Unions express unease with new Workplace Relations Minister

ACT deputy leader Brooke van Velden. Photo: RNZ
ACT deputy leader Brooke van Velden. Photo: RNZ
The new Workplace Relations and Safety minister has a busy two weeks ahead, with promises to axe Fair Pay Agreements and start work to reinstate 90-day trials before the summer break.

ACT deputy leader Brooke van Velden has rocketed into Cabinet, and knows she is biting off a lot more than many of her ministerial colleagues this side of Christmas. Two key aspects of the government's 100-day plan are hers to shepherd through.

"We've heard from business owners who want more certainty going into the New Year about what employment law will look like, so that we have a flexible labour market, where everybody knows what their rights are, and people can be employed with confidence," she said.

But van Velden's relationship with unions is already off to a rocky start.

Unions, since election night, have had to come to terms with the fact FPAs would be on the chopping block, and 90-day trials would be back.

Both National and ACT made both policies key parts of their campaign manifestos.

But the Council of Trade Unions president Richard Wagstaff is still disappointed.

"It's signalled that the incoming government intended to exercise a sort of free market deregulation zeal in their workplace relations space. That for us is very concerning," he said.

Council of Trade Unions president Richard Wagstaff. Photo: RNZ
Council of Trade Unions president Richard Wagstaff. Photo: RNZ
FIRST Union general secretary Dennis Maga believed the repeal would drive wages down, and increase unemployment and underemployment.

"Putting an extreme libertarian ACT minister in charge of Workplace Relations and Safety is like putting a vampire in charge of the country's emergency blood supply," he said in a media release.

Van Velden raised her eyebrows when that quote was put to her.

"I certainly don't think that's helpful. But look, respect goes both ways. I start all new relationships with a foundation of respect and in good faith. So I would hope that that comes back to me too."

Undoing FPAs, which allow for sector-wide collective bargaining, would put an end to one of Labour's pet projects, but one that never fully got off the ground.

While they had been secured for early childhood education, commercial cleaners, hospitality staff, security guards, and bus drivers, none have been fully concluded or enforced.

Van Velden argued a repeal would be a return to the status quo, and that increased costs to businesses would be passed on to consumers, and lead to more job losses.

"It was really important for me that we repealed the law as soon as possible, so that we didn't end up muddying the waters with some Fair Pay Agreements having gone through or finishing their bargaining process, and that would make it much harder to repeal, and also far more complicated in the law," she said.

With just two weeks to go until Parliament breaks for the summer (a shortened summer break, as the prime minister has indicated), it is a mad dash for the government to keep its pre-Christmas promises.

Leader of the House Chris Bishop is set to plunge the House into urgency this week to get legislation over the line, with the repeal of FPAs second on the list.

It means no select committee process, and no opportunity for workers or unions to make submissions.

That, along with the revelation officials had advised the agreements would benefit Māori, Pacific people, women, and young people, as well as a feeling van Velden did not properly consult with the CTU, has left Wagstaff feeling the process has been in bad faith.

"It's a significant step, and one that was worthy of a proper debate, proper discussion, and proper policy development. And we've been denied all those things," he said.

Van Velden maintains she did consult with the CTU.

"I reached out in good faith to both sides of the Fair Pay Agreement argument, which is the Council of Trade Unions and BusinessNZ, to give both parties an opportunity to start a good working relationship. I would have hoped, that's how we would have been able to play the next three years. I'm less certain of that now," she said.

"Of course, I'm always open to listening. I'm always open to hearing advice. But I will govern for the people of New Zealand, who believe that we have been elected on a mandate to do what is in the coalition agreements, and also to reform employment law."

BusinessNZ is pleased something at the top of its wishlist is being ticked off.

Its advocacy director Catherine Beard has echoed the minister in calling FPAs a blunt tool.

"You cannot kind of put a whole bunch of businesses in the same category, when they're different sizes and different geographical locations around New Zealand. It would have been quite hard to deliver on, we believe."

The officials' advice, along with a Cabinet paper, was leaked to Newshub last week. The Ministry of Business, Innovation, and Employment has launched an investigation.

Van Velden said she was disappointed.

"Whoever has leaked this Cabinet paper, if they've done it intentionally, they haven't let me down. They've let down the public service. And they've let down their team members who worked very hard to make sure that this government could fulfil its commitments."

Unlike FPAs, Bishop indicated legislation to reinstate 90-day trials for all businesses would be referred to a select committee.

The trials were brought in by National in 2009 for firms with 19 or fewer employees, then rolled out fully in 2011.

They were mostly scrapped when Labour came into office, though its deal with New Zealand First still limited trials to those smaller firms.

There have always been questions over the benefits of the trials.

A 2016 paper commissioned by Treasury and released by then-finance minister Sir Bill English found 90-day trials did not have any significant positive or negative effect on the number of jobs, on the likelihood of disadvantaged job seekers being employed, or on job churn.

But Beard believed their reinstatement would be a confidence boost for businesses.

"We think the 90-day trials are a good safety valve, and encourage business to maybe take a chance on employees that they may just consider too risky, if they haven't had a lot of work experience, or maybe they've been out of work for some time."

Wagstaff said the select committee process meant the CTU would be preparing submissions, arguing against the reinstatement.

"They just make a big difference to the level of insecurity people have, which is obviously much greater with a 90-day trial. We know the government prides itself on looking at the evidence, or they say they do. Here's the chance to act on that.

"But we're not hopeful that they will, given the promises that [they've] made and the rhetoric that they keep speaking to on this issue."

Van Velden would not indicate specifically why ACT sought the Workplace Relations and Safety portfolio, saying the division of portfolios was part of David Seymour's discussions directly with Christopher Luxon.

ACT did not get everything it wanted in that space.

A three-year freeze on the minimum wage, reversing new sick leave entitlements, and the scrapping of the 2 January public holiday did not make it into ACT's coalition agreement with National.