groups, and the more institutionalised theirrelationship, the more accurate are their perceptions of each other (Levine & Cambell,1972). Secondly, Swedish union and employer negotiators may trust each other morethan their New Zealand counterparts. Unsurprisingly, research shows that trust is moreprevalent in cooperative relationships than in competitive relationships (Beersma & De
Dreu, 1999; Walton & McKersie, 1965). Thus, we hypothesised that Swedish negotiators
would be better at discerning the within-issue preferences of the other party, and that
there would be more trust between union and employer negotiators in Sweden than in
New Zealand.

MethodParticipants and Procedure
A total of 136 New Zealand and Swedish employment relations negotiators, who negotiate
employment relations issues on behalf of employers or union members, completed
questionnaires. There were four different groups of participants: New Zealand unionnegotiators, New Zealand employer negotiators, Swedish union negotiators and Swedish
employer negotiators.

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22 Eva Zellman & Simon Kemp

New Zealand union sample: New Zealand union negotiators were recruited throughthe Council of Trade Unions in Christchurch. Fifty-six questionnaires were sent out tounion organisers and union delegates and 32 were completed and sent back, giving a
57% response rate. Of the 32 union negotiators (28 organisers and 4 delegates) who
participated, 17 were male, and they represented 14 different unions. The average age
was in the 41-50 year age range. The amount of time the union negotiators had been
negotiating employment relations issues on behalf of union members ranged from twomonths to 26 years and two months, with an average of 12.5 years.
New Zealand employer sample: Human resource management professionals andmanagers/supervisors who negotiate employment relations issues on behalf of employers
in various industries were recruited from The Human Resource Institute of New Zealand.
Thirty-seven questionnaires were posted, and 32 returned (22 from human resource
professionals and 10 from managers/supervisors) to give a response rate of 87%. The
participants’ average age was in the 41-50 year age bracket, and 19 of them were male.
Participants had negotiated employment relations issues on behalf of employers for
between one and 26 years, with an average of 9.2 years.
Swedish union sample: Swedish union negotiators were identiﬁed on trade union internet
sites and contacted via e-mail. Forty-nine questionnaires were sent out, and 37 werereturned, for a response rate of 76%. The 37 local, regional and central level unionnegotiators (28 organisers, 7 delegates and 2 not responding) were from 16 different
trade unions; 23 were male; and the average age was in the 41-50 year range. The
average time the union negotiators had been negotiating employment relations issues onbehalf of union members was 13.2 years, but ranged from one year to 26 years.
Swedish employer sample: Employers’ association negotiators, human resource
management professionals and managers/supervisors who negotiate on behalf of
employers were identiﬁed from internet sites and through professional contacts. Thirtyeight questionnaires were posted to those who responded positively to an email, and 35 ofthese were returned for a response rate of 92%. As a result, 35 local, regional and centrallevel employer negotiators took part in this study (21 employers’ association negotiators,
11 human resource professionals, 1 manager/supervisor and 2 not responding); 20 weremale; and the average age was in the 41-50 year range. They had been negotiating
employment relations issues on behalf of employers between two and 31.2 years, withan average of 13.5 years.
Questionnaire
New Zealand employer negotiators read the following scenario:“You are a manager at a State Owned Enterprise called IT Direct. At present, you are
representing IT Direct in negotiations with the union representing the organisation’s
computer programmers. The aim of these negotiations is to renew the programmers’

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Union and Employer Preference Estimation 23

collective employment agreement and to allocate a pool of money to their remuneration
package. The issues discussed in your negotiations include wages, beneﬁts andwork hours.
1. Wage increase: The programmers have not had a wage increase in two years andin the light of this the union is claiming a minimum of a 5% wage increase to coverrises in the cost of living due to inﬂation. IT Direct’s position is that a 5% increaseis excessive considering the organisation’s low proﬁts in the last year.
2. Beneﬁts: A ﬂexible beneﬁt scheme has also been tabled, which would allow the
programmers to choose between a medical insurance scheme, superannuation
saving scheme or a student loan repayment scheme. The union and IT Direct
must agree upon the monetary values for these ﬂexible beneﬁts.
3. Hours of work: Flexi-time has been suggested to give the programmers an
opportunity to balance their home and work life in a more effective manner. IT
Direct recognizes how ﬂexi-time would beneﬁt the programmers, but they areconcerned about the actual logistics and the reduced control they will have overtheir employees.”
Respondents were asked to “provide their initial reactions” to questions about the
scenario. Each reaction was given on a seven-point rating scale ranging from 1 (notimportant at all) to 7 (very important). Twelve (6 X 2) separate questions asked them torate the importance of the wage increase, the ﬂexibility of the beneﬁt scheme, the valueof the ﬂexible beneﬁts, control of programmers’ work hours, IT Direct’s level of proﬁt, andthe programmers’ level of job satisfaction to both the union and to IT Direct.
The questionnaire also contained two other scenarios (not reported here), and requested
demographic information (age, sex, etc.). The ﬁnal question asked the respondent torate his or her trust in negotiators representing the other party on a scale from 1 (no trust
at all) to 7 (fully trust).
Questionnaires presented to New Zealand union negotiators were identical, except thatthe ﬁrst two sentences of the scenario directed them to take the perspective of a unionnegotiator representing the programmers. Swedish questionnaires were identical incontent to New Zealand questionnaires. (English questionnaires were constructed ﬁrst
and translated into Swedish by the ﬁrst author, similarity of meaning was checked byhaving another person proﬁcient in both English and Swedish translate the Swedish
version back into English.)Results
Descriptive statistics and t-tests were conducted on the importance ratings the participants
assigned to the 6 questions, assessing how important the participants perceived theissues to be for each party.

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24 Eva Zellman & Simon Kemp

TABLE 1: Means (standard deviations) and t-values for the New Zealand union andemployer negotiators’ actual and estimated importance ratings of the six different
employment relations negotiation issues.

Note. Results of t-test: *p<.05, **p<.01

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Union and Employer Preference Estimation 25

TABLE 2: Means (standard deviations) and t-values for the Swedish union andemployer negotiators’ actual and estimated importance ratings of the six different
employment relations negotiation issues.

Note. Results of t-test: *p<.05, **p<.01

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26 Eva Zellman & Simon Kemp

The results of Table 1 show that employer negotiators in New Zealand underestimatedthe importance the union negotiators placed on the ﬂexible beneﬁt scheme, the controlof employees’ work hours and the level of job satisfaction. However, the New Zealandemployer negotiators were accurate in their estimations of the union negotiators’
preferences regarding the importance of the wage increase, the value of the beneﬁtscheme and the level of proﬁt. The New Zealand union negotiators overestimated theemployer negotiators’ concern for the control of work hours and the level of proﬁt, andunderestimated the importance employers placed on employees’ job satisfaction.
Similar statistics for the Swedish union and employer negotiators’ actual and estimatedimportance ratings of the different issues are presented in Table 2. The Swedish employer
negotiators were quite accurate in their estimations of the union negotiators’ preferences
for ﬁve of the six issues, but underestimated the importance union negotiators placed on
the job satisfaction issue. The union negotiators overestimated the importance employers
placed on the control of work hours and underestimated the importance the employers
placed on the job satisfaction issue. Yet, the union negotiators correctly estimated theimportance employers placed on the wage increase, the ﬂexible beneﬁt, the value of the
beneﬁt and level of proﬁt issues.
These results suggest that the Swedish negotiators were more accurate than the New
Zealand negotiators in their estimations of the importance the other party placed on theissues. To compare whether Swedish union negotiators were in fact more accurate thantheir New Zealand counterparts in judging the employers’ importance ratings, difference
scores between the union negotiators’ estimated employer importance ratings and theemployer negotiators’ actual importance rating means were computed and compared
between the New Zealand and Swedish union samples. Table 3 presents these difference
score means, standard deviation and t-values for the six issues. The closer the difference
score means are to zero, the more accurate were the union negotiators’ estimations of
the importance the employers placed on the issues. The difference score means for the
Swedish union negotiators were signiﬁcantly smaller than the difference score means for
the New Zealand union negotiators for the ﬂexible beneﬁt, value of beneﬁt and level of
proﬁt issues. There were no signiﬁcant differences between the difference score means
for the two union samples for the wage increase, control of employees’ work hours andlevel of job satisfaction issues. Thus, the Swedish union negotiators were more accurate
than the New Zealand union negotiators in their judgments about employer negotiator
priorities for three of the six issues.

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Union and Employer Preference Estimation 27

TABLE 3: Means (standard deviations) and t-values for the difference scores
between the New Zealand and the Swedish union negotiators’ estimated employer
negotiator importance ratings and employer negotiators’ actual mean importance
ratings.

Note. Results of t-test: *p<.05, **p<.01

TABLE 4: Means (standard deviations) and t-values for the difference scores
between the New Zealand and the Swedish employer negotiators’ estimated unionnegotiator importance ratings and union negotiators’ actual mean importance
ratings.

Note. Results of t-test: *p<.05, **p<.01

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28 Eva Zellman & Simon Kemp

Similarly, to establish whether the Swedish employer negotiators were more accurate
than their New Zealand counterparts in judging union negotiators’ priorities, difference
scores between the employer negotiators’ estimated union negotiators’ importance ratings
and the union negotiators’ actual importance rating means, were compared between the
New Zealand and the Swedish employer samples. Table 4 displays the difference scoremeans, standard deviation and t-values for the six issues. The difference score means
for the Swedish employer negotiators were signiﬁcantly smaller than the difference scoremeans for the New Zealand employer negotiators for the wage increase, ﬂexible beneﬁt,control of employees’ work hours and level of job satisfaction issues. In contrast, thedifference score mean was signiﬁcantly smaller for the New Zealand employer negotiators
than the Swedish employer negotiators for the value of the beneﬁt issue. There wasno signiﬁcant difference between the Swedish and New Zealand employers’ different
score means for the level of proﬁt issue. Thus, the Swedish employer negotiators weremore accurate than the New Zealand employer negotiators in judging union negotiators’
priorities for four of the six issues. However, the New Zealand employer negotiators
were more accurate about the union negotiators’ importance ratings than the Swedish
employer negotiators for one issue.
A t-test was calculated to establish whether the New Zealand and Swedish negotiators
differed in their level of trust for the other party. The mean for the Swedish negotiators(M=5.31, SD=.96) was signiﬁcantly higher than the mean for the New Zealand negotiators(M=4.16, SD=1.43, t(134)=5.56, p<.01). Swedish union and employer negotiators trust
each other to a greater extent than New Zealand union and employer negotiators. There
were no signiﬁcant differences in the level of trust between the Swedish union (M=5.24,
SD=1.09) and the employer negotiators (M=5.37, SD=.81, t(70)=.56, ns) or between the
New Zealand union (M=4.03, SD=1.56) and employer negotiators (M=4.28, SD=1.31,
t(62)=.70, ns).

Discussion
It was hypothesised that union and employer negotiators in both Sweden and New Zealandwould make inaccurate estimates about the level of importance the other party places on
different employment agreement issues. This hypothesis was supported by the results.
New Zealand and Swedish employer negotiators both underestimated the importancethe union negotiators placed on employees’ level of job satisfaction. The New Zealandemployer negotiators also underestimated the importance of the ﬂexible beneﬁt and thecontrol of work hours issues. Union negotiators from both Sweden and New Zealandunderestimated the importance the employer negotiators placed on the employees’ levelof job satisfaction and overestimated their concern for control of employees’ work hours.
The New Zealand union negotiators were alone in overestimating the importance of theissue of proﬁt. Both countries’ union negotiators were accurate in their estimations of thewage increase, ﬂexible beneﬁt and value of beneﬁt issues.

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Union and Employer Preference Estimation 29

A detailed comparison is possible between these results and those from Robinson andFreidman’s (1995) study. The union negotiators in the earlier study made inaccurate
estimations for all ﬁve employer issues they considered, while the employer negotiators
were incorrect in three of the four union issues they estimated. In the present study, the
New Zealand union and employer negotiators made inaccurate estimations for three ofthe six issues, the Swedish union negotiators were inaccurate in their estimations for two
issues, and the Swedish employer negotiators made inaccurate judgements for only oneof the six issues. Overall, then, the negotiators in the present study were more accurate
than the negotiators in Robinson and Friedman’s study, a difference which might reﬂect
either the American setting of Robinson and Friedman’s study or that this study was
conducted during an actual dispute.
As hypothesised from our consideration of the differing histories of New Zealand andSwedish employment relations, Swedish negotiators were more accurate than the New
Zealand negotiators in their estimations of the importance the other party attached todifferent aspects of the negotiation. We also found more trust between Swedish unionand employer negotiators than between New Zealand union and employer negotiators.
Overall, our negotiators were often inaccurate as to the importance the other party
placed on different employment agreement issues. The comparison of Swedish and New
Zealand negotiators suggests that greater understanding of the other party’s within-issue
preferences is possible in a less conﬂict-oriented employment relations environment
where there are more opportunities for interaction and collaboration between the twoparties. Awareness of the other party’s within-issue preferences is important to establish
whether they have overlapping settlement ranges that can make optimal agreements
possible (Pinkley et al., 1995).

Conclusion
Our study shows that New Zealand and Swedish employer and union negotiators tend to
make inaccurate judgements about the other party’s within-issue preferences in regard
to different issues negotiated in a collective employment agreement negotiation. Our
research also indicates that Swedish negotiators appear to be better at discerning thewithin-issue preferences of the other party and to trust each other to a greater extent
than New Zealand negotiators. The different employment relations climate and history
in the two countries may have caused this divergence in the accuracy of preference
judgements and trust.

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30 Eva Zellman & Simon Kemp

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Casualisation Friend or Foe? 33

Casualisation Friend or Foe?
A Case Study Investigation of two
Australian Hospitals
CLARE LUMLEY*, PAULINE STANTON** & TIMOTHY BARTRAM***

Abstract
This paper seeks to address the limited systematic research concerning the explanations
and consequences of the growing casualisation of nursing in Australia. It draws on acase study of two Victorian metropolitan hospitals, a private and public facility. This
paper also seeks to improve our understanding of why nurses prefer casual working
arrangements. This paper explores the effects of casualisation on permanent and casual
nurses, and the workplace. This is achieved through both qualitative and quantitative
research methods, exploring attitudes and perceptions of permanent nurses, casual
nurses and nurse managers concerning casualisation and its impact on their workloads,
occupational stress, work performance and the provision of quality of care. The mainﬁndings in this study were that a number of nurses are electing to work casually out ofchoice rather than necessity. Moreover, hospital managers have to use casual nurse
labour as a consequence of an inadequate permanent workforce as opposed to thehistorical technique of controlling labour supply. It was found that all three groups
of informants considered that permanent nurses provided the highest rate of work
performance and quality of care. Finally, implications are drawn for government andhospital management.

Introduction
The last decade has witnessed tremendous growth in the casualisation of employment
throughout the western world (Kalleberg, 2000; Campbell, 2000). In keeping with thistrend, Australia now has one of the highest rates of casualisation of employment and thatrate is increasing (Campbell & Burgess, 2001). Management literature suggests thatcasualisation has traditionally been seen as an employer strategy to increase ‘ﬂexibility’of the workforce by maximising the operating ability of a business, while minimising its
operating cost (Davis-Blake, Broschak & George, 2003; Kalleberg, Reskin & Hudson

Clare Lumley is a Clinical Risk Manager at St. Vincents & Mercy Private Hospital** Dr Pauline Stanton is a Senior Lecturer at the Graduate School of Management, La Trobe University***Timothy Bartram is a Lecturer at the Department of Accounting and Management, School of Business, La Trobe
University

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34 Clare Lumley, Pauline Stanton and Timothy Bartram

2000; Schroeder & Worrall-Carter, 2002; Fitzgerald, 2002; Allan, 1998). Many scholars
argue that this strategy means that as well as having less job security, casual workers are
more vulnerable than permanent workers to unfair dismissal, discrimination or harassment
and generally have lower wages and conditions (Pocock, 1998; Nightingale, 1995).
Thus, casualisation of the workforce is seen to be ﬁnancially beneﬁcial for employers but
detrimental for employees.
However, in this paper we argue that in some sectors the situation is more complex
and we explore this contention in the nursing profession. The nursing literature bothfrom Australia and overseas, suggests that “casualisation” of the workforce is increasing
across all areas of professional nursing practice (Buchan, 1995: 22-23; Dickson, 1993:
12-14; Miles, 1997; Morgan, 1996: 175). While there is some debate in Australia as tothe extent of casualisation in nursing profession (Davies, 2000; Victorian Department
Human Services, 1999), there is growing evidence to suggest that a signiﬁcant cohortof nurses are working in casual rather than permanent working arrangements. At thesame time, there has been considerable attention towards a labour force ‘crisis’ as
demand for nurses far exceeds supply nationally and internationally (Buchan, 1995). It
has become clear that it is not just difﬁcult to recruit nurses but also to keep them, as
there is evidence that nurses are leaving the profession in high numbers (Fitzgerald,
2002; Victorian Government Department Human Services, 2001). In Victoria, difﬁculties
of nurse recruitment and retention have been identiﬁed by the State government. The
Nurse Recruitment and Retention Committee Final Report concluded that nursing
is increasingly becoming a physically and mentally exhausting occupation and that
nurses are no longer prepared to work under the resultant stress (Victorian Government
Department Human Services, 2001). Strategies adopted to ameliorate the situation have
involved improved pay and conditions, including the adoption of nurse-patient ratios andsophisticated recruitment campaigns (Creegan et al., 2003; Fitzgerald, 2002; Buchanon,
Bretheron, Bearﬁeld & Jackson 2004).
Creegan et al. (2003) argue, however, that little is known about the reasons behindnurses exercising their preference for casual working arrangements. They suggest that“… more detailed knowledge of the forces driving the decisions of this group is essential
if health care organisations are to equip themselves to manage this changing workforce
and maintain a standard of patient care that is acceptable to the community” (p201). In
addition, little known about the effect of increased casualisation on permanent nurses inthe same workplace and their views concerning the outcomes of casualisation. However,
De Ruyter (2002) found that employers were concerned that the employment of casual
nurses could lead to tensions on the ward if they were not able to demonstrate the sameknowledge of unit procedures as the permanent staff.
This paper seeks to address the limited, systematic research concerning the explanations
for the growing preference for the casualisation of nurses and investigates perceived
outcomes of casualisation. It draws on a case study of two Victorian metropolitan

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Casualisation Friend or Foe? 35

hospitals, a private and public facility. In particular, the paper seeks to improve ourunderstanding of why nurses prefer casual working arrangements. It also investigates
the effects of casualisation on permanent nurses, casual nurses and the workplace.
This is achieved through both qualitative and quantitative research methods, exploring
attitudes and perceptions of permanent nurses, casual nurses and nurse managers
concerning casualisation and its impact on their workloads, occupational stress, work
performance and the provision of quality of care. These areas of investigation areimportant in aiding health policy makers and health services to improve the attraction
and retention of permanent nurses and fulﬁl their responsibilities to employees, patientsand the wider community. According to Creegan et al. (2003), in nursing, where demand
exceeds supply, any strategy that focuses solely on the individual is likely to increase
the imbalance between casual and permanent employees, particularly in environmentscharacterised by increasing workloads, loss of capacity to apply nursing models of care,loss of status and the problem of a power differential between medical and nursing staff
in the control of workﬂow.
The article commences with a review of the literature on casualisation and in particular,
casualisation in the health sector and nursing. The methodology and research designof the study reported in this article are also presented. The results of the study are
discussed in two phases. The qualitative results presented are based on views ofmanagers and perceptions and experiences of permanent bank and agency nurses
with casualisation as well as the rationale and outcomes of casualisation in the healthsector. The quantitative results presented represent 80 permanent nurses’ perceptionsof performance, workload, occupational stress, and quality of patient care associatedwith various types of nurses. Finally, implications are drawn for health policy makers andhospital managers in terms of how casualisation might be better managed.

Casualisation of Employment
The nature of casual employment has changed signiﬁcantly and represents one of themost dramatic changes in the structure of employment in Australia and abroad since the1970’s (Allan, 2000). According to Campbell (2000), casual employment in Australia hasmore than doubled as a percentage of the paid workforce since 1982, having risen from
13 per cent of the workforce to over 26 per cent in 1999. Of the 1.5 million jobs createdin the decade to 1998, more than two-thirds were offered on a casual basis (Campbell,2000). Despite of the conjecture and debate in the literature concerning the deﬁnitional
accuracy of the term ‘casual’ (Campbell & Burgess, 2001; Kalleberg et al., 2000), theAustralian Bureau of Statistics (ABS) estimates that 27.3 per cent or around 2.1 million
workers are employed on a casual basis (cited in Campbell & Burgess, 2001).
There is considerable diversity and ambiguity among casual working arrangements.
While casual employment is generally associated with short-term engagement andbeneﬁt exclusion, it can also be associated with so-called “long-term casuals” (Creighton

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36 Clare Lumley, Pauline Stanton and Timothy Bartram& Stewart, 2000), or independent contractors or people employed through a hire agency(Campbell & Burgess, 2001). In addition, casual employment occurs when employees
are not entitled to paid holiday leave or sick leave, whereas employees with permanent
employment are entitled to both beneﬁts (Campbell & Burgess, 2001:86). In theoccupation of nursing, there are generally two modes of casual employment, bank nurses
and agency nurses, which will be discussed in more detail below.
Conventional management scholars argue that management employment strategies havebeen identiﬁed as a major causal factor in the expansion of casual employment (DavisBlake; Broschak & George, 2003; Leighton & Painter, 2001; Kalleberg, 2000; Kalleberg,
Reskin & Hudson, 2000). Global economic changes have increased competition anduncertainty amongst organisations and placed greater pressure on them to pursue more
ﬂexible working arrangements with their employees in order to maintain competitivenessand responsiveness to consumers (Burgess, 1997). Casual employment enables
managers to more easily match working time to business activity. The utilisation of casuallabour thus produces direct savings in expenditure as labour is paid only when required(Allan, 2000). Moreover, according to Burgess (1997), some ﬁrms have reduced theiremployment costs through “shamrock” or “ﬂexible ﬁrm”, organisational design. These
organisations are composed of a functional, ﬂexible core of permanent, full-time workers,“buffered” by a group of numerically, ﬂexible peripheral workers. The adoption ofcasual work has also been facilitated by technological improvements in communicationand information systems that have made it easier for organisations to specialise theirproduction, and assemble temporary workers quickly for projects. Leighton and Painter(2001) further argue that senior management in many organisations put pressure on
HRM departments to be lean and efﬁcient and reduce the “head counts” of core staff. It
has been argued that a reduced core of permanent, full-time employees, supplemented
by the almost hidden casuals, can increase efﬁciency (Cascio, 1992). Employers
may experience greater productivity as employees working part-time experience lessfatigue and exert greater effort during their engagement (Allan, 2000). Moreover, theabsenteeism rate for casual workers is often lower than their permanent counterparts(Lee & Hoon, 1993).
Despite the beneﬁts of employers pursuing casual labour as a cost reduction strategy,
there are difﬁculties (Allan 2000). Employing workers on a part-time or casual basis
may increase administrative costs, such as record maintenance, payroll calculation,
supervision, training and recruitment. These costs can be further exacerbated by higher
turnover rates of casual employees (Lee & Hoon, 1993). Lee and Hoon (1993) also
found that casual workers have less time commitment and arguably less psychologicalcommitment to the organisation which in turn can lead to difﬁculties in terms of commitment,
motivation and turnover. Davis-Blake, et al. (2003) found that “workforce blending”, (i.e.,
extensive use of casual labour) worsened relations between managers and permanent
employees, decreased permanent employees’ loyalty, and increased their interest bothin leaving their organisations and in exercising a voice through unionisation. Reasons

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Casualisation Friend or Foe? 37

for worsened workplace relations included: managers delegated the training andsupervision of casual workers to permanent co-workers; managers devoted substantial
attention to managing conﬂicts between casual and permanent workers; and increased
responsibilities and reduced job security and opportunities for permanent workers.
Cappelli et al. (1997) argues that labour laws designed to protect permanent employees
have also fuelled the growth in casual work by encouraging employers to avoid mandates
and costs associated with these laws. Economic labour market models have advocatedthat labour markets need to reduce protective and interventionist labour laws in order toremain ﬂexible, competitive and adaptive (Leighton & Painter, 2001). Therefore, many
academic commentators have associated casual employment arrangements with “bad”
jobs and lower wages, conditions and beneﬁts relative to full-time jobs. Kalleberg, et al.
(2000: 257) suggest that to the “extent that casual jobs pay poorly, lack health insurance
and pension beneﬁts, are of uncertain duration, and lack the protections that unions andlabour laws afford, they are problematic for workers”. Many casual employers fall outside
the range of entitlements associated with permanent, full-time employment. These include
protection from unfair dismissal, holiday, long-service and sickness beneﬁts. Research
indicates that casual employment tends to be clustered into the lower paying and thelower skilled jobs. In keeping with their marginal workforce status, causal employees
are often excluded from training programs, do not receive wages increments and do nothave an established career path (Burgess, 1997; Romeyn, 1992). Lewis (1990) also
purports that casual employees on average earn less per hour than full-time employees.
Moreover, Kalleberg, et al. (2000) found that casual employment strongly increased
workers’ exposure to ‘bad’ job characteristics, such as job insecurity, low pay, lack ofpension plans and health insurance and lower propensity to belong to a union.
A number of academic commentators have also argued that females make up a
disproportionate group of casual workers (Kalleberg 2000; Davis-Blake & Uzzi, 1993;
Burgess, 1997). Pfeffer and Baron (1988) argue that demographic changes in thecomposition of the labour force, such as the rise in the number of married women workers
and older workers in the workforce, have facilitated an increase in the casualisation asthese workers often prefer the ﬂexibility available through casual work arrangements.
According to ABS data, over 40% of married and over 40% of all females are part-timeworkers, whereas, only 10% of males are part-time workers (cited in Burgess, 1997).
Kalleberg, et al. (2000:261) argues that gender difference “almost certainly stem fromoccupational differences”. In fact, according to Kalleberg, et al. (2000) women average
more “bad” job characteristics than men in ﬁve of the seven casual work arrangements,
and that the gender difference is substantially greater in casual work than in regular fulltime jobs.

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38 Clare Lumley, Pauline Stanton and Timothy Bartram

Casualisation in the health sector
In the health sector there is evidence that casual nurses have often been employedby hospitals as a means to gain greater labour market ﬂexibility (Allan, 1998; Buchan,1995). A number of studies indicate that there is also an increased reliance on casual
nurses because of a sufﬁcient number permanent nurses cannot be found due to a
growing shortage of registered nurses both in Australia and overseas (Davies, 2000a;
Taylor, 1999; Miles, 1997: 20; Naish, 1995: 3; Tully, 1992: 69-73; White, 1990: 219-229;
Ginzberg, 1990: 204). Consequently, it is likely that many nurses are able to accept
casual, temporary employment on their terms (Morgan, 1996: 176). A casual nurse may
decide to work for an agency, in which the agency is responsible for contracting the nurse
to an assigned hospital and for paying the nurse for the assigned hours. Alternatively, anurse may decide to be employed directly by a hospital but to work casually. Such nurses
are referred to as ‘bank’ nurses whereby the hospital is responsible for contracting thenurse to an assigned ward within that hospital and for paying the nurse for the hours
completed.
During the 1990s, government policy in Victoria led many hospitals to outsource
their nurse banks thus leading to an increase in nursing agencies. The Australian
Nursing Federation (ANF) opposed this trend and indeed still opposes the increase incasualisation more generally. The ANF (1994) policy on casual employment states that itshould only be “used for genuinely transitional situations”. although the growth of casual
work is unsupported by the ANF, which sees it as undermining permanent staff, creatinga lack of job security and limiting career options for nurses (ANF, 1994). However, many
nursing agencies advertise the lucrative beneﬁts of working casually. For example,
advertisements in newspapers by nursing agencies regularly advertise high rates of pay;
which is in marked contrast to the lower rates of pay for part-time and casual work inmany other industries.
Hancock (1990) also argues that nursing continues to have a ‘male’ work model.
Unbroken full-time service is a prerequisite for career development and many argue
that hospital management have been slow to adopt policies which enable women to
combine a career with family responsibilities (Truman, 1987: 44-45). This rigid modelof employment may help explain why casual work has become more desirable for many
nurses. The Queensland Nurses Union argues that there are a number of reasons fornurses choosing to work casually:• lack of family-friendly employment practices and inﬂexibility in rostering forpermanent, full-time employees;• pressure on permanent employees to be part of the ‘bureaucracy’ and contributeto decision-making and administrative functions, (e.g., casuals employees can go
into the workplace, complete their nursing duties and leave, whereas permanent,
full-time employees are pressured to perform other non-clinical duties); and3 Lumley, Stanton & Bartram 10 Nov 04.indd 6

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Casualisation Friend or Foe? 39•

the degree of “work intensiﬁcation” which has escalated signiﬁcantly in nursing, withmany nurses claiming they would like to work full-time but are unwilling to subject
themselves to the stresses of the workplace on a full time basis (Queensland
Nurses’ Union, undated).

The nursing literature also identiﬁes negative effects of utilising casual nurse employees
in the hospital organisation. It is argued that in order to deliver high quality care, nurses
must be able to perform effectively and be competent in the application of theory and skill
in the clinical setting (Hogston, 1995: 117). Benner (1984: 2) argues that “any nurse,
entering a clinical setting where she or he has no experience with the patient population,
might be limited to the novice level of performance if the goals and tools of patient careare unfamiliar”. A Canadian study indicated that a high usage of agency nurses had
implications for quality of care (Costello & Tsushima, 1996: 63-64). Hodgson (1995:49)
also argues that casualisation of the workforce will create many difﬁculties in the nursing
profession and nurses will be in no position to safely argue aspects and standards ofpatient care. Likewise, Miles (1997:20) suggests that casualisation is having a profound
impact on professional nursing practice and that it has trivialised standards in the nameof rationalisation.
In terms of the effects of casualisation within nursing, the literature focuses upon theeffects on the organisation and not on the effects to casual workers themselves. Buchan(1995: 24) states that some casual nurses may consider the ‘ﬂexibility’ that a hospitalis trying to achieve with the use of casual labour as “casualisation of their employment
conditions and career prospects.” However, as previously stated some claim that
there are lucrative beneﬁts of working casually (Morgan, 1996: 176) and some believe,
contentiously, that this situation is a result of a current shortage of nurses, which has
thereby created a ‘sellers’ market (Ginzberg, 1990; Morieson, 2000). In the literature,
however there appears to be no direct study concerning whether casual nurses areindeed ‘reaping’ the rewards of abundant work availability.
In Victoria, Considine and Buchanan (1999) argue that industrial reform coupled withbudgetary cuts and other policies in the 1990s led to work intensiﬁcation amongst nurses
in public hospitals. This situation was often compounded by nurses choosing to leavepermanent, full-time positions due to increased stress and greater responsibilities without
increased remuneration.
There is abundant evidence that the retention of nursing staff is inﬂuenced by many
tangible and intangible factors (Neathawk et al., 1988). It is suggested that by increasing
job satisfaction, nursing turnover can be curbed (Klemm & Schreiber, 1992). This has
obvious implications for casualisation within nursing as it could be argued that if sufﬁcient
nurses were to be recruited or retained on a permanent basis then the requirement forcasual employees could be reduced. Indeed, a Victorian Committee of Inquiry wasestablished in 2000 to examine the nursing shortage and as a consequence the Health

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40 Clare Lumley, Pauline Stanton and Timothy Bartram

Minister John Thwaites reinstated the Nursing Advisory Unit within the Department of
Human Services (Davies, 2000a). The Victorian Government also earmarked up to $7
million in the ﬁnancial year of 2000 to be spent on refresher and retraining courses torecruit and retain permanent nurses (Davies, 2000b). Throughout 2000, the Government
and individual hospitals organised recruitment drives in an “effort to entice some of thestate’s registered, but not practicing nurses - estimated to be about 20,000 - back onto
the wards” (Davies, 2000c). The Government also established limits on the amount ofmoney that could be used for agency nurses and the 2000 Nurses’ Award introduced anurse-patient ratio of one nurse to four patients (Buchanon et al. 2004). Therefore, isthe increase of casualisation within the nursing context due to the employers’ preferenceor the employees’ choice?

The Study
Our research, which was conducted in 1999-2000, took a case study approach in orderto obtain in-depth information about the situation of casualisation within the nursing
profession. It was conducted within two acute hospitals in Metropolitan Melbourne, one
private hospital and one public hospital. Two hospitals were chosen so that there was anopportunity for different issues of casualisation to emerge. For this reason, the hospitals
chosen were in different locations. The public sector hospital was located in the innercity and the private sector hospital in the suburbs. The hospitals varied in size, the public
hospital having approximately 300 beds and the private hospital having approximately
120 beds. It was a common belief that both hospitals, as in every hospital in the state,
were facing problems in recruiting and retaining nurses.
The ﬁrst stage of the study was a literature review, which explored ‘casualisation’ of theAustralian workforce, with a focus on nursing. As the literature review progressed, it
became apparent that the issues pertaining to casualisation could be placed into two
main structural themes - individual inﬂuences and organisational inﬂuences. Hence,both categories were considered in the formation of the research questions which were
aimed at several major areas. First, to determine the actual usage of casual nurses andwhether the trend was increasing or decreasing. Second, to examine the reasons for
hospitals utilising casual nurse employees and whether this was linked to a shortageof nurses and also to examine the reasons for an employee working casually. Third,
to examine the question “what are the effects of casualisation on the workplace?” This
question was considered to be essential to the study in order to compare previous study
ﬁndings. The ﬁnal research question to be explored was “what had been done or whatshould be done about casualisation?” These questions have been formulated and guided
by the nursing literature. It is important to examine these questions in order to improve
the attraction, retention and quality of care provided by nurses (Creegan et al., 2003;
Fitzgerald, 2002).

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Casualisation Friend or Foe? 41

TABLE 1: Investigation 1 Interview schedule

TABLE 2: Investigation 2 questionnaire of permanent nurses

The study consisted of two investigations, as outlined in Tables 1 and 2.. First, a seriesof key informant interviews took place with hospital managers, and casual nurses
using an in-depth, semi-structured interview. The Director of Nursing and four Nurse
Unit Managers were interviewed at each hospital making a total of eight managers.
Two casual nurses from each ward were also interviewed, making a total of sixteen
interviews. These groups were selected in order to obtain a broad picture of casualisation
within each organisation. Each interview was approximately 40-60 minutes long. The
second investigation consisted of a questionnaire distributed to 80 permanent nurses
at the two participating hospitals. There was a 100% response rate from the private
hospital (40 questionnaires returned) and an 83% response rate from the public hospital(33 questionnaires returned). On a 10-point Likert scale (e.g., ten equated to “strongly
agree” and zero to “strongly disagree”), respondents were asked to rate four statements
regarding workload, stress, work performance and quality care provided by permanent,bank and agency nurses. The statements are provided in Tables 3 and 4 below and werealso developed and informed by the literature on casual nursing (Allan, 1998; Costello &Tsushima, 1996)

Results and Discussion
The study obtained information that conﬁrmed previous research as well as providing
an insight into other less well researched areas. Although there were some occasional
differences between the results obtained from the private hospital and the public hospital,in general the major themes that emerged were very similar.

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42 Clare Lumley, Pauline Stanton and Timothy Bartram

Is Casualisation a Friend?
Most of the hospital managers interviewed in this study were unable to provide
consistent and accurate data regarding the use of casual nursing. However, mostof the key informants and participants interviewed stated that there was generally an
excessive amount of casual work available, which consequently provided casual nurses
with security and the opportunity to seek work on their own terms. In addition, the key
informants indicated that although numerical ﬂexibility was used at times, particularlyin the private hospital, the main reason for the use of casual labour was not numericalﬂexibility. In both hospitals, the ﬂuctuations in demand for nurses had lessened and, ingeneral, casual nursing staff were employed due to a shortfall in permanent nursing staff
available to cover the necessary shifts. These ﬁndings differ from the evidence available
in the literature which suggests that the major reason for casual labour being utilised isthe ‘numerical ﬂexibility’ that it offers (Casey et al., 1997; Curson, 1986).
All the casual nurses interviewed in this study had chosen to work casually and not
because they were unable to obtain a permanent position. Additionally, most of themplanned to continue to work casually or to leave nursing altogether. Owing to theavailability of work in both the public and private sector, the casual nurses reported that,
overall, they were able to choose when they wanted to work and thus, allowing them the
ﬂexibility that was not obtainable with a permanent, full-time position. When the hospitalmanagers were questioned about the ﬂexibility that they offered permanent nurses,
most of them stated that although they encouraged ‘self-rostering’, they were still underpressure to “cover all shifts”.
The key informants in the study pointed out that most of their nursing colleagues werefemale. Pocock argues (1995: 97) that women are more likely to work casually or inpart-time employment so that they are able to balance work and family responsibilities.
Indeed, many of the casual nurses interviewed indicated that they needed the ﬂexibility ofcasual work in order to balance ‘family commitments’. The casual employees identiﬁed afurther factor – the demands associated with permanent, full-time work - as contributing
to their decision to work casually. Such demands included, “increased responsibility,
receiving no thanks and the necessity to take work home”.
The ﬁndings revealed differing views between casual employees and hospital management
regarding the importance of pay. Although the casual employees interviewed did notdeny that pay was important, it was not the driving force behind their decision to do work
casually. The study also highlighted the differences between an individual’s choice towork as a bank nurse or as an agency nurse. Again pay was important for some of thesubjects interviewed, but different reasons were given for wanting to work either as anagency nurse or as a bank nurse. Many of the agency nurses enjoyed the variety of workthat they were exposed to when working in different places. Nurses working as a banknurse enjoyed the familiarity of returning to the same place.

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Casualisation Friend or Foe? 43

Aside from the advantage of providing the hospitals with a ﬂexible labour force, otheradvantages included the introduction of new ideas, different viewpoints and a ‘pool ofresources’. In addition, some of the casual nurses interviewed believed that owing to theexperience gained in a wide variety of settings they could provide “an holistic approach”
and could be a “breath of fresh air”.
In regard to the effects of casual work on the casual nurse employee, the results were instark contrast to the ﬁndings of Allen (1998). He argued that the employment of casualstaff in hospitals was “decidedly one sided in favour of the employer”. However, most of
the interviewees in our study stated that as they were generally able to obtain work, they
could be then employed on their terms, which also is supported by similar ﬁndings in the
study of De Ruyter (2002).
In summary, the results in this part of the study showed that casual work was theemployees’ choice and not an employer strategy. The choice made by employees wasagainst the background of the availability of work, family responsibilities and wanting
less responsibility in the workplace. Pay as well as an increase in the variety of working
arrangements were also identiﬁed as important issues underpinning the attractivenessof working casually. There were some beneﬁts for the employer in terms of a ﬂexible
workforce but casualisation was often a response by employers to severe labour shortages
rather than a deliberate strategy. That is, employers were hiring large numbers of casual
workers because they could not ﬁnd permanent staff to ﬁll the positions.
Is Casualisation a Foe?
Casual workers also highlighted a number of disadvantages of casual work. These
included: insecurity of not getting work, lack of fringe beneﬁts, and the lack of professional
development. Access to professional development was identiﬁed as an important issue
by most respondents. Moreover, a signiﬁcant ﬁnding in the study, which had not been
identiﬁed in the literature review, was the difference in ongoing education that bank andagency nurses received. It was found that bank nurses were involved in ongoing education
programs, whereas agency nurses received very little training and development, unless
it was self-initiated.
The questions posed in this study also concentrated on examining the effects ofcasualisation on the standards of nursing care, work performance, and the effects ofcasual nurses on permanent nursing staff. The views and experiences of hospitalmanagers, casual nurses and permanent nurses allowed for a wide range of views to
be canvassed. In general, it was found that all three groups of informants consideredthat permanent nurses provided the highest rate of work performance and quality ofcare. It was also believed that bank nurses delivered, on average, a higher level of work
performance and quality of care than agency nurses and this was attributed to familiarity
to the workplace setting. Previous studies have indicated problems associated with a3 Lumley, Stanton & Bartram 10 Nov 04.indd 11

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44 Clare Lumley, Pauline Stanton and Timothy Bartram

high usage of agency staff (Costello & Tsushima, 1996; Considine & Buchanan, 2000)
in terms of: the efﬁciency of agency nurses, unfamiliarity with the working environment,
inappropriate qualiﬁcations for particular areas and the increase of stress and workload
for permanent staff. This was further supported by the survey of permanent full-timenurses as demonstrated in Table 3 and Table 4.
TABLE 3: Results from Permanent Nurse Questionnaire Distributed in the Public
Hospital.

Table 4: Results from Permanent Nurse Questionnaire Distributed in the Private
Hospital.

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Casualisation Friend or Foe? 45

Outcomes of Casualisation
The results of our second investigation indicated that all the hospital managers were awareof the consequences of using casual nursing staff. Moreover, many of the strategies they
implemented to minimise the negative inﬂuences mirrored the recommendations in theliterature. For example, matching the skills of the casual worker to the requirements ofthe position (Morgan, 1996), and following set guidelines when using a nursing agency(RCN, 1997). An obvious solution from these ﬁndings is to recruit more permanent nurses(although this was not a practical solution as discussed above). Our study also suggested
that strategies should be implemented to employ more bank nurses as opposed to using
agency nurses. However, pay could be a major issue since some nurses worked for an
agency (as opposed to nurse bank) because they received higher rates of pay.
Most of the casual bank and agency nurses interviewed had a long term plan of either
leaving nursing altogether or remaining casual. As previously discussed, the majority ofthe subjects interviewed were also working casually out of choice and not as a result of
inadequate permanent nursing positions. If they were currently agency nurses, they werequestioned about factors that may entice them to work in the nurse bank, or incentives
that may entice them to work permanently. The results varied: some of the nurses were
content with their situation and would not be interested in working as bank nurses or
having a permanent position; a couple of agency nurses said that they would work asbank nurses if they were paid the same rate as agency nurses; a couple of agency
and bank nurses stated that “improvements” would have to be made before they would
consider working permanently again. From the hospital manager’s perspective, mostof the managers interviewed recognised that something had to be done to attract more
nurses to permanent positions. However, they were unsure as to what techniques would
be successful to recruit and retain permanent nursing staff.
In terms of what is being done to curb the rise in casualisation within nursing, the hospitalmanagers interviewed gave a number of different responses. One of the main incentives
offered to permanent nursing staff in both the public and private hospitals was the provisionof professional education. However, with the exception of the professional education
incentive, other incentives offered by each of the hospitals differed and reasons for thisare unclear. It might be due to the differences in the philosophies of the two hospitals oreven the demographics of the nurses that they have tried to attract. It could also be dueto the differences in the autonomy of managers in the public and private sectors.
Since the completion of this study the problem of a ‘shortage’ of permanent hospitalnurses has become even more acute and in response the Victorian State Governmenthas begun to make improvements in the recruitment and retention of permanent nurses.
Currently, the Victorian State Government is attempting to attract casual nurses towork for the public hospital nurse banks as opposed to the more expensive nursing
agencies. In addition, the potential consequences of implementing the new Victorian

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46 Clare Lumley, Pauline Stanton and Timothy Bartram

Nurses Award (2000) are also important. The Award states that casual nursing staff are
not to be used to ﬁll the chronic shortfall in stafﬁng but should only be used if there is atemporary unforeseen absence of a staff member or sudden and unexpected increase inworkload. Moreover, as the Award stipulates an exact nurse patient ratio, the restrictive
use of casual nurse labour under the terms stated above, becomes extremely difﬁcult toimplement in a climate of a permanent “nurse shortage”.

Conclusion
This paper sought to address the limited systematic research concerning the explanations
for the growing preference for the casualisation of nurses. We also investigatedperceived outcomes of casualisation, both qualitatively and quantitatively by drawing
from two case studies of private and public metropolitan hospitals. The main ﬁndingsin this study were ﬁrstly, that a number of nurses were electing to work casually out ofchoice rather than necessity. Secondly, that hospital managers have to use casual nurse
labour as a consequence of an inadequate permanent workforce as opposed to thehistorical technique of controlling labour supply. This implies that the phenomenon ofcasualisation is turned around, as normally the use of casual labour tends to favour theemployer’s needs.
However, there are two issues here. The ﬁrst is that casualisation in nursing in Victoria is
obviously part of a wider labour market problem that government has to deal with throughworkforce policy and increased funding. Second, the Bracks’ Labour Government has
begun to address this issue by putting more money into the system to encourage nurses
back into the workforce. This study took place before these initiatives were introduced.
Because of these initiatives, it is unclear whether casualisation within the nursing
profession will continue in its present form or has it been stopped in its tracks?
Further studies need to investigate what incentives would best attract casual nurses
to return to permanent positions. For example, an investigation could be conductedamongst the existing permanent nursing staff to assess problems within their workplaceand strategies that they consider would improve the attractiveness of their working
environment. Such a strategy could improve the retention of existing permanent nurses
and might also enhance the recruitment of casual nursing staff to permanent positions.
For example, this study found that many nurses elected to work casually owing to the
ﬂexibility that it offered. Therefore, it might be advantageous for hospital managers toconsider setting shifts according to individual needs, providing alternative starting andﬁnishing times where feasible, removing the requirement to rotate onto night duty orproviding extra incentives to work night duty.
The increasing trend of using casual nurses has some positive and negative implications.
Some of the hospital managers expressed the opinion that one beneﬁt of using casual
nurses was the introduction of new ideas and different viewpoints. However, the study

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Casualisation Friend or Foe? 47

also found that it was believed that the quality of care delivered by agency nurses was
generally of a lower standard than that of bank nurses or permanent nurses. Overall, theinformants related this to the unfamiliarity of the agency nurse with the clinical setting.
Finally, our study also found that the issue of pay had some importance. For example,
some of the agency nurses stated that they would consider working in the nurse bank if
their rate of pay matched agency pay rates. This is a difﬁcult issue for the public sector
where pay is largely centrally determined through awards and agreements. However, it
might be economically viable for hospitals to employ bank nurses as opposed to agency
nurses, even on the same rate of pay, as no commission would be payable to the agency
and productivity may increase.

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Reluctant Managers 49

Reluctant Managers: Nurses
Surviving Despite the Bottom LineRICHARD GOUGH* & MAREE FITZPATRICK**

Abstract
Chronic hospital bed shortages and compromised patient care has dominated the media
over the past decade. Restructure and change are the catch cries for the survival of aquality public health system. The majority of existing Australian research has focusedon the impact of hospital restructuring and retrenchment from the perspectives of the
non-professional staff, such as cleaners and kitchen hands. This research investigates
the perceptions of middle management nurses in a major Victorian hospital. Unlike
other managerial survivors of restructuring, this research reveals that this group of nurse
managers have remained committed to their vocation and their workplace, despite theunrelenting pressures they have endured.

Introduction
This paper provides an analysis of the impact of restructuring on middle management
nursing staff in a major Victorian catholic public hospital. During the ﬁrst half of the 1990s
the hospital moved from a traditional, functional and hierarchical model of nursing to
one based on the development of decentralised multi-skilled teams of nursing and allied
professionals focusing on patients with similar illnesses (Campbell and Breen, 1994).
Informing, but not totally determining the organisational and nursing role aspect of thesechanges was a United States model of patient-focused nursing care (Brider, 1992;
Schweikhart and Smith-Daniels, 1996). During this period, the downsizing of nurses
as a result of a ﬂatter, decentralised organisational structure, was limited to indirect
administrative staff and some direct nurse mangers. In the second half of the 1990s
closure of wards in the hospital and their reaggregation (integration) with remaining wards
caused more major downsizing of nursing jobs. These changes were driven by healthfunding cuts by a National Liberal Coalition government. These cuts were achieved by
the introduction of a new casemix based funding formula, which allocated resources
according the type of clinical service delivered to patients. The impact of the formula wasto proscribe duration of hospitalisation for different illnesses and increase throughput ofpatients. This casemix funding formula resulted in greater nursing workloads in Victorian* Richard Gough is a Senior Lecturer at the School of Management at Victoria University, Australia.
** Maree Fitzpatrick is a Lecturer at the School of Management at Victoria University, Australia

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50 Richard Gough and Maree Fitzpatrick

hospitals, and facilitated reductions in stafﬁng (Duckett, 2000). In New South Wales’
public hospital system during the 1990s, Bray and White (2002) note similar problems withincreases in the number of patients serviced without matching increases in stafﬁng levels,
leading to an intensiﬁcation of work for nurses and other hospital staff. These changes in
New South Wales during this period occurred under a state Liberal government and alsoan Australian Labor Party government.
The development of a ﬂatter and more decentralised structure in the hospital was
accompanied by the creation of a new role for charge nurses. They were renamed “Nurse
Unit Managers” (NUMs) and took on managerial duties such as stafﬁng, monitoringof supplies and equipment, quality processes and procedures and coordination withother areas of the hospital on patient needs. These changes led not only to greater
work pressures on NUMs but also required them to work considerable unpaid overtime.
In the broader Victorian hospital sector, Considine and Buchanan (1999) found that
unpaid overtime by nurses was equivalent to 750 extra positions a week. Based on theirstudy on NUMs in a New South Wales hospital, Bray and White (2003) report a similarintensiﬁcation of work and longer working hours.
Another important factor causing intensiﬁcation of work for nurses has been technologicalchange in health care, which has led to major increases in day surgery and increased
levels of acutely ill patients staying in hospital (Bray and White 2002).
Analysis of similar processes of restructuring and downsizing in Australia across thewhole labour market (Dawkins, Littler, Valenzuela and Jensen, 1999) reveal that the
managers who survived had poor morale and commitment, low levels of job satisfaction
and security and lacked motivation. With these problems in mind and also the greater
work pressures referred to above, the aspirations and values of the nursing staff thathave remained in the hospital throughout the changes are explored. In this paper the
response of nurses to the changes in the second half of the 1990s will be examined.
The impact of a role change from a mainly clinical role to a managerial one for nurses isalso explored. Whilst increased work pressures and unpaid overtime similar to that of theresearch cited above are apparent in the hospital, its will be shown that the interaction
between skills, technology and length of tenure of staff in different wards of the hospital
led to varying levels of perceived stress by the nurses. Their willingness to remain in a
difﬁcult environment is also mediated by their professional commitment and concern forpatients.
The method adopted in the research was qualitative. Individual interviews were conductedfrom September 1999 to April 2000 with fourteen nurses from three levels of managerial
status at the hospital; two nursing clinical directors, seven Nurse Unit Managers and ﬁve
Associate Nurse Unit managers. Interviews were also conducted with a former Clinical
Director of Nursing Education, a former Hospital Services Delegate and an ofﬁcial fromthe Australian Nurses Federation covering the hospital. Transcripts of interviews were

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Reluctant Managers 51

analysed by topic and quotes are given to illustrate the predominant attitudes of thoseinterviewed.
The paper begins by explaining the nature of the new funding formula introduced by
the Kennett National Liberal Party government and nurses’ perceptions of its impact
on their work. It then looks at the repeated reaggregation of wards caused by resultant
funding cuts and nurses’ responses to the situation. This is followed an examination of
the varying level of work pressure experienced by nurses in different wards. Finally, it
explores how the professional commitment and the morale of the nurses who remained
have been sustained despite changes to the role of their job, the repeated downsizing
and growing work pressures.

The New Funding Formula
Prior to the introduction of a new method of funding hospitals major changes to the role ofnursing managers had occurred at the hospital. The decentralised team-based structures
put in place in the ﬁrst half of the 1990s meant a major change in the role of ward
charge nurses, who became Nurse Unit Managers (NUMs) in the new structure, and also
shifted the emphasis from a clinical role to a more management oriented one. Nurse UnitManagers became involved in matters such as staff recruitment and selection, appraisal,rostering, patient discharge, planning, and budgeting. Nurse Unit Managers worked
what could be deemed as regular ‘ofﬁce’ hours, whereas Assistant Nurse Managers (theold assistant charge nurses) (ANUMs) had a patient load and worked both night shifts
and weekends, deputising for the Nurse Unit Manager during those periods. A numberof wards or units were grouped together to form care centres under a director so that thecentres became almost mini hospitals.
These changes formed part of a coherent vision of improving efﬁciency and patient care,and the hospital soon became a state leader in these areas. However, concurrent withthese major changes, a new method of funding was introduced, which created furtherpressure to reduce costs.
When the Kennett government gained ofﬁce in 1992, it moved quickly to cut healthfunding by 14% over the following two years (Stoelwinder and Viney, 2000). The Victoriangovernment also introduced Casemix funding in July 1993. The government, however,used the introduction of Casemix, not as a way to more effectively allocate resources but
as a vehicle for cutting costs, rather than services, in hospitals (Duckett, 2000).
Casemix funding replaced block grants to hospitals, which was based on the number ofpatients treated, with funding based on Diagnosis Related Groups (DRGs). DRGs are amethod of classifying hospital stays into various categories, and specifying cost of eachof the stays or inputs required to treat the illness. As a result, complexity of treatment
rather than numbers of patients became the basis of costing. One key aspect of the

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52 Richard Gough and Maree Fitzpatrickmeasures associated with each of the DRG is the normal length of patient stay in thehospital. Nursing costs are treated as an overhead and allocated to DRGs according tolength of stay. No successful attempt has been made in Victoria to accurately accessactual nursing inputs associated with each DRG. In effect, nursing stafﬁng levels were
determined by the funding available to the hospital through the DRG based formula. Thismethod of measuring nurse stafﬁng levels in the context of the government cuts to healthfunding had a signiﬁcant negative impact of the number of nurses in Victorian hospitals.
Casemix was used to increase efﬁciency by linking it to a funding formula called “Weighted
Inlier Equivalent Separations” (WIES)1. This formula works by calculating an average
cost across all DRG groups for patient treatment. This average cost then becomes aunit of measure against which all DRGs are compared (Auditor General’s Report, 1998).
Weights are created against this unit for different DRGs. The WIES system allows
hospitals to choose the number of patients they will treat in each DRG within their limit of
WIES units allocated by the department and the weighting given to each DRG.
Due to the prior restructuring, it was better placed than other hospitals to achieve
efﬁciency improvements required under the new funding arrangements. However,further efﬁciencies could only be achieved by further cuts in services and stafﬁng.
Such reductions placed unreasonable and in the longer term unsustainable pressureson remaining nursing staff. As argued by Stoelwinder and Viney (2000:220), ‘Massive
funding reductions were achieved by obfuscating them in Casemix funding rhetoric of
hospital competitiveness and complexity of formulation’.

Closure and Reaggregation
The failure to increase throughput of patients to match the level of WIES available
resulted in the closure of beds. This inability to keep within the budget raised concernsthat the hospital might be closed. Pressures on the hospital to cut costs led to two major
reaggregations, one in 1996 and another in October 1998.
The second reaggregation came about because of the gradual closure of beds across thewards, which led to an assessment by management that a whole ﬂoor should be closed tosave costs. As a result many units within wards were reallocated throughout the hospital.
These changes came on top of the several reshufﬂings of wards prior to the move to the
new hospital. Inevitably, one would not expect to ﬁnd the new ward structure to remain
due to the impact of changes in technology and methods of treatment. However, the timeand effort devoted in the planning of the structure of the new hospital was undermined by
the piecemeal changes that followed.

1

Inlier equivalent separation refers to a measure of the number of patients below the average length of stay for a DRG
adjusted back to average length of stay equivalent value.

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Reluctant Managers 53

Perceptions of nurse managers on the impact of the reaggregations were varied. Most
had been subject to reaggregation, although several claimed that they had not been
affected. Also on both occasions of the ward closures, Nurse Unit Managers were forced
to reapply for their jobs creating considerable anxiety. ANUMs and other nurses werereallocated to different wards. The closures led to further redundancies amongst seniornursing staff and non-nursing support staff.
Nursing staff found themselves affected by either being placed in a new ward or having
to integrate new staff from a different area of specialisation into their ward. In somecases specialist areas were allocated to a ward, taken off that ward and then returned
again. One of the NUMs, who did not change wards ,but experienced a lot of upheaval,commented:
So we have had a few moves physically and downsizing of staff and totally splitting
teams up and reconﬁguring them again…We had a unit running well [after the ﬁrst
reaggregation] and then they reaggregated again. That soul destroyed staff.
Another NUM observed that:…what was across the whole ﬂoor [each ﬂoor has two wards] became one ward,that was a massive change for staff.
The reaggregations had several effects on staff. The ﬁrst effect impacted on staff who
were dispersed to other wards and thus required to learn a new specialism. This also
applied to remaining staff, who had another specialist group integrated into their ward.
As one ANUM stated:
Each ward is a speciality unto themselves, so there is a learning curve as wellAnother ANUM noted that:
I was very worried about renal because I knew nothing about it.
Seemingly, no formal training on how to cope with these changes was provided for staff
and they were left to learn from other nurses and medical staff who were familiar with thearea. Most claimed that this was stressful and placed an extra demand on their alreadydiminished free time.
The second problem was that nurses had difﬁculties adapting to new unit managers andintegrating into an effectively functioning teams again. One senior NUM noted that:
The staff became very unsettled because…most people got on well with their
NUM and did not really want to change.
There were also comments regarding the fact that more effort should have been madeto ensure more cohesive teams. One ANUM remarked on the importance in taking time
to build teamwork:
We built a lot of teamwork knowing each other.

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54 Richard Gough and Maree Fitzpatrick

The third problem was the pressure placed upon NUMs to help integrate new staff into
the ward and to orientate them on new specialisms. One NUM said that:In the ﬁrst six months I was doing this job after reaggregation, I think I was working
from 7 a.m. to 6 p.m.
The fourth major impact was that for some nurses the reaggregations increased thenumber of patients they nursed. The reduction in the number of beds and ward closurescreated constant pressure to ﬁnd beds for patients and an increased nurse-patient ratio,
as one NUM said:
When the ward went from 20 to 25 patients, I found it busier.
Staff were also disconcerted how abruptly the changes occurred and the lack ofcommunication, particularly with the ﬁrst reaggregation. Examples of comments were:• They told us it was happening when it happened.
• Every time there is a reaggregation, it just depresses you the way they doit…they don’t take people aside and tell them solo before it is told to a big
audience.
With regard to the second reaggregation in 1998, the current ANF job representative
indicated that:
When the eight ﬂoor shut I did not ﬁnd out until it was happening…[the ANF
organiser] had been to see management a week before it happened and she
couldn’t believe they had not mentioned it.
However, some communication did occur with NUMs who were directly affected. One of
the senior NUMs, affected by the reaggregation, indicated:
With the last one there was quite a bit of communication with it all.
Another senior NUM also commented:
Management walked around from top to bottom and said we should actually close
another ﬂoor and think this through again.
The ambivalence in the comments probably reﬂects the change in senior management
at the time. The new management were more consultative compared to the previous
management. The job representative believed that management were more approachable,
but they still did not necessarily always communicate.
In summarising the nurses’ responses to the reaggregations and WIES driven cost
reductions, one of the ANUMs said:
So we are placing too much emphasis on that budget by reducing, closing beds,
wards and re-aggregating them so that we can provide the services just with lessbeds, a higher turnover and lesser work.

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Reluctant Managers 55

Nurses’ Attitudes to Casemix and WIESIn examining the effect of Casemix and WIES based funding on nurses, the impact ofincreased acuity (level of illness) needs to be taken into account. This issue was raised
repeatedly in interviews. For example, the job delegate commented that:
Before on a ward you would have patients come in and they would be really sickand then they would get a little bit better…so you would have a balance of sick anda balance of ones nearly ready to go home, but now the patients are kicked out soquickly, they are sick all the time so there is no break so the graduates are burning
out. So the pressure is more constant now…so their workload has increased but
they have not changed the stafﬁng numbers
Therefore, irrespective of other changes the impact in the increase in acuity has added
to the nurses’ workload.
The perception of nurses regarding Casemix and WIES varied in two ways. Firstly, those
ANUMs, who carried a patient load, tended to respond to the pressure created by theinteraction between Casemix and WIES, as the examples of comments below testify:• I know because of the WIES targets it puts the pressure on…there is a set
number of days a patient stays for a procedure• We just have a higher turnover of patients coming through. Everyone is out ofcontrol, everyone is so busy and working so hard that you think well this is no
good.
• It has created a lot of pressure for beds and.… then you have got the pressuresof patients being admitted who have not got a bed and you are desperately
trying to ﬁnd a bed or facilitate a discharge to make that happen, so it has beenvery stressful.
The responses of the NUMs reﬂect not only the pressure they were under, but also
highlight the issue of efﬁciency. For instance:• In some ways I think it is a good thing, because it has meant that things are a
lot more efﬁcient, and we look at our practices.
• Now there is this constant demand and bean counting for us, but you are being
more co-ordinated instead of putting a multitude of tests over ﬁve days you aredoing them in two. There was a lot of waste.
Both the ANUMs and NUMs who were in wards and where the pressure was greater,
felt much more strongly about the impact of the need to juggle beds and the turnover ofpatients as well as the need to meet the Casemix DRG benchmarks of number of days
stayed per patient. The following comments from NUMS in such areas are typical:• The ward just gets busier and busier…getting people in and out quickly or as
quickly as we can.

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56 Richard Gough and Maree Fitzpatrick• Alot of a Nurse Unit Manager’s time is spent dealing with the bed disaster…Wenever have enough beds, it’s a nightmare.
In the discussion, concern was expressed about the nature of the Casemix system andthe weighting inherent in WIES. Having to average the treatment costs for a DRG acrossa ﬂoor, even though nursing intensity (nurse patient ratio) differed, was a signiﬁcant issue.
Concern about the capacity of the hospital to accurately cost the nursing component ofvarious DRG’s was also raised by some of those interviewed. The weighting in the WIES
system was seen as a source of mounting pressure and the following comments reﬂect
the pressure most NUMs were under:• You have to achieve so many procedures including operations to get points…
so the weight [changes] so the money goes down so we have to do more toachieve the same amount.
• Juggling the beds and the length of stay is dropping all the time.
Another concern raised was that the incessant and increasing pressure had made it very
difﬁcult for ANUMs and nurses to provide emotional support for patients. For instance,
one talked about this with compassion and concern:
I know I don’t have time to sit down and talk to a patient
Generally, it was apparent that the emphasis on shortening bed stay and the pressure
to discharge patients had become unduly onerous in some areas of the hospital. The
improvements in efﬁciency in terms of working smarter and using resources better wererecognised by the NUMs as valuable. Although quality improvement techniques to identify
inefﬁciencies in existing procedures and protocols was inherent in the new structure, theremorseless pressure to continually revise WIES weights for particular DRGs went wellbeyond what seemed reasonable.

Differential Pressure on Nurses
Increased acuity (level of illness) of patients, the pressure to increase patient throughput
because of the WIES based funding system, increased nurse-patient ratios and the new
responsibilities added to the duties of ANUMs and NUMs, contributed signiﬁcantly to thework pressures experienced by nurses. However, it was apparent from interviews thatthe nurses differed in their assessment of the extent to which they felt under pressure.
This can be attributed to the following factors. First, whether the ward was a general
medical ward, in contrast to a specialist surgical ward with intensive patient monitoring,
often made a signiﬁcant difference to perceptions by nurses of their ability to cope. The
specialised surgical areas often had lesser staff-patient ratio than general wards. One of
the ANUMs in a surgical ward noted:
Our work is different. It is not as physically demanding.

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Reluctant Managers 57

Another noted:
I think we are pretty well staffed with one to four [patient ratio] but I know on the
medical wards on the 9th ﬂoor they are one to ﬁve, they work a lot harder than
we do.
Surgical patients also tended to be very sick initially and then required less attention.
They were also more likely to be ambulant in the recovery phase and did not need thecontinuous heavy lifting required by very sick medical patients. An ANUM said:
Because we are a medical ward we are very heavy [workload]…You can have ﬁvepatients but four can be bed bound. We aren’t a surgical ﬂoor, where, once you
ﬁx their problem, they can walk around and all that. The type of patients we haveneed 24 hour care.
This was supported by one of the NUMs in a surgical ward:
If you are in medical, people don’t stay because it is heavy and hard on yourback.
The challenging nature of the work in specialist surgical wards also made it attractive tonurses, enabling such wards to retain skilled staff. A senior NUM said:
So you have a better chance of maintaining staff if you are in a surgical area inpreference to medical area because they have had holes in their roster as long as
I can remember.
An ANUM in a medical ward commented:
I think medical nursing needs a big uplift…we need more nurses…we can’t get ourjust regular stafﬁng ﬁlled because of the shortage.
The ability to retain senior staff and as result have a relatively stable team was a second
factor that affected the level of stress. One senior NUM in a largely surgical area notedthat:
I have the luxury of having very senior staff and a very stable workforce…and ﬁve
to one is adequate and if you have good regular staff, you manage.
Higher turnover of staff plus the inability to ﬁll vacancies meant there was a need to use
the hospital’s bank of casual staff and outside agency staff. These nurses required more
supervision, were not necessarily as competent as permanent staff and did not form aclose knit team. A skill mix, which included more experienced staff also, helped to takepressure off supervisory staff. An ANUM noted that:
I worked on a general [medical] ward and now I am in working in specialised area
so we have less junior staff.
The higher acuity also impacted on the skill mix. According to one of the senior NUMs ina surgical area the greater acuity meant that:

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58 Richard Gough and Maree Fitzpatrick[There was a need] for more grade twos [experienced nurses] and less gradeones
A third factor differentiating wards and the level of pressure was the degree of focus
required to do the work. General medical wards particularly with their variety of different
types of patients meant that nurses do not develop the same level of skills and resultant
efﬁciency. One senior NUM said:
Our ward is acute medical …,so we have a massive variety of patients.
The fourth factor that added emotional pressure on the nursing staff was the number ofpatient recoveries. A senior ANUM in oncology said:
We have always had high turnover in our area anyway. It is because of the typeof nursing we do. Young people, serious illnesses, a lot of death and dying andpeople tend to burnout fairly quickly.
As noted previously, the high turnover of staff, in part because they are stressed, adversely
affects the skill balance and increases pressure on senior staff.
The ﬁfth factor was higher turnover of patients. Obviously the WIES/Casemix system
had increased pressures to discharge patients, but some wards, especially surgical had
a particularly high turnover of patients.
The ﬁnal factor related to the mix of patients. If most patients in a ward were just backfrom surgery or treatment it could mean a very heavy workload, since they required
constant attention. One NUM described this:Sometimes when you might have a ward of twenty-two patients, they might bevery independent, they can do a lot of things for themselves and there might betwenty two who can’t and it just makes the workload a lot busier and heavier andthat is hard to judge and plan for.
Therefore, although the overriding impact of the broader factors mentioned above,
particularly the pressure to discharge patients, was felt by all participants, there werealso the speciﬁc factors in the nature of the ward which were a source of stress fornurses. Variance in the capacity to cope obviously relates to the speciﬁc characteristics
of wards and patients outlined above.

‘Invisible’ Overtime
One way of coping with the increasing work pressures was the increase in unpaid
overtime. Overwhelming the majority acknowledged that overtime was worked in termsof working longer hours than their shifts, not only as managers, but the other nursing staff
not only worked overtime, but often missed lunch and tea breaks in order to get throughthe work.

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Reluctant Managers 59

The statement below was a common sentiment amongst most of the interviewees:... but the girls are still doing quite a bit of overtime or not getting to tea breaks,
which is something new, that never used to happen as well… Lunch often getsbusy… so it’s often difﬁcult to get staff off for half an hour they’re often run off forﬁfteen minutes.
Three of the participants held slightly different views and one interviewee in particularstated that it was more of a give and take between management and staff and making
sure that when he was in charge he would let people off earlier when he could or have
longer breaks to make up for the overtime.
I feel that it’s a two way street and there are times, a lot of the time when we get off
ten minutes late, so I try and get people off early, especially on the weekend.
One of the participants regarded the issue as a status quo, in that she regarded that the
problem existed previously in the old structure.
Much the same, even in the old unit, the problem shift is always the evening shift
going over to night shift and the night shift leaving in the morning, being organised
enough because there’s lots of unforeseen things that can come up and you canbe as organised as you possibly can and something can hit the fan so to speakand can put you half an hour behind and we try and we always have done, its very
unusual for people to get off late on an early shift.
Nonetheless, overtime was described as a major issue that affected not only this hospital
but all nurses in Victoria:
It is a major issue. They work it because they have always been refused. The
managers have never paid it and they’ll turn it around and put it back on the people
and say its just that you are inefﬁcient… It’s not just at ………, it’s state-wide.
It would seem that the majority of nurses at all levels work overtime, with those inmanagement roles accepting that they needed to work longer in order to get their work
completed. This is consistent with the research done by ACCIRT (1999:104), whichfound that most people working in managerial positions in most occupations worked
overtime:…the big difference, however, between white collar and blue collar jobs is thatwhite collar don’t get paid for their overtime.
The nurses in management positions indicated that overtime had become invisible andpart of the organisational culture, in that there was an expectation by management thatdoing overtime was part of the job. Some of the nurses saw this as a deterrent fromapplying for more senior roles and for recruiting young nurses.

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60 Richard Gough and Maree Fitzpatrick

Survivors and Reluctant Managers
The participants in this study were survivors of dramatic changes to their work environmentthat had lasted for almost a decade. Analysis of similar processes of restructuring anddownsizing (Dawkins, et al. 1999) revealed that managers who remain in downsizedorganisations tended to suffer from poor morale, lack of commitment and motivation,
job dissatisfaction and insecurity. These symptoms were clearly not evident with theparticipants in this organisation.
The process of restructuring and downsizing outlined in this study can be divided into twophases. Phase one included the major changes in job roles, organisational structures anddownsizing that occurred with the move to the new hospital in the ﬁrst half of the 1990s.
These changes did cause anxiety amongst the nurses and the loss of some senior andexperienced nurses who did not want to change the way they worked. The downsizing was
also handled with short- term contract appointments ﬁlling most promotional positions in
the year leading up to the move to the new hospital, thus avoiding further redundancies.
The restructuring was also accompanied by extensive consultation about the new model
for running the hospital. This model of downsizing ﬁts the criteria of what Dawkins et al.
(1999) have described as ‘good downsizing’. Nurses views of the results of the change
process show a relatively positive response.
The second phase of change, which led to further downsizing with the reaggregations
and the growing pressures of the WIES/Casemix system present all the features of bad
downsizing; repeated job cuts, increased pressure on remaining staff and likelihoodof further cuts. In effect this second phase was driven by economics, bottom line
considerations and did not appear to have any of the positive beneﬁts like the previous
phase.
Despite the experiences of the second phase of change, the nurses’ morale, commitment,
motivation and job satisfaction remained relatively good. One important reason for thiswas that, despite being put in managerial positions, most of them remained reluctant
managers. That is, they remained committed to their vocation. Concern for patients andattachment to specialist areas of nursing were prominent themes in the interviews. Many
spoke with passion about their work and this was illustrated in the following comments:• I stay here because I want to be a nurse and I still see myself as a clinical nurse
a well as a manager.
• The reason I am here is because of the patient contact and I love what I do, sothat gets you over everything else most times, even having a bad day.
• We are torn between the increased managerial role [and clinical nursing].
• My passion is surgery, [but] all I feel I am doing at the moment is managing beds
and staff allocation.

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Reluctant Managers 61• If I move into management I would like to stay in an area I know somethingabout• I started of in plastics, which is my main passion in life.
• I love haematology.
Thus, while most interviewees expressed some frustration with the managerial side of
the job, the positive attachment to the clinical role was very important in maintaining
morale and job satisfaction. The inability to give what they considered an appropriate
level of emotional support to patients due to work pressure was the only other source ofjob dissatisfaction expressed.
Besides their commitment to clinical nursing, strong commitment to the hospital was also
apparent. This was despite the negative views of previous senior management who wereseen as only interested in cost-cutting and lacking the ability to communicate. Typicalcomments about the hospital included:• It is a very supportive organization…It has done an enormous amount of work
to review our priorities and be efﬁcient and good at what we do.
• It has always been very caring and like a big family.
• People who stayed through the second re-aggregation were dedicated andworking very hard to keep the place aﬂoat.
The character of the employees who remained after all the restructuring was anotherimportant factor in the positive attitudes expressed. First, they were a relatively younggroup with an average age of 31, which made them more receptive to change and able
to cope with pressures they faced. Second, most of those interviewed showed a capacity
to deal with change, despite expressing initial misgivings about changes to their workroutines. Some commented about how they liked change:• I have really learned to like change.
• It was a total revelation to me that I turned out to be an early mover and achange agent.
• Then you think about it [change] and think about it as a challenge, something
new and different and so it is a positive thing.
The third factor was an ability to cope with what were often unreasonable pressuresand to think positively. Comments such as the following from a NUM in one of the morestressed wards illustrate this strength:
But you have to try and get on with it keeping everyone positive and I guess thatis the way you run the ward… We could not survive if we had a heap of negativity
here. Because I was an associate it was important to keep positive with everyone
because otherwise it reﬂects badly with everyone down the line.
The ability to cope was also aligned with the love of clinical nursing. For instance an
ANUM in a very stressful ward explained:

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62 Richard Gough and Maree Fitzpatrick• The reason I am here is because of the patient contact and I love what I do, sothat gets you over everything else most times even having a bad day.
• Maybe I am a survivor, I love my job and I think that helps.
• The reward comes from knowing you have done your absolute best forpeople.
• Then you realise you are a good nurse and I know what I can do and I do it for
that.
Several interviewees also commented that they were surprised at the ability of the nurses
to cope with the pressures.
• Nurses just seem to cope with it all.
• I thought we will never function with this number of beds but we havemanaged.
• I believe everyone has all these things happening and all these deadlines andmaybe not enough staff to help out, but it works out, it works out.
• But we got through it all and people made excellent adjustments.
A fourth factor was the perception that senior NUMs and Care Centre Directors
communicated well to staff and were supportive in so far as they could be, given the budget
contraints. Meetings at Care Centre level were viewed as good vehicles for discussions
and decisions about operational issues. The ability of NUMs, in many cases, to be handson at work while arguing for more resources for staff, was seen as a positive feature.
Previously senior managers were viewed as uncaring and non-communicative but the
recent more open approach of senior management of the hospital was appreciated.
• It’s more open now than it was.
• We are well consulted with and communicated with by management of thehospital.
There was some ambivalence about senior management communication. In the area ofprofessional nursing practice issues, such as work practices, however, the reviviﬁcationof a consultative forum called the Professional Nurse Practice Council, was favourably
viewed. It was seen as a mechanism for tackling issues through the hospital and actually
implementing agreed changes.
However, with some policy issues there seemed to be little dialogue. For instance, one
NUM noted:
But there are still decisions made they go to executive and they get passed andwe hear later or you hear about it the day before it goes to the executive, there isnothing you can do. It upsets people.
The job delegate indicated that communication had improved with the new senior
management, but said:
They will only let you know what they want you to know.

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Reluctant Managers 63

There was also a feeling amongst some of the participants that there was not enoughappreciation by some senior management of the pressure staff were under.
Some managers are really good they will do their best to get you more staff when
you need it, but there are other managers who say, “It’s not in the budget, it is justthe way you work, your skills, that is why you are not coping”.
Overall, despite the ongoing pressures faced by the management nursing staff toachieve bottom line targets, it is evident that their morale, commitment and motivation
remained positive. Those who instigated and implemented the restructuring and changes
experienced by the nurse managers was in stark contrast to Dawkins et al (1999) ‘bad
downsizers’ which was described as those who engaged in repeated downsizing, did
not have a positive strategy for the future and failed to consult employees about thechanges.

Conclusion
This paper set out to explore the response of nurse managers to the continuous change
experienced by public sector hospitals in the 1990s. These changes occurred in thecontext of increasing acuity of patients and technological change affecting nursing care.
The hospital chosen was a leader in understanding the need to change and acting on it.
According to the interviewees, it was a better place to work in terms of workload thanother major public hospitals.
The organisational changes of the ﬁrst half of the 1990s provided a new more patient-focused model of nursing in an environment of decentralised, decision making. Thoseinterviewed were largely positive about these changes, having chosen to remain, whileothers who did not like the changes had left. Those who remained expressed some regret
about colleagues who had left and were critical of senior nursing management. There
were also adjustment problems with the initial reaggregation of wards prior to the transfer
to the new hospital. Consultation about these changes was extensive, even though there
were criticisms of it. The levels of redundancies of nurses were considerably less thanthose experienced by support staff and allied professionals. Generally, morale of nurses
on entering the new hospital was positive, despite major changes to their work roles toencompass managerial responsibilities.
Subsequent changes brought about by State Government policy through the applicationof the WIES funding formula in interaction with Casemix put great pressure on nurse
mangers. Each reaggregation and related cost cutting made the situation more intolerable.
However, as the ﬁndings revealed, the impact of this pressure was unevenly felt by thenurses. Some wards were harder hit than others due to the nature of the wards, treatment
measures and the type of patients.

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64 Richard Gough and Maree FitzpatrickResearch by Dawkins et al. (1999) indicates that managers in organizations suffering
repeated downsizings and increasing work pressures would show poor morale, lowcommitment and motivation. However, this research has shown that, to a large extent, thenurses interviewed were reluctant mangers, whose overriding concern for their work andpatients largely counteracted such negative feelings. Further, they were a self-selectedgroup in that they remained while had others left. They were also a relatively young groupof managers with considerable energy. These factors assisted them to absorb a great
deal of pressure, whereas, with a group of people less dedicated this would not havebeen possible.
However, the broader labour market consequences of this situation were to renderacute care nursing unattractive to potential nurses, as the hospital found it difﬁcult toﬁll positions in key wards where the pressure were felt most. This outcome raises a key
issue: the inability of politicians, health department ofﬁcials and in some cases hospitalmanagement to see when an equilibrium point of reform had been reached beyond whichfurther change and cost cutting became counter productive. By the time labour market
pressure demonstrated by a nurse shortage became apparent, considerable damage
had been done to the hospital and to the community it serves. Recent decisions by
the Australian Industrial Relations Commission (AIRC) in August 2000 and April 2001
have set a ratio for nurses in acute care hospitals at one nurse to every four patients inareas other than intensive care and day surgery. In agreeing to the AIRC decisions the
Brach’s Australian Labor Party government made budget costings, which failed to take
into account the inability of hospitals to staff to these levels. The need to staff to thislevel has led to extensive use of highly expensive agency nurses, which, in turn, hascaused overruns in hospital budgets. The current government has initiated a ban on useof agency staff in order to restrain costs. As a result some hospitals have been forced toseek alternative arrangements such as building their own nurse banks and closing beds
due to their inability to attract full time staff. These changes have occurred in the context
of an international nurse shortage.
Innovation, better quality and efﬁciency are admirable, but this research indicates that
there is a need to recognise when the equilibrium point has been reached beyond
which damage is done to the organization, its employees and clients. More effective
understanding by management of the situation faced by employees is critical to stop theneed for crude responses such as labour market pressures being the only warning sign.
Bodies such as the Auditor-General in his report did highlight the issues. However, thereis need for an independent body such as the Auditor-General to develop a methodology
to assess these issues to improve public policy making.

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Reluctant Managers 65

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Bullying in the Health Sector 67

Bullying in the Health Sector: A Studyof Bullying of Nursing Students
BARRY FOSTER*, BETH MACKIE** & NATASHA BARNETT***

Abstract
Workplace bullying is a phenomenon that, although it has existed for decades, has only
recently begun to be studied and understood. Although the international literature points
towards a strong occurrence of bullying amongst nurses, there is very little New Zealandbased research. This article, therefore, examines the prevalence of bullying of nursing
students while on their clinical placement from their tertiary institution and documents theexperiences and perceptions of those nursing students who have been bullied. It also
gauges the perceptions of students who have never experienced bullying. The resultsof the study outlined in the article clearly show that bullying is a problem for nursing
students and that a high percentage of the bullies were senior nurses. Most disturbing
was that most nursing students were aware of the patterns and implications of bullying.

Introduction
Bullying is a phenomenon that, although it has existed for decades, has only recently
begun to be studied and understood. Overseas literature indicates that bullying inschools and workplaces is common. There is growing academic interest and recognition
that bullying is prevalent in the health sector, particularly amongst nurses. However, until
recently in New Zealand, the research on bullying and how to counteract the behaviour
have been embedded in childhood education programmes. As a result there is little New
Zealand research regarding the incidence and nature of workplace bullying in generaland even less written on bullying in the health sector.
The primary purpose of this paper is to contribute to the small pool of academic knowledge
concerning the prevalence and nature of bullying in New Zealand workplaces. This
paper is of particular interest as it reports a survey of student nurses who straddle thework-study divide and investigates their experiences and perceptions of bullying while
on clinical placements from their New Zealand tertiary institutions. Based on a surveyof student nurses about their experiences of bullying while on their clinical placements,
it is argued that bullying of current student nurses rests on a long tradition of such

* Barry Foster is a lecturer in Employment Relations at Massey University, Palmerston North.
** Beth Mackie is a lecturer in HRM at Massey University, Palmerton North.
*** Natasha Barnett is a HR Advisor at the National Police Headquarters, Wellington.

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68 Barry Foster, Beth Mackei and Natasha Barnett

behaviour, is frequently committed by senior female nurses and is endemic in the nursing
profession. However, as the students become more experienced, the bullying declines.
It is also suggested that the acceptance of bullying has in turn perpetuated the situation
and retarded efforts to correct this signiﬁcant problem for nursing students.

Review of the Literature
Stressful working conditions, continuous restructuring, poor pay rates and inadequate
stafﬁng levels have had little impact on individuals wishing to become nurses andenrolments for nursing training have remained the same. However, one aspect ofnursing that could severely affect the recruitment and retention of nurses is bullying in
the workplace. As stated previously, there is growing evidence that workplace bullying ofnurses is a signiﬁcant problem. For example, UK studies show that nurses are in the top
three most bullied groups in the National Health Service and that qualiﬁed nurses weremore likely to be subjected to bullying than any other medical staff in the UK (Dowd, 1996;
Quine, 2001). It was found that managers, fellow staff (particularly senior nurses) and the
public were their biggest bullies and that younger nurses faired worst than most (Quine,
2001). One in two nurses reported being subjected to bullying, compared with one inthree amongst other staff categories. Another British study concluded that 25% of nurses
reported verbal abuse and 75% of nurses surveyed received unfair criticisms regarding
work performance (McMillan, 1991). US studies also indicate that registered nurses
regularly experienced verbal abuse, and a nationwide survey revealed as many as 97%
experienced some type of verbal abuse on the job (Cox, 1987). The most common formsof bullying reported by nurses included serious slander, being met with silence, having
information systematically withheld, being ignored and excluded as well as being teased
or ridiculed (Einarsen, Matthiesen and Skogstad, 1998). Wilson (2000: 24) also notesthat “horizontal violence” (a nursing term used to describe workplace bullying) meansthat nurses are frequently exposed to negativity and professional jealously in a so-called“healing and caring environment” (Wilson, 2000: 24). Hadikin and O’Driscoll (1996),
based on their study of 462 midwifes, noted that one-quarter of all victims reported that
their health had been affected by bullying, while 8% reported having to take time off
work.
In New Zealand, the problem of students being bullied whilst on their clinical placements
has become more recognized than was previously the case (Adler, 2002). Lucia Fell
(2000), the NZ National Student Unit Chairperson, not only highlighted the fact that
nursing students were being bullied but she also noted that there were a variety ofsources of bullying in the New Zealand health sector. These sources included tutors,
clinical placement buddy nurses, charge nurses and other senior nurses, both enrolled
and registered (Fell, 2000). She argued that bullying was not a good management ofpeople, was not conducive to learning, created a stressful working environment andthe costs incurred to the organization if not controlled were considerable (Fell, 2000).
However, the issue is being confronted head-on at a few tertiary institutions. For example,

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Bullying in the Health Sector 69

in one tertiary institution, ﬁrst year students are given a two-hour education programmeon bullying in which they are told that it is unacceptable and are informed of the avenues
for confronting bullies in the workplace (Fraser, 2002).
It has also been suggested by Hadikin and O’Driscoll (1996) that the culture of hospitals
has a great deal to do with the high level of bullying, particularly of junior nurses. Smith,
Droppleman and Thomas (1996) suggest that anger amongst nurses can be used asboth a weapon and as a shield in a hostile environment, and that this anger may bedirected more at junior nurses than other senior nurses.
Thus, while nurses face many challenges, such as constant changes, reviews andrestructuring, one of the most signiﬁcant problems comes from working with theircolleagues (Wilson, 2000). Moreover, the literature indicates a culture of bullying ismore prevalent than the profession may care to admit (Stevens, 2002). This includes
an entrenched view that it is necessary for younger nurses to endure the harsh regime
that previous generations of nurses have also endured, particularly with regards totraining, thus maintaining the cycle of bullying. Indeed, O’Connor (1998) argues thatthe acceptance of bullying behaviour is at odds with nursing as a profession; there isa contradiction between this behaviour and the public perception of caring and kindnurses.

The Working Life of Student Nurses
Part of every nursing programme is the clinical component; in New Zealand this requires
1500 hours of clinical placement over three years of training (Holland, 2002). Dunn andHansford (1997) state that clinical education is a major component of the undergraduate
nursing curriculum and is important as student nurses develop not only theoreticalknowledge but also the practical application of skills. The development of a student’s
attitudes, psychomotor skills, knowledge and clinical problem solving skills are all largely
inﬂuenced during clinical placement (Dunn and Hansford, 1997). However, problemsof bullying appear to arise during clinical placements where students seem to become
the losers in the faculty-staff-student triad. Assessment of clinical performance is amajor issue in relation to this triad. Studies have shown that problems often occur when
students are asked to take on clinical placements in the ﬁrst year of study. It has been
noted that trying to adjust to tertiary education as well as a ward environment causes agreat deal of stress for students (Gwele and Uys, 1998). This, combined with busy andfrazzled senior nurses who do not necessarily have time to assist the students, can leadto a very unpleasant learning experience for most student nurses (Fell, 2000).
In addition, timing of clinical placements, which are usually towards the end of the year
when students are also studying for ﬁnal examinations, is often an added source ofstress (Holland, 2002). Conﬂicting relationships between students and the nurses they
are assigned to, merely adds to this stress. Research has revealed that some registered

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70 Barry Foster, Beth Mackei and Natasha Barnett

nurses lack the willingness and encouragement to assist training the students (Dunn andHansford, 1997, Stevens, 2002). This becomes a major problem particularly as there
is a power imbalance inherent in the “trainer-trainee” relationship (Garrett, 1997). In
this context, Garrett (1997) notes that power has the capacity to produce a change as
the trainer has greater knowledge, greater objectivity and status, and therefore has thepower to produce change (positive or negative) in the trainee.
Garrett (1997) argues that those “buddy” nurses who lack the willingness to encourage
students could be described as “bad supervisors”. Speciﬁcally, bad supervision involves
the absence of effective teaching strategies, role modelling and enthusiasm. This
combination often results in having trainers who are disinterested and/or inept, areauthoritarian and exploitative, encourage conformity and may punish those who do notconform (Garrett, 1997). These traits have also been reported in other studies (O’Connor,
1998) and by the nursing students surveyed whilst on their clinical placement (as outlined
below).
In order to try and overcome the problems associated with clinical placements, inparticular the problems involving the trainee and the trainer relationship, one tertiary
institution has introduced an incentive programme. This programme involves clinicalstudy scholarships given to registered nurses who “guide, mentor and instruct student
nurses” (“Boost for”, 2002: 11). These scholarships enable recipients to continue theirprofessional development and further learning in their clinical specialty. It is hoped thatthe scholarships will encourage a high level of clinical support and partnership between
the tertiary institution and its clinical placement organizations and its staff.
However, there is increasing research that shows that such incentive programmes do
not necessarily provide an antidote to the entrenched organisational culture that fosters
bullying. As one commentator stated:“Although a tough competitive environment doesn’t create bullies, it may aggravate
their behaviour”. (Financial Times, 1996 cited in Savva and Alexandrou, 1998)
This quote concurs with research that suggests that while an organisation’s culture may
not create bullies, it can foster and encourage their behaviour. Cowie et al (2002) assertsthat the values and norms of a workplace strongly inﬂuence how bullying is viewed, howemployees interpret situations and whether bullying is recognised as a problem. Lee(2002) found that annual staff performance-related pay and promotions are occasions
where line managers can bully their subordinates. Beasley and Rayner (1997) add that
where bullying does occur in organisations, it usually ﬁlters down from the top management
to the supervisors, and therefore it is seen as an acceptable way to manage staff, anda behaviour that may even assist people getting promotion. Furthermore, O’Moore et al(1998) found that the majority of victims in their study reported that organisational factors,
such as autocratic management and a competitive and stressful work environment,

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Bullying in the Health Sector 71

contributed to the prevalence of bullying.
Rayner and Hoel (1997) and Sheehan (1998) support this view by stating that insufﬁcient
control of certain behaviours and high levels of conﬂict resulting from excessive workloads
and unreasonable expectations by supervisors, are often precursors to bullying ofsubordinates. Crawford (1997) also points to the economy that has generated highlevels of unemployment and the commercial trend towards downsizing, thus increasing
the employees’ anxiety and vulnerability and contributing to a climate of fear and bullying.
Because there is a managerial expectation that their employees will be loyal to thecompany (even though this loyalty is not reciprocal) and that dissent is not tolerated,bullying can often remain hidden as employees are too scared to speak out for fear of
being portrayed as disloyal or as a trouble-maker (Crawford, 1997).
In summary, as a group, nurses seem to be vulnerable to bullying at work, whether it isinﬂicted by their peers or their managers. Because of the vulnerable nature of student
nurses, as outlined above, it is important to determine the prevalence of bullying of thesestudents whilst on clinical placement, and to ascertain if any characteristics are more
dominant in either bullies or their victims.

Methodology
The main objectives of the study reported in this paper was to establish a case study
investigating workplace bullying in nursing students in New Zealand, using a lower North
Island tertiary institution as the sample population. Given the current limited understandingof the topic, this study took an exploratory approach for which case study methodologies
are well suited. Nonetheless, the extant literature indicated that there was a likelihood
that:1) A high percentage of nursing students will report some level of bullying whilst on
clinical placement, as proven by international research.
2) Students in later years of study may interpret characteristics and behaviours of bullies
differently (with greater knowledge of the role of nurses) than those beginning study.
3) As previous research has shown, characteristics imagined by those who have neverexperienced bullying will differ greatly from those who have experienced bullying.
4) Students subjected to the harassment education programme (3rd years in 2003) willreport substantially less bullying, and more positive action taken to report bullying
than other students.
The study was divided into two main parts: part (a) for those who reported being bullied
and part (b) for those who had not experienced bullying. The characteristics researched

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72 Barry Foster, Beth Mackei and Natasha Barnett

included general demographics, such as age group, gender, year of study, as well as alist of commonly reported forms of bullying and symptoms associated with workplacebullying. The study involved a mixed qualitative and quantitative survey analysis within
a singular New Zealand industry, the nursing sector (Yin, 1989).
As no existing questionnaire was available for use for this particular project, it wasnecessary to develop one. The questionnaire was divided into three main sections.
Section 1 of the questionnaire gathered demographic information from the participants.
This section then gave a broad deﬁnition of bullying and gave a list of commonly
reported forms of bullying. These forms of bullying were taken from the State Services
Commission, (2002) study of career progression, which reported up to 16% of employees
had experienced a number for forms of bullying and that some types of bullying weremore serious than others. Respondents were asked to identify which of these types ofbullying they had experienced.
Section 2 of the questionnaire was used to determine similar information about the bully.
Participants were asked to identify the perpetrators age range (approximate), genderand job type (position). Respondents also were asked to concentrate on the behaviours
associated with the ‘worst’ incident. Finally awareness of anti-bullying programmes wascanvassed.
The third section was completed by those participants who had not experienced any
bullying while on clinical placement in order to gauge their perceptions. In an openended question, they were asked to imagine what a typical bullied person would be
like and describe the average age range, gender and position (job type) of the victim.
They were also given a range of symptoms and asked to identify what symptoms theimagined victim would suffer as a result of being bullied and the level of frequency thesymptoms would occur. In another open-ended question, the respondents were also
asked to imagine what the bully would be like and describe their demographics; this is,age range (approximate), gender and job type. The respondents were also asked if they
were aware of any anti-bullying programmes, and if so what were the programmes aswell as what actions they would take if they were bullied.
While a detailed description of “bullying” evolved from this study, it should be noted thatsuch a description was reliant on the participants “schema” of its constructs. Participants
made their own judgments on what it meant to them to be defenceless, humiliated, stressedor undermined. Therefore, as Cowie et al (2002) stated, a comprehensive understandingof the imbalance of power criterion is never actually satisﬁed. The one-sided nature of
the questionnaire also makes it impossible to accurately gauge the characteristics andthe reasons why bullies act as they do and who would no doubt see themselves and their
behaviours very differently from the victim.

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Bullying in the Health Sector 73

Given that there was a small number of responses, generalisations cannot be madeon the basis of this data. However, the case study data does point to some disturbing
trends and further research using a much larger pool of participants from various tertiary
institutions would be advantageous.

Results
Of the 75 questionnaires deposited at the tertiary institution’s Student Resource Centre,
40 were completed and returned, giving a response rate of 53%. The results presented
below follow the phases of the study and questionnaire format.
Demographics of the Interviewees
The majority of participants in this study were aged between 18 and 40, with only 2
participants (5%) older than 40 years of age. The sample consisted of 4 males and 36
females. The majority of participants were in their third year of study (65%), with second
year yielding 25% and ﬁrst year contributing to only 10% of participants. No participants
reported being in more than their third year of study. A break down of participants by age
and year of enrolment is illustrated in Table 1 below.
TABLE 1: Participants by age group and year of study, (note % are given inbrackets)

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74 Barry Foster, Beth Mackei and Natasha Barnett

Victim Characteristics
Ninety per cent of participants (or 36 out of 40) reported that they had experienced someform of bullying while on clinical placement. As seen in Table 2, the majority of participants
were under 20 years of age (18 or 55.5%) when they were ﬁrst subjected to bullying
behaviour. Another 15 (41%) were aged between 21 and 30, and 3 (or 27%) were aged
between 31 and 40. No participants aged 41 or over reported being subjected to thebullying behaviour. Also, as outlined in Table 3, all the male participants stated that they
had been bullied at some time during their placements (see below for more discussion).
The majority of participants reported being enrolled in their second year of study whenthe (worst case) behaviour took place (61 %). Ten participants, (27.7%) reported being
in their ﬁrst year of study and only four (11 %) experienced the behaviour in their thirdyear. Table 2 summarises participants by age and year of study when the behaviour
occurred.
TABLE 2: Age and year of study when bullying took place (worst case)

TABLE 3: Gender of participants who report being bullied.

Forms of bullying and the worst form of bullying
Over half of the participants experienced ignoring/excluding (70%), intimidation (60%)
and belittling remarks (55%). At least 2 of participants (or (10%) had been the victim of all
the forms of bullying as outlined below in Table 4, which also summarises the frequency
it occurred.

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Bullying in the Health Sector

75

TABLE 4: Forms of bullying and the worst form of bullying experienced

The ﬁrst question of part (a) asked participants to identify the worst form of bullying fromthe list of the most commonly reported behaviours outlined in the question above. This
question was asked in order to assess: 1) if a participant had been bullied on more than
one occasion, and 2) which of the forms of bullying they were subjected to, did theyﬁnd the worst. As illustrated in Table 4, ignoring/excluding was reported as the worst
behaviour experienced by 14 participants (38.8%). Intimidation was next with 6 (16.6%),
followed closely by being set up to fail (5/36 or 13.8%) and belittling remarks (4/36 or 11%).
The type of symptoms and frequency experienced
Participants were then given a list of commonly reported symptoms and asked to state
whether they had experienced these symptoms as a result of being bullied, and how
frequently they experienced these symptoms, as seen in Table 5. Anxiety was the mostcommonly reported symptom with over 75% of participants experiencing it at somelevel of frequency (52% once or twice; 22% frequently and 2.7% for prolonged periods).
Participants reported shattered self-conﬁdence (69%) and low self-esteem (66%) as thenext most commonly reported symptom. At least one participant reported experiencing
each of the symptoms, except sleeplessness, at a prolonged frequency. At least 35% of
respondents reported experiencing some type of symptom as a result of being bullied.
TABLE 5: Type of and frequency of symptoms experienced.

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76 Barry Foster, Beth Mackei and Natasha Barnett

Awareness of anti-harassment policies and reporting behaviours
Anti-harassment policies are commonplace in most organisations and the next question
required participants to report if they were aware of anti-bullying programmes in theirclinical placement organisation. Only 19% of respondents stated that they were aware ofany such a policy.
Respondents were questioned as to whether or not they talked to anyone regarding thealleged behaviour and 86% stated that they had talked to someone. The most commonly
reported conﬁdant was their lecturer/tutor (44%) while conﬁding in classmates came aclose second (33%). When asked, however, if any actions were taken against the person
bullying them as a consequence of talking to someone about the problem, only ﬁve(13.8%) reported that some action was taken to mitigate the problem.
Characteristics of bullies
Questions then focused on the perpetrator of the bullying behaviour. Twenty-nine of the
respondents (80%) stated that people who bullied them were aged over 31 years ofage. More speciﬁcally, the most reported age group of bullies was between 31-40 yearsof age (47%), followed by the age group between 41-50 years of age (30.5%). Table 6
below summarises the age of bullies in relation to their victims. It is interesting to notealso that almost no respondents were bullied by someone of a noticeably younger age
group (2.7%).
TABLE 6: Age of bullies in relation to their victims.

The majority of respondents also identiﬁed that the perpetrators were mostly female(86%), with only 3 respondents (8.3%) identifying males. Results also indicate that the 3
respondents who reported male bullies were also male themselves.

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Bullying in the Health Sector 77

When asked to identify the bully’s occupation or position in the organisation, the majorityof respondents indicated that the bully was a nurse of some description (88%), with only
4 respondents stating that the person bullying them was not a nurse. Within the nursing
occupation, the most commonly reported bullies were registered nurses (38%) with“buddy” nurses being the second most commonly reported bullies (36%). Table 7 below
summarises the gender, occupation and organisational position of the reported bullies.
TABLE 7: Gender, occupation and organisational position

Respondents were then asked if it was always the same person who bullied them. The
results were virtually split down the middle, with 44% stating that it was always the same
person and 47% stating it was not. Three respondents (8%) did not complete this question.
When asked to specify the occupation of the serial bully, again most were nurses, inwhich 33% of the respondents stated that the person continuously bullying them was aregistered nurse and 8.3% respondents stated that it was another “buddy” nurse.
In order to establish if the victims had any preconceived views of the person who bullied
them, the ﬁnal question for this section asked respondents to indicate whether or not they
had any suspicions in the beginning that the perpetrator would subsequently bully them.
Again results were almost evenly split with 52% indicating they had expected that theperson would bully them and 47% indicating they had not.
Perceptions of respondents who not experienced bullying
Of the four respondents who had not experienced any bullying, two of them believedthat the victims would be aged between 18-20 while the other two respondents thoughtthat typically the victims would be aged between 21-25 and between 26-30 respectively.
All respondents thought that the victims would be female. In relation to the victim’s
occupation, three of the respondents thought that nursing students would be mostvulnerable to bullying and the other respondent thought that the victim would most likely
be a nurse aid.

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78 Barry Foster, Beth Mackei and Natasha Barnett

When asked to imagine the type of symptoms that victims of bullying might experienceand the frequency of these symptoms, all respondents thought that the victims would
experience some level of shattered self conﬁdence (50% frequently; 50% prolonged) andalso low self-esteem (25% once/twice; 25% frequently; 50% prolonged). In addition, 3(75%) of the respondents thought that the victims of bullying would suffer from anxiety.
Table 8 illustrates the respondent’s perceptions of the victim’s symptoms and thefrequency of the symptoms.
TABLE 8: The perceived symptoms and the frequency of the symptoms

With regard to the characteristics of bullies, two of the respondents imagined the bullies
to be aged between 36-40; while the other respondent thought the age to be between 3645 and remaining respondent believed the age to be between 41-45. Three respondents(75%) thought that the perpetrator would be a woman while one respondent thoughtthat the bully would be a man. With the exception of one respondent, who thought thatthe bully could either be a charge nurse or a doctor, all the respondents thought that theoccupation of the bully would typically be a registered nurse, enrolled nurse or a charge
nurse.
All four of the respondents stated not only were they aware of an anti-bullying programmes
in their clinical placement organisation but that they would also tell their lecturer if they
were subjected to bullying.

Discussion
The results from the study show that that 90% of the student nurses surveyed had
experienced some form of bullying while on clinical placement. Although the results
are more extreme than those reported by Quine (2001) and Einarsen, Matthiesen and
Skogstad (1998), (who reported that one in every two students was bullied and that 8.4%
were bullied respectively), this study indicates that there is an increasing trend towards
student and junior nurses being bullied. However, as noted earlier, Garrett, (1997)
argues that the power imbalance between a trainer and trainee can lead to harassment

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Bullying in the Health Sector 79

and bullying. Therefore, the reason for the high number of nursing students being bullied
could be because the victims are students as well as nurses (also refer to see Alder,
2002, Anonymous, 2002, Fell, 2000).
Over half of the student nurses surveyed noted that the most frequent forms of bullyingthat they had experienced were ignoring/excluding, intimidation and belittling remarks. It
is interesting to note that these forms of bullying involve social aspects of the job (being
ignored/excluded, etc.) rather than the tasks themselves. It could be argued that wanting
to ﬁt into the social fabric of the workplace and not being able to readily achieving thismay in itself cause as much distress for nursing students as the action of bullying.
The age of the participants who reported being bullied was diverse. Although just overhalf were 20 years of age or under, the other half were fairly evenly spread between 21
and 40 years of age. None of the participants over the age of 40 reported being bullied,
however this may be because there were only two (5%) in the study. Therefore, it could
be concluded that while the very young student nurses (under 20) are most prone tobeing bullied whilst on clinical placement, there is no age that can be deemed “safe”.
This ﬁnding is supported by the literature (Rayner, 1997, Rayner, 1998b and Rayner and
Hoel, 1997) in which there is general consensus that bullying can happen to anyone at
any age.
There also appears to be a correlation between the year in which students are enrolled
in study and when they are bullied. The majority of respondents reported being bullied
in their ﬁrst year (27.7%) and second year (61 %) of study, while only 11 % of the
respondents reported being bullied in their third year. In addition, because students only
have one week of placement at the end of their ﬁrst year, the inexperience may makesome nurses more vulnerable and thus more prone to bullying. As they enter the second
year of clinical placement, they gain more exposure to the working environment andgain more knowledge of their profession; they become more socialised into their groups
and more aware of the mores and norms of their occupation; and therefore become
more conﬁdent. Moreover, the more experience they gain, the more they become awareof what behaviour is tolerated and not tolerated and how to counteract inappropriate
behaviour.
However, the results show that a number of students nurses experience symptoms ofbullying (such as low self-esteem, etc) for prolonged periods of time. These symptomsof bullying are a direct cost to the organisation in terms of high rates of sickness andabsenteeism, low morale, mental and physical illnesses and high staff turnover (alsorefer to Beasley and Rayner, 1997; Douglas, 2001).
Although most of the student nurses surveyed had been bullied, a high percentage ofthem (86%) were able to talk to someone about it and that this conﬁdant was usually alecturer/tutor or classmate. O’Moore et al (1998) found a similar number of respondents

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80 Barry Foster, Beth Mackei and Natasha Barnett(over 70%) had also sought advice and support by talking to someone else about
their experiences. Sheehan (1998) cited that one-quarter of victims sought help fromfamily doctors and counsellors after being bullied. While a high percentage reported
the incident to others, only a small percentage of conﬁdants took any action against theperpetrator. Liefooghe and Davey (2001) state that if there is a lack of procedures to deal
with bullies and there is a propensity for bullying and harassment to be condoned, thenthese behaviours will continue unchecked and even increase.
Furthermore, this study supports other research in that the bully is frequently older thantheir victim (Rayner, 1997; Rayner, 1998a; Rayner, 1998b and Quine, 2001). However,
one reason for this could be that the majority of respondents (and indeed students ingeneral) are in the young age group (61 % in this study under the age of 25) and therefore,
it is likely that senior staff will be older than them.
The respondents also stated that almost all the bullies were women (86%). However,this is not surprising as nursing is a female dominated profession. Therefore, bullying
amongst nurses is more often than not perpetrated by women, most of whom will be older
than the victim, as mention above (Stevens, 2002; Einarsen, Matthiesen and Skogstad,1998). It is also interesting to note that the three male respondents stated that they werebullied by men. There is some research that supports this ﬁnding which suggests that on
one hand women are bullied by men and women, while on the other hand men are more
likely to be bullied by other men and unlikely to be bullied by women (Rayner and Hoel,
1997; Rayner, 1997). There is debate, however, as to whether or not this is an accurate
claim. It could be argued that men are bullied by women but are too embarrassed todisclose it (Rayner, 1997). However, as one of the male respondents stated that he had
been bullied by a senior female nurse, this assertion may also be ﬂawed. Moreover, in
an industry dominated by women, perhaps the notion of a man being bullied by a woman
is not remarkable or embarrassing as would be the case if the man worked in a male(macho) dominated industry.
Not only were the bullies predominately women, but also 88% of the respondents notedthat most of the bullies were nurses; the most commonly reported bullies were registerednurses (38%) and buddy nurses (36%). Only four respondents were bullied by anindividual who was not a nurse.
This indicates that the bullying is occurring within the nursing profession rather thanoutside it. O’Connor (1998) points to a vicious cycle where a nurse is bullied by anothercolleague, who is often more senior, they then lose conﬁdence and become a victim. As
a way of diminishing the victim’s role they have assumed and to make themselves feelbetter, they in turn bully another more vulnerable colleague. Stevens (2002) argues thatthe cycle is perpetuated by senior nurses who believe that because they had to endure
a rigorous and often tyrannical training in which bullying was part of the system, theirjuniors should also have to put up with it. Thus, the cycle continues on.

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Bullying in the Health Sector 81

Almost half of the respondents in this study had been bullied by more than one person
and nearly all had been nurses. Moreover, nursing students are not only bullied by theirown buddy nurse on more than one occasion, but also by other nurses in the samedepartment (33% identiﬁed other registered nurses). There was also evidence that the
respondents were being bullied by different buddy nurses (8.3% identiﬁed other buddy
nurses), i.e. two different placements with different buddy nurses but the same bullying
behaviour. To make matters worse, 52% of the respondents expected to be bullied while
on clinical placement. The question, therefore, is: “Why are students going out on theselearning expeditions and expecting to be bullied?” And “If students are expecting to bebullied, why does the profession seem to be ignoring the problem?”
The perceptions of those respondents who had not been bullied and those who had
were similar. However, when the respondents who had not been bullied were asked
to envisage what symptoms victims would experience, they perceived the symptoms
to be worse and last longer than was actually experienced by the student nurses who
had been bullied. An explanation for the differences between what was perceived andwhat was experienced by the nurses could be that the non-bullied respondents may
have previously witnessed someone being bullied at work. This assertion is supportedby Rayner (1997) who found that 77% of individuals had at sometime witnessed bullying
at work and Quine (2001) revealed that nurses were more likely to witness bullying thanany other health-care providers.

Further Research
Although it is acknowledged that the number of responses (40) were too few to provide
any conclusive statements or to apply any generalisations, the ﬁndings do highlight anumber of directions for further research. One such area that requires further investigation
is whether or nor student nurses have an expectation and acceptance that they will
experience a level of bullying while on clinical placements. The results from this study,
which are somewhat disturbing, suggest that this may be the case but other similar
studies are required to test this hypothesis.
Another possible area for investigation is the affects of bullying on student nurses, and inparticular the impact of bullying on the recruitment and retention of nurses. For example,
studies that link the levels absenteeism, withdrawals from courses and resignations withthe affects of bullying could provide the basis of useful arguments to fund comprehensive
programmes to counteract bullying behaviour. Research in other sectors shows thatvictims of bullying invariably leave their positions and seek employment elsewhere.
However, given that there is a chronic nursing shortage, it may be useful to address
issues, such as bullying, that detract from the nursing profession.

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82 Barry Foster, Beth Mackei and Natasha Barnett

Conclusions
The results of this study clearly indicate that bullying is occurring to the majority of students
whilst on clinical placement. Targets of such behaviour do not fall within a speciﬁc age
group and can be either gender suggesting that bullying can happen to anyone. The
more advanced the student is in their training, the less likely they are to suffer bullying,suggesting that as they become more experienced and conﬁdent, the incidence of bullying
also decreases. The majority of respondents reported some form of psychological effects
associated with being bullied. A high percentage of the bullies are nurses, suggestingthat bullying comes from within the profession, rather than from outside it (e.g., doctors,
specialists). Bullies in this study were most likely to be older than their victims, and are
typically female. While the perceptions of the non-bullied respondents did not necessarily
match those had experiences of being bullied, the ﬁndings indicate that even the nonbullied respondents were aware of the patterns, forms and implications of bullying.
Although the ﬁndings from overseas research on bullying has implications for New
Zealanders, further research is still required in order to assess the prevalence andwider affects of this harmful behaviour amongst vulnerable workers in New Zealand.
While bullying is often trivialised and condoned, the long-term negative impact it hason the victims, the colleagues, the families and the organisation deems that it should
no longer be ignored. Furthermore, studies that reveal better ways of predicting andpreventing bullying behaviour should be encouraged and organisations and government
enforcement agencies need to be more proactive to end this damaging behaviour that
occurs in the “sanctity” of the workplace.

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Lee, D. (2002), Gendered workplace bullying in the restructured UK Civil Service. Personnel Review, 31(2): 205-227.
Liefooghe, A.P., and Davey, K.M. (2001), Accounts of workplace bullying: the role of the organisations environment. European
Journal of Work and Organizational Psychology, 10(4): 369-373.
McMillan, I. (1991), Losing control: bullying in the workplace. Nursing Times, 91(40): 42-43.
O’ Connor, T., (1998), Bullying - A problem for nurses? Kai Tiaki Nursing New Zealand, 4(2): 22-24.
O’Moore, M., Seigne, E., McGuire, L., and Smith, M. (1998), Bullying at work: Victims of bullying at work in Ireland. Journal of
Occupational Health and Safety, 14(6): 569-574.
Oxford, J., and Beasley, J. (1997), Editors Preface. Journal of Community and Applied Social Psychology, 7(3): 173-175.
Quine, L. (2001), Workplace bullying in nurses. Journal of Health Psychology, 6(1): 73-84.
Rayner, C. (1997), The incidence of workplace bullying. Journal of Community and Applied Social Psychology, 7(3): 199-208.
Rayner, C. (1998a), Bullying at work. Workplace bullying: Do something. Journal of Occupational Health and Safety, 14(6): 581585.
Rayner, C. (1998b), From research to implementation: Finding leverage for intervention and prevention. Paper presented at
Bullying at Work 1998 Research Update Conference. Staffordshire University Business School, July 1998.
Rayner, C., and Hoel, H. (1997), A summary review of literature relating to workplace bullying. Journal of Community and AppliedSocial Psychology, 7(3): 181-191.
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Sheehan, M. (1998), Bullying - signs and solutions. Paper presented at Bullying at Work 1998 Research Update Conference.
Staffordshire University Business School, July 1998.
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CHRONICLE
February 2004
The ﬁrst submissions on the Employment Relations Law Reform Bill were presented to
the Transport and Industrial Relations Select Committee and employer organisations
were vehement in their criticism of the Bill. They claimed that it would reduce employers’
ﬂexibility; increase red tape, government intervention and union power; it would drive
many workers into collective agreements. Furthermore, it was reported that employers
planned to boycott the deadline for submissions claiming that the 11-week period to makethem was insufﬁcient. Employer representatives accused the government of introducingchange at a speed which was `indecent’ and in breach of good faith.
The Government appeared to acknowledge the lack of support from the business
community. The architect of the Bill, Minister of Labour, Margaret Wilson, was replaced
by Paul Swain in a cabinet reshufﬂe and the Press noted that the Government hoped hewill be able to quell business opposition which at times had been personalised against
Ms Wilson. Meanwhile, the NZ Herald reported that Minister for Small Business, John
Tamihere, told Parliament that he had not received any support from small businesses
for the Bill.
While employer criticism dominated media reports they were countered by union
representatives. Interestingly, the Council of Trade Unions (CTU) advocated muchstronger intervention and suggested that some kind of compulsory arbitration to establish
more multi-employer collective agreements might be necessary. This implied a returnto the old national award system, despite the Government’s explicit rejection of such a
move. The Sunday Star Times criticised employer lobbyists for interpreting the legislationin the most extreme way possible and that the loose wording of the Bill gave them “extra
scope for their paranoia”.
The Dominion Post reported that the National Party, according to its leader Don Brash,would repeal the proposed changes if it became the government because they were “badfor the economy, bad for employers and bad for employees”. Dr Brash also suggested theBill could become a `stepping stone’ to national wage awards which could be a disasterfor provincial New Zealand. He claimed that unions looked at what larger centres like
Auckland needed, not at the smaller provincial centres which tend to be economies ofsmall companies, so labour laws need to be more ﬂexible. This view was supported by the
CEO of meat company Anzco Foods who told the government to scrap its controversial
employment legislation. This came after the company announcing it would reopen its
Waitara meat works, providing 70 jobs and up to $100 million in exports.

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The NZ Herald reported Bank of New Zealand customers faced frustrating telephone
delays during a three-hour strike by Auckland call-centre staff. BNZ spokesperson, Owen
Gill, defended a 3.5 percent pay rise offer as generous, but Finsec union organiser,
Geraldine Molloy, said staff wanted parity with branch employees within the bank. Finsec
also began legal action in the Employment Relations Authority, saying the bank should
not have paid non-members the 3.5 percent while a collective agreement remained undernegotiation.
Industrial unrest in the health sector featured in several media report. The Dominion Post
reported that a new national collective employment agreement for about 2,000 surgeons,
psychiatrists and pathologists had become unstuck when the senior doctors rejected
a pay offer made by the District Health Boards (DHBs). Just over half of the seniordoctors took part in a ballot and voted by 84 percent to 16 percent against the offer.
The Executive Director of the Association of Salaried Medical Specialists, Ian Powell,
pointed to upcoming negotiations for nurses and junior doctors and said: “There is a riskof anarchy in employment relations if DHBs continue to misunderstand the needs of theirhealth professionals”.
Nationwide, nurses started the NZ Nurses Organisation’s 2004 campaign for pay equity.
Around 4,000 nurses employed by District Health Boards in the lower North Island
attended meetings to discuss a new collective employment agreement, designed to givethem equal pay with their Auckland counterparts.
Negotiations over the crucial multi-employer collective agreement in the engineering
sector - the so-called `Metals Agreement’ - became unstuck. The Engineering, Printing
and Manufacturing Union (EPMU) gave 14 days notice of stopwork meetings acrossthe manufacturing sector when three tense days of negotiation with the Employers andManufacturers’ Association failed to reach an agreement. The union’s claims included a
5 percent pay rise, a 37.5-hour working week and an increase in the allowance for dirty
work. The agreement was expected to cover around 220 ﬁrms and 2,500 employees.
Following strike action, the meatworkers at Richmond’s Takapau plant settled theircollective employment agreement and accepted a 3 percent pay increase for the next
12 months. Initially, they were offered a 1.5 percent pay rise which led to more than 500
workers staging a two-day strike in January.
Striking wool-pullers at PPCS Finegand wanted the meat-processing company to `open
its books’ to prove it could not afford to meet their pay demands. The workers wereseeking pay parity with other PPCS plants and this was their second strike action in
February.
With the amendments to the Holidays Act due to come into force on April 1, the Press
reported that the Chief Executive of Employers and Manufacturers Association, Paul

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Winter, stated that the law forced employers to do what most were happy to grant on adiscretionary basis. The Dominion Post reported that other employers claimed that the new
Act will enable widespread `abuse’ of bereavement leave provisions. The Employment
Relations Manager of the Employers and Manufacturers Association (Northern), Peter
Tritt, suggested that leave would be limited only by the number of deaths each year,
about 28,000 and proposed that the Government should have conﬁned bereavement
leave to the death of close relatives.
A report by the Catholic charity Caritas raised fears that New Zealand children are being
exploited and put in danger at work. The survey found 39 percent of the children surveyed(between the age of 7 and 17 years) had some form of paid work. The Sunday Star Timesargued that the survey had uncovered some `Dickensian child-labour practices’ which“raised questions about the failure of parents to monitor their children’s working lives andto understand the laws relating to children in the labour force”.

March 2004
There were several reports of submissions on the Employment Relations Law Reform
Bill and again attacks by employer organisations featured prominently (see February
Chronicle). Business New Zealand’s Chief Executive, Simon Carlaw, argued that the bill
signalled a return to compulsory bargaining, compulsory arbitration and national awards.
He also suggested that the Bill could increase employment-related compliance costs by
30 to 50 percent.
The Dominion Post reported a new survey conducted by the Employers and Manufacturers
Association (Central), which found that almost three-quarters of companies in central New
Zealand believed that the Bill will hurt businesses. The Auckland Chamber of Commerceargued that Bill was fundamentally ﬂawed, had too many compliance costs and possibly
breached the International Labour Organisation’s collective bargaining conventions.
Michael Barnett, Chief Executive of the Chamber said if the Bill had been tested forcompliance costs “it would never have seen the light of day”.
According to the Press, a South Island retailer estimated that the Employment Relations
Law Reform Bill in its current form would force it to shed 70 jobs from its 525-strong
workforce. However, this was based on the assumption that the ﬁrm would be required to
pay employees in all of its 25 outlets the same hourly rates.
On the other hand, union submissions supported the Bill, though many found that it was
not going far enough. The ﬁnancial sector union, Finsec, wanted parts of it strengthened
further and it argued that the process of free-riding was prevalent in the banking sector.
Finsec also claimed that the Employment Relations Act had made insufﬁcient progressin addressing the inherent inequality of bargaining power and it wanted the `contracting

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out’ protection of vulnerable workers to be extended to cover all workers.
The CTU President, Ross Wilson, launched a blistering attack on big business and its
criticism of the Government’s employment relations reforms: “…it is one-eyed of big
businesses to applaud everything the Government does for them and attack everything
the Government does for low-income workers, such as better workplace health andsafety and improved holidays.” Instead Wilson argued that the position of workers wasconsiderably better than two years ago. The main economic issues facing New Zealandwere infrastructure and investment in skills and social development policies were partof the solution as they were helping people to get the skills and motivation to work.
According to Wilson, the biggest single challenge facing the nation was to recognise thatwhat was good for workers was not necessarily bad for business.
There were signs that the intense lobbying of business was having an impact on
government thinking about the Bill. The media furnished several rumours that inﬂuential
Cabinet ministers had indicated they were prepared to make substantial changes to thelegislation to take account of submissions from business. NZ Herald reported that someof its sources had suggested that the Bill came close to not being introduced in the ﬁrst
place and that senior economic ministers had foreshadowed that the Bill would have tobe revisited. Minister for Small Businesses, John Tamihere, said the Government was“all ears” on the Employment Relations Law Reform Bill: “We’re obliged to follow thatprocess through and have a look at what the weight of submissions are saying.”
The Engineering, Printing and Manufacturing Union accepted reluctantly a renewal ofits multi-employer collective agreement - the `Metal Agreement’ - following protracted
negotiations (see February Chronicle). Union Secretary, Andrew Little, claimed, according
to the NZ Herald, that employers drove a harder bargaining than usual: “It was the mostaggressive response from employers in the 12-year history of this document”. In viewof inﬂation and high employment, the union had originally sought a 5 percent pay rise
but it had to settle for 2.9 percent and it did not achieve its demands for more employee
participation in health and safety. The settlement was expected to cover directly 2,500
employees in 220 ﬁrms. However, the relatively modest pay rise could have signiﬁcant
ﬂow-on effects as the `Metal Agreement’ often set a benchmark for other negotiations in
the manufacturing sector.
The Evening Standard reported that university staff were seeking a national collective
agreement and that they sought a major catch-up in pay. However, the universities
rejected these claims from the union, the Association of University Staff (AUS), andeach university wanted to negotiate separately. It was also unlikely that the union’s pay
demand would be met as it sought salary increases of 10 percent a year for the coming
three years for academic staff, and 10 percent for the ﬁrst year for general staff (seeSeptember 2003 Chronicle).

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There were several media reports that some businesses were threatening to ignore the
new Holiday Act because they were confused about some of its key provisions. However,there was little sympathy from the Minister of Labour, Paul Swain, who said that he would
take a dim view of any business that ﬂouted the law. Chief Executive of the Employment
and Manufacturers’ Association (Northern), Alasdair Thompson, estimated that around 70
percent of businesses already failed to comply with aspects of the Employment Relations
Act and the cost and complexity of the new holidays legislation would not help.
The Dominion Post reported that workplace stress was being routinely tagged on toworkers’ personal grievance claims. Employment lawyer Karen Spackman said thatclaims of stress was becoming a regular feature in personal grievance cases and in
disciplinary matters. “When there is an allegation of misconduct or poor performance
made by employers, we’re ﬁnding that stress is being brought up as a defence by workers
in almost every case”. However, she argued that it was too early to evaluate whether lastyear’s change to occupational safety and health legislation would lead to an increase inlegal prosecutions based on stress (see May 2003 Chronicle).
Waikato Times raised the issue of smoking in the workplace in a new way. It quoted oneof Waikato’s biggest employers as having a preference for non-smokers over smokers
because “they’re more valuable as employees”. A survey conducted last year revealed
that almost half of the surveyed non-smokers resented smoking workmates because of
the amount of time they spent on `smoko breaks’ and around 55 percent believed thatthe breaks resulted in decreased productivity. According to the article, the Human Rights
Commission had stated that smoking was not a human right and it was, therefore, notdiscriminatory for employers to advertise for people to be smokers or non-smokers.
The Press reported that bonuses and incentive payments now accounted for more than 20
percent of chief executives’ salaries, according to an annual salary and wage survey fromthe Canterbury Chamber of Commerce. Incentives were not just conﬁned to executive
pay packets with more skilled and semi-skilled workers being paid by performance.
Finally, a Taupo ﬁreﬁghter made headlines when he lost his bid for reinstatement in adismissal case at the Employment Relations Authority. He was dismissed for driving a
ﬁre engine to serve a trespass order on his tenant and then getting his crew to remove
her belongings. The Authority said the Service’s decision to dismiss him “was a decision
open to a fair and reasonable employer in all the circumstances”.

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April Chronicle
The submissions on the Employment Relations Law Reform Bill moved into their third
month and employer criticism of the Bill continue unabated. At a special Select Committee
hearing in Auckland, around 200-odd members of Employer and Manufacturers
Association (Northern) appeared en mass before the Committee.
One employer predicted that rolling stoppages or `mini-strikes’ would be one of theoutcomes if union access to workplaces was increased. It was also predicted, by the
Chief Executive of the Employers and Manufacturers’ Association (Northern), Alasdair
Thompson, that New Zealand’s employment relations were about to be bogged down ina legal quagmire if the Bill’s new applications for `good faith’ came into play.
A survey in the National Business Review found that the current disapproval of the
Employment Relations Act amongst the public was lower than that of the Employment
Contract Act in 1990s. However, the disapproval of the Employment Relations Act had
increased slightly from 24 percent shortly after the Act’s enactment to the current 29
percent.
Westpac Bank admitted that it had passed on union-negotiated terms and conditions to
non-union employees. This conﬁrmed a point raised by ﬁnancial sector union, Finsec,
during select committee meetings in March (see March Chronicle). Westpac claimed thatoutlawing `free-riding’ would be its worst nightmare.
Union organiser with the NZ Nurses Organisation, Laila Harre, stated that paying nurses
what they were worth might cost the taxpayer $22 million in the ﬁrst year but that themove had the potential to save the health system $100 million a year in staff turnovercosts. Around 4,000 nurses, midwives and health assistants settled their multi-employer
collective agreement. The agreement covered staff in seven Lower North Island district
health boards and increased pay by an average of 10 percent (see March Chronicle).
The agreement brought pay rates closer to those paid in other parts of the country andaround 75 percent of members voted to accept the settlement. Finally, pay talks resumed
for about 2,000 senior doctors employed by district health boards and these negotiations
had been running for 12 months.
The Press reported that Air New Zealand had achieved a two-year agreement with its
engineers when the engineers’ union, the Engineering, Printing and Manufacturing Union(EPMU), accepted a further adjustment to the employer offer. The agreement included
a pay rise of 3.75 percent in the ﬁrst year and a 3.25 percent rise in the second year.
EPMU’s National Secretary, Andrew Little, said that Air NZ had avoided an escalationof its dispute by withdrawing a contentious bargaining claim and by increasing the pay
offer.

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Industrial unrest in the tertiary sector continued when union members across seven of
the country’s eight universities voted in favour (by 79 percent) of sector-wide industrial
action. Massey University management and staff announced plans for two full-day strikes
on April 28 and May 25. Full or partial strike action was also planned for May 6, 14 and
17.
The National Party criticised the Post Primary Teachers Association (PPTA) andsuggested that it might re-introduce bulk funding if it gained political power. In response,
the PPTA warned of industrial action since its members would have “no option but to ﬁght
industrially”.
A Porirua real estate company only avoided a substantial ﬁne when it ﬁnally compliedwith the terms of a settlement with a former staff member. The Employment Relations
Authority had explicitly warned the ﬁrm last month that the employee could ask the
Employment Court to impose penalties - including a ﬁne of up to $40,000 - if the ﬁrm did
not pay the amount owing.
Westpac Bank was censured by the Court of Appeal for not doing enough to ﬁnd a
new job for a redundant Wanganui bank manager. A position in Palmerston North was
not offered to the manager, despite it being a substantially similar position and within“reasonable commuting distance” from Wanganui.
An Inland Revenue employee, who looked up the tax ﬁles of her children and a man shebought a property from, lost her dismissal case at the Employment Relations Authority. In
its ﬁnding, the Authority accepted that the employee was hard working and conscientious
and that her breaches were not deliberate or for personal gain. However, she had
demonstrated a fundamental failure to grasp and apply the obligation of privacy andconﬁdentiality.
The Employers and Manufacturers Association (Northern) claimed that business waspaying out at least $12 million a year to settle personal grievances claims arising outof employee dismissals. It arrived at the ﬁgure by extrapolating from the $1.25 millionof awards made by the Employment Relations Authority last year. While awards had
increased in value by 17.3 percent in 2003, compared to 2002, it was also found that just
57 percent of personal grievance claims arising from redundancy - 31 cases out of 54- were decided in the employee’s favour.
With the introduction of the new provisions of the Holidays Act, the Wellington Regional
Chamber of Commerce claimed that many small businesses could be forced to close
when an week’s extra annual leave came into force in 2007 ( see January Chronicle).
Meanwhile, Restaurant Association’s Taranaki Branch President, Craig MacFarlane, said
that diners, charged with a 15 percent surcharge during Easter, had been quick to accept
the extra charge. However, he pointed out that many other restaurants had chosen to

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close during the Easter break: it was estimated that about 30 percent of restaurants andcafes, which normally would have opened on Good Friday or Easter Monday, stayed
closed.
Following the recent high-proﬁle random drug-testing case at Air New Zealand (seeNovember 2003 Chronicle), the Dominion Post reported that around 9 percent of random
drug tests on workers conducted by the Institute of Environmental Science and Research(ESR) proved positive. The ESR undertook drug-testing programmes for more than 400
companies (involving more than 700 sites) and the most common drug detected wascannabis.

May Chronicle
The select committee hearings about the Employment Relations Law Reform Bill
continued. New Zealand’s largest cleaning company, Spotless Services was particularly
concerned with proposals about free-riding and transfer of undertakings and claimed thatthey were unclear and open to abuse. Spotless also stated that it deals with different
unions and queried how it could negotiate them without being guilty of supporting freeriding.
The Independent reported that employers were accusing the government of a lack of goodfaith in the bargaining process, claiming that the government was “looking after its union
mates by introducing the amending legislation”. Employers argued that they had been
hit by a bipartite agreement, negotiated behind closed doors by the previous Minister ofLabour, Margaret Wilson, and the President of the Council of Trade Unions, Ross Wilson.
They wanted the new Minister of Labour, Paul Swain, to shelve the legislation and begin
a round of genuine tripartite negotiations.
The Meat Industry Association predicted a decreased in productivity and proﬁts andincreased industrial disruption, according to the National Business Review. The meatindustry employed nearly 20,000 people, most of whom were unionised and covered bycollective agreements. The Association claimed that the proposed reforms would “tilt thebalance too far towards collective bargaining, in favour of third-party politics, and destroy
a large part of enterprise differentiation through compulsory arbitration and multiparty
collective agreements and even a possible return to national awards”.
The Business Roundtable in its submission asked the Government to park the Bill, andstart a new reform process instituted with genuine consultation among all stakeholders,
including business. The Business Roundtable expressed concerns about several aspectsof the Bill, including changes to the deﬁnition of good faith, changes to personal grievanceprovisions, measures promoting unionism and collective bargaining, and the provisions
relating to the transfer or sale of a business. It also suggested that a probationary period

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for newly hired workers should be introduced as well as a maximum salary bar on
unjustiﬁed dismissal claims
The Press reported that the Vice-President of the Marlborough Chamber of Commerce,
Chris Elphick, had resigned because of his dissatisfaction with its `unbalanced’
representation of business views. Mr Elphick wrote an article for the Chamber’s newsletterin which he argued that the Employment Relations Law Reform Bill would help “create
conditions for fair and respectful working relationships and that good employers would
have nothing to fear from them”. The article was an attempt to provide some balancein the debate after the chamber had earlier circulated, according to Mr Elphick, “almost
entirely negative” views on the legislation.
Nurses employed by 21 district health boards voted in favour of negotiating a national
multi-employer collective employment agreement and they primarily sought `fair pay’ andimproved stafﬁng levels (see April Chronicle).
Around 240 workers employed by the Lyttelton Port Company returned to work after
a stop-work meeting when negotiations for the collective agreement stalled. The port
company’s use of permanent part-timers had been a stumbling block.
The Press reported that thousands of Christchurch primary school teachers stopped work
to discuss a 6 percent pay claim by their union, the NZ Education Institute (NZEI). The
claim could cost the Government $120 million and it would increase the starting salary ofa teacher with a three-year Bachelor of Teaching degree from $36,256 to $38,431.
Canterbury University staff settled their collective employment agreement when they
accepted a 3.5 percent pay increase for both academic and general staff. Originally,
academic staff had sought seeking a 30 percent increase over three years, while generalstaff were after a 10 percent rise in 2004 (see April Chronicle).
As part of her personal grievance claim against the Corrections Department, a Napierprobation ofﬁcer claimed that she was harassed by a District Court Judge in a motel
unit. The employee was suing the department for $50,000 for stress, humiliation, lossof dignity and injury to feelings after she was `medically retired’ 20 months after the
alleged incident in April 2001. She argued that the department had not supported heradequately after the incident and this had impacted on her recovery from post-traumaticstress disorder and prolonged her return to work indeﬁnitely.
After his employment relationship soured, a South African hydraulics engineer wasordered to reimburse the airfares which had been paid by the company that brought him
to New Zealand. The Employment Relations Authority found that his employment contract
speciﬁed that he would have to repay the cost of the airfares if he left the company withinfour years.

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The Press reported that Chambers of Commerce had found that small and medium
enterprises were more likely to face severance grievances than bigger companies,
because employees bank on the owners’ preference for an easy settlement. The report
said that claimants knew that the companies had no in-house legal counsel, and neither
the time nor the money to follow through to court. Thus, even if the company had a goodcase, it is usually tempted just to settle in order to resolve the issue.
According to the Dominion Post, a survey conducted by Kelly Services found that nearlya third of all New Zealand employees were on some kind of performance-based pay.
The survey found that 32 percent of workers were covered by arrangements where partof their salary was tied to performance targets. A further 17 percent of employees werekeen to adopt performance-based pay and felt, if that happened, that they would be moreproductive. Only about 12 percent of Australian employees were on performance-basedpay.
The Waikato Times reported that, in the past year, more than 170 New Zealanders had
asked the Occupational Safety and Health Service to investigate their employers after
submitting complaints about stress. This included 39 serious harm notiﬁcations where
people said they had been exposed to mental stress, 32 notiﬁcations where employees
said they suffered mental stress, and 104 notiﬁcations where employees said they had
been exposed to stressful situations in the workplace.
Erling Rasmussen and Colin Ross
The University of Auckland

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