The bill outlines the government's framework for the proposed fair pay agreement system
Parliament has introduced legislation to improve the wages and conditions of employees across New Zealand, announced Workplace Relations and Safety Minister Michael Wood.
The Fair Pay Agreements Bill (Bill 115−1) outlines the government’s framework for the proposed fair pay agreement system. The fair pay agreement system seeks to provide for minimum binding standards for both employers and employees in a particular sector or occupation through collective bargaining.
At present, the country’s employment relations and standards regulatory system only allows for collective bargaining at an enterprise level. There is no mechanism for parties to co-ordinate collective bargaining across entire occupations or industries.
“For too long, New Zealanders working in critical roles like cleaners and bus drivers, whose work is keeping our country going during the pandemic, have lacked bargaining power to seek better wages and conditions,” Wood said. “We want to turn that around and ensure workers get a fair go again.”
In particular, the bill will authorise any eligible union to initiate bargaining for a fair pay agreement if it meets either:
- a representation test of at least 1,000 employees or 10% of the employees in proposed coverage; or
- a public interest test based on specified criteria, such as low pay, little bargaining power, or lack of pay progression.
The chief executive of the Ministry of Business, Innovation, and Employment (CE MBIE) will assess applications based on either test and may request further evidence and information from the initiating union if necessary.
The bill will require the initiating union to identify if the proposed fair pay agreement is either an industry-based or occupation-based.
Moreover, the bill sets out what must be contained in a fair pay agreement, such as effectivity and expiration date, coverage, normal hours of work, minimum base wage rates, overtime pay, penalty rates, the governance arrangements that will be applicable to the bargaining sides, and the process for each bargaining side if they want to amend the agreement.
To finalise a fair pay agreement, the bill provides that it must be assessed and approved by the Employment Relations Authority, ratified by all the employees and employers covered by the agreement, and verified and brought into force by the CE MBIE through secondary legislation.
In addition, the bill provides a dispute resolution process based on the Employment Relations Act 2000 and includes a penalty regime for non-compliance consistent with other employment legislation.
According to Wood, the bill will go through a full select committee process and is expected to pass all legislative stages this year.
