Government brings in Bolger to spearhead contentious workplace reform

The coalition government has started work on its most radical labour reform – minimum standards for all workers in an industry or occupation.

It has announced former Prime Minister Jim Bolger will lead a working group to make suggestions on how to create a sector-level bargaining system. The group must report back to Workplace Relations Minister Iain Lees-Galloway by the end of the year. It will get about $300,000 in funding from the Ministry of Business' baseline budget for policy work. 

The government says fair pay agreements will be based on generally accepted minimum terms and conditions in the industry and be set by collective bargaining between unions and employers.

It says in a release strikes or lockouts will not be permitted in negotiations for a fair pay agreement. Mr Lees-Galloway says fair pay agreements will resist a race to the bottom for workers.

“Aspects of the labour market are failing,” he said, adding that he wanted "business voices at the table.” 

“We can and must do better for middle New Zealanders. Fair pay agreements will establish a framework for employers and employees to work together constructively to lift wages and productivity.”

“Workers and employers know their sector best. By working together through effective engagement and bargaining cooperatively, workers and employers can set standards that are relevant to their sector and support productivity and growth.”

Mr Bolger said the group was bipartisan and the work was important because “some have made obscene wealth and some are missing out altogether. The middle is almost forgotten.”

The former National prime minister, who passed the Employment Contracts Act, crushing unions under his leadership during the 1990s, said it was an area he was particularly interested in.

Before the election last year BusinessNZ chief executive Kirk Hope said the policy was a substantial change to the framework which industrial relations had been conducted within in the last 30 years.

"Business would be concerned if the fair pay agreements resembled national awards which caused strikes and economic decline in the past.”

He says employers would have to take part in the bargaining even if they didn’t want to, and smaller employers may not be able to afford it when wages went up.

Council for Trade Unions president Richard Wagstaff said in June last year a fair pay agreements policy was celebrated by working people and was the way of the future.

Working group members:

• Jim Bolger – 35th prime minister of New Zealand, former minister of labour

• Stephen Blumenfeld – director, Centre for Labour, Employment and Work at Victoria University

• Steph Dyhrberg – partner, Dyhrberg Drayton Employment Law

• Anthony Hargood – chief executive, Wairarapa-Bush Rugby Union

• Kirk Hope – chief executive, BusinessNZ

• Vicki Lee – chief executive, Hospitality NZ

• Caroline Mareko – senior manager, communities and participation, He Whānau Manaaki o Tararua Free Kindergarten Association

• John Ryall – assistant national sSecretary, E tū

• Isabelle Sin – fellow, Motu Economic and Public Policy Research, and adjunct senior lecturer at Victoria University of Wellington

• Richard Wagstaff – president, New Zealand Council of Trade Unions