Chauvel Charles: Minimum Wage and Remuneration Amendment Bill — In Committee 
Chauvel Charles: Minimum Wage and Remuneration Amendment Bill — In Committee 
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CHARLES CHAUVEL (Labour) 
: 
 I start my contribution to the debate by paying tribute to Darien Fenton for this legislation the Minimum Wage and Remuneration Amendment Bill. As she said there is a problem with our law at the moment in this area. This bill would go a long way if passed towards dealing with that problem. Before I came into Parliament I practised in the area of employment law. In fact I started my career in that area working with Darien at what was then the northern hotel hospital and related trades industrial union of workers. 
Grant Robertson 
: Were any of them there? 
CHARLES CHAUVEL 
: That was a long long time ago even before Mr Robertson was born I think. We learnt at that time that there was significant potential for exploitation in the workforce in New Zealand by the ability to use the legal arbitrage of the distinction between an employee on the one hand and a contractor on the other. There are several of those loopholes in New Zealand employment law. I know that Mrs Collins knows about them because she has come across them in her time in practice as well. 
Another area where our law is not terribly sophisticated and probably needs to be looked at in the same way that Ms Fenton’s bill would do is the area of offshore jurisdiction. An offshore company can come to New Zealand and provided that it maintains some sort of connection to another jurisdiction—a foreign jurisdiction—it can actually set up employment relationships under the laws of that jurisdiction in New Zealand and which our employment institutions would have to enforce as legally binding on employer and employee. So there are some areas in our employment law like this one where one can use the arbitrage of contractor versus employee and like the one that I have mentioned where one can use some sort of connection with a foreign jurisdiction to avoid New Zealand terms and conditions. That often happens in the transport industry for example. It happens increasingly with the employment of foreign executives in New Zealand under terms and conditions often based for example on the law of New South Wales. The employee or employees concerned are employed by foreign corporations operating in New Zealand. 
We have a system in New Zealand that is in some areas of employment law surprisingly unsophisticated. This is one and there are others. Why should we have a system in New Zealand where people can use the ability to re-categorise a person doing exactly the same work as an employee as a contractor and pay that person a whole lot less just because the person is in no economic position to object to that re-categorisation? Is that the sort of arbitrage on pay and conditions that we want to see in this country? Is that how we want to see enterprises be competitive? I would not have thought so. 
Hon Tau Henare 
: What was that word? 
CHARLES CHAUVEL 
: How it works I say to Mr Henare is that one day a person turns up to work having been an employee for years and years and the employer says: “I’m going to restructure the business and I want to make a bit more profit out of it. I want to run it more profitably and the way I’m going to do that is I’m going to get you to incorporate yourself and your colleagues. You’re going to be contracting to me from now on to do the cleaning in this building. Instead of turning up and being paid $14 an hour your rate of contracting to this company will be $10 an hour if you’re lucky.” That is how they save the $4 an hour. 
David Garrett 
: And he can say: “Bugger off!”. 
CHARLES CHAUVEL 
: Mr Garrett is showing the typical compassion of his party for the low paid. He says they can tell the employer to bugger off. With unemployment rising now it is actually really difficult to do that. It is a really hard thing to do. That is why this bill and measures like it advanced to protect ordinary working people are supported by parties in this House that actually care about those people. It is good to see that Mr Harawira’s party is doing the right thing by this legislation. It is good to see Mr Henare listening carefully. I hope that he might change his vote on it as well. It is good to see people doing the right thing and making sure that ordinary working people are protected because as I have said a number of times already in this speech we have an employment law system that is not terribly sophisticated when it comes to this sort of thing. In New South Wales in Australia for example there are quite a few industries that use contractors but those contractors can unionise they can get the protections of the industrial agreements and that is what we should have here.