Employment Relations (Statutory Minimum Redundancy Entitlements) Amendment Bill — First Reading 
Employment Relations (Statutory Minimum Redundancy Entitlements) Amendment Bill — First Reading 
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Employment Relations (Statutory Minimum Redundancy Entitlements) Amendment Bill 
First Reading 
DARIEN FENTON (Labour) 
: 
 Kia ora Mr Assistant Speaker. Kia ora e te whanau o nga ringa tota. I move  
That the Employment Relations (Statutory Minimum Redundancy Entitlements) Amendment Bill be now read a first time. 
 It is a privilege to introduce the first reading of this bill and at the appropriate time I intend to move that the bill be considered by the Transport and Industrial Relations Committee. 
In the last year 60000 workers have lost their jobs. For each of those workers that is a personal tragedy. Every one of them has faced the awful impact and humiliation that redundancy has had on them and their families. How they have coped will have differed. Those who are union members by and large will be better off because most of them are likely to have had some kind of redundancy protection in their agreements. But thousands of others—like the warehouse supervisor Rob Highsted who had worked for his company for 20 years until he was made redundant this week—will have gone out of their jobs with absolutely nothing. 
An estimated 80 percent of working New Zealanders have no redundancy protections written into their employment agreements. For these New Zealanders losing their jobs can mean that they have no way to pay their mortgages or support themselves and their families while they search for other jobs. That is because there are no requirements in New Zealand law for minimum redundancy notice and compensation. The need for a fair system for redundancy protection has become more urgent over the past 18 months as more people have lost their jobs and replacement jobs have been harder to find. I have been hearing from laid-off workers who have had no redundancy notice and pay. That has left them struggling to pay their mortgages and support their families. I have no doubt that other members in this House have heard the same stories. 
This bill would provide all working New Zealanders with basic redundancy protection to help tide them over between jobs. It is based on recommendations from the 2008 report of the Public Advisory Group to the Minister of Labour on Restructuring and Redundancy which advised the then Government to consider introducing minimum redundancy protections for all workers. That group was established by Labour in 2007 to examine the adequacy of redundancy laws and provisions in New Zealand workplaces. The group was an independent body established to provide advice to the Government and it included representatives from the New Zealand Council of Trade Unions and Business New Zealand. 
The advisory group recommended options for addressing the gaps in and issues with the existing law and policy provisions. The first recommendation of the advisory group was that the Government should consider the introduction of a statutory requirement for redundancy compensation and other entitlements that incorporated the following features: notice of redundancy termination for the affected worker compensation based on length of service a maximum level of statutory compensation and provision of redundancy support and active labour market mechanisms for affected workers and organisations. Unfortunately the National Government’s Minister of Labour allowed this very extensive and well-researched report to languish on her desk for 12 months and then she threw it in the rubbish bin. 
This bill amends the Employment Relations Act by inserting a new Part 6E “Statutory minimum redundancy entitlements” under clause 4. The minimum entitlements for employees in this new part would apply to an employee who had been in a continuous employment relationship with an employer for more than one calendar year. Within 12 months the Minister of Labour would be required to conduct a public education campaign to inform employers and employees of the minimum entitlements conferred by this legislation and to report to the House of Representatives within 6 months of the conclusion of the campaign as to its details including an independent evaluation of its effectiveness. The minimum entitlements under the bill that employers would receive as a result of new section 69ZL(1) inserted under clause 4 would be: “(a) notice of dismissal”—due to redundancy—“of no less than 4 weeks; and (b) compensation for redundancy … of 4 weeks’ remuneration for the first full year of the employee’s continuous employment with the employer; and (c) further compensation for redundancy in the amount of 2 weeks’ remuneration for each subsequent full or partial year of the employee’s continuous employment with the employer up to a maximum entitlement of 26 weeks’ remuneration.” 
New Zealand workers are among the cheapest and easiest in the world to sack. We are nearly alone in the developed world—apart from the USA—in having no redundancy notice in compensation. Last year the Australian Federal Government introduced generous redundancy entitlements because it is serious about protecting working families through the recession. We keep talking about wanting to catch up with Australia but the Government seems unwilling to take notice of any of its good ideas—and have we not heard some of them today! We can take the example of the hundreds of skilled New Zealand engineers who were dumped from their jobs with Australasian company Transfield Services with no redundancy pay. Transfield said that it did not have to give them any redundancy pay because there was nothing in law and nothing in the agreement for it to do so. Funnily enough if those workers had been in Australia Transfield would have been required by law to pay at least the compensation proposed in my bill. It just does not make sense to me that a company can treat its workers one way in its home country and differently in another country. But unfortunately they do. 
Hon Lianne Dalziel 
: Because they can. 
DARIEN FENTON 
: That is right. This issue is not just some abstract notion that I have dreamt up. I know that you yourself Mr Assistant Speaker have been involved in this issue in the past as a member of Parliament. I have advocated for workers who have had redundancy compensation and for those who have not had it. I have seen first-hand how devastating redundancy is and how devastating it can be for those workers who get laid off with nothing. I have been made redundant. My husband has been made redundant twice. I also had to make some of my own staff redundant when I was an employer so I have a good idea about what it feels like from all sides. Redundancy pay does not make up for the loss of a job but the important thing is not just the process but being left with a feeling of dignity and respect. That is very very important. Being laid off without notice and redundancy compensation is shocking. Not only does an employee’s job disappear leaving him or her without any feelings of self-worth but there are still bills to pay kids to feed and the huge uncertainty of whether that employee can find another job particularly in the current market. This bill is about giving families some breathing space some time to pay the bills while they have that breathing space and some time to find other work. 
Redundancy can happen to anyone. It is not an issue for low-paid workers or higher-paid workers; it can happen across the board. We are talking about workers in all categories of occupations from the low-paid and vulnerable as I said to the highly skilled. Just this week I had an email from a worker who said to me: “I work in IT and I was made redundant due to the economic downturn. The employment contract I had did not have any redundancy clause in it. I was told this news 2 weeks before the Christmas break. Looking for work over that time was next to impossible.” Now after 4 months that worker does have a new job but she is earning less than one-third of what she used to earn; she has lost her house and all her savings. We know that lay-offs happen to well-paid workers too but normally they get suitcases of money—we can just look at former Telecom chief executive Theresa Gattung. She got $1.8 million in a golden handshake. When Evan Davies left Skycity he got $1.77 million. David Holdsworth from Hellaby Holdings got half a million dollars. Craig Norgate left Fonterra with about $1.5 million. So if it is good enough for them I do not think that the very modest provisions in this bill are too much to ask for other workers after years of service. 
Hon Lianne Dalziel 
: What do MPs get? 
DARIEN FENTON 
: Well that is right. MPs of course get 3 months’ salary and other things. 
This bill should go to the select committee for a proper discussion and consideration. We need to front up to the question of whether it is fair that Kiwi workers are being laid off through no fault of their own and with no basic financial protection to tide them over in the hard times between jobs. This afternoon the Minister of Labour the Hon Kate Wilkinson shed crocodile tears when I asked her some questions and gave her some examples of the terrible circumstances of real New Zealand workers. She said that redundancy is never easy. That is true but so far she and her Government have done nothing about it. Well today they have a chance to ensure that there is a fair deal in hard times for Kiwi workers. I urge the Government to do the right thing today for Kiwi workers by supporting my bill to go to the select committee. 
Waiata 
DAVID BENNETT (National—Hamilton East) 
: 
 The Employment Relations (Statutory Minimum Redundancy Entitlements) Amendment Bill goes to the heart of what Labour stands for and what it tries to do to New Zealanders when it has any ability to set direction over somebody’s life or even a country and the way it dictates employment relations. In the previous speech made by Darien Fenton we heard the classic Labour mentality: the fear tactics the inability of workers to determine their own future and how workers need Labour to give them direction. That is the Labour mentality. Labour does not trust its own people. It cannot bet on people making their own decisions and setting their own directions in life. That is the heart of Labour. It wants to keep everybody down. It wants to be in control and keep the same rules so it can dictate what those people can achieve and their direction. 
I think it is sad that Labour still does that in this House to New Zealanders. Labour does it to the people from whom it has tried to get support in past years. Labour uses the jealousy technique when talking about Telecom chief executive officers. It uses the fear tactics on ordinary Kiwis out there who want to get jobs and want to work hard. It is about time that Labour woke up and backed New Zealanders. The heart of that mentality was mentioned by the previous speaker because she wants to make everybody a union member. That is Labour’s purpose for this bill. Labour says that people in a union will get a redundancy payment. This is the heart of what Labour is doing in this legislation. It is not about workers’ rights it is not about helping workers and it is not about providing for them in their time of need; it is about providing more union members. This is what it is about: Labour wants to make everybody a union member. Labour needs to look at its heart and soul and at the reality of what it is saying instead of the rhetoric it brings to the House. 
I would like to see Labour stand up and deliver. It had 9 years in Government but did it bring this legislation forward? No. Where was it? I ask where it came from because Labour did not bring this legislation forward when it had the chance. Now that Labour is in Opposition it says this bill is the best thing since sliced bread. Why is that? Labour knows the reality of this legislation. It is not good for New Zealanders and it is not good for Kiwis. That is why Labour did not bring this legislation to the House when it had the chance. Now Labour puts the blame on us. That is Labour’s fear tactics. It says that National is the big bad wolf that will not pass this bill. Labour had the chance but it never passed the bill and it will never get that chance again because the public does not trust it. Labour— 
Hon Trevor Mallard 
: Sorry I thought you’d finished. 
DAVID BENNETT 
: The only person finished is Trevor Mallard. 
The Labour Party does not want to give people choice. At the moment we can give workers choice and we do that because it is to the benefit of workers. If we look at this bill we see that it sets minimum requirements. If there are minimum requirements employers will stick to them. They will not give people more than the minimum and this will hurt some employees who could have negotiated for more than that but who will be held to minimum requirements. Some of Labour’s own people whom it believes it represents will be hurt by this legislation. They will be held to the minimum requirements when they could have negotiated for something better. What is the matter with negotiating for something better? What is Labour’s problem with that? 
This will have a huge cost on businesses. This will hurt workers because businesses will be reluctant to take people on reluctant to promote people and reluctant to give them any opportunity because employers fear the cost that this legislation would impose on them. This legislation will hurt the workers. Why would we want to pass a bill in the House that hurts workers in a time of a recession? Why would we want to do that when we have unemployment rates at the current rate? Why would we want to make it harder for people to get a job? There is no commercial reality in what the Labour Party is looking at here. If anything it is taking a total disregard to the practicalities of the economic environment we are in. The Labour Party is ignoring how hard it is to get a job. It wants to make it harder for New Zealanders to get a job. Labour wants to make it harder for Kiwis to stay in work and to get promotions. That does not make any sense. It is not in the best interests of the people of our country or the future economic growth of this country. 
When we look at redundancy provisions we see that they are already in place. There are personal grievance provisions under the Employment Relations Act. There are plenty of opportunities for people who feel they have difficulty in taking advantage of those kinds of legislative regimes. The Labour Party passed the Employment Relations Act when it was in Government and said that it was a universal panacea for deciding employment relations. It is available now and it deals with those issues when required. 
Let us look at the Public Advisory Group to the Minister of Labour on Restructuring and Redundancy which the Labour Party said was the great source of directive for this bill. There are some downsides that the public advisory group noted and I will read these out for members so that they are aware of them. The public advisory group felt that there would be disincentives to hire more staff there would be reduced wages there would be more temporary and contract workers and there would be additional stress on businesses that are already struggling which would result in further job losses. It felt that the bill would put business viability at risk and would reduce international competitiveness. Not one of those things whether one is in National or Labour would anyone want to see happen at the moment. Who wants to have disincentives to hiring more staff? Who wants reduced wages? Who wants more temporary workers? Who wants additional stress on businesses? Nobody does but the Labour Party is willing to put legislation before the House that would achieve those things. That is not in the interest of New Zealanders or of our working people. 
I think it is sad that the Labour Party has to put this legislation up come to this House and take the emotions of New Zealanders and portray them as defenceless and unable to negotiate for themselves so that the big red bus can come along and deliver to those people the safety and direction that they want. It is really sad. It demeans New Zealanders who are working hard and negotiating their future. It shows the mentality of the Labour Party. It does not trust our people it does not trust individuals to negotiate and it does not trust the unions because now it wants mandatory requirements. That is very sad in this time and this day. Labour does not take into account the economic reality that we now face. 
The Transport and Industrial Relations Committee would hear this legislation if it passed its first reading but I doubt it will. I am sure that most parties in this House will be of the opinion that this legislation is not in the best interests of workers or our country. It will go down in the history of a Labour Party that tried to control and hijack personal ambition and that tried to direct people because it thought it knew best at a time when people needed to be given the strength and ability to take advantage of their opportunities. That is the difference between National and Labour. We bet on our people and we want them to succeed. We will not tell them how to live their lives through an institution that sets mandatory rules. We will provide the instruments for people to achieve their full purpose. With that National will not support this bill. Thank you. 
Hon TREVOR MALLARD (Labour—Hutt South) 
: 
 If the speech from the member who has just resumed his seat David Bennett were made outside the House I think it could be described fairly as hypocritical. I know we cannot say that in here but if it were it would be. That member after being here for 18 months has an entitlement to a redundancy worth over $32000. That member after a very short period of time in this House has a personal entitlement to well over $32000 worth of redundancy whether or not he runs at the next election. He could even retire at the next election which would be a logical thing to do and he would still get his redundancy money. He said that the most vulnerable people in New Zealand should not be allowed a pittance. 
I think frankly if there can be criticism of Darien Fenton’s Employment Relations (Statutory Minimum Redundancy Entitlements) Amendment Bill it is that it does not go far enough. The Public Advisory Group to the Minister of Labour on Restructuring and Redundancy came out with a unanimous recommendation supported by Business New Zealand. Business New Zealand consulted widely with its members and decided that the Government should consider the introduction of a statutory requirement for redundancy compensation and other entitlements incorporating the following features. 
Those features are notice compensation based on length of service and a maximum level of statutory compensation—this is what this does. It is doing what the employers asked for 2 years ago. Why did they ask for it? They know that having stability and loyalty from their workers is an important part of the employment arrangement. They know that having some stickiness in the labour market having people wanting to stay with an employer and having some sort of security if they stay there with the likelihood of a job going forward and being less likely to be fired if there is a redundancy arrangement are things that are good. It means that the incentives are on the employers to train people properly to provide them with decent equipment and to make them productive rather than making them redundant as is far too often the case. 
Hon Tau Henare 
: Now who’s the hypocrite? 
Hon TREVOR MALLARD 
: We will not talk to Mr Henare about how he left the trade union movement. That was a bit of a bottler on that occasion a bit of a bottler I say to Mr Henare. I do not know whether he got redundancy when he got the sack. [ 
Interruption 
] Well when he left Parliament he got $30000 redundancy money and he came back. Did he pay it back? No he did not. The Prime Minister said he would take the rough edges off the recession. He has; he has for his mates. He gave Bill English a free house when he was not entitled to one. He let Phil Heatley off when he cooked the books. But does he say to individual workers who are made redundant that they can have a minor redundancy payment? He says no. I think it is an outrage that this Government hates low-income workers. 
Michael Woodhouse 
: I raise a point of order Mr Speaker. The member made reference to a member “cooking the books”. I think that that is well out of order. I ask that he withdraw it. 
Hon TREVOR MALLARD 
: The member who cooked the books is in the House. He did not take offence. He is the one who pleaded guilty to putting in false claims. 
Michael Woodhouse 
: I am not asking for a withdrawal because I am offended I am asking for a withdrawal because it was way out of line with Standing Order 116. 
The ASSISTANT SPEAKER (Hon Rick Barker) 
: There are two points. Firstly a point of order has to be taken at the time that the offence was given. The comments were made quite some time back. It was not immediate. That is the first point that I make to you. I accept that the member was looking for the Standing Order but the point of order should taken at the time. It is very hard to rewind the tape and remember the exact words that were said. That is why the Standing Orders say to do it immediately so that people can have very fresh in the mind the exact words that were said. The second point is that it is against the Standing Orders to accuse someone of breaking the law. But cooking the books is a step short of that—it is. A lot of other words we come to are offensive but others are not. This is a House of robust debate. 
Hon TREVOR MALLARD 
: Working families are facing hard times. This Government has a choice now to send a bill to a select committee to hear what people think. It does not have to guarantee now that it will support the bill at its later stages. All we want to know is that the Government is prepared to listen to a wide view from people. That is not a big thing. We are not asking for a definite support for the later stages. But we are asking for a relatively lazy Government to sit in a select committee and to listen—to sit in a select committee and to listen to the cases to listen the way that the employers did at the public advisory committee. 
Dr JACKIE BLUE (National) 
: 
 I am very pleased to speak to the Employment Relations (Statutory Minimum Redundancy Entitlements) Amendment Bill. I will make some initial comments about the Government’s priorities for creating jobs. Creating jobs is a top priority for this Government. We are committed to a sustainable economic recovery and to creating more jobs for New Zealanders. The Government’s economic policy during the global recession has been focused on this commitment. 
The Government has taken steps to keep people in employment and to assist them when they lose their jobs. We have put in place policies that encourage economic growth and those policies are built on exports and investment rather than on Government spending or consumer spending. Last year the Government’s small-business relief package was designed to help lighten the load of small and medium sized business which employ many New Zealanders. That plan was about improving the environment for business and therefore jobs and growth. 
A number of members’ bills on employment law have been brought to the House. Some have passed into law others have not. Suffice it to say that National believes employment law must expand job opportunities and treat all parties fairly protecting both employees and employers. The purpose of this bill is to insert a new part into the Employment Relations Act providing for minimum statutory redundancy entitlements. 
Currently if an employee is made redundant the employee’s entitlements are governed by his or her employment agreement. If there is nothing about redundancy in a person’s employment agreement the default position is that there is no requirement to pay redundancy compensation. Employers and employees are free to agree to redundancy provisions in their employment agreements. As well the law also provides that redundancy occurs only when a position has become genuinely redundant. Employers are not able to make a worker redundant on a whim. 
Specifically this bill outlines that all employees who have worked for more than 12 months are entitled to redundancy compensation and the bill outlines some requirements around that particular point. National will be opposing this bill. We are concerned that statutory redundancy provisions act as a barrier to employers taking on new staff. That would work against the Government’s commitment to creating jobs and fostering economic growth. 
The Government acknowledges that during the recession redundancies have been of real concern. In late 2008 the Government launched its ReStart package which provided for workers made redundant helping them back into work. This was set up quickly to help provide breathing space for those hardest hit by redundancy. 
The issue of statutory redundancy was assessed in the last term of Parliament in great detail in the report of the Public Advisory Group to the Minister of Labour on Restructuring and Redundancy. Interestingly 14 of the 22 submitters supported the status quo. There are negatives which were noted by the report and they are concerning and numerous. Members of the group were concerned that there would be disincentives to hire more staff and that wages could be reduced. They envisaged that there would be more temporary and contract workers. Importantly they were concerned that by putting greater pressure on businesses jobs would be lost and business viability could be jeopardised. 
Clearly the previous Government was concerned by these findings because it did not go ahead and implement a statutory requirement for redundancy. The previous Government had 9 years to do so and it did not. That is very very revealing. It had its opportunity when it introduced the Employment Relations Act 2000. It failed to do so and that speaks volumes. 
The Government like the public advisory group is concerned that mandatory redundancy provisions will destroy jobs and stop employers from hiring new staff. That would be totally counter to its commitment to create jobs. The Government is also concerned about the significant cost to business which is not insignificant. We consider that this proposal would make redundancy unaffordable for most businesses and there would be a real risk of businesses closing as a result. We will be opposing this bill. 
KEITH LOCKE (Green) 
: 
 The Green Party will be strongly supporting the Employment Relations (Statutory Minimum Redundancy Entitlements) Amendment Bill. If it is passed—and I hope it is—it will correct a major injustice for workers in this country: being laid off without any redundancy. I think that David Bennett conceded there was a problem but he said that under this legislation employers would stick to the minimum rather than giving more than that to workers in redundancy. However the current problem is not that employers may stick to a legislative minimum which does not exist; the problem is that they do not give any redundancy at all in many cases. 
We have a recent statement from the National Distribution Union referring to a dozen workers who were laid off by T A Macalister Ltd without any redundancy at all because of a downturn in business. Warehouse supervisor Rob Highsted who was laid off said: “I feel bitter”. “The warehouse in this company has been my baby - I was proud at how well I made it work then they just say ‘piss off.’ Its 20 years of my life down the toilet.” Mr Highsted said another couple with 40 years’ service between them had also been shown the door without so much as a thankyou from the company. 
That is the problem that we face and that is why it is important to have a minimum of 4 weeks’ notice 4 weeks’ remuneration after 1 year and 2 weeks’ additional remuneration for each subsequent year of continuous employment up to a maximum entitlement of 26 weeks’ remuneration. That is consistent both with longstanding Green Party policy and as has been pointed out with the report of the Public Advisory Group to the Minister of Labour on Restructuring and Redundancy. 
I will tell members why we have redundancy. One point is that it is a recognition by the employer who has benefited from the labour of workers—often over many years as in the case I mentioned—of the value of that work. It says “Here have something because unfortunately we have to make you redundant.” Secondly it is to reduce the suffering that workers face when they are laid off. The unemployment benefit is not in itself sufficient and there is a qualifying period for it as well. That is particularly important now when couples who work are mortgaged up to the hilt. If one person in the relationship loses his or her job they cannot afford to pay the mortgage the house goes down the tube—all kinds of things happen. There is huge suffering if people do not have any continuity of income while they look for another job. The third point is that it gives a breathing space to find another job—not just another job but a job in one’s specialist area if at all possible. It gives someone the time to look around to find an appropriate job. Often the problem is that workers are very highly specialised. They are geared to one job and it takes a while either to train for something else or to look around for something that is the equivalent of what they were doing. 
I myself was made redundant when I was working at the Gear meatworks in 1981 and it closed down. We got some redundancy pay but I know that it was very difficult for many of the workers there who were highly specialised knife hands and who had spent decades working as knife hands. Many of them became very depressed and their families became depressed because they did not have other work in their specialist area. 
That relates to another issue raised in the public advisory group’s report: the need to give plenty of notice of the termination of employment. In this bill 4 weeks’ notice of redundancy is required but there is also the need to look a bit further out. If something is happening to an industry if a change is going on and there might be redundancies there is a need to have a whole transition to new employment. That is why it is important to have adult education and not to cut night classes which are often a way for people to make the transition to a new job. Unfortunately this Government has cut night classes. 
We want to be able to ratify ILO Convention 158 and it is important that we pass measures like this so that we can do that. We do not want to be in breach of international conventions. 
The question is not that somehow workers will suffer through redundancy payments undermining full-time employment as David Bennett claims. In fact I think redundancy provisions are a deterrent against employers laying people off; it adds a bit of restraint which is good. The idea that redundancy provisions somehow stop employers from employing people is a bit silly too. How many employers think that in 3 years they might have to lay off employees and pay them 8 weeks’ redundancy so therefore they will not employ them? That is not the way things would play out. 
HONE HARAWIRA (Maori Party—Te Tai Tokerau) 
: 
 Kia ora tatou katoa e te Whare. I was checking out the website hardtimes.org.nz the other day. This website is pushing for a fair deal in hard times. It calls for people to sign a petition hold a workplace meeting or just to read the real-life stories of people who have copped a bad deal in redundancy. It sets out pretty much all the reasons why any decent citizen should support a minimum level of redundancy protection for all workers. What is being proposed here ain’t nothing flash: 4 weeks’ notice; and 4 weeks’ redundancy for the first year and 2 weeks after that up to 26 weeks. But the key focus of the bill is that a redundancy agreement should be part of every employment contract; that if we are really committed to a fair deal in hard times then everyone should be entitled to basic redundancy protection to help them get by between jobs. 
I do not know whether I buy into the exact details of the bill. I can recall a couple of years ago when we were pushing for a minimum wage being rudely reminded by my wife that if I was going to talk about a minimum wage then I had to make sure that my kura Te Rangianiwaniwa and the local iwi radio stations operating under Te Hiku Media were actually paying according to the standards that I was preaching. So I had to have a sit-down with the bosses and go through the numbers. I found out that in both cases we were paying better than most other local businesses but that we were not actually paying the minimum wage in certain cases. However after a review of finances some careful consideration and some creative thinking both Te Rangianiwaniwa and Te Hiku Media were able to make some readjustments to ensure that everyone was being paid at least the minimum wage. I can tell members that that is no mean feat in a town that lies in the heart of the country’s highest Maori unemployment zone. 
That is the challenge I have with this bill; I have not yet had a chance to get the folks at Te Rangianiwaniwa or Te Hiku Media to run the numbers on this redundancy proposal to see whether we can actually operate on the basis found in this bill. But certainly the principle of workers having redundancy protection to tide them over between jobs is a sound one and one that both I and the Maori Party are more than happy to support. We support the Employment Relations Act 2000 we support amendments to make it more worker-friendly and we support pay and employment equity legislation. So we certainly support the intention of this bill to provide all workers with the redundancy support to tide them over the tough times. Kia ora tatou. 
The ASSISTANT SPEAKER (Hon Rick Barker) 
: I call Hone Harawira. [ 
Interruption 
] Oh sorry. 
Hon TAU HENARE (National) 
: 
 I know that we all seem to look alike. 
The ASSISTANT SPEAKER (Hon Rick Barker) 
: I call the Hon Tau Henare. 
Hon TAU HENARE 
: That is something that we have been fighting against for a long long time—but we will get there. 
Chris Hipkins 
: Who’s the biggest loser? 
Hon TAU HENARE 
: Well if we want to go down that track. 
I want to start my korero tonight with this quote from March 2000: “This bill marks a new era in industrial relations in New Zealand; an era that will be distinguished by a commitment to the fundamental principle that underlines all parts of this legislation—namely that it is better to work together cooperatively for the common good in the workplace than to work in opposition to each other.” That quote is from the then Minister of Labour the Hon Margaret Wilson in the Employment Relation Bill’s first reading on 16 March 2000. 
Nowhere in that bill was there any mention at all of a redundancy clause—and that was in 2000. In 2009 there was an anniversary: the ninth anniversary of Labour taking office. Between 2000 and 2009 not one of the Labour members including the former Ministers and including the backbenchers ever raised the issue. Outside of this House that would have been called hypocrisy to coin a phrase of Trevor Mallard. Those listening outside would have called it hypocrisy. 
The funny thing about the Fabians—there is always a funny thing about the Fabians and the Fabian Society—is that they never do anything when they are in power. But when they are in Opposition they love to tell the Government what it should do. The Public Advisory Group to the Minister of Labour on Restructuring and Redundancy was established back then but when I was a union member we used to fight for this sort of thing. We did not go cap in hand to ask the Government to do it. We did not even go cap in hand to the Labour Party and ask its members do it. We used to go and fight for it unlike the pussies that the Labour Party has today. They think that the easiest way is to just front up to the Government and say: “Please sir no sir can I have three bags full sir?”. That is their modus operandi; it is not about going to workers and saying: “Listen what we need to do is organise. We need to talk if we may to the employer. Let us fight for something that we really believe in.” 
What we see in the House tonight is nothing more than Darien Fenton and her mates in the Service and Foodworkers Union grandstanding because they know full well that they cannot deliver on this bill the Employment Relations (Statutory Minimum Redundancy Entitlements) Amendment Bill. Although they cannot deliver on it somehow it makes them feel good. Like the do-gooders in the Fabian Society they are a pack of pussy do-gooders. Quite frankly I am over the moon. I am ecstatic that this Government is not going to buy into any of that Fabian rubbish. 
JOHN BOSCAWEN (ACT) 
: 
 This is an impassioned debate. We have just heard an impassioned speech from the Hon Tau Henare and earlier this afternoon we heard from David Bennett. This is an economic debate. It is a debate about employment. It is a debate about redundancy and redundancy provisions and those things are very very important. I think Mr Bennett impressed us all this afternoon with his knowledge of economic theory—who could not be impressed. I was very impressed. 
Mr Bennett said to us that this measure would be a huge cost on business and that businesses would be reluctant to take on workers. Mr Bennett asked why we would want to make it harder for people to get a job which is a very good question to ask. Mr Bennett said that this bill imposes costs on employers and that it would make them reluctant to take on new employees. Mr Bennett asked a very reasonable question: why would Labour members want to make it hard for Kiwis to get a job? It was a very reasonable question. 
Why would National want to make it hard for Kiwis to get a job? If National members believe that imposing a compulsory redundancy provision on workers would have a negative impact on employment why do they believe that imposing the costs of an emissions trading scheme and artificially increasing the price of electricity will not have the same impact on jobs? Mr Bennett asked who would want to place additional stress on business. Clearly it is the National Government because it is prepared to impose extra costs on businesses and exporters and it wants to do that at a time when all our major trading partners are backing away from an emissions trading scheme. 
Just last Tuesday the Prime Minister of Australia Kevin Rudd announced that Australia would be delaying the introduction of an emissions trading scheme until 2013. The United States does not have an emissions trading scheme China does not have an emissions trading scheme. But what does National do? It continues to perpetuate the myth that our farmers and exporters will not be affected. The Minister of Agriculture the Hon David Carter has been telling farmers at field days that agriculture will not come into the emissions trading scheme until 2015. I call on Mr Carter the Minister of Agriculture to tell the truth to farmers. He knows that Meat and Wool New Zealand has said that the cost of the emissions trading scheme to dairy farmers will be about $10200. There will be redundancies in the farming industry. 
Meat and Wool New Zealand is telling farmers that under the emissions trading scheme they will have to start paying extra for electricity petrol and the emission costs of their dairy factories but National is in denial. The Employment Relations (Statutory Minimum Redundancy Entitlements) Amendment Bill is an economic bill. It is about redundancies. We should be asking how we can stop redundancies how we can recover from the recession and how we can reduce our unemployment rate of 7.5 percent. The answer is to put in place economic policies that will create employment. We should ask ourselves why there is a need for Darien Fenton’s bill. How do we avoid that need? Do we have economic policies that make it easier for businesses to employ people and for us to trade our way out of recession? 
I will leave the last word to the Hon John Key the Prime Minister of New Zealand. Just 3 weeks before the last general election he said we should not be a world leader because that would come at the expense of our economy. He was obviously thinking of Darien Fenton’s bill and about the consequences of unemployment. He went on to say that he could see no sense in New Zealand exporting emissions and jobs to another part of the world. In the face of overwhelming change in the environment for emissions trading legislation and costs and when all our major trading partners have pulled away from an emissions trading scheme—just last Tuesday Australia announced it was delaying its emissions trading scheme by 4 years—the National Government is charging ahead with it. National has its head in the sand. The Hon David Carter the Minister of Agriculture told farmers in Waikato this morning that we will proceed with the scheme. How stupid is that! I can understand why Darien Fenton thinks we need a bill of this nature. 
CHARLES CHAUVEL (Labour) 
: 
 I will start my short contribution today by congratulating Darien Fenton on the success she has had in getting her bill out of the ballot and on the effort she has gone to in doing something through this bill that if the House were to pass it would represent us as doing the right thing. The bill implements the recommendations of the Public Advisory Group to the Minister of Labour on Restructuring and Redundancy which reported back in 2008. That group recommended that it was time to put in place a modest entitlement on a universal basis for qualifying employees. 
I practised in the area of employment law for many years before I came into this House and not only is this bill a decent thing to do; it is a smart thing to do from the point of view of making the law certain. I will take the House through some of the developments that have been seen in the law in this area to explain what I mean by that. There has never been a statutory obligation in this country to pay redundancy compensation to an employee dismissed through redundancy and that absence of a statutory obligation at the time when we last went through major unemployment in this country back in the 1990s caused major disruptions in employment law. It was not an issue during most of the term of the last Government so it was interesting to hear Mr Henare’s contribution on that point. There was no need to legislate for redundancy in that area because we had full employment. But guess what the House needs to remember that we are not in those times now. We are now in times where the rate of unemployment is over 7 percent and this issue will have to be confronted by the courts again. 
It is timely for the House to recall what the courts did in the absence of a statutory redundancy entitlement the last time we faced high and unlikely-to-decrease unemployment. I will describe some of the legal cases. First of all from about the early 1980s onwards the courts looked at what used to be called the dispute of rights provisions in the labour law that prevailed at the time. There ended up being a number of cases over whether the dispute of rights provisions in the legislation could be used to confer a right on workers to redundancy compensation when their employment contract award or agreement did not expressly call for that entitlement or if the contract did so it did not specify how much redundancy compensation—or notice even—they would be entitled to. Employers tied themselves up in knots trying to work out what the law should be in any particular case where an employment instrument mentioned redundancy but did not go further than that—it did not define an entitlement. 
The courts did not give any clear guidance as to whether there was such an entitlement. In some cases like the Wellington Hospital Board case in the early 1980s the court indicated that yes there was such an entitlement. Then there was the Cornhill Insurance case the Westland Catchment Board case the Timbercraft case and finally Westland again this time in the Court of Appeal. All of these cases gave inconsistent results as to whether an employer had to pay redundancy. 
Parliament took the matter in hand when it passed the Employment Contracts Act. Clause 34 of the Employment Contracts Bill which became section 46 of the Act did away with the ability to use the disputes process to get a redundancy compensation deal. But the courts were actually a step ahead of Parliament because unemployment was still high and rising at that time and 8 days before the introduction of the Employment Contracts Act the Labour Court in a decision called  
G N Hale and Sons Ltd v Wellington Caretakers IUOW 
—and in its second judgment in that case following the matter being remitted from the Court of Appeal—decided that the personal grievance jurisdiction in the relevant labour law could be used to give a redundancy entitlement. All those same problems that arose under the disputes law applied for a number of years. Although yes it was deemed fair by the courts to pay compensation there was never any clear guidance as to how much and in what circumstances. 
We have the same provisions that applied then in our labour law at the moment as far as personal grievances are concerned. The test is whether it is fair in all the circumstances to dismiss somebody. If the courts decide to swing the pendulum again and decide there is an entitlement in the common law that redundancy ought to be paid to dismissed workers in certain circumstances we will be back in that same position. No doubt this Parliament will swing in under this mean-spirited Government and just abolish the entitlement but would it not be better to do the right thing: to support Darien Fenton’s bill and provide a modest entitlement on redundancy to workers dismissed for that reason? 
CAROL BEAUMONT (Labour) 
: 
 Let me start by acknowledging my colleague and friend Darien Fenton. As Mr Chauvel has said Darien Fenton has done a lot of work on the Employment Relations (Statutory Minimum Redundancy Entitlements) Amendment Bill and for many years she has promoted the rights of workers in this country. I think that is worth putting on the record of the House. 
I have been appalled at the contributions from members on the other side of the House. Mr Bennett went on about mandatory rules—mandatory this mandatory that. He said the bill would undermine workers’ rights. I do not think there is an understanding of the importance of having in place strong minimum rights that provide guidance and the base on which we build. New Zealand has international obligations to provide a strong mandatory framework. 
It has been fascinating to hear some members opposite trying to rewrite history. Mr Henare gave a very good analysis except he forgot to mention what happened as a result of the Employment Contracts Act. He did not say that it ripped out the award system which had provided quite significant redundancy coverage for workers in this country and left us in a situation where there was no statutory right and rights were limited to what people negotiated in individual or collective agreements. They negotiated their own rights. None of that was mentioned. Then we heard all that commentary about do-gooders but frankly if promoting workers’ rights and ensuring protections for workers in hard times is being a do-gooder I am proud to be one; so are my colleagues. 
This bill amends the Employment Relations Act to provide minimum statutory entitlements for employees in the event of dismissal for redundancy. I reiterate the point already made that this bill was a unanimous recommendation of the public advisory group on restructuring and redundancy. Employer representatives and union representatives understood the importance of having these protections and at times of record job losses 80 percent of New Zealanders having no protection against redundancy is just plain wrong. 
Members opposite still have the opportunity to do the right thing tonight for the 80 percent of workers in our country who do not have a right to redundancy protection. Redundancy entitlements will not replace a lost job but will certainly help workers and their families in the period until they have a new job. 
I was interested today to hear the Minister of Finance say we are through the recession but he should tell that to the 170000 New Zealanders who are unemployed—7.3 percent compared with Australia’s 5 percent. Many more people are underemployed and are struggling to make ends meet. In the area of Auckland I work in Maungakiekie I talk to people who are struggling because they have lost their jobs lost hours of work or had little or no pay increases over recent times and are facing rising prices. We need to do something to send a message that this Parliament recognises that we are in hard times and that there should be minimum protections against redundancy. 
This bill is particularly important at this time but this Government has failed New Zealanders through hard economic times. It has failed in this recession to respond appropriately. Let us look at the rate of unemployment. It is not about just numbers; it is about people who are without jobs and are struggling to make ends meet. 
There is a lack of empathy on the other side of the House and there is certainly a lack of action. I compare that to just about every other country in the OECD where active attention has been paid to job creation and the protection of workers’ rights—but not by this Government. This bill is about rebuilding a minimum code. This bill is about rebuilding after 9 years of a Labour Government where much was done. 
Melissa Lee 
: We had 9 years of mismanagement. 
CAROL BEAUMONT 
: I tell Ms Lee that in those 9 years Labour made regular increases to the minimum wage and put in place a number of employment protections. So members opposite should not try to rewrite history. 
Many New Zealanders think there is a right to redundancy. New Zealand workers are in fact the cheapest and easiest in the world to sack. Is that something that members opposite are proud of? Are they proud that New Zealand workers are among the cheapest and easiest to sack in the OECD? That is not something they should be proud of. 
This bill is about people. As others have said it is about people who lose their jobs who struggle and who have to deal with the emotional consequences as well as the financial consequences. I urge members opposite to take this bill seriously and do the right thing. 
DARIEN FENTON (Labour) 
: 
 First of all I want to thank the Green Party and the Maori Party and of course my colleagues in the Labour Party for their contributions and support. I appreciate very much their understanding that this is a situation of basic fairness; that the Kiwi way is to treat people fairly particularly when they are vulnerable. I also put on record my thanks to the many people who have been in touch to tell me their stories or to offer their support. I acknowledge all of the unions and organisations that have backed the redundancy protection bill and who will continue to fight alongside Labour to ensure that this issue will be on the agenda at the next election. I mention them by name: the Council of Trade Unions the Engineering Printing and Manufacturing Union the National Distribution Union my own union the Service and Food Workers Union the Dairy Workers Union the Unite union the Rail and Maritime Transport Union Finsec the Maritime Union the Public Service Association the Nurses Organisation the New Zealand Educational Institute Te Riu Roa and the Wellington People’s Centre. I want Government members to know that together these organisations represent 350000 workers plus their families. Today National and ACT have sent a strong message to all of those people that National and ACT do not care about them. 
I also respond to the pathetic defence from members opposite who say that Labour had 9 years. I mentioned in my first speech on the bill that Labour actually did an awful lot about redundancy protection but it was not a priority because people were not losing their jobs in the droves that they are now. For insolvency situations we made redundancy protection a priority. We also cut the tax rate on redundancy payments and we set up the advisory group because we also want to do things based on good evidence. That is what the advisory group was about. Members opposite should not go on about Labour having 9 years because we did a lot there was a lot to do and there will always be more to do. The fact is the Labour Party has more ideas and will take them to the next election. 
This Government has failed working people again. It has failed to take the harsh edges off the recession as John Key promised it would. Wages are in decline unemployment is skyrocketing and workers cannot look forward to any support from this Government. 
When this bill was drawn from the ballot last year I deliberately postponed its first reading. I wanted to make sure that the bill was not taken lightly by political parties but unfortunately the speech made by David Bennett shows that the Government has utter contempt for the issues facing workers today. I wanted to make sure the bill was not taken lightly; I wanted to give National and ACT and other parties a real chance to show that they were prepared to listen to working people and their families when they say that not enough is being done for workers facing redundancy. Actually I do not think they bothered even though more than 120000 of these postcards that I am holding up went to John Key’s office. I know they would have gone in the rubbish bin but what about the cost to workers? We can talk about the cost to business but what about the cost to workers and the cost to their families? 
Redundancy entitlements are about recognising that the loss of a job is not the fault of workers; they provided their labour in good faith to an employer and they have a risk of not finding a comparable job. We have had examples in the debate today. It also recognises the impact generally on the earning capacity of the worker. Redundancy entitlements can also act as a deterrent; I think some of my colleagues have referred to this. An employer might otherwise make a worker redundant without due consideration. For example I am aware that many of the employers in the 9-day working fortnight programme— 
Hon Darren Hughes 
: Ha! 
DARIEN FENTON 
: Yes I know. Many of them joined that. The cost of redundancy of making their workers redundant made them sign up to it. It acted as a deterrent. It was not John Key’s brilliance; it was the fact that something stood in the way of them being able to just send people down the road. I have noted that in the last year personal grievances in relation to redundancy have doubled. That is the consequence of not having certainty in the law around redundancy. The cleaners who work in this Parliament have no redundancy payments in their agreement. They have a specific clause that says that they do not get anything. This is legal in the current situation and common. Yet all of us in this Chamber can be made redundant at every election but we get paid 3 months’ salary. 
A party vote was called for on the question  
That the Employment Relations (Statutory Minimum Redundancy Entitlements) Amendment Bill be now read a first time. 
Ayes 57 
New Zealand Labour 43; Green Party 9; Maori Party 5. 
Noes 64 
New Zealand National 58; ACT New Zealand 5; United Future 1. 
Motion not agreed to. 
DARIEN FENTON (Labour) 
: 
 I seek leave to table a redundancy notice to the Hon John Key saying that he will receive no notice and no redundancy pay because the law says he is not entitled. 
The ASSISTANT SPEAKER (Eric Roy) 
: That is not an acceptable document for tabling.