Uffindell Sam; Wood MichaelSAM UFFINDELL (National—Tauranga): I'd like to continue on from where my colleague the Hon Paul Goldsmith was talking about before especially in relation to the at least 1000 employees covered and the Hon Paul Goldsmith made the comment around these very large sectors or industries where you would have numerous people working in them—you know 100000; maybe even more—and only 1000 of those is needed to trigger this process and once triggered it cannot be stopped. He did comment about whether or not this was representative and I would really want to ask that question again: is it representative? I'd also like to tie it back to a big part that we discussed in Part 2 which was around good faith. Is this really a bill that is operating in good faith if you are allowing a very small percentage of the workforce to initiate a process that the vast majority may not be engaged in or wanting to engage in? Have we met that good-faith test where you could have a number of people who for political or ideological reasons or whether they just want to agitate? Or as my colleague Erica Stanford mentioned before maybe they are induced by the potential of benefits that the union could represent to them. Are we necessarily meeting that good-faith test in this regard? I would say that I'm not sure that we are but I would like to hear from the Minister on how he balances that. I would also like to go to clause 29(1)(a) which was discussed around you know receiving low pay for work and whether that takes account for—a lot of employment arrangements are based on a base salary as it may be but there's also a commission aspect to it as well. It may be you know in some jobs that are ultimately high paying however the base conditions to that are quite low but that is commonly used as an incentive especially in the sales industry to entice employees to work hard and make sales. It is a pretty good model for encouraging people to get out there and work hard. Does it take account of that? I would like the Minister to comment on whether it does reflect commissions. We note that banks don't necessarily look at commissions or bonus structures when they're reviewing mortgages so I'm not particularly sure whether this bill would take that into account. You may have someone that does earn a lot of money given that they do have commissions in the good times but when you just look at it on paper as a bank would do when assessing how creditworthy you are you may just be on a low base rate.I'd also like to ask when you're talking about low pay for their work in relation to what are we talking about here? Is that in relation to the minimum wage? Is it in relation to a living wage? Is it in relation to the local environment and the cost of living pressures that they may be facing in their locality? Are we talking about an industry median wage? Are we being cognisant of the fact that it is a global and movable workforce and looking at what international competitors may be offering in this space?If I move down to clause 29A(1)(b)(i) where it talks about having little bargaining power in their employment I'd like to ask the Minister who is the judge of this how is that determined? I would also like to then skip down to clause 29A(1)(b)(iii)(A) where it talks about not being adequately paid taking into account factors such as working long or unsocial hours—you know late nights weekends. I've certainly done my share of night shifts and they're not great and I was compensated for that but some of those are unique to different workplaces. That's where we get into issues here because the different workplaces are so unique and they all have their own little intricacies and how we are able to then through this bill—and I would like to know how we can then apply blanket nationwide industry-wide and then take into account all of the variables that each different workplace will be faced with. I think that will be a significant challenge and is probably quite a blunt instrument in that regard. So I would be interested to hear what the Minister's response is.Hon MICHAEL WOOD (Minister for Workplace Relations and Safety): Thank you to the members for their questions. They primarily revolved around the representation and public interest tests. I encourage all members in the debate to read the very good report that was put together by the Fair Pay Agreement Working Group chaired by the Rt Hon Jim Bolger.Hon Paul Goldsmith: Elder abuse.Hon MICHAEL WOOD: I think that's a very disrespectful comment about our former Prime Minister who's played a very significant role in public life and worked very constructively with unions employers academics and civil society more broadly to develop the Fair Pay Agreement Working Group's recommendations.It's really worth pointing out as well if the member or others wish to read that report—and I would recommend it—that that report confirms that in all respects except for the universal application of fair pay agreements (FPAs) all of the parties agreed to the key design details. It's fair to say that Business New Zealand did not agree with the universal application of FPAs; that's their prerogative and that's clearly stated in the report. But all of the other design details were unanimously agreed by all of the parties including the initiation tests because the initiation tests both public interest pathway and representation pathway that members see in this bill come straight from the recommendations of the Fair Pay Agreement Working Group. So that is the genesis of them. The reason for where the working group arrived and the Government continues to agree with this is it is appropriate to have a test and a threshold but by definition fair pay agreements are mainly in place for workers who have found it really difficult under the existing arrangements to organise and to engage in collective bargaining and prohibitive tests would simply mean that it would not happen. It would be too difficult for workers to be able to access the benefits of collective bargaining which ultimately is the core problem that we are trying to resolve here. That is something that has been commented on by many international organisations who visit New Zealand that our low rates of collective bargaining lead to some of these poor outcomes in the labour market and that we're unusual in not having a sector-based form of bargaining to deal with that.I also put this to the member in respect of effectively the questions of legitimacy that he raises here. I've had colleagues of his say that instead of doing this the Government should just choose some sectors where there are labour market problems and the Government should just legislate for there to be improvements. Well what we have actually tried to do here is to set up a process whereby employers and employees can sit down and bargain in good faith knowing the sectors that they represent and come to those outcomes themselves instead of Government imposing it or as opposed to the Australian model a commission hearing arguments and then determining instantly no bargaining involved. So actually I think where we've landed in terms of the way of doing this is a pretty reasonable way that actually tries to make sure that civil society partners our social partners unions and businesses can work these things through. That is a genesis of both of those thresholds.In terms of the public interest test and how those matters will be assessed they've encouraged me to just read a little bit further down to 29A(3) which makes it clear that regulations will be put in place so that the Ministry of Business Innovation and Employment has guidance to make judgments as to whether those criteria have been set and those regulations will be put in place in time for parties to be able to engage in the initiation process. We will do work to ensure in those regulations which are not actually the substance of this debate but we'll do work to make sure that those regulations are really focused in on low pay and those other factors and have a reasonable degree of objectivity about them. I think when it comes to low pay the members can take it as a given that we will be focused on those people who are genuinely paid at a relatively low rate of pay at or around or a little bit above the minimum wage.Mr Uffindell asked whether the representation test met the definition of good faith". The Act's definition of "good faith" in the Employment Relations Act and in this bill has a specific meaning that relates to good-faith relationships between parties involved in the bargaining process so that doesn't really come into it. The member asked about the role of commission in determining pay for the purposes of this piece of legislation. Generally speaking commission because it is variable no one can rely upon it. It is not considered to be a part of base pay. In terms of who judges who has little bargaining power and all of the other criteria that role as this part clearly describes is the Employment Relations Authority. The member asked about the individual variables that were listed in the bill. As I described in my opening comments my Supplementary Order Paper actually removes those so it's just the core criteria that will be assessed for the public interest test."