Hudson Brett; Williams PotoEMPLOYMENT RELATIONS (ALLOWING HIGHER EARNERS TO CONTRACT OUT OF PERSONAL GRIEVANCE PROVISIONS) AMENDMENT BILLSecond ReadingBRETT HUDSON (National): I move That the Employment Relations (Allowing Higher Earners to Contract Out of Personal Grievance Provisions) Amendment Bill be now read a second time.Fundamentally this bill is about providing choice to employees and employers to construct the employment arrangements that best suit each of them and mutuality is a cornerstone and key component of this bill. But like so many bills the bill emerges from select committee in better shape than it entered. It might be a bit of a blunt way to put it but so often select committees have a major role in panel beating the original legislation into something that is more fit for purpose more relevant and more applicable to New Zealanders and such is the case with this bill. The Transport and Industrial Relations Committee was able to spend time scrutinising the provisions of it and making very sound amendments.Now it's important to note there were a number of submitters that pointed out that certain rights such as the right to be free of discrimination and sexual or racial harassment in the workplace would have been contracted out under the bill as it was originally introduced. It is right to point out that the member that introduced this bill to the House and sponsored it at first reading the Hon Scott Simpson did point out those very elements in that first reading speech. It was signalled very clearly that the bill would receive changes in select committee to address those matters. In fact as the member that had taken over the bill by the time it actually received attention at select committee as the first to submit on the bill I made those very points very early on—that we needed to look at amendments to make sure that those provisions were brought back into the scope—and of course naturally enough they were made.But I'd like to point out before we talk about the changes the committee made that when the bill was first introduced to the ballot it received wide support—including from the then Labour spokesperson one Andrew Little who noted that he supported the bill in principle and anticipated that Labour would support it. Well if they've got any clue they would continue to do so. Of course it's in even better shape now and that's a good thing.As I said the bill is fundamentally about allowing employees and employers to together arrive at the best employment agreement for each of them. Essentially it allows employees to negotiate some form of compensation that is more valued by them than the personal grievance provisions of the Act. Likewise it permits an employer who can see some relevancy in having such a situation to offer more to the employee such that they might be prepared to enter into an agreement. One of the issues that was raised by members opposite in their then Opposition roles in select committee was: what problem does this solve?Hon Member: Exactly.BRETT HUDSON: Exactly—exactly. What it shows is the members opposite who were in Opposition then but now are in charge of running the country can't understand that members in this House should be getting ahead of problems and actually proactively introducing things that are going to help New Zealanders get ahead—in this case help people to have the right sort of workplace relations and opportunities. [Interruption]Madam DEPUTY SPEAKER: Order! Members—order!BRETT HUDSON: If they can't get their heads around getting ahead of a problem we're going to continue to see more of the Government that we've seen over the last few weeks which is an absolute shambolic mess. One can only hope that they will learn from the experience.The situation was widely canvassed by submitters and it was acknowledged that these sorts of actions are quite routinely seen today with the likes of chief executive officers having employment contracts that contract out of these very personal grievance provisions. In fact the submitters—and particularly I think the Law Commission which submitted—pointed out that there are questions about enforceability of those provisions of those contracts under the law as it stands today. But no one—no one—questioned about whether they actually work in practice.So this bill says: why should CEOs be the only employees in companies who should be allowed to negotiate those sorts of terms and provisions in their employment contracts? Why should other employees who feel they have the confidence and are prepared to go into negotiations—why should they be excluded? Why should they not be permitted to likewise care for their own circumstances and their own future?Clearly—to another point that was raised by members opposite and submitters—they think that these employees who are earning at least $150000 a year are somehow vulnerable or disadvantaged. The reality is that any employee that is earning that much in a business is clearly highly valued by the business else they wouldn't be in that sort of role and wouldn't be compensated to that very high level of earnings. To suggest that they are by and large somehow vulnerable disadvantaged or somehow not capable of negotiating their own employment terms and conditions is the noise from members that are still living in the 1970s and one could only hope they might make it into the 21st century sometime soon. I won't hold my breath.But none the less these people are in roles of responsibility. They are highly valued by the companies who are prepared to compensate them to such a high amount. Should they wish to enter into those negotiations why—why—should they be prevented from negotiating those terms such as we all permit CEOs to do and have done for many years?It's important to note too that the bill had and retains provisions to protect employees to ensure that they are not coerced into such negotiations and that the agreement that is reached is clearly mutual and can be proven to be so through the independent legal advice that is a fundamental requirement in order for the agreement to be valid. The employee must seek and receive independent legal advice. The agreement must be in writing. There are measures to protect employees being coerced by employers into entering into provisions that they truly do not wish to.Now there were as I noted at the beginning elements of the bill as first introduced that would have meant that employees would not have had redress in matters that had been raised by submitters as issues on basic human rights. These are elements such as not being able to take action in the case of discrimination sexual or racial harassment or certain other measures. Officials advised and it was acknowledged right at the very beginning of the select committee process that it would be a good idea to ensure—and in fact necessary to ensure—that those provisions were still available to employees. Officials came up with a very simple and elegant way of addressing that such as the bill permitting the contracting out of only a single provision: section 103(1)(a) which is the element about unjustified dismissal. So the employee does and will retain redress through instances where the employer contravenes their other rights. At the same time though the committee did make recommendations to this House that clarification be made to ensure that where the employee does contract out of that one provision they understand and there is no opportunity for them to take other legal proceedings in the matter of that dismissal.The committee as committees often do looked at provisions or situations in other countries and committee members did chat if I might say about why in Australia they do have the provision for those legal challenges despite the fact that they have legislation that automatically contracts those higher-earning employees out of the personal grievance provisions. In fact I think that's probably the very reason and members did I think reach some level of agreement on that. In Australia because it's not optional if you earn over a certain amount you are automatically out of those provisions. That's why they retain—The ASSISTANT SPEAKER (Poto Williams): I apologise to the member. Your time has expired.