7 things New Zealand can teach Australia about workplace reform
Australia can learn a lot from the leadership of the Ardern Government — from policy reform to address stagnant wages, to building more inclusive workplaces.
Centre for Future Work economist, Alison Pennington, has looked at how New Zealand’s Ardern Government is reforming workplace policies to address low wages, inequality, and poor job quality. Here are 7 things Australia can learn from New Zealand policy reform:
1 // Industry bargaining agreements
A new system of “Fair Pay Agreements” (FPAs) is emerging from an increasing consensus in New Zealand that the current workplace relations system — based on individual contracts for most workers, with only minimal enterprise-level bargaining — has failed to deliver decent wages and fairer income distribution.
A move toward FPAs is well underway, allowing representative employers and employees to create industry-wide agreements that set minimum terms and conditions of employment for all workers within the scope of the agreement — including wages, hours, leave, allowances, weekend and evening rates, and more.
2 // Pay equity
Similar to Australia, women in New Zealand are more likely than men to be in part-time employment with insufficient hours, and more likely to work in the lowest-paid industries (like healthcare and social services).
Pay equity forms a key pillar of New Zealand’s strategy to boost wages growth. A recent landmark settlement for care and support workers was reached in New Zealand that was achieved through collective bargaining. The settlement delivered pay increases of up to 50 per cent for tens of thousands of workers — which is now facilitating pay equity claims and settlements for women workers economy-wide.
3 // Annual increases to the minimum wage
Ensuring that minimum wages increase alongside average wages and productivity is an important backstop against rising inequality; in this way, the wages of the lowest-paid workers will rise at least proportionately with average wages.
For New Zealand, strengthening the minimum wage is of particular importance due to the large proportion of workers who are paid according to legal minimums — the government has made commitments to raise the minimum wage every year through to 2021. This will put the lowest-paid workers in New Zealand in better standing relative to average workers, compared to the lowest-paid in Australia.
4 // Restoring employee and union rights to collectively bargain
Union rights to represent workers are already far less restrictive in New Zealand than in Australia. But a suite of labour law reforms to further improve unions’ ability to access and organise in workplaces and collectively bargain were passed by the New Zealand government in 2018.
These reforms mean prospects of building a collective bargaining system at multiemployer, industry-wide, and occupation-wide levels have been significantly enhanced in New Zealand.
5 // Greater protections against unfair dismissal for labour hire and agency workers
Insecure work arrangements such as temporary, labour hire, casual, independent contractor and “gig” work are increasingly workers’ reality, but government regulations, rights and protections for these workers have not kept up.
New Zealand ranks as having the weakest regulation of labour hire work in all of the OECD. To start to plug this regulatory hole, there is a bill before the New Zealand Parliament that proposes to extend employees in labour-hire the right to pursue employment grievances against their host firm.
6 // The “living wage” movement
The living wage is a wage that represents the amount of income required to secure a dual-earner household a basic, but decent, lifestyle. In response to the failure of modern industrial relations systems to ensure wages are high enough to protect workers from poverty, demands for a “living wage” have arisen across the world.
New Zealand’s vibrant Living Wage Movement was started in 2012, and now stands as an alliance of 70 member-groups from unions, community organisations and faith-based groups. The Ardern government has agreed to extend the living wage to all of its employees.
7 // Ten days paid domestic violence leave for workers
Adding to New Zealand’s list of progressive labour law developments, legislation for 10 days paid leave to workers experiencing domestic violence (DV) was passed in July 2018, making the country one of the first in the world to legislate paid DV leave in employment law at a national level.
Domestic violence is a pervasive problem in Australia, and ABS figures show around two-thirds of the 440,000 women who reported experiencing violence in the last 12 months in 2016, are in the workforce. Despite this, Australian labour law is yet to extend paid DV leave to employees. The lack of access to leave has consequences for workers’ safety and financial and job security.
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