From Contract to Relationship: The

Employment Relations Approach of New Zealand

James Wilson, Chief of the Employment Relations Authority Craig Smith Chief Adviser, Workplace Relationships

October, 2007

Overview

From awards to contracts to employment relationships-a timeline

A new legislative environment unpackaged

Approaches to dispute resolution Current issues and trends Future possibilities

Historical perspective

1890 – 1970 Awards The 70’s and 80’s enterprise

bargaining 1990’s Employment contracts 2000 Employment relations

Employment Relations Act 2000

The Act’s overall objective is:

“to build productive employment relationships through the promotion of mutual trust and confidence in all aspects of the employment relationship”.

This is achieved through…..

Good faith and mutual obligations of trust and confidence Acknowledging and addressing the inherent inequality of power

in employment relationships Promoting collective bargaining Protecting the integrity if individual choice Promoting mediation as the primary problem solving

mechanism Reducing the need for judicial intervention Promoting observance of the principles underlying ILO

Conventions 87 (freedom of association) and 98 (collective bargaining)

The new approach-a framework for employment relations

The Employment Relations Act 2000 establishes the overall regulatory framework for employment relations through setting the:

− Legal framework for collective and individual bargaining

− (new) Good faith obligation that underlies employment relationships

− Personal grievance and problem resolution mechanisms for employees covered by individual and collective agreements

The new approach-continued

Minimum employment standards are also contained in a number of other statutes, including:

– Minimum Wage Act– Holidays Act– Equal Pay Act– Wages Protection Act– Parental Leave and Employment Protection Act

Key elements

Good faith Unions Employment agreements Collective bargaining Strikes and lockouts Essential services

Problem Resolution Continuum

MediationMediation

Good Employment RelationsGood Employment Relations

Workplace Resolution

ERA

Courts

2,200,000

44,000

9,000

2,000

150

Dispute resolution

Good employment practices Workplace resolution Information and education on the employment relations

framework Employers & employees encouraged to talk & listen to

each other Focus on solving problems at the earliest stage through

information and education Mediation as a primary problem-solving mechanism Adjudication seen as the final option—Employment

Relations Authority as primary decision-making body Rights of appeal to specialist court

Mediation

Mediation is free, fast, and flexible Confidential as far as the law allows Personal grievances, employment relationship

problems, and collective bargaining Full and final settlement Mediator may make decision by authority of

parties Neutrality and independence are

cornerstones

The Employment Relations Authority

“An investigative body that has the role of resolving employment relationship problems by establishing the facts and making a determination according to the substantial merits of the case, … without regard to technicalities.”

The Employment Relations Authority

Independent statutory officers For problems not settled in mediation, the Authority is a

low-level and speedy decision making body Makes binding determinations based on the substantial

merits of the case Determinations may be challenged in Employment Court Investigates claims of unjustified dismissal,

interpretations of employment agreements, and wage claims

Can order reinstatement, compensation, and compliance

Powers of the Authority

The Authority investigates− Claims of unjustified dismissal and unjustified actions

(PGs)− Interpretation of employment agreements − Wage claims

The Authority can order− Reinstatement (including interim reinstatement)− Compensation− Compliance (with Employment Agreements, mediated

settlements or orders of the Authority)

Hears cases where parties are dissatisfied with the outcome in the Authority (this is usually de novo)

Hears matters surrounding strikes and lockouts (injunctive)

May refer cases before it back for further mediation

Can have its decisions appealed on points of law

Employment Court

Current trends and developments

Tripartism Workplace productivity Flexible work Partnership System improvement

What the research tells us

The system works but we can do better Most disputes settled privately Costs Fairness Levels of satisfaction Use of representatives A different picture for SMEs compared to large

businesses

What we are learning from practice

There are different views about the desired outcome of mediation

Different views about mediator style Education services seen as important and

need to be increased Need to strengthen cross cultural practice A call for greater consistency but also

increased flexibility

Future Possibilities

Employment policy and legislation are political artifacts

There is an emerging research about what works- towards an evidenced practice

The changing nature of workplace and workforce requires a reflexive system

A clearer connection between workplace practices and productivity

Better responsiveness to small business through education, training and support

Websites

Department of Labour− http://www.dol.govt.nz/− http://www.ers.govt.nz/

Ministry of Justice− http://www.justice.govt.nz/lac/pubs/2001/

legislative_guide_2000/chapter_18.html