New Zealand

30 Octobre 2019

Working life in New Zealand

About

  • Auteur: Parker, J., Arrowsmith, J., Barney, A., Bone, K., Junaid, F., Port, Z., Rao, V. and Tappin, D.
  • Institution: MPOWER, Massey University
  • Published on: Mercredi, Octobre 30, 2019

This profile describes the key characteristics of working life in New Zealand (NZ). It aims to complement other EurWORK research by providing the relevant background information on the structures, institutions and relevant regulations regarding working life.

Key figures

Key figures

Comparative figures on working life in New Zealand

 

2012

2017

% (point) change
2012–2017

NZ

EU28

NZ

EU28

NZ

EU28

Real GDP per capita 1, 2

35,486

25,700

37,806

27,600

6.5%

7.3%

Unemployment rate – total 3,4

6.9

10.5

4.5

7.6

-2.4%

-2.9%

Unemployment rate – women

7.6

10.6

5.0

7.9

-2.6%

-2.7%

Unemployment rate – men

7.1

10.4

4.0

7.4

-3.1%

-3.0%

Unemployment rate – youth

15-19 years

20-24 years

30.9

12.4

23.1

19.4

8.4

16.8

-13.9%

-4.0%

-6.5%

Employment rate – total

62.6

71.7

73.3

73.4

10.7%

1.7%

Employment rate – women

57.0

65.5

62.4

67.9

5.4%

2.4%

Employment rate – men

68.4

77.8

73.3

78.9

4.9%

1.1%

Employment rate – youth

15–19 years

20–24 years

30.2

65.3

42.4

40.7

73.3

41.7

10.5%

8.0%

-0.7%

Sources: Real GDP per capita – EU: Eurostat (chain linked volumes [2010], in EUR) and percentage change 2012-17 (both based on tsdec100), 2 Real GDP per capita – New Zealand/Aotearoa: World Bank (2019) (current USD – 2012: 39,970 and 2017: 42,583; currency exchange to EUR on 5.6.19), 3 Unemployment rate by sex (% of active population) and age (youth 15-24 years) – EU: annual average, % [une_rt_a], 4 Employment rate by sex (% of active population) and age (youth 20-24 years) - annual average, % [lfsi_emp_a]. Unemployment rate total, by sex, youth – New Zealand/Aotearoa: Stats NZ (2012a, 2017a), December quarters (youth defined in 15-19 and 20-24 year categories).

New Zealand/Aotearoa is one of the most ethnically diverse countries in the world, a phenomenon that is set to escalate (Stats NZ, 2017b), with implications for managing and accommodating diverse labour force characteristics and circumstances.

Figures on working life in New Zealand, by main ethnic group

Ethnic group

Employment rate

%

Uenmployment rate %

Total labour force (000s)

Employed

(000s)

European

69.1

3.5

1,991.8

1,922.6

Māori

64.4

9.0

349.0

317.7

Pacific peoples

62.2

7.7

161.7

149.2

Asian

69.5

4.5

   

Source: Stats NZ (2017b).

Background

Background

Economic and labour market context

In recent decades, New Zealand/Aotearoa’s economy has transformed from being one of the most regulated of the Organisation for Economic Co-operation and Development (OECD) members to one of the least. The economy has shifted from being based on agriculture, dependent on concessionary British market access, to a mixed economy that operates on free market principles. Its sizeable service makes up a large portion of the country’s GDP, with exported goods and services (dominated by agricultural outputs) representing 27%. According to the Central Intelligence Agency’s (2019) The World Factbook, expanding New Zealand/Aotearoa’s network of free trade agreements remains a topic of foreign policy priority.

From 2012 to 2017, New Zealand/Aotearoa’s economy expanded by 26.9% or NZ$57.3 billion (€33.7 billion) (Stats NZ, 2018a). This is an average growth rate of 4.9% per year, below the European Union average of 7.4%. Since 2017, the country’s economic growth rate has slowed, with this change in growth expected to persist, averaging three percent over the next five years.

Unemployment rates between 2012 and 2017 for all categories decreased and, other than for youth, were below the European Union averages.

More information on:

Legal context

Until 1840, New Zealand/Aotearoa adhered to Māori customary law which is still recognised if it meets certain criteria. The country’s legal system was founded on British law, but it has evolved into an independent system. Signed by the British Crown and Māori chiefs in 1840, the Treaty of Waitangi is widely seen as a constitutional document, but can only be enforced in a court of law when an act of parliament explicitly refers to the Treaty (Ministry of Justice, 2019).

Criminal and civil law constitute the two broad parts of the country’s law, with common law derived from judicial decisions. International law and treaties have influenced New Zealand/Aotearoa law, particularly since the 1960s.

Laws are drafted by the government. The public and social partners can lobby members of parliament, and at specified stages make submissions on bills.

Working conditions are mainly covered by both statute, particularly the Employment Relations Act 2000 (ERA), and common law. The ERA 2000 reframes employment contracts as employment relationships, indicative of an ideological shift from a unitarist orientation to a more relational approach based on social exchange. The majority of workers have individual employment agreements (IEAs), though collective employment agreements (CEAs) are more common in the public sector (New Zealand Companies Office, 2018). Other key statutes applying to the labour market and employment relations are:

  • Holidays Act 2003
  • Wages Protection Act 1983
  • Minimum Wage Act 1983
  • Parental Leave and Employment Protection Act 1987
  • Equal Pay Act 1972 (EPA)
  • Health and Safety at Work Act 2015 (HSWA)

Although statutes establish the minimum entitlements of employees in New Zealand/Aotearoa, they do not amount to a ‘labour code’ in its true sense. There is scope for courts to apply and develop common law principles, which mostly derive from British common law.

The Employment Relations Amendment Act 2018 amends the ERA 2000 and introduces changes that effectively reverse the law to how it was in 2015. There are good faith provisions in the ERA 2000, Health and Saftety at Work Act 2015 (HSWA) and State Sector Act 1988, with the latter specifying the obligations of a ‘good employer’. A forthcoming statute is the Equal Pay Amendment Bill.

Industrial relations context

In law, the formalisation of industrial relations (IR) in New Zealand/Aotearoa began with the Trade Union Act 1878 and the Industrial Conciliation and Arbitration Act of 1894 (IC&A). In return for compulsory conciliation and voluntary arbitration of industrial disputes, unions agreed to curb their rights and powers ‘within a context of preferential status for unions and their members’ (Rudman, 2013). The state supported a system that stayed largely intact until union membership and dispute arbitration were made voluntary in 1984, and the Labour Relations Act 1987 removed union monopolies. For nearly a century, statutes have provided limited details on the individual employment relationship. This meant that its legal base was defined by common law as a master-servant relationship.

The Employment Contracts Act 1991 (ECA) marked a dramatic shift from a system of collective representation and bargaining to one based largely on individual contracts, in a context of labour market and economic deregulation as well as employer-driven workplace flexibility. The ECA removed the distinct legal status of unions and precipitated a significant decline in union activity and scale, as well as tripartite arrangements relating to employment (Parker, 2013). Its replacement with the ERA 2000 aimed to recalibrate the balance of power between employers and employees and unions. It emphasises collective and individual bargaining and employment agreements, recognising unions as the only representative of worker collectives and introducing the notion of ‘good faith’ into employment relationships.

According to the International Labour Organisation (ILO, 2019), the predominant view of the ERA 2000 ‘is that [it] introduces a considerably more orthodox and moderate approach to labour market regulation.’ However, certain principles from the ECA are still present, including an emphasis on local or enterprise-level bargaining, and trying first to resolve a dispute within the workplace.

Another cornerstone statute is the HSWA, which introduced new responsibilities for managing risks that could cause serious injury, illness or death in the workplace. The Employment Relations Amendment Act 2018 brought in changes including restricting 90-day trial periods to businesses with 19 or fewer employees (protecting the employee from unfair dismissal), a duty to reach a collective bargaining agreement, and removing the opt-out for employers bargaining for multi-employer collective agreement (MECA) (Employment New Zealand, 2019a).

Actors and institutions

Actors and institutions

Public authorities involved in regulating working life

In New Zealand/Aotearoa, a multi-level system involving trade unions, employers’ organisations and public institutions is key to the regulation of employment relationships, working conditions and industrial relations institutions.

The Department of Labour (DoL) was responsible for improving the performance of the labour market, contributing to strengthening the economy and increasing living standards. In 2012, the department became part of the Ministry of Business, Innovation and Employment (MBIE), and was rebranded as Employment New Zealand. The MBIE conducts most administrative functions surrounding labour rights and their practical application, provides free mediation and information on employment matters, and can clarify employment rights and obligations. According to the MBIE, Employment New Zealand seeks ‘to support positive relationships between employers and employees, and to promote safe, fair and harmonious workplaces’ (MBIE, 2018a).

The Court of Arbitration, a specialist industrial relations court, dealt with industrial relations disputes from 1894–1973. The ECA established the Employment Court (regarded as equal to the legal standing of the High Court). The Employment Relations Authority was established as an independent body by the ERA 2000 and sits below the Employment Court.

Established in 2013, WorkSafe New Zealand (WorkSafeNZ) is New Zealand/Aotearoa’s primary regulator of workplace health and safety. Its three key roles concern regulatory confidence, harm prevention and system leadership, and collaboration with businesses, undertakings, workers and their representatives to promote good practice. WorksafeNZ has implemented the most significant reforms to workplace health and safety in over 20 years, and the regulator’s goal includes a government target to reduce workplace fatalities and serious injuries by 25% by 2020.

The State Services Commission is the central public service department charged with overseeing, managing and improving the performance of the state sector and its organisations.

Representativeness

The (NZ) Council of Trade Unions (CTU) was formed in 1987 by the merger of the New Zealand Federation of Labour and the Combined State Unions. It represents 360,000 members across 27 affiliates (CTU, 2019). The peak body is closely associated with the Labour Party, and affiliated with the International Trade Union Confederation. A small number of union members belong to unions that are not affiliated to the CTU.

Business New Zealand (BusinessNZ) was founded by four large regional organisations of member businesses. Similar to the CTU, BusinessNZ does not have the authority to conclude collective agreements. As a consequence of the decentralised character of employment relations in New Zealand/Aotearoa, employer organisations do not have a particularly prominent role.

The vast majority of union-management agreements are collectively bargained for through negotiations occurring at local or at enterprise level.

Trade unions

About union representation

The ECA adopted a traditional contractual approach to the employment relationship, which assumed that employers and employees had equal bargaining power. In 2000, this was superseded by the ERA, which became the primary legislation governing union membership and union-management workplace disputes in New Zealand/Aotearoa. The Act enables core provisions on:

  • freedom of association
  • recognition and operation of unions
  •  collective bargaining, collective employment agrements (CEAs) and indvidual employment agreements (IEAs)
  • employment relations
  • education leave
  • strikes and lockouts
  • personal grievances and disputes
  • enforcement of employment agreements
  •  the Mediation Service, the Employment Court, the Employment Relations Authority
  • labour inspectors

In New Zealand/Aotearoa, any employee may choose to join a union, with each union setting its own fees. In 1936, the government under the Labour Party introduced a system of state-enforced compulsory union membership. In 1961, the National Party replaced the compulsory system with one of unqualified preference, a post-entry closed shop, negotiated and enforced by unions and employers.

Under the ERA 2000, a registered union must contain at least 15 members. In 2017, there were 131 registered unions (New Zealand Companies Office, 2018). An employer and union should deal with union visits, and conduct bargaining for collective agreements in ‘good faith’. The Act also provides for facilitated bargaining. The Employment Relations Amendment Act 2018 extends the purposes for for which a union representative may enter a workplace (Employment New Zealand, 2019a). Some union members may be entitled to paid leave to attend approved employment relations education courses. However, these receive comparatively little state funding.

Employers cannot undermine collective bargaining or agreements by automatically passing on the terms and conditions of a CEA to employees who are not covered by it. However, an employer may offer employees the same, or similar, terms and conditions as those covered by the collective agreement, and must bargain with individual employees in good faith (Employment New Zealand, 2019b). The Amendment Act requires parties to conclude collective bargaining, unless there are reasonable grounds not to. Additionally, employers can no longer opt out of MECA bargaining.

Union membership has declined over the last three decades, contributing to increasing inequality. Factors driving this trend include the introduction of the ECA in 1991 and the deregulation of a centralised wage bargaining system to one focused on enterprise bargaining. Indeed, the rate of decline in union membership and density in New Zealand/Aotearoa has exceeded that of many other OECD countries. The ERA 2000 was an attempt to support union organisation and the role of unions in collective bargaining. However, the damaging impact to these institutions in the 1990s under the ECA and the move away from a centralised bargaining system has proved difficult to reverse.

Since 2010, union membership and density have declined, despite the growth in employment following the end of the global financial crisis. In key industries, union membership has been maintained rather than grown (Ryall and Blumenfeld, 2016).

Union membership and density

Union membership and density

 

2012

2013

2014

2015

2016

2017

Union density in terms of active employees1

16.9

16.4

15.7

15.2

14.5

14.1

Union membership (000s)

369.2

365.9

361.4

358.6

357.1

361.7

Source:1Ryall and Blumenfeld (2017). Data sourced from the Centre for Labour, Employment and Work (CLEW) Survey 2017. D ensity figures reflect total union membership divided by the total employed labour force according to the HLFS.

In the private and public sectors, union membership and density in New Zealand/Aotearoa has declined, and unions are now largely public sector institutions (60% density compared with 10% in the private sector in 2017). Public sector jobs such as those in public and community services are most likely to be unionised. In the private sector, the transport, postal and warehousing group is the only industry group where union density (34.5% in 2017) approaches that in the public sector (Ryall and Blumenfeld, 2017).

Main union confederations and federations

The proportion of union members who belong to affiliates of the CTU has changed little since 2000 (89.6% in 2012 and 87.0% in 2017) (Ryall and Blumenfeld, 2017). The table summarises the main union confederation in New Zealand/Aotearoa, in terms of members and bargaining role.

Main union confederations and federations

Long name

Abbreviation

Members

(2017)

Involved in collective bargaining?

New Zealand Council of Trade Unions

(NZ)CTU

314,466

No

Source: Ryall and Blumenfeld (2017). Data sourced from the CLEW Survey 2017.

In 2017, 25 unions were affiliated to the CTU. Of the 75 unions with fewer than 1,000 members, only nine were CTU affiliates, and of the 11 unions with more than 5,000 members, 10 were affiliates (CLEW, 2017, as cited in Ryall and Blumenfeld, 2017). One factor that has contributed to union decline has been amalgamation, primarily amongst affiliates and with future amalgamations unlikely to impact small unions.

Employers’ organisations

About employers’ representation

Business owners in New Zealand/Aotearoa may choose to join various organisations that act to represent their interests collectively. The most important of these employer organisations have traditionally been four regional employers associations (EAs): EMA Northern, Business Central, Canterbury Employers’ Chambers of Commerce and Otago Southland Employers’ Association. Collectively, the associations advocate and provide a range of employment, advisory and training services to local members who pay an annual subscription.

At national level, these four regional associations, combined with several other industry interest groups, collectively form BusinessNZ (see figure) – the employer counterpart to the CTUBusinessNZ advocates for business interests across a range of issues, such as export and the environment, as well as industrial relations. Typically, BusinessNZ lobbies the government for business-friendly legislation and inputs where relevant to the work of international organisations, including the OECD, ILO and International Oraganisation of Employers (IOE).

Employer Associations and BusinessNZ network

Source: BusinessNZ (2019).

While the BusinessNZ network provides high-level coordination on matters of business policy and business advocacy, the coordination of employer and collective activity in day-to-day industrial relations is far less – a reflection of New Zealand/Aotearoa’s history. For nearly 100 years, the country’s industrial relations system fostered a highly centralised, collective approach. Compulsory unionism led to high levels of union density and strong sector-based unions. Terms and conditions of employment for workers were fixed through national awards, typically covering thousands of workers and large numbers of employers operating within the same sector. Awards were renegotiated annually by senior union officials and ‘advocates’ who represented one of the four regional employment associations.

Individual employers were usually unable to negotiate ‘first tier’ or core terms and conditions directly with their own staff, and independent enterprise-level bargaining was rare. Unlike workers, employers were not compelled by law to join employment associations, but did need to belong to one of the regional associations to gain access to the award negotiations.

This highly collectivised system was overturned by the ECA, which permitted employers to negotiate terms and conditions of employment directly with individual members of their staff, or with their ‘representative’ (who no longer needed to be a union official). This enterprise-based approach to industrial relations contributed to a decline in union density, with the majority of workers and employers choosing to represent themselves in most employment relations activities. The decline in centralised and coordinated worker representation has been mirrored in the level of employer coordination on daily industrial matters. The majority of industrial relations in New Zealand/Aotearoa, particularly in the private sector, is enterprise-based and individually focused. Specialist representation can be contracted in to assist, when required, by either party, while most formal industrial relations is still union-based.

While the changes introduced in 1991 contributed to union decline, the four regional employment associations survived this period and maintained, or attracted, a sufficient number of members to stay economically viable. However, with the shift away from centralised award negotiations, the need for regular centralised collective representation of employers evaporated. To maintain union membership, employment associations adopted two main strategies: firstly, the diversification of services offered, and secondly, merging with compatible business service providers, such as regional Chambers of Commerce, ExportNZ and Business Mentors NZ. Therefore, while many employers continue to belong to centralised employer organisations, their reasons for doing so are now less easy to discern.

Determining membership and density figures for the different employer organisations is problematic. While the number of employers in New Zealand/Aotearoa is approximately 150,000 (Stats NZ, 2016–2017; MBIE, 2017), the total number of employers and active employees represented collectively by the regional associations is hard to establish. Firstly, these organisations are not public bodies but private organisations, working in a competitive business services market with no requirements to keep or release membership data. Second, historical information on the total number of employees covered by these organisations’ members (necessary to calculate total densities) does not appear to be maintained by all four organisations. Most significantly, two regional employment associations operate in joint partnership with other networked business organisations in New Zealand/Aotearoa. Members joining one organisation are counted as members of the other two organisations, even if they do not utilise the services provided. Data must, therefore, be treated as indicative only.

Employers’ organisations – membership and density

Employers’ organisations - membership and density

 

2013

2014

2015

2016

2017

Employers’organisation density in terms of active employees

Not available

Not available

Not available

Not available

Not available

Main employers’ organisations and confederations

Long name

Abbreviation

Members (2018)

Involved in collective bargaining?

Employers’ and Manufacturers’ Association

EMA

8,5811

Yes

Business Central

BC

3,6252

Yes

Canterbury Employers’ Chambers of Commerce

CECC

2,9003

Yes

Otago Southland Employers’ Association

EOC

2,5004

Yes

Business New Zealand

BusinessNZ

No direct membership5

No

Sources: EMA (2018), 2 Business Central (2018), 3 Canterbury Employers’ Chambers of Commerce (2019), Estimate (number unavailable), BusinessNZ (2019).

Tripartite and bipartite bodies and concertation

New Zealand/Aotearoa has seen far less formal bipartite and tripartite cooperation between employment relations actors than is typical in Europe. For many years, there have been no significant cooperative agencies working permanently at tripartite level. However, in 2019 the government announced the establishment of a new Tripartite Future of Work forum, involving representatives from the CTU, BusinessNZ and the government. There are also a handful of smaller bipartite organisations operating at sector or industry level (such as the National Bipartite Action Group in the health sector).

Main tripartite and bipartite bodies

Name

Type

Level

Issues covered

Tripartite Future of Work forum

Tripartite

National

  •  Just Transitions
  • Learning for Life
  • Technology
  • Productivity

National Bipartite Action Group (National BAG)

Bipartite

District health boards and health sector unions

 

Workplace-level employee representation

Many workplaces have some form of representative mechanism for workers, including consultative arrangements between employees and management. There is no legal regulation in place, except for the health and safety committees mandated under the HSWA. These systems of representation usually discuss matters related, or similar, to those covered by collective bargaining, albeit in a less formal manner.

In 2017, 46% of CEAs that were examined contained specific details of employee participation systems relating to occupational health and safety (OHS). Two percent made reference to a separate policy or the HSWA, and 52% contained no clause relating to this matter (Blumenfeld et al., 2017). This reflects a steady decline since 2009, when 57% of examined CEAs contained a specific OHS participation clause.

Regulation, composition and competences of the representative body

 

Regulation

'Is the regulation of these bodies codified by law or in collective agreements?'

Composition

 

Competences of the body

'Involved in company level collective bargaining?'

Thresholds/rules 'When do they need to be or can be set up?'

Union

Yes – ERA 2000, parts 3 and 4

Voluntary membership for relevant workers (generally sector-specific).

Yes.

Need at least 15 members to become an incorporated society and to register as a registered union.

Health and safety representatives (HSRs) for work groups

Yes – HSWA, part 3

HSR number is in line with a legislated minimum ratio of representatives to workers.

No, but can issue a provisional improvement notice if a HSR reasonably believes that a person is contravening, or is likely to contravene a provision of the Act.

Employer must seek to resolve the unsafe matter raised in the notice, or face legal penalty.

Employer must determine the number of HSRs for a work group in line with prescribed minimum ratio.

Health and safety committee (HSC)

Yes – HSWA, part 3

Workers and management.

One member must be appointed by the employer and have health and safety decision-making authority.

At least half of committee members must be workers and not nominated by the employer. HSRs are eligible for committee membership.

No, but can raise concerns and give recommendations.

Employer must establish a committee if a request is made by five or more workers, or an HSR, but can decline if it has fewer than 20 workers and is not in a high-risk industry (as prescribed under by the regulations/law).

Can be set up by the employer voluntarily.

Collective bargaining

Collective bargaining

Bargaining system

Wage bargaining coverage

The OECD identifies New Zealand/Aotearoa as a ‘fully decentralised’ collective bargaining system, whereby ‘bargaining is essentially confined to the firm or establishment level with no co-ordination and no (or very limited) influence by the government’ (OECD, 2018b). Collective bargaining is not entirely voluntary. First, a union or employer can initiate bargaining by giving the other parties a bargaining notice. If a party receives a notice meeting the requirements, they have to enter into bargaining. Second, the ERA 2000 (part 1, subsection 1(a)) requires the parties to negotiate in ‘good faith’. This means being active, constructive and not misleading or deceptive in their relations with each other. Collective agreements can be no longer than three years, and strikes cannot occur while a collective agreement is in place.

Collective bargaining coverage of employees

According to the OECD (2016), collective bargaining coverage was 15.9% in 2016 (data are unavailable for recent years). Other measures show a slightly higher figure.

In 2016, Stats NZ introduced new questions to the HLFS in the June quarter. These include union membership, whether employees have a written employment agreement, and, if they do, whether it is an IEA or a CEA. This information has only been collected twice before 2016, in 2008 and 2012, and published in the Survey of Working Life (SoWL). The results indicate that around one in five employees belong to a union, with half of these members employed in either healthcare or education (Stats NZ, 2016). Regarding written employment agreements, which are a legal requirement, 8.6% of employees said they did not have one and a further 2.8% did not know. Of 1,759,200 employees who reported that they had a written employment agreement, 71.1% said they were on an IEA compared with 23.3% on a CEA. According to these figures, 23.3% of workers in New Zealand/Aotearoa are covered by collective bargaining.

It is worth noting that since the ERA 2000, only union members can be covered by a CEA. However, around one in 10 of those who believe they are covered by a collective agreement are not union members. This might be because many collective agreements in New Zealand/Aotearoa permit employers to offer the same terms to all or part of the non-union workforce, in a practice known as ‘passing on’ of terms.

The CLEW maintains a database of all collective agreements. Bringing together the number of workers included in these agreements with the total numbers of employees that are recorded by the official Quarterly Employment Survey (March quarter) provides the following figures for collective bargaining coverage (see table).

Collective bargaining coverage of employees, public and private sectors

Year

2012

2013

2014

2015

2016

2017

Private sector

9.7

11.0

10.6

10.2

9.9

9.2

Public sector

62.6

62.7

59.3

59.2

57.7

58.2

Total

20.2

21.3

21.5

19.8

19.0

18.2

Source: Calculated from Blumenfeld et al. (2017).

Collective bargaining coverage has declined in the public and private sectors. The growth of private sector jobs has contributed to a steady decline in the overall coverage (18.2% in 2017) of employees. However, these data only measure employees who are directly affected by CEAs, not employees who are affected by collective bargaining through ‘passing on’.

Bargaining levels

Levels of collective bargaining

 

National level (Intersectoral)

Sectoral level

Company level

 

Wages

Working time

Wages

Working time

Wages

Working time

Principle or dominant level

-

-

X (public)

X (public)

X private)

X (private)

Important but not dominant level

-

-

-

-

X (public)

X (public)

Around 92% of private sector employees covered by a CEA are in a single-employer agreement, compared to 41% in the public sector. MECAs are now rare in the private sector, but remain prominent in the public sector where a central authority often negotiates for employers. Overall, 39% of employees covered are involved in MECAs (Blumenfeld et al., 2017).

Fair payment agreements (FPAs) may signal the government’s commitment to introducing a system of bargaining to set minimum employment terms and conditions across industries or occupations. The decline of union membership and collective bargaining has contributed to low wage and productivity growth and rising inequality, forming the premise of the agreements. The Fair Pay Agreements Working Group was established by the Minister for Workplace Relations and Safety, and provided its recommendations in December 2018 (Fair Pay Agreements Working Group, 2018). Under the Working Group’s recommendations, workers should be able to initiate a FPA bargaining process if they can meet a minimum threshold of 1,000 workers, or 10% of workers in the nominated sector or occupation, whichever is lower. Alternatively, a FPA may be initiated without a representation threshold where ‘harmful labour market conditions’ are identified.

Articulation

There are no formal mechanisms that link different levels of bargaining.

Coordination

No formal mechanisms exist for the coordination of bargaining, though informal benchmarking may occur by any party.

Extension mechanisms

The only legal extension mechanism applies at individual level. Any new employee that is appointed, where a CEA is in place, must be employed under the agreement’s terms and conditions for the first 30 days of employment, even if they are not a union member. The parties may also agree that their CEA extends to non-union employees.

Derogation mechanisms

No data are available, but such mechanisms are likely to be rare.

Expiry of collective agreements

The ERA 2000 requires CEAs to exist for a specific term of up to three years. An expiry date may be entered, or termination linked to a specific event (such as the completion of a project). However, if bargaining for a replacement agreement is initiated prior to termination, then the agreement will remain in force for up to 12 months to allow a new agreement to be negotiated. Most workers (42%) are covered by two-year agreements, and three-year agreements are also common (22%).

Peace clauses

Peace clauses are effectively automatic during the life of an agreement. Employees cannot legally go on strike, or be locked out, if there is a current CEA,or if fewer than 40 days have passed since bargaining was initiated.

Other aspects of working life addressed in collective agreements

The main issues that are covered by CEAs are wages, hours, overtime and other penal rates, as well as leave. In terms of pay, an increasing proportion of agreements in New Zealand/Aotearoa link pay increases to performance or productivity. This is especially the case in central and local government, where 68% and 61% of employees respectively have some form of performance element to their pay, compared to 28% covered by private sector CEAs. Since the introduction of the state-sponsored workplace pension scheme – ‘KiwiSaver’ – in 2007, pensions are commonly included in CEAs; with more than two-thirds of employees covered having a provision for their retirement.

Apart from pay and hours of work, CEAs also commonly cover training, occupational health and safety, and redundancy. According to data from CLEW, more than three-quarters of employees on CEAs have some provision for training and skill development. Health and safety is normally included in CEAs, traditionally covering the basics, such as wearing protective clothing. However, nearly half of CEAs now address employee participation in OHS, and this is likely to increase following the HSWA and the introduction of new regulations.

New Zealand/Aotearoa is unusual for having no statutory provisions for redundancy notice or pay, so CEAs will tend to stipulate this. The usual agreement for compensation is six weeks’ pay for the first year of service, which covers 70% of employees on CEAs, and at least two weeks’ compensation for each additional year (60% of employees). Other provisions relate to employer outplacement and other support in redundancy situations.

Industrial action and disputes

Industrial action and disputes

Legal aspects

In New Zealand/Aotearoa, the law governing the regulation of industrial action is the ERA 2000. Strikes and lockouts are legitimate forms of industrial action used by parties to advance their bargaining aims. They are also deemed lawful where those striking or locking out have reasonable grounds for believing health or safety is being compromised. Under Section 82 of the Act, before a strike may proceed a union must hold a secret ballot of its members. The conditions when employees cannot strike or be locked out include when a collective agreement is in place, when the right notice has not been given in an essential service, in relation to a personal grievance or dispute, or when it is against a court order. When a strike or lockout is not legal, a party can apply to the Employment Court for an injunction to stop it, or to sue for any losses caused. The duty of ‘good faith’ continues with a strike or lockout, meaning that communication should be accurate and the parties should be trying to resolve their issues (Employment New Zealand, 2019c).

A significant change was brought in by the Employment Relations Amendment Act 2018, reversing an earlier amendment to the ERA 2000, whereby employers can no longer deduct pay in response to partial strikes (Employment New Zealand, 2019a).

Industrial action developments 2012–2017

Industrial action developments

 

2012

2013

2014

2015

2016

2017

Working days lost per 1,000 employees1

43

0

1

..

..

..

Person-days of work lost2

78,589

483

1,448

392.5

195

370

Work stoppages2

10

6

13

5

3

6

Sources: 1OECD (2017a), 2 Employment New Zealand (2019d).

Stats NZ no longer collects strike-specific data, but work stoppages, submitted to the MBIE under the ERA 2000, combine strike and lockout figures. Stats NZ also records total working days lost each year and estimated loss in wages and salaries. Both measures showed a 25-year peak in 2012. In 2017, all six stoppages were complete strikes and involved 421 employees, which amounted to 0.8 days lost per striking employee and an estimated €420,000 (NZ$727,408.50) in lost wages and salaries (Employment New Zealand, 2019d).

Although stoppage and other measures declined between 2014 and 2016, there has been a revival of strike action during the first year of the current government (since late 2017). At least 70,000 people, including nurses, teachers, bus drivers, port workers, fast-food workers, retail workers, steel workers and public servants, walked out last year (Boraman, 2019).

Dispute resolution mechanisms

The current model of workplace dispute resolution in New Zealand/Aotearoa may be characterised as statute-based, comparatively formal, and (despite the best efforts of all concerned) ‘inherently confrontational’ (Jülich and Cox, 2013).

The ERA 2000 groups employment conflict, disputes and grievances under the term ‘employment relationship problems’, in an attempt to merge rights and interest disputes. This is to address collective and individual concerns. There is a focus on self-determination, where employment relations parties collaborate to resolve their employment disputes among themselves and in ‘good faith’, encouraging productive relationships. However, although mediation has been the consistent dispute resolution process provided by the state for over 100 years, resorting to legal causes of action rather than dialogue has remained the preferred option (Greenwood, 2016).

Individual dispute resolution mechanisms

If a dispute cannot be settled internally, individuals can take it to the MBIE’s Employment Mediation Services or to independent mediators, regardless of whether it involves a personal grievance. A mediator from MBIE’se mediation service can implement a range of different procedures, ‘structured or unstructured, or do such things as he or she considers appropriate to resolve the problem or dispute promptly and effectively’ (ERA 2000, Section 147(2)(a)). The aim is to move the parties and employment relations institutions from positional bargaining to an integrative, problem-solving approach. However, international conflict management literature has challenged the fairness and effectiveness of these processes, claiming they are symptomatic of the rise of individualism (Greenwood, 2016).

Where mediation is rejected, the dispute may be escalated to the courts. The Employment Court hears and determines employment dispute cases, including challenges to the Employment Relations Authority, questions of interpretation of law and disputes over strikes and lockouts. The Authority helps to resolve employment relationship problems by examining the facts and making a decision based on the merits of the case, not on technicalities.

Collective dispute resolution mechanisms

Unions and employers must bargain in good faith but, if negotiations break down or the parties deadlock, there are a number of processes before litigation should be considered. Parties, similar to individuals, can access MBIE services including negotiation advice from its call centre, free mediation services, early assistance mediation, settlement mediation, and sign-off for recorded settlement.

For collective disputes, union and employer parties may agree that collective bargaining has ended and stop negotiating. A strike or lock-out may re-start negotiations. One or more of the bargaining employers and unions can ask the Authority for a neutral, adjudicated determination or facilitated bargaining. If there is a serious and sustained breach of ‘good faith’, and other reasonable alternatives have been exhausted, the parties can apply to the Authority to fix the terms of a binding and enforceable CEA (Employment New Zealand, 2019e).

Under the ERA 2000, the Employment Court has full and exclusive jurisdiction in relation to torts and injunctions, concerning strike or lockout activity.

Use of alternative dispute resolution mechanisms

Alternative dispute resolution processes are commonly seen to include negotiation, mediation, conciliation and arbitration, although these are increasingly provided for in legislation. Restorative justice has emerged in New Zealand/Aotearoa. This is influenced by a growing acknowledgement of the limitations of western criminal justice system, rethinking of the role of justice in the community, extending the stakeholders involved, aiming to meet the needs of ‘victims’, and addressing a dispute’s underlying causes (Zehr, 2002).

Restorative practices at work, or workplace conferencing, can be used to address many conflicts relating to the workplace that may, or may not, break the law (with regards to interpersonal relationships, for example). Although still in its early development, one organisation – Workplace Conferencing – has provided restorative conferencing for the last decade, and successfully addressed conflict around issues such as customer complaints and workplace bullying. Restorative practices can be used to address individual and group conflicts, including those concerning external parties. Jülich and Cox (2013) argue that they could ‘provide an opportunity for unions to demonstrate their commitment to co-operative and good faith bargaining’, but are not a ‘cheap fix’ or a ‘one-off’ approach.

A tradition-based approach to mediation reflects the indigenous Māori consensual decision-making process, with community participation and a restorative justice orientation. This community model is less likely to be confidential and may have elements of kōrero tahi – participatory talking together in a circle (Metge, 2001). Good faith negotiation in this process incorporates respect for cultural differences, drawing inspiration from the partnership principle embedded in the Treaty of Waitangi (Greenwood, 2016).

Use of dispute resolution mechanisms

 

2012

2013

2014

2015

2016

2017

Mediation (completed requests)– MBIE

10,059

10,857

10,584

Not available

12,100

Not available

Employment Relations Authority cases2

912

999

881

732

798

748

Employment Court cases filed3

183

184

176

172

179

164

Sources: 1DoL (2012) and MBIE (2013, 2014, 2016, (cited in Huang, 2016), 2Employment New Zealand (2019f), Courts of New Zealand (2012).

Mediation is one of the most common ways to resolve employment disputes in New Zealand/Aotearoa, and almost all employment cases go to mediation first. Completed mediation requests include all ways that mediation services can be provided. Only a proportion involve direct meetings (approximately 4,000 per year). Mediation settlement rates are high, between 81–84% for the years shown. Cases brought to the Employment Relations Authority between 2012–17 (other than in 2015) reflect a decline, while Employment Court cases are fewer and more stable in number, with the lowest number in the period occurring in 2017.

In 2015, the Government Centre for Dispute Resolution surveyed independent providers of dispute resolution services. From 117 respondents, mediation emerged as the most common form of dispute resolution service offered, particularly in the areas concerning family, commerce and work (MBIE, 2015).

Individual employment relations

Individual employment relations

Start and termination of the employment relationship

In New Zealand/Aotearoa, an employee is characterised as ‘a person who has agreed to be employed to work for some form of payment under a contract of service’ including for wages, salary, commission and piece rates (Employment New Zealand, 2019g). Employees can be permanent, fixed-term, casual, homeworkers, seasonal workers, or on probation or trial periods in a full or part-time capacity. The characterisation of an ‘employee’ excludes contractors and volunteer workers.

Requirements regarding an employment contract

By law, every employee must be provided with a copy of their IEA or CEA. This employment agreement must include:

  • a description of the work to be performed
  • location
  • hours to be worked
  • wage or salary
  • public holiday increased payment rate
  • procedures for dealing with personal grievances
  • the nature of employment (permanent or fixed-term)
  • any other agreed matters such as trial periods, availability provisions, etc.

Minimum rights, such as minimum wage and annual holidays, are legal requirements, and apply even when they are not articulated in the employment agreement (Employment New Zealand, 2019e).

There is no minimum age for employment in New Zealand/Aotearoa. However, young people under the age of 16 years cannot work during school hours, after 10pm, or before 6am on school days. In addition, employment should not prevent or interfere with attending school (Employment New Zealand, 2019h).

Dismissal and termination procedures

Employment relationships may end in several ways including resignation, retirement, dismissal or redundancy. Notice must be given by one party (the employee or employer) to the other. If the employment agreement does not have a notice period, then fair and reasonable notice must be given, which is usually between two to four weeks in duration (Employment New Zealand, 2019i).

Employers who want to dismiss an employee have to:

  • act in good faith
  • have a good reason
  • follow a fair and reasonable process
  • have an open mind when dealing with problems, so they ensure outcomes are not pre-determined

Good faith requires that the parties must not act in a misleading or deceptive way, and must be responsive and communicative. Before making a decision which may result in employees losing their job, the employer must give the affected employees sufficient information to be able to understand the proposal, and then give them a proper opportunity to comment. If any of the above conditions are not met, an employee could make a personal grievance claim against the employer (Employment New Zealand, 2019j).

Entitlements and obligations

Under employment law in New Zealand/Aotearoa, both employers and employees have certain rights and obligations, and an employer is required to ensure that the workplace is safe for employees. An employer may ask an employee to undertake a 90-day trial in a new job, but an employee does not have to accept a trial period. If accepted, a written agreement must be provided before starting work. Only employers with fewer than 20 employees can use trial periods.

Employees receive a minimum of four weeks of annual leave and can ask to exchange one week of leave for renumeration. In addition, there are 11 public holidays in New Zealand/Aotearoa. If an employee works on a public holiday they receive extra pay, and may be able to take the holiday on another day (take a day in lieu). Employees are also entitled to a certain amount of paid leave for other reasons. For example, an employee can take leave if they are experiencing, or have experienced, family violence.

Parental, maternity and paternity leave

In New Zealand/Aotearoa, parental leave is not divided into maternity or paternity leave divisions. Leave is based on identifying the primary caregiver, and entitlements depend on either a six month or 12 month eligibility criteria. Employees can calculate their parental leave entitlement by using the parental leave eligibility tool . Primary carer leave is available to the following:

  •  Female employees who are having a baby, or to their spouse or partner. The spouse or partner can have all or part of the birth mother’s parental leave payments transferred to them.
  • Employees who will have primary responsibility for the care, development and upbringing of a child under six years on a permanent basis, through adoption, ‘ home for life ’ or whāngai (a customary Māori practice where a child is raised by someone other than their birth parents, usually a relative).
  • An employee who has a spouse or partner and so will need to choose to be the primary carer.

Primary carer leave can be taken for up to 22 weeks. It must be taken in one continuous period, and cannot be taken if an employee has already taken any period of parental, or similar, leave in relation to that child.

Different entitlements are available to parents depending on whether they are employees and meet the six month or 12 month eligibility criteria, or are self-employed. It is important to determine who will be considered the primary carer, as their and their partner’s entitlements are different, regardless of gender (Employment New Zealand, 2019k).

Sick leave

All employees, including part-time workers, are entitled to a minimum of five days of sick leave per annum. Conditions for sick leave entitlement come into place when an employee has worked six months of continuous employment with the same employer; or has worked for the employer for six months for an average of 10 hours per week, with at least one hour in every week, or 40 hours in every month.

For each 12 month period after meeting the conditions, each employee receives at least five days of sick leave. If, in any year, the employee does not meet the criteria, then they are not entitled to any new sick leave but can use an outstanding leave balance, which may have carried over from the previous year. An employee may re-qualify for sick leave as soon as the criteria is met. Employees can accumulate up to 20 sick days a year (Employment New Zealand, 2019l).

Retirement age

There is no retirement age in New Zealand/Aotearoa, but most people receive New Zealand Superannuation and other pension entitlements when they turn 65. An employee can also withdraw all of their savings from the KiwiSaver when they turn 65, as long as they have held the account for at least five years (New Zealand/Aotearoa Government, 2019).

Pay

Pay

Minimum wages

New Zealand/Aotearoa was the first country to introduce general minimum wage laws through the Industrial Conciliation and Arbitrations Act (IC&A) in 1894, although the lower rate for women was not abolished until 1977. Minimum wage rates are now set through an Order in Council under Section 4 of the Minimum Wage Act 1983. The Act requires the Minister for Workplace Relations and Safety to review the minimum wage rates by 31 December each year.

The ILO recommends that minimum wage rates are reviewed regularly to preserve their purchasing power, and to provide certainty and predictability for employers. New Zealand/Aotearoa is a signatory to the ILO’s Minimum Wage-Fixing Machinery Convention 1928 (No. 26), which includes a requirement to ensure an adequate minimum wage rate. The minister takes advice from ministry officials, who draw on research and submissions before providing their review and recommendations. Any changes to minimum wage rates traditionally come into effect on 1 April.

By international standards, the minimum wage for adults in New Zealand/Aotearoa is relatively high, whether measured in purchasing power parity terms or relative to median wages. Annual growth has exceeded general wages and inflation for nearly 20 years. However, the Labour-led coalition government promised to increase the adult rate to NZ$20 (€11.9) by 2021 (see table). This was in the context of rising living costs, especially housing, which impacted on groups most affected by the minimum wage (such as young people, Māori and Pacific peoples), as well as unemployment.

Minimum wage levels,1 2009–21

 

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

2021

Adult rate

12.50

12.75

13.00

13.50

13.75

14.25

14.75

15.25

15.75

16.50

17.70

[18.90]

[20.00]

% change

4.2

2.0

2.0

3.8

1.9

3.6

3.5

3.4

3.2

4.8

7.3

[6.8]

[5.8]

Lower rate

10.00

10.20

10.40

10.80

11.00

11.40

11.80

12.20

12.60

13.20

14.16

NA

NA

Source: 1MBIE (2018b), NZ$.

Historically, the adult minimum wage applied to all workers aged 20 years or over. A lower ‘youth rate’ minimum wage was introduced In 1994 of NZ$3.68 (€2.13) per hour for workers aged 16 and 17 years (compared to the full rate of NZ$6.125/€3.54). The adult age was changed to 18 in 2001 and to 16 in 2008, when the youth rate was replaced by a ‘new entrant’ rate. Employers could apply this to workers aged 16-19 years in the first six months of their employment or engaged in an industry training programme.

Introduced in 2013, the training rate currently applies to those aged 20 or over engaged in an accredited industry training programme (see table). The new entrant and training rates are both mandated to be no less than 80% of the full minimum wage rate. These lower rates are not commonly used. According to the National Survey of Employers 2017–18, the training rate is used by only four percent of eligible employers and fewer than one in five (17%) applied the starting out wage (or a wage between this and the adult rate) for any of their eligible employees.

Current minimum wage rates1 for adults, new entrants and trainees

Type of minimum wage

Per hour

8-hour day

40-hour week

80-hour fortnight

Adult

17.70

141.60

708.00

1,416.00

Starting-out

14.16

113.28

566.40

1,132.80

Training

14.16

113.28

566.40

1,132.80

Source: 1Employment New Zealand (2019m), NZ$.

Workers paid the minimum wage are disproportionately young people (61%) and part-time workers (62%). Women (60%), Māori (17%) and Pacific (5%) workers, people without formal qualifications, disabled workers and refugees or migrants are more likely to be paid the minimum wage than other groups of workers. Workers paid the minimum wage are more likely to work in hospitality and retail industries (18.6% and 9.1% respectively), compared with an overall average of 3.5% of workers (71,500 workers). It is worth noting that a higher proportion of workers are on minimum wages outside the main cities of Auckland and Wellington.

Income (Pay As You Earn) tax is deducted from wages before an employee is paid. Another, much smaller, deduction is for the Accident Compensation Corporation (ACC), which runs the insurance system in New Zealand/Aotearoa, covering costs from injury. ACC will compensate for a large portion of lost wages if a worker is injured.

Working time

Working time

Working time regulation

According to the SoWL 2018, standard working time in New Zealand/Aotearoa is between 7am and 7pm, Monday to Friday. Any agreed hours of work, or indication of the arrangements relating to the time that the employee is to work, must be in the employment agreement. Employment agreements must fix the maximum number of work hours at not more than 40 hours per week (excluding overtime), unless the employer and employee agree otherwise. If the maximum number of hours (excluding overtime) is less than 40 hours, the parties must try to fix them to ensure that they are worked on no more than five days of the week.

The employer and employee must be clear about, and agree upon, what is considered work. Activities such as on-the-job training, opening and closing of business, meeting attendance and tidying up at work are all considered part of such, and employers must ensure that employees are paid for the work activities that they perform (Employment New Zealand, 2019n).

In New Zealand/Aotearoa, full-time workers devote 62% of their day (14.9 hours), on average, to personal care and leisure – below the OECD average of 15 hours. Reflecting a relatively long working hours culture in New Zealand/Aotearoa, 15% of employees average 50 or more hours of work per week, compared with the OECD average of 11% (OECD, 2017b).

The Employment Standards Legislation Act 2016 addresses zero-hour contracts, where the employer and employee are required to agree to, and set, the number of hours in the employment agreement, and have clarity on their mutual commitments (Community Law, 2019). Employers cannot have an availability clause for employees (choosing when to provide work and obliging employees to accept this), unless there are exceptional circumstances. If an employer does not have such a clause, but asks the employee to work at a time that is outside of the agreed time of work to their agreement, then the employee can refuse.

Non-standard working time includes evening, night, early morning and weekend work. Overall, 25–34 year olds form the largest group of those who perform this, and men tend to work more non-standard hours than women (Stats NZ, 2019).

Overtime regulation

In New Zealand/Aotearoa, overtime is productive work outside standard paid hours, which is paid at a higher rate. This might include additional time at work, work performed at home or work undertaken in transit.

The hours agreed to in an employment agreement are generally only those when an employee needs to be present at work. Many employees receive payment if their employer asks them to work more than their normal hours. Whether this overtime is factored into the employee’s salary or paid at their normal, or a higher, rate of pay, the arrangement needs to be agreed by the employer and employee and included in the employment agreement. When an employee works more hours than those for which they are paid, they should take the matter up with their employer (Employment New Zealand, 2019n). Furthermore, employers must take steps to ensure that employees’ work hours do not jeopardise their health or wellbeing.

Part-time work

A part-time worker in New Zealand/Aotearoa usually works for less than 30 hours per week in all jobs. Women tend to do more part-time jobs than men, and men tend to do more full-time jobs than women. Workers employed on a part-time basis (between 0 to 19 hours) tend to be more satisfied with their jobs compared to full-time workers, working 40 and 41–44 hours. Overall, as work hours increase, work-life balance decreases (Stats NZ, 2019).

Hours worked by sex in 2012 and 2018

Hours worked per week (2018)

Male

(000s)

Female

(000s)

Hours worked per week (2012)

Male

(000)

Female

(000)

0–19

104.6

219.2

0–19

69.5

194.6

20–29

64.4

190.0

20–29

53.2

155.4

30–39

132.6

260.4

30–39

115.1

206.7

40

470.0

336.1

40

404.8

270.9

41–44

81.2

37.7

41–44

73.8

37.9

45–49

192.1

76.3

45–49

164.6

55.7

50–59

211.7

87.7

50–59

160.9

51.5

60+

134.7

42.9

60+

104.0

28.8

Source: Stats NZ (2019).

Involuntary part-time

Involuntary part-time workers can be defined as those working part-time because they are unable to find a full-time job. The table shows that, in New Zealand/Aotearoa, the involuntary part-time employment rates for men, women and all those aged 15–24 years have increased since 2016, with the rate for men higher overall than women over the 2012–2017 period. For all workers and women workers aged 15–24 years, involuntary part-time employment increased from 2016, while the 2017 figure for men in this age group decreased.

Involuntary part-time employment as % of total part-time employment, by sex and age

 

2012

2013

2014

2015

2016

2017

(%)

Men (25–54 years)

34.5

36.2

34.9

32.9

34.6

38.7

Women (25–54 years)

20.3

21.6

21.3

20.1

25.0

26.9

Total (25–54 years)

22.6

24.0

23.5

22.2

26.6

28.8

Men (15–24 years)

28.0

27.1

26.9

26.8

33.6

31.7

Women (15–24 years)

26.6

26.0

29.3

27.7

32.2

34.1

Total (15–24 years)

27.1

26.4

28.3

27.4

32.8

33.1

Source: OECD (2019).

Night work

Night work is a form of non-standard work, and concerns hours worked outside 7am to 7pm, Monday to Friday (Stats NZ, 2019). The table indicates that workers in the retail and food services; professional, administrative and support services; and education and health care sectors have the highest frequency of night work, whereas the financial and rental sectors have the lowest frequency.

Frequency of night work (7­­–11pm) in the last four weeks, by sector

Source: Stats NZ (2019).

The sector with the highest incidence of night work performed between 11pm and 5am is health care, followed by retail and professional services.

By occupation, total evening and night hours are highest for managers and administrative staff – the largest professional grouping. Occupations that involve technology are more likely to work during the evening and night hours, compared to those in other occupational groups.

Total working evenings and night hours, by occupation

Source: Stats NZ (2019).

Shift work

The ERA 2000 defines shift work as ‘a period of work performed in a system of work in which periods of work are continuous or effectively continuous, and may occur at different times on different days of the week.’

The SoWL 2018 found that the least common non-standard time was night work (between 11pm–5am), with only 12% of people having worked at least one night shift in four weeks. Individuals who worked night shifts were the most likely to want different hours, with 35% indicating they would prefer to work at a different time, compared to 12% of workers who worked during the day. One fifth of people working during non-standard times experienced difficulties because of their work times, including disruption to sleep, health problems, as well as reduced time with family members.

Weekend work

According to the SoWL 2018, workers aged 25–34 years are the largest group working on the weekend, with more men than women doing so (see table).

Weekend working, by age group and sex

 

Age group (years)

Male

Female

Total employed

 

15–24

25–34

35–44

45–54

55–64

65+

 

 

 

 

(000s)

Worked 1–4 Saturdays/Sundays in all jobs in last four weeks

14.9

13.4

12.2

12.2

8.8

5.3

20.1

19.0

30.7

Worked 5–8 Saturday/Sundays in all jobs in last four weeks

11.7

11.3

8.5

10.2

8.1

5.1

15.7

16.0

23.6

Source: Stats NZ (2019).

Rest and breaks

Recent changes to the regulation on rest and meal breaks in the workplace mean that, under section 69ZD of the Employment Relations Amendment Act 2018, employers must provide their employees with breaks according to the number of hours worked. For example, if a work period is between two to four hours, an employee is entitled to one 10-ten minute paid rest break. For a work period between four to six hours, an employee is entitled to one 10 miunte paid rest break and one 30 minute unpaid meal break. Where the work period is between six to eight hours, an employee is entitled to two 10-minute paid rest breaks and one 30-minute unpaid meal break. The employer and employee should mutually agree on the breaks, with the minimum time for rest and meal breaks being 10 and 30 minutes respectively.

Employers are required to accommodate for their employees as much as is reasonably possible. Mothers who are breastfeeding can ask for a break to feed or to express milk. In such cases, the employer and employees need to decide on the timings and the practical arrangements of the breaks. However, these breaks are unpaid (Employment New Zealand, 2019o).

Working time flexibility

In New Zealand/Aotearoa, flexible work is defined as the ‘hours that allow an employed person to vary the time they start and finish work […] This is often referred to as flexi-time or glide-time, and excludes one-off arrangements to vary a start or finish time; for example, because of an emergency at home’ (Stats NZ, 2019).

Employees can seek flexible work schedules, locations and timings. An employer must consider an employee’s request and respond in writing within a month. The employer can decline the request, but is required to give a reason for their decision (Employment New Zealand, 2019p). Under Part 6AA of the Employment Relations (Flexible Working Arrangements) Amendment Act 2007, certain employees can request a variation of their working arrangements if they are the carer of an individual. This arrangement can relate to the hours, days and place of work.

According to the SoWL 2018, 50% of employees feel that flexibility is offered at their workplace. More men (53.3%) than women (46.7%) believe that there is flexibility in the workplace, while temporary employees perceive that flexibility is available (50.5%) or unavailable (49.5%) to them in equal proportions. Around 89–95% of all employees are aware that they can take a few days of unpaid leave.

In terms of having the flexibility to reduce work hours (to fewer than 30 per week), the survey found that fixed-term agency workers found this most difficult, followed by permanent employees, whilst casual workers found it easy. More males than females indicated that they were unable to reduce their work hours (61% and 51% respectively). A similar pattern emerges concerning changing the hours that an employee works from week to week in order to meet employer needs.

For employers, meals and unpaid breaks should involve the minimum unpaid time. However, if employees choose to take extra time off as a break, then they should be entitled to do so, on the condition that they also add the time taken to the end of their working day. If an employee would rather take compensation over a break, this can be negotiated based on their time and regular pay rate. Different mechanisms exist for rest and meal breaks for employees engaged in essential and national security services.

Employers and employees can also seek flexibility around public holidays. Under the Holidays Act 1993, if an employee wants or expects to work on a public holiday, then they must be compensated in money and time. Requests to transfer can be made by either party, and must be considered in good faith, and any agreement must meet the minimum set out in the law (Employment New Zealand, 2019q).

Health and well-being

Health and well-being

Health and safety at work

The Health and Safety in Employment Act 1992 (HSE) replaced several acts in New Zealand/Aotearoa with one overarching statute. Based on Alfred Robens’ model, it adopted a self-regulatory approach, placing duties on employers and workers along with designers, manufacturers and suppliers through additional regulations. Amendments to the HSE in 2002 incorporated participative processes, and the Act was broadened to include psychological hazards.

In 2013, the Independent Taskforce on Workplace Health and Safety reported that the health and safety in the workplace system was failing. Consequently, the country underwent significant workplace health and safety reforms, and in 2015, the Act was repealed and replaced by the Health and Safety at Work Act 2015 (HSWA). The scope of the HSWA was extended to place obligations on directors and company owners to ensure health and safety standards are met. This was in response to the high incidence of fatalities in the workplace, and a mining incident in 2010 that failed to establish culpability due to the limitations of the HSE. The incident resulted in two independent reports (Royal Commission on the Pike River Coal Mine Tragedy, 2012 and Workplace Health and Safety Report, 2013), and the establishment of a government department – WorkSafeNZ – dedicated to workplace health and safety.

Since 1974, the Accident Compensation Corporation (ACC) has administered a universal, no-fault personal injury scheme, covering all work and personal injuries. The scheme is funded through levies and government contributions, and removes the right to sue. It is targeted towards physical injury, and the extent of the cover provided is dependent on any existing health conditions. Whether the scheme is suitable in its current guise is now openly debated, particularly as most health hazards and diseases are not covered.

In 2003, the National Occupational Health and Safety Advisory Council (NOHSAC) was established to provide independent advice to the government on these issues. Data indicated that, in addition to the lack of a suitable surveillance system, work-related disease represented a 10-fold burden when compared to work-related injury (NOHSAC, 2004). Further reports elaborated on this core finding. However, the Council was dissolved in 2008 during the global financial crisis.

Health and safety-related absences from work

WorkSafeNZ’s system for work-related injury forecasting and targeting includes ACC data on injury claims that resulted in more than a week away from work. The data indicate a consistent level of injuries when accounting for increases in workload and overall population (see table).

Injuries resulting in more than a week off work, January 2013–December 2017

Source: WorksafeNew Zealand (2017a).

The HSWA requires that WorkSafeNZ is notified if someone becomes seriously ill, or is seriously injured, as a result of work (see table).

Non-fatal injuries and illnesses for all industries, April 2016–March 2019

Source: WorksafeNZ (2019).

Incidence rates for work-related claims, by year of injury and claim type, 2002–2017

Year

All claims (claims/1,000 FTEs)

Claims involving entitlement payments (claims/1,000 FTEs)

2012

108

13

2013

108

14

2014

109

15

2015

108

15

2016

105

15

2017

101

14

Source: Stats NZ (2017c).

A biennial survey on workplace wellness is conducted by BusinessNZ and a national private health insurer. While all three reports to date recognise the limitations of the small dataset, they are one of the few surveys to note the importance of considering well-being. In 2013, 119 responses were received from organisations across the private and public sectors employing 97,116 people, including 89,955 permanent staff (5.67% of all employees in New Zealand/Aotearoa). The first report emphasised the importance of workplace wellbeing, and the need to consider differences between private and public sector organisations, the range of organisational sizes, and the ageing workforce when managing it.

In 2015, 113 organisations responded, representing 116,218 people. The report found that absence from work was most likely to be due to illness or injury unrelated to the workplace, with caring for a family member or being dependent on relatives the second most common cause of absence. The need for better stress management strategies was another main finding (BusinessNZ, 2015). In 2017, 109 organisations responded, representing 93,125 people. The report found that the average days lost for manual workers is decreasing, but increasing for non-manual workers; more than 40% of staff are more likely to turn up to work when they are sick, despite advice to stay home, and stress and anxiety has consistently risen over the life of the survey (BusinessNZ, 2017).

Psychosocial risks

Psychosocial risks have only recently been considered at national level. Work stress came under the HSE in 2002, and the ACC is under increasing pressure to accept mental health claims. Findings from a 2018 government enquiry into mental health and addiction revealed that greater assistance in the community is required to supplement the support provided by the government and the health system, and that current mental health resources are stretched to the point where continuation of care is inadequate, leading to an escalation of distress. The enquiry also found that unmet mental health needs resulted in worse outcomes for Māori and other minority populations than for the overall population (New Zealand/Aotearoa Government, 2018). A health-oriented approach to the harmful use of alcohol and drugs is recommended.

Data on psychosocial risks are still relatively scarce. The SoWL 2018 measures workplace autonomy in relation to workers’ control over tasks, the organisation of work, and their influence on decision-making. Only one in four workers reported having high levels of control across all three areas. These employees were more likely to be satisfied with their jobs (41%) than those who perceived a lower autonomy (27%).

Workplace bullying has received more attention than the broader concept of psychosocial risk. According to the SoWL 2018, around 11% of workers had experienced discrimination, harassment or bullying in the past 12 months. This figure is consistent with findings from the New Zealand Workplace Barometer study (Bentley et al., 2018).

In 2018, the government produced the Health and Safety at Work Strategy 2018–2028, with an emphasis on ensuring mental health risks are addressed and included in the assessment of key health indicators. This commitment is promising, although similar initiatives in 2002 and 2003 were relatively short-lived.

Skills, learning and employability

Skills, learning and employability

National system for ensuring skills and employability

By international standards, New Zealand/Aotearoa has low productivity rates, with GDP per capita 20% below the OECD average. This reflects the small size of the economy and its constituent firms, its distance from global markets, the levels of research and development, and factors related to skills development and skill utilisation. Therefore, there is a keen interest in policies related to training, especially given prospective technological change.

Formal training provisions is shared between further education institutions and sector-based industry training organisations (ITOs). According to the Ministry of Education (MoE) (2019), in 2017, 65,310 enrolled in vocational courses at a further education institutions, and 138,100 workers were engaged in ITO training agreements through their employers. The ITOs supported 46,540 workers to complete industry qualifications, with 23,315 through institutes of technology and polytechnics. However, only 15% of employers offered such formal training that led to qualifications.

Formal training is supported by an Industry Training Fund (ITF) which subsidises formal, structured, employment-based training linked to qualifications. This is primarily at levels one to four on the New Zealand Qualifications Framework, which covers apprenticeships, industry training and industry-related training projects. It enables ITOs to develop and maintain skill standards (unit standards and qualifications) and arrangements for delivering training. The ITF is the government’s contribution to the cost of training, with the balance met by contributions from employers, trainees and apprentices. In 2016, the ITF received NZ$176 million (€102 million) from the government, NZ$49.5 million (€28.6 million) from industry and NZ$17.8 million (€10.3 million) from other sources (also Tertiary Education Commission, 2019).

Under current proposals to reform the Vocational Education and Training (VET) system, the 11 ITOs would relinquish their role of arranging workplace training and apprenticeships to vocational education providers, including a new national institute formed out of the 16 separate institutes of technology and further education.

Training

Adult literacy and problem-solving skills in New Zealand/Aotearoa are, on average, among the highest in the OECD, with numeracy skills above the OECD average (MoE and MBIE, 2016). However, the growing economy means that employers report higher levels of skills shortages than in other countries (around 45% of firms with 10 or more employees). Data from the Business Operations Survey suggests that a third of firms were increasing training and/or redefining jobs in response to this shortage (OECD, 2015). However, those in low skilled jobs are less likely to receive learning and development opportunities. This partly reflects the predominance of small and medium sized enterprises (SMEs) in the economy, which have less access to training resources and expertise, and may fear labour mobility if workers accumulate transferable skills.

In May 2019, the Prime Minister and her business advisory council launched a voluntary initiative to prepare organisations and their employees for rapid change in the future of work. The Aotearoa New Zealand Skills Pledge – signed by some of the country's largest employers – commits signatories to doubling investment in re-skilling and training hours by 2025, and to reporting annually on progress.

On-the-job training

Data for on-the-job (OTJ) training is limited. However, the SoWL 2018 was run as a supplement to the HLFS in 2008 and 2012, and asked a number of questions related to education or training funded by employers. In 2008, 31% of employees had received employer-funded education or training, with 21% participating for one day or less and two-thirds for five days or less. By 2012, the overall figure remained the same (31.3%), but the proportion on short courses rose to 26% for one day and 71% for five days or less.

Employer-funded study and training

 

Employer-funded study and training in last 12 months

No employer-funded study or training in last 12 months

Total employees

1 day or less

2 to 5 days

6 to 10 days

11 days to less than 1 month

1 month or more

Total

(000)

Sex

               

Male

79.2

145.3

47.3

26.3

25.4

327.5

603.3

934.4

Female

85.1

138.6

35.8

19.0

19.7

303.0

603.4

909.3

 

 

 

 

 

 

 

 

 

 

Source: Stats NZ (2012b).

There are strong occupational differences in the provision of education and training funded by the employer, with half (49.7%) of professionals receiving funding provisions in the preceding year and over a third of managers (36.8%), community and personal service workers (38.9%) and technical and trades workers (33.7%). In contrast, only 28.2% of machinery operators and drivers, 20.1% of sales workers and 19.5% of labourers had any employer-supported training or education providedin the preceding year.

The SoWL 2018 contained extra questions covering OTJ training, in addition to courses funded by the employer. Overall, six out of 10 employees undertook work-related training in 2018, three-quarters of whom had undertaken OTJ training – making it the most common training type. Just over half of employees completed a course paid for by their employer, while seven percent did a course they had paid for themselves. Of those who had done training, seven out of ten spent five days or less completing it. Just over one in 10 spent more than a month over the past year doing training relating to work.

Professionals were the occupation group most likely to have taken part in any form of training in the past 12 months (71%). Machinery operators and drivers (48%) and labourers (43%) were the least likely. There was also variation by age, with 25–34 year olds (65%) and 45–54 year olds (64%) most likely to have done work-related training. Young employees (below 24 years) were more likely to have done OTJ training than any other age group, but less likely to have done a course paid for by their employer.

In addition to the SoWL 2018, the Business Operations Survey of employers in 2014 found that 84% of businesses provide employees with training (98% of larger firms compared to 79% employing 6–19 workers). The 2014 survey also asked about barriers to training, with 62% referring to constraints on giving employees time off and 53% indicating cost. Only a third said a concern that trained employees would leave represented a barrier to training.

Work organisation

Work organisation

Work organisation underpins economic and business development, and has important consequences for productivity, innovation and working conditions.

The SoWL 2018 asked people who are employed about their ‘work arrangements, employment conditions, and satisfaction with their job and work-life balance.’ It found that 56% of employees felt that they had a lot of control over how they did their tasks at work, 45% perceived that they had a lot of control on how their work was organised (see figure), and 36% reported having a lot of influence on decision-making that affects their tasks.

Employee control over how daily work is organised (main job)

Source: Stats NZ (2019).

Employees with high autonomy were more likely to report a good relationship with their direct manager and colleagues than those who reported lower levels. High autonomy was more common among self-employed people (67% compared to 24% of employees). Men were more likely to have a high level of workplace autonomy (33%) than women (26%), and workplace autonomy was lower for employees working for shorter periods.

Equality and non-discrimination at work

Equality and non-discrimination at work

In New Zealand/Aotearoa, the grounds for unlawful discrimination in employment are outlined in the ERA 2000 and the Human Rights Act 1993. These are on the basis of:

  • age
  • race or colour
  • ethnicity or national origin
  • sex (including pregnancy or childbirth)
  • sexual orientation
  • disability
  •  religious or ethical belief
  • marital or family status
  • employment status
  • political opinion
  • being affected by domestic violence
  • involvement in union activities (ERA 2000 only)

The Human Rights Act 1993 legislates for discrimination in most aspects of employment, and applies to unpaid workers and independent contractors. Employees who feel unlawfully discriminated against during their employment can seek to discuss the issue with their employer to resolve the problem, go to mediation and/or raise a personal grievance to the Employment Relations Authority (under the ERA 2000), or make a complaint to the Human Rights Commission (HRC).

Equal pay and gender pay gap

The Government Service Equal Pay Act 1960 abolished pay according to gender in the public service. In 1972, this was extended to the private sector with the EPA. Under the EPA, employers are required to pay men and women equally for work needing ‘the same, or substantially similar, skill, effort, responsibility and working conditions.’ In 2014, the Court of Appeal’s (CA) decision in Terranova Homes & Care Limited vs Service and Food Workers Union Nga Ringa Tota Inc. and Bartlett interpreted the EPA as extending to pay equity (such as equal pay for work of equal value) (CA, 2014), emboldening parties in other female-concentrated professions to issue equal pay proceedings.

Following the case, there was renewed effort for legislative reform around pay equity, with the National Government establishing a Joint Working Group in 2015, stressing the use of good faith bargaining arrangements under the ERA 2000 as the platform. Under the present government, a reconvened Joint Working Group, again involving tripartite partners, provides further recommendations and proposes new legislation (Parker and Donnelly, 2019).

In New Zealand/Aotearoa, there is a high concentration of female workers in several occupations (>80% female), which are often lower paid. These occupations are healthcare and social assistance; professional, scientific, technical, administrative and support services; and education and training.

The gender pay gap from 2016–2018 decreased from 12.0% to 9.2% (StatsNZ, 2018b), making it the second smallest gap since the beginning of the series 20 years ago, and the seventh lowest globally. However, for workers on higher salaries the gap is 20%, and persists despite the increasing number of women in higher education (Ministry for Women (MfW), 2017). Māori and Pacific women have lower rates of pay compared to both women and men of other ethnicities (MfW, 2018a), while disabled women are paid less than disabled men, constituting ‘the most marginalised in New Zealand/Aotearoa’s labour market’ (HRC, 2018).

The government’s Gender Pay Principles and Gender Pay Gap Elimination Action Plan 2018-2020 are intended to address gender inequities in public service through the ‘principles of partnership, protection and participation’ (MfW, 2018b, 2018c). The Equal Pay Amendment Bill provides a process for addressing discrimination in pay, based on gender, in female concentrated industries. If passed, it will enable employees to make pay equity claims within the current ‘good faith’ bargaining framework, with court action a last resort.

More information:

Quota regulations

In the private sector, female representation in senior leadership positions decreased from 31% in 2004 to 18% in 2018 (Grant Thornton International, 2018). Women on public sector boards rose to a record level of 47.4% for 2018, up from 45.7% in 2017, closing the gap towards the government’s target of women forming 50% of all state-sector boards by 2021. This compares with the private sector, where women constitute just 22% of board members in NZX’s listed companies (up from 19.7% in 2017) (MfW, 2019). However, the use of mandatory quotas remains a highly contested field.

With disability, the New Zealand Disability Strategy 2016–2026 was launched on 29 November 2016, and is intended to guide the work of government agencies on disability issues without any quota regulations. Eight outcomes are defined in the strategy, with gender norming recognised for playing out in the disability community, as it does in wider society. A Disability Outcomes Framework has been under development since 2017, which aims to set targets and measures for the strategy (Office for Disability Issues, 2016).

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