Lees-Galloway Iain: Employment Standards Legislation Bill — First ReadingText is incorporated into the Bound VolumeLees-Galloway Iain: Employment Standards Legislation Bill — First Reading[Sitting date: 08 September 2015. Volume:708;Page:6354. Text is incorporated into the Bound Volume.]IAIN LEES-GALLOWAY (Labour—Palmerston North): I want to say at the outset that Labour will support the Employment Standards Legislation Bill going to the select committee. There is a range of aspects of the bill that we think need thorough discussion at the select committee and our continued support after that point will be reliant on there being some significant changes to the legislation. It seems unusual that the three issues that have been brought together in this legislation have been brought together under one bill. I suspect that what happened was that the Minister was intending to bring the changes regarding minimum standards. Then there was a campaign led by the Labour Party and others—fronted extremely well by Sue Moroney—on paid parental leave. The Government realised it had to do something about paid parental leave so that got tacked on to this legislation. Then there was the spectacular campaign led by the Unite union around zero-hour contracts. The Government realised that it needed to be seen to be acting on those as well so it tacked these other things on to this legislation. It is a bit of a dog’s breakfast but if this is the way we are going to get to address these issues then so be it.There are some valid issues that have been raised in this legislation. We do want to see it go to the select committee albeit there is some work that has to be done. I would like to focus my contribution on the issue of zero-hour contracts. Our first concern is that although the Minister promised he would get rid of zero-hour contracts what in fact happens with this legislation is that zero-hour contracts are legalised. What we get from this are rules for how to use zero-hour contracts not their abolishment which is what New Zealanders thought they were going to get.At the moment zero-hour contracts are of dubious legal status. Whether or not our current employment law actually allows permanent part-time agreements with no fixed hours is a matter that a lot of people have wondered whether it ought to be tested by the courts. In a way it has potentially restricted the use of these contracts because of that dubious legal status. This legislation gets rid of that dubious legal status and enshrines zero-hour contracts in law. We are deeply concerned about that. We think it has absolutely the opposite effect to what the Minister stated the purpose of this legislation is.Getting rid of zero-hour contracts is incredibly important. Zero-hour contracts is one of the most exploitative tools in the bad employer’s tool box. They leave people at the absolute mercy of the employer as to how many hours of work they get from one week to the next. The way they operate means that people have to be available for work whenever it is offered. They have no opportunity to turn down work. They might get 10 hours one week 6 hours the next week 15 hours the week after that and zero hours the week after that but they have to be available at all times. What we get are people who maybe have come off a benefit. They have done the right thing. They have done what the Government has asked them to do. The employer makes vague promises about how many hours of work they are going to get and what ends up happening is that they get far fewer hours than they were expecting. They do not get the certainty of income that they were expecting and they end up worse off often in an employment agreement in work than they were when they were on the benefit. They might have left other jobs for this.It does not affect just young people. The people whom I have found the most moving to talk to are parents often sole parents who are trying to make ends meet who are trying to provide for their children who are trying to put food on the table pay the rent and save some money and they just cannot do it without the certainty of guaranteed hours. When there is competition for rentals the tenancy agent will say: “Can you show us how much you earn from one week to the next?”. People on zero-hour contracts cannot do that let alone try to go to the bank and get a mortgage where likewise they do not have a chance of doing that when on a zero-hours contract.The Government is right to say that we have got to do something about this. But what we actually need is real change that gets rid of zero-hour contracts not enshrines them in the law. The Minister says that those people who are expected to be available for work will be paid compensation by their employer. How much compensation? That is not in the legislation. Will it be money? That is not in the legislation. Exactly how is this going to work Minister? Does the Minister expect that people will be able to bargain for good levels of compensation in their employment agreement? Well we are talking about people on zero-hour contracts. These are the most vulnerable workers in our society—the people who are offered zero-hour contracts and who have to take them or leave them. It is ridiculous to expect people in that situation to be able to bargain for reasonable compensation for being expected to be on call.Then we have got the issue of shift cancellations. Again what we are being offered here in the legislation is worse than the status quo. At the moment basic contract law says that if you are offered work and you show up for that work you have completed your part of the bargain. If the employer then says that that work is not available they have not met their obligations under basic contract law. They would be obliged to pay you for the work that you agreed to do and which they offered you. Under this legislation there could be a clause included in people’s agreements whereby those shifts could be cancelled and they would get again compensation. But how much compensation? And will it be money? Will the employer be able to say: “I’ve cancelled your shift. Would you like fries with that?”. Because that is the situation we could be facing. So in a lot of ways this legislation is going to leave vulnerable workers in a worse situation than they are already in.We might hear employers saying “Actually you don’t have an 8-hour shift; you have a series of 2-hour shifts.” so that they can limit their liability for cancelling shifts at short notice. There are too many gaps in this legislation as it is written right now. I think actually that this is legislation that increases flexibility. It increases the opportunities for exploitation dressed up as something that is supposed to make workers safer and more secure at work. It does the exact opposite to what the Government has been telling us it is supposed to do.It is good to see again that the Government is considering the issue of restrictions on secondary employment—so-called restraint of trade clauses. But again under our current law we already have quite tight restrictions on when restraint of trade clauses can be used. We are concerned that the way the legislation is currently worded actually makes it possible for an employer to include more pervasive restraint of trade clauses that capture more alternative forms of work than what is possible under the current legislation. We need to have a good look at all of those things. Most important we need to have a clear separation of casual agreements and permanent agreements—whether they are part time or full time. This legislation blurs those lines even more than what we already have. There may be some things that we can do about this and I would like to offer two possible ways forward before my time is up.First of all we could look at what Unite has achieved through their collective bargaining with the fast-food industry and look at setting guaranteed hours based on what hours people ordinarily work. You might have an initial period where there are no guaranteed hours and then after that people have to get guaranteed hours based on what they normally work. That is essentially how those collective agreements bargained by Unite work. We could look at enshrining that in the law. The other thing is that we could look at casual loading. If you want to put someone on a casual agreement you have to pay a little bit more for that and if you do not want to pay more then you have to give people guaranteed hours so that there is a clear distinction between casual agreements and permanent agreements that give people guaranteed hours.There is a lot of work that needs to be done to this legislation if it is to get the support of the whole House throughout the whole process and if we are to be sure that it is legislation that will actually make vulnerable workers more secure at work. At the moment we fear that this legislation will make vulnerable workers more insecure and do the exact opposite to what the Government has promised. But we are prepared to work with the Government to make it work properly.