In Business

EMA Policy Update

April, 2022

By: Alan McDonald

EMA’s Head of Advocacy & Strategy

As I mentioned during our recent round of online briefings, the Government’s policy agenda continues to ramp up at pace, and in the past few weeks, we have seen confirmation of the National Income Insurance Scheme (NIIS) proposal and the first draft of the Fair Pay Agreements.

I have never seen such strong negative feedback to legislation as the reaction we had from members on the NIIS, and our recent survey confirmed that 75% of you simply don’t want to see it introduced at all. A webinar in early April confirmed that same strong negative reaction. We are hosting the Employment Relations Minister Michael Wood at a member forum on April 27 to discuss both proposals. That will be a mix of in-person and online, so please join us at the EMA when the invites go out shortly.

A small percentage of respondents indicated some support for the NIIS idea, but not the scheme as outlined, and we’ll use that to inform our submissions when they close at the end of this month.

Fair Pay Agreements have also met a strong negative reaction. We will continue to oppose this step back in time proposal. A return to centrally bargained, national awards with all the inflexibility that system implies, is simply not fit for purpose in a modern work environment that requires flexibility and adaptability in the workplace.

Our main concerns with the scheme are the loss of flexibility, particularly for employees, the cumbersome process where a third party will negotiate for both employees (CTU unions) and employers (not clear). BusinessNZ, the EMA and others in the network have already indicated that we won’t bargain for employers because we believe the scheme is illegal, and not needed. The Auckland Chamber of Commerce and others also support that stance.

To get around that, the Government is now suggesting an even slower process involving the Employment Relations Authority. There is already a 12–18-month delay in having cases heard through the Authority.

Centrally bargained, centrally mandated and cumbersome national pay awards were abandoned as unfit for purpose in the early 1990s. It’s unclear what problem they will solve in a modern workplace that requires speed, flexibility and adaptability for employees and their employers.

It’s hard to imagine employees wanting to go to Wellington to ask for flexibility in their workplace when all they need to do now is talk to their employers.

It is also proven that the more engaged employers are with their workforce, the more productive that team becomes. Now, the Government is demanding you put a third party in the way.

We support MBIE’s proposal to apply a workplace test and review to limited identified sectors and apply minimum conditions and pay rates to those if a problem is identified and agreed.

Our public campaign opposing these agreements is likely to launch in early May.

We’ve also been told that the long-awaited Holidays Act replacement is now unlikely to be in place until April 1, 2024.

The ongoing review of the RMA continues, although we are yet to see details of the Climate Adaptation Act. It will join the National Built and Environment Act (NBEA) and the Spatial Planning Act (SPA) as one of the three replacements Acts for the current RMA.

It’s not yet clear how these three Acts will interact or align, and our fear is we will end up with a replacement system more complex and cumbersome than the one we have now. We are also concerned that the voice of the economic and development sectors is being overlooked in designing the future under these new Acts.

Nevertheless, Minister David Parker continues a push to have all three in place before the 2023 election – a pressing deadline for the current Government.

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