The Education and Workforce Committee has examined the Employment Relations (Pay Deductions for Partial Strikes) Amendment Bill and recommends by majority that it be passed. We recommend all amendments unanimously.

The Employment Relations (Pay Deductions for Partial Strikes) Amendment Bill would amend the Employment Relations Act 2000 and make consequential amendments to the Wages Protection Act 1983 and the Education and Training Act 2020.

Partial strikes are industrial actions by employees that are less than a full withdrawal of labour. Under the current law, employers’ main options for responding to a partial strike are to take no action, or to suspend or lock out employees and deduct all pay for that period as if it were a full strike. The bill would give employers the ability to make pay deductions in response to partial strikes. A similar mechanism was in place between 2015 and 2018.

The bill would give employers two alternative ways to calculate pay deductions, should they wish to make them. They could either: deduct 10 percent of an employee’s pay for the period of the partial strike; or reduce an employee’s pay by a proportionate amount (calculated using a specified method).

The bill would require employers to give notice of the pay deductions and sets out the dispute resolution process that would apply in relation to a dispute about pay deductions for a partial strike.

As part of our consideration of the bill, we have examined its consistency with principles of legislative quality. The majority of us have no issues regarding the legislation’s design to bring to the attention of the House.

This commentary covers the main amendments we recommend to the bill as introduced. We do not discuss minor or technical amendments.

The New Zealand Labour Party opposes this bill and the specific legislative changes that reduce a worker’s right to take strike action. This bill would unjustly affect workers’ ability to advocate for their best interests and tips the balance of workplace negotiations unfairly in the employer’s favour.

Partial strikes have been a tool for workers to engage in industrial action in a way that makes their point effectively whilst not unsustainably reducing the output of their workplace. Imposing sanctions on partial strikes, as evidenced in the select committee submissions, increases the likelihood that full strikes would be undertaken.

The regulatory impact statement (RIS) claims that these proposed changes aim “to restore better balance to collective bargaining situations”. It argues that employers are disadvantaged because they cannot make proportionate responses to partial strikes undertaken by employees during bargaining. This reasoning fundamentally ignores that employers can respond to partial strikes under the current law through suspension of employees.

The RIS also shows no robust evidence on the effectiveness of the bill. Clear evidence of the impacts of these measures should be available as these amendments have been previously enacted and repealed; however, the evidence of the effectiveness of these proposals towards the Minister’s aims has not been provided.

The bill undermines Aotearoa New Zealand’s obligations under international labour standards. Relevant statements in the RIS in relation to consistency with international obligations including labour standards were redacted. The bill misaligns with ILO Convention 98 (Right to Organise and Collective Bargaining Convention, 1949) in that it enables discriminatory treatment of workers engaging in lawful union activity.

The bill specifies that a partial strike can be defined as “a reduction in the employees’ normal performance of work, normal output, or normal rate of work”. Yet, the bill allows sanctions for actions undertaken as part of a partial strike that cannot reasonably be construed as impacting upon the worker’s “normal performance of work”. It also ignores the unfairness of this proposal that would mean that an employer could deduct 10 percent of an employee’s wages for any partial strike even if that partial strike did not mean the employee was not doing 100 percent of their job, for example if the employer determined wearing a union badge on a uniform was a partial strike.

It is our view the bill will damage relationships between employers and employees, is a solution looking for a problem with no evidence provided for the alleged issue, and further impacts an industrial landscape where good faith, trust, and co-operation have been sacrificed for ideologically political purposes.

The Greens oppose this bill and believe that the right of workers to organise collectively to advance their interests must be protected and that upholding the right of workers and their unions to campaign for political, environmental, social, and work-related industrial issues and, importantly, the right to strike. There is no evidence to show that the partial strike provisions which existed from 2018 to now have encouraged more or longer industrial action. There are a number of negative consequences of this bill. One is that this provision could lead to manifestly unjust consequences, such as workers losing pay for partial strike action. Another is the chilling effect that this bill will create, in conjunction with other industrial relations measures that this Government has advanced and proposed. This bill will make it more difficult for workers to take strike action for better pay and conditions, tipping the balance further in favour of employers, keeping wages low and enabling more of the income share to go to capital rather than labour.