Fenton Darien: Employment Relations (Statutory Minimum Redundancy Entitlements) Amendment Bill — First Reading 
Fenton Darien: Employment Relations (Statutory Minimum Redundancy Entitlements) Amendment Bill — First Reading 
[Volume:662;Page:10767] 
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