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28/3/2018 — General
Submissions urged on employment relations changes
By Dene Mackenzie

Businesses are being urged to submit on the Government's Employment Relations Bill this week before submissions close on Friday.

EMA chief executive Kim Campbell said businesses had to be able to meet the growing demand of their particular operation and be agile enough to remain competitive now and into the future.

“Our concern is there are proposed changes in the Bill which appear to deliver less flexibility and more compulsion without improving productivity.”

The EMA was concerned about six areas of the Bill, Campbell said.

They were:

  • Restriction of the 90-day trial period to businesses with fewer than 20 employees.
  • Restoration of statutory rest and meal breaks.
  • Reinstatement of an employee as the primary remedy to an unfair dismissal.
  • Restoration of 30-day rule where new employees were employed under terms consistent with the collective agreement.
  • Restoration of union access without prior employer consent and requirements to include pay rates in collective agreements.

Reports from earlier this year showed 70% of New Zealand workers were employed by large businesses, which accounted for a small percentage of the total number of employers in New Zealand.

That meant 70% would be exempt from trial periods but more than 95% of all NZ businesses would still be able to use them.

The Bill meant employers would once again have a duty to conclude collective bargaining unless there was a good reason not to.

Campbell said the increase in the minimum wage to $16.50 an hour or April 1 was heralded by the previous government and most businesses would have prepared for the rise.

However, it was important to note New Zealand had the highest minimum wage, as a proportion of the average wage, in the world.

“We are keen to understand how businesses will increase productivity to cover further proposed increases in coming years.”

A cafe employing five staff on the minimum wage would have to sell six more cups of coffee a day to cover the increase from April 1, he said.

If the minimum wage increased to $20 an hour, all other factors remaining equal, the cafe would need to sell 36 more cups of coffee per day.

The issue raised important questions for business, Campbell said.

Did they sell more units, did they raise the cost of their products and services or did they look for ways to automate processes?

Decisions around the minimum wage could not be made in isolation of other dynamics, such as the proposed employment relations changes, he said.

*Dene Mackenzie is business editor of the Otago Daily Times.

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