In our October newsletter, we reported on the progress of the Employment Relations Amendment Bill. We can now report that the bill was passed in parliament on 5 December 2018.
Since the Select Committee’s report was released, there have been a few amendments to the Bill, but otherwise what we reported earlier is what has basically been passed. The particular changes of note in the most recent Parliamentary wrangling are:
- At a practical level, employers will effectively be able to opt out of a multi-employer collective agreement (a “MECA”). While employers still need to bargain in good faith, they can oppose concluding a MECA if they have “reasonable grounds” to do so.
- Consent to access a workplace by union officials is still required. However, there is no requirement to seek consent if:
- a collective agreement is in force that covers the work done by employees at the workplace; or
- bargaining has been initiated for a collective and the intended coverage of that collective covers the work done by employees at the workplace.
- There are additional exemptions from the requirement to provide rest and meal breaks for those engaged in an “essential service” or “national security”, where such employers can provide “compensatory measures” instead of breaks themselves. These number of employers this will apply to will likely be quite limited.
The provisions of the Bill will come into force on 6 May 2019. The Bill has a number of “back to the future” changes that repeal amendments to the Employment Relations Act 2000 made by the previous National Government. These include:
– Removing the Employment Relations Authority’s power to determine collective bargaining is at an end;
– Giving unions a head start when initiating collective bargaining again;
– Reintroducing the requirement to conclude a collective agreement unless there are genuine reasons, based on reasonable grounds, not to;
– Requiring parties to keep bargaining about other matters even if they’ve reached a deadlock about one matter in the bargaining. These changes won’t have much impact on run-of-the-mill bargaining, but they may have an impact on out-of-the-ordinary bargaining where the parties can’t agree and the bargaining becomes protracted.
Unions may also push for more multi-employer collective bargaining but MECAs remain rare and were rare even before the National Government allowed employers to opt out of MECA bargaining.
Of more interest is the new requirement to include wage and salary rates in a collective agreement. Employers won’t be able to resist entering into a collective agreement on the grounds they object in principle to including wage and salary rates in a collective agreement. Most collective agreements do in fact have wage and salary rates in them, but this change could impact new union-employer relationships and existing union-employer relationships where wage and salary rates are not set out in a collective agreement. Unions are likely to test this law and push for a broad application because of the importance of wage bargaining to them and their members.
There are also some changes afoot to the law relating to industrial action. The law allowing employers to make partial pay deductions during partial strikes will go. This means an employer won’t be able to reduce an employee’s wages if they go on a partial strike, such as a go slow or paperwork ban. The employer will either need to suspend the employee or keep paying them even though they’re only performing part of their duties when they’re on strike.
Also, a minor or technical error in a strike notice in a non-essential service will no longer invalidate the strike. This shouldn’t have a huge impact because it’s pretty difficult to get injunctions restraining strikes in non-essential services.
There haven’t been too many cases from the Employment Court on the collective bargaining front, but a couple of interesting decisions relating to industrial action have come out.
In Secretary for Justice v PSA  NZEmpC 129, the Employment Court refused an application for an interim injunction to restrain a strike in a non-essential service. Court Security Officers (‘CSOs’) were going on strike in court rooms, which created inconvenience and potential health and safety risks when the courts were closed.
The parties agreed the justice sector was not an essential service, so no particular number of days’ notice needed to be given. However, the employer argued it was still entitled to “reasonable notice” of a strike. The union was giving 30 minutes’ notice of strikes and the employer said this was unfair. The Employment Court found there was no requirement to give reasonable notice because there was no minimum period of notice set out in the Employment Relations Act 2000 for non-essential services. The case may proceed to a full hearing, but in the meantime employers in non-essential services can continue to expect pretty short notice of strikes and this will continue to be lawful in most circumstances.
In Wendco (NZ) Ltd v Unite Inc.  NZEmpC 67 the employer obtained an interim injunction restraining picketing related to a strike. In that case, the union went on strike and then picketed on the employer’s premises and drive thrus. The employer showed there was evidence of the strikes committing the tort of trespass and the court held that because of the health and safety risk arising out of picketing in drive thrus the picketing should be restrained. The union’s argument that the Employment Court could not grant an injunction to restrain picketing where it related to a lawful strike was rejected. This means that even if a union lawfully goes on strike, if its picketing is unlawful it can be restrained. It also confirms that a union can’t picket on an employer’s property. Stay tuned for more developments when the new laws come into force, and no doubt there will be litigation about these new laws.