Posted on: Apr 05, 2012
Some of the current rules around collective bargaining limit choice, flexibility and the effectiveness of the bargaining process. The Government has announced that they intend to make a number of improvements to the Employment Relations Act this term to help provide a fair and flexible environment, including:
- Remove the requirement to conclude collective bargaining
- Remove the requirement for employers to offer a new employee the terms of a collective agreement for the first 30 days
- Allow employers to opt out of negotiations for a multi-employer collective agreement (MECA)
- Allow partial pay reductions for partial strikes
The first is to remove the requirement to conclude collective bargaining unless there are genuine reasons not to. This requirement can lead to protracted negotiations in instances where agreement is clearly never going to be reached. In many cases, it has resulted in workplace disruption and a deterioration of relationships between employers and unions – which is a damaging situation for both groups in terms of the success of the business going forward. That is why the Government will return the Employment Relations Act to its original form in this respect – to keep the requirement to bargain in good faith, but not necessarily force the bargaining to end with a collective agreement.
In addition, Government also intends to remove the rule whereby employers have to offer the terms of the collective agreement to a new employee for the first 30 days. This is currently a requirement regardless of whether the employee actually wants to become a union member or not. Removing the 30-day requirement will enable employees to agree to the exact terms and conditions they want from the very beginning of their employment, whether on individual contract or union collective.
Another planned change to collective bargaining will allow employers to opt out of negotiations for a multi-employer collective agreement (MECA), if it is not the right option for them. Currently they are forced to enter negotiations with their employees, their competitors and their competitor’s employees. DHBs may still choose MECAs but other businesses in competition with each other won’t be forced into them against their will.
Finally, in order to create a fairer bargaining environment, Government intends to apply partial pay reductions for partial strikes or low-level industrial action. Receiving full pay while on partial strike and not doing the full requirements of the job is not fair to employers. It can also mean low level industrial action, like not answering phone calls or doing any paperwork or training, can drag on with no end in sight. Allowing partial pay reductions in these situations will create a fairer bargaining environment while giving parties a balanced incentive to reach agreement. It happens in other jurisdictions and should happen here.
These new policies, which require amendments to the Minimum Wage Act and Employment Relations Act, should be put before the House later this year.
This article, and any information contained on our website is necessarily brief and general in nature, and should not be substituted for professional advice. You should always seek professional advice before taking any action in relation to the matters addressed.