Dyson Ruth: Employment Relations Amendment Bill — Third Reading 
Dyson Ruth: Employment Relations Amendment Bill — Third Reading 
[Volume:633;Page:5301] 
Hon RUTH DYSON (Minister of Labour) 
: 
 I move  
That the Employment Relations Amendment Bill be now read a third time 
. This bill gives effect to the Labour-led Government’s intent of ensuring that the terms and conditions of employment of New Zealand’s most vulnerable employees are protected when their work is restructured. The bill also encourages businesses to utilise existing talent and facilitates productive employment relationships that are built on good faith. This bill will protect specified vulnerable employees such as cleaners and food-catering service workers. The terms and conditions of employment of these specified employees have successively been undermined when the work they do is contracted out passed on to another business sold or transferred or brought back in-house. 
The bill will mark an improvement for employees who deserve to be treated better. They are the mums and dads of New Zealand who work hard to provide for their families. In the past their terms and conditions of employment have been undermined time and time again when the price of their labour is reduced to undercut competitors in restructuring situations. This bill will provide additional protection at the time of restructuring. It does not mean that the specified employees are assured of jobs for life. There are existing mechanisms that can be used when dealing with performance issues in employment relationships. These mechanisms are based on good faith dealing with each other fairly and developing processes to support effective working relationships. 
An employer who is concerned about the performance of an employee should inform the employee of his or her concerns and provide the employee with any support or training needed. Ultimately an employer can dismiss a poorly performing employee if after following a fair and reasonable process poor performance remains an issue. The bill does not affect an employer’s ability to do so. Simply allowing poor performance to continue—and a business consequentially losing the contract—is not effective business practice. This type of practice will not result in the kind of high-performing and productive workplace that is critical to our economic transformation. 
All too often it is claimed that vulnerable employees are poor performers when in a restructuring a new employer increases the amount of work expected while simultaneously decreasing the number of hours within which to do that work. This is typical of the type of cost-cutting exercise that goes on during restructuring situations. This bill will protect employees made vulnerable in restructuring situations from having to bear the brunt of this type of practice by providing for continuity of employment on existing terms and conditions—including for subsequent contracting. 
The effective protection of specified vulnerable employees will happen only if this bill applies to all businesses. Is a cleaner any more or less vulnerable because of the size of the company he or she works for? No. In order to be effective these protections must apply across the board. In line with the rest of New Zealand’s employment law there should be one law for all employers. 
The Government’s policies with regard to vulnerable employees have not changed since additional protection was first introduced in 2004. This bill ensures that the original policy intent of those 2004 amendments to the Employment Relations Act is delivered on. Further this bill aims to clarify that original policy intent. As such it includes examples that describe how the protections will apply in practice. This practical approach will assist in the interpretation of the Act and also in determining how the provisions will apply to a range of commercial arrangements. 
A change made to the bill at the Committee stage will ensure that businesses can make informed decisions about whether to take on work that will be done by employees who are covered by the extra protections. By requiring the disclosure of labour costs to potential new employers the level of protection provided to vulnerable employees will be improved. The vulnerable employees are less likely to be adversely affected as a result of a contractor entering into a new contract to carry out the work those employees currently do and underestimating the labour costs it will take on if the vulnerable employees choose to transfer. 
Potential risks will also be minimised for businesses deciding whether to restructure as businesses will not have to tender blind for contracts to which Subpart 1 of Part 6A of the Employment Relations Act applies. This issue was raised with me by both the Employers and Manufacturers Association (Northern) and Peter Brown of New Zealand First and I thank Mr Brown for his constructive engagement on this and other matters relating to the bill. 
This bill balances protection for those employees who are most vulnerable with rights for businesses that will be subject to additional obligations. The bill does not implement a large-scale shift in employment rights; instead it just delivers on what Parliament intended in 2004. I conclude by thanking the Transport and Industrial Relations Committee for its diligent work on this bill. The changes recommended have made the bill clearer and more effective. I am confident this bill increases protection for vulnerable employees during restructuring situations which is a time when their terms and conditions of employment are most at risk of being undermined. I commend this bill to the House.