Adams Paul: Employment Relations Law Reform Bill — Second Reading 
Adams Paul: Employment Relations Law Reform Bill — Second Reading 
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PAUL ADAMS (United Future) 
: 
 I rise on behalf of United Future to speak on this bill. After hearing all the previous speakers I say that the biggest sign or indicator to the Government that this legislation is bad legislation is that the only other party I have heard supporting it in the House so far is the Green Party. That has to be a wake-up call for the Government if nothing else is. 
But really there is no better situation for a good working relationship between an employer and an employee than the current working environment. The employer needs staff and staff numbers are short at the moment but of course every worker in the country needs a job. So I think there is a great opportunity there for the worker and the employer to work together and negotiate as the Hon Richard Prebble said a satisfactory working relationship. 
I want to raise some of the amendments made by the Transport and Industrial Relations Committee. Some of the changes seem to make good sense. The bill now acknowledges that it is possible that an employee in negotiating an individual agreement may end up with pay rates and conditions that are the same as those negotiated as part of a collective agreement without it being part of some grand anti-union conspiracy. I suggest that under this legislation it will still be very difficult for employers to avoid the claim that they are undermining the collective agreement. 
This bill also gives employers more scope to withhold sensitive financial information when jobs are under threat. We do not want a situation where a company that is contemplating restructuring is forced to share commercially sensitive information with the unions which have the opportunity to comment and which may then publicise that information in an attempt to put pressure back on the company. That is hardly acting in good faith. It is also a serious threat to employer autonomy. After all employers are the ones who are risking their capital that they have invested in the business as Peter Brown adequately pointed out to us. 
However the committee did not get rid of the provisions that allow collective agreements to recognise the benefits of that agreement through a bargaining bonus. Last year over 6000 Public Service Association members at the Inland Revenue Department the Ministry of Social Development and Land Information New Zealand received a total of almost $4.5 million in bonus payments for successfully negotiating new collective agreements. At the time United Future and other parties in this House questioned whether that was a breach of section 9(1) of the Employment Relations Act which prohibits preference on the basis of union membership. Only unions can negotiate collective agreements so the one-off nature of the bargaining bonus means that it is effectively restricted to union members. It does not extend to non-union members who are then signed up to the same terms and conditions as in the collective agreement. 
If we look at the average bonus received $712 we see that it would cover each member’s union dues for the year. The Minister of Labour must have been worried about the legality of the bargaining bonus for Public Service Association members because clause 8 amends section 9 of the principal Act by adding subsection (3) which states: “this Act does not prevent a collective agreement containing a term or condition that is intended to recognise the benefits—(a) of a collective agreement: (b) arising out of the relationship on which a collective agreement is based.” 
To further discourage free-riding the Government members on the select committee even encouraged the Minister to bring in a Supplementary Order Paper containing a provision that means that employers and unions can agree to take money off non-union workers as a bargaining fee. Fonterra and the Dairy Workers Union tried to get non-union workers to pay the fees of the union members who had negotiated a collective agreement but it was thrown out of court. The amendment put forward on the Supplementary Order Paper will effectively override that judgment. In theory it enables non-union employees to opt out of paying the fee but members can imagine the situation of a new employee who has just started working in a job where a collective agreement exists. The current law requires a new employee to be put on the collective agreement for the first 30 days and he or she is then given the opportunity to join the collective agreement or to negotiate an individual contract. It is really a Hobson’s choice. The employer cannot pass on the terms and conditions of the collective agreement to the employee in the form of an individual agreement because the employer would risk opening himself or herself up to a claim that he or she had undermined the collective agreement. The employee is then faced with the choice of remaining in the collective agreement thus retaining the current terms with the possibility of receiving an additional bargaining bonus when the agreement is next negotiated or negotiating an individual agreement that is likely to offer him or her less than the collective agreement does and that may be reduced again by the amount of a bargaining fee. Under this bill the unions will have the ability to double dip by both gathering a bargaining bonus as part of the collective agreement and taking a bargaining fee off non-union employees. 
This bill started out as a way for the Government to pay back its union mates by making it more difficult for employees to avoid joining a union and the select committee’s recommendations only reinforce that. It is evident in the preference given by the legislation to multi-employer collective agreements which comprise only 1 percent of agreements yet dominate in the public service. Pushing uniform conditions on the private sector does not recognise that unlike public sector agencies individual firms are in competition and want the freedom to change the wage structure of their employees for competitive advantage. This bill denies the private sector the legitimate choice between collective and individual agreements. 
The expectation that a collective agreement should be concluded is nowhere more evident than in the provision that places the burden of proof on employers who have to provide a genuine reason not to conclude a collective agreement. An employer may not want to agree to a collective agreement for a very good reason such as few of his or her employees belonging to a union or the union making unreasonable claims. Yet if the union persists the law is behind it and the Employment Relations Authority could force the employer to agree to a collective agreement anyway. 
It is those sorts of provisions and particularly the numerous references in the bill to all the penalties that can be applied against employers for breaches of the legislation that seem totally at odds with the object of the Act which is to build productive employment relations through the promotion of mutual trust and confidence. Therefore United Future will continue to oppose this bill.