Wilkinson Kate: Employment Relations Amendment Bill (No 2) — First Reading 
Wilkinson Kate: Employment Relations Amendment Bill (No 2) — First Reading 
[Volume:665;Page:13305] 
Hon KATE WILKINSON (Minister of Labour) 
: 
 I move  
That the Employment Relations Amendment Bill (No 2) be now read a first time. 
 At the appropriate time I intend to move that the Employment Relations Amendment Bill (No 2) be considered by the Transport and Industrial Relations Committee that the committee report finally to the House on or before 5 November 2010 and that the committee have authority to meet at any time while the House is sitting except during questions for oral answer and during any evening on a day in which there has been a sitting of the House and on a Friday in a week in which there has been a sitting of the House— 
Hon Trevor Mallard 
: I raise a point of order Mr Speaker. I know that it could slightly be my colleagues but I think it might be the sound system again. I am the next speaker and I am having real trouble hearing the Minister. I notice that the microphones at the front appear to be working so it might even be better if she could shift down there and that might help. 
Mr SPEAKER 
: No I believe that it was the level of noise in the House. Would members just be a little more quiet as they move about the House and if they are going to have conversations I ask them please not to have them in the House. 
Hon Trevor Mallard 
: I raise a point of order Mr Speaker. I know that this is really unusual but it is not done in any facetious way at all. Could the Minister start again? 
Mr SPEAKER 
: I invite the Minister the Hon Kate Wilkinson if she would like to to start her address to the first reading again because members were making a great deal of noise. I say to members in the House to please not have conversations in the House. I am looking at a pair of members carrying on their conversation and totally ignoring the Speaker. I ask members if they are going to have conversations not to have them in the House please because it was very hard to hear their colleague. 
Hon KATE WILKINSON 
: At the appropriate time I intend to move that the Employment Relations Amendment Bill (No 2) be considered by the Transport and Industrial Relations Committee that the committee report finally to the House on or before 5 November 2010 and that the committee have authority to meet at any time while the House is sitting except during questions for oral answer and during any evening on a day in which there has been a sitting of the House and on a Friday in a week in which there has been a sitting of the House and to meet outside the Wellington region during a sitting of the House despite Standing Orders 187 189(a) and 190(1)(b) and (c). 
The employment reforms contained in this bill are designed to assist New Zealand and New Zealanders as we grow out of the recession. This Government is focused on growing a stronger economy and creating more jobs. This bill is about creating opportunities. The changes being debated today are thoughtful pragmatic sensible and above all fair. They will help New Zealand’s overall productivity and will give businesses of all sizes the confidence to seek new opportunities to invest and to take on new workers. 
Shortly after the 2008 election trial periods for businesses with fewer than 20 employees were introduced. Employers with small and medium sized businesses gained the confidence to hire new employees without the fear of facing a personal grievance claim if the relationship did not work. That initiative has been successful. An evaluation of the operation of trial periods revealed that 40 percent of employers who used it said that they would not have or were unlikely to have hired a person without a trial period. Aside from that report I have received and read positive feedback on this policy. One employer thanked us for introducing the trial period as it allowed that employer to hire three new farm workers all of whom were unemployed and two of whom had criminal records. Without the trial period those three New Zealanders could still be sitting in the dole queue. Furthermore a brief survey by the Hutt Valley Chamber of Commerce found that 30 new jobs could be directly attributed to the introduction of the trial period. Examples like those can be found all over the country. Because of this policy New Zealanders are being given opportunities that they might not otherwise get. By extending access to trial periods we are giving all businesses the increased confidence to hire new employees and giving many more people the chance to prove themselves in the job market. 
I am proud to stand here and tell New Zealanders that this Government backs them. We want them to be successful in life. We want them to increase their standard of living and that of their families. We want businesses to flourish and invest in their communities and not to be too scared to hire someone out of fear that it will derail their business. The trial period has been a success and will continue to be a success. 
The bill also brings us more in line with overseas jurisdictions. If we compare how the same discussion was handled in Australia we see that its Labor Government introduced a system of qualifying periods under the Fair Work Act where employees cannot take an unfair dismissal claim in the first 12 months if they work for a small business and in the first 6 months for all other businesses. That is different from the situation in New Zealand as it applies to everyone whereas our trial period occurs only with the agreement of both parties it must be included in a written employment contract and it is only for the first 90 days. The Australian Council of Trade Unions put in a submission supporting a 3-month or a 90-day qualifying period. 
On one side of the Tasman we have a Labor Government and a union movement that support having compulsory grievance-free periods because they know that it is a policy of opportunity—a policy that encourages employers to invest and to take on more staff. Yet here in New Zealand we have a Labour Party and a union movement so blinded by ideology that they cannot see the positive opportunities. They try only to exaggerate the perceived negatives. Fortunately New Zealanders recognise the positive opportunities that this policy offers. They understand that the employment reform we are progressing is all about providing more opportunities and flexibility. Trial periods in various forms have been utilised successfully all over the world and I am confident that we will continue to see employers using this policy to take on new staff and offer more opportunities to those who need them. I am also confident that sufficient safeguards have been built into the policy and the legislation to prevent the exploitation of employees. 
This Government has always had an express commitment to improve labour laws in this country to make them fairer for employers and employees. Fixing the personal grievance system is a prime example of a targeted change. Earlier this year I invited submissions on the personal grievance system. There was an overwhelming response. A large number of submissions highlighted the point that the test of justification in the current legislation is confusing and we are fixing that. We want employers to be assured that minor and technical procedural defects in their processes will not mean that a fundamentally justified decision can be deemed wrong. 
We will also be making a number of other changes to make the system fairer more consistent and efficient. Reinstatement will no longer be the primary remedy in settling personal grievance cases but it remains as an option where practicable and reasonable. When a relationship has broken down for whatever reason in some situations reinstatement is simply not suitable. Furthermore the Employment Relations Authority will now be able to filter out vexatious and frivolous claims early on. We are focusing on the importance of early resolution by encouraging the use of mediation as the primary instrument to address grievance. To encourage parties to attend mediation first the authority will be giving priority to cases where parties have first attempted a mediated resolution. Both employers and employees need certainty in the process and neither need nor want that process to be drawn out. That is not justice for either party. 
This Government was elected on a manifesto that included a commitment to make changes to union access provisions. We will be progressing that election promise. Employers have the right to manage access to their workplace in a reasonable manner. Unions retain the right to access their members as an employer cannot unreasonably withhold consent. The majority of union members will see little or no difference. Where some union representatives have abused the current very relaxed law they will no longer be able to. As I have said previously this is not a widespread problem but where abuse does occur it has the potential to cause significant disruption and to have an impact on the productivity of a business. Protections for union members are retained by ensuring that consent cannot be unreasonably withheld. Where an employer denies consent but does not provide a written explanation of the grounds for refusal the employer would then be subject to a penalty action. 
This bill also addresses other issues relating to communication during collective bargaining and it strengthens the enforcement powers of labour inspectors in order to improve compliance. Employment agreements are the cornerstone of employment relationships. All employers will be required to have a written employment agreement. Labour inspectors will be able to seek a penalty action for not having employment agreements reinforcing the importance of having written employment agreements. 
The bill also increases the maximum penalty to $10000 for individuals and $20000 for companies and other bodies corporate. This will send the strong message that deliberate or persistent non-compliance will not be tolerated. Collectively the changes in this bill provide more flexibility and greater choice and they will ensure a better balance of fairness for employees and employers. 
This bill provides for more speedy resolution of employment problems improves the overall efficiency and operations of the Employment Relations Authority and discourages poor employment practices by parties. It will reduce costs improve overall confidence in our employment law and lay the foundation for higher economic growth and better times ahead. However it will not condone exploitation of employees; nor will it allow ideologically driven principles to hamper or restrict economic growth. Good businesses need good employees and good employees need good employers. It is as simple as that. I commend this bill to the House.