Edmonds Judd

fair pay

Fair Pay Agreements Repeal Act 2023

Commercial, Employment, First Job, Your Own Business
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What this has meant for you

Many people welcomed the introduction of the original Fair Pay Agreements Act 2022 (FPA) to set minimum pay and working conditions across various sectors. Others worried it could limit flexibility or create extra compliance costs. Now, the Fair Pay Agreements Repeal Act 2023, enacted just over a year ago, has turned back the clock on these industry-wide agreements.

 

Why repeal?

The main reason for the repeal stemmed from a change in government policy. The FPA, introduced by the previous government, aimed to improve wages and standardise conditions for employees in historically low pay sectors such as cleaners, hospitality workers and early childhood educators. Critics argued that this approach was too broad, as it could force employers to follow terms that they hadn’t agreed on, leading to reduced flexibility in workplaces.

 

By repealing the FPA, the current government signalled that pay and conditions should largely be negotiated between individual employers and employees or through standard collective bargaining processes rather than a universal, sector-wide system. Supporters of the repeal believed this would allow businesses to be more agile and able to respond quickly to changing market conditions.

 

Implications for employees and unions

For employees who would have benefitted from agreements under the FPA, the repeal has meant a return to individual employment agreements or traditional collective bargaining through unions. Workers in industries where wages are typically low may feel the difference most, especially if they were expecting a lift in pay or improved working conditions under the FPA process.

 

Unions have lost a tool for coordinating negotiations. The FPA regime gave unions a clear pathway to start negotiations on behalf of employees across an entire sector, even if there was initially low union membership. Without the FPA, unions are now focussing again on bargaining at a company level or encouraging voluntary industry-wide agreements. This may be a setback for union-led initiatives to raise pay and conditions in sectors with historically vulnerable workers.

 

Implications for employers

Employers now have more freedom to negotiate pay and conditions directly with their teams, without the worry of being locked into sector-wide rules. Businesses that operate in specialised markets or have unique staffing needs may welcome this. They can continue to tailor employment agreements to suit their circumstances, offering different pay structures, benefits or flexible arrangements.

 

On the other hand, before the repeal some employers saw a benefit in a level playing field for everyone in their industry. If all competitors had to meet the same pay and conditions then there was less concern about undercutting each other on labour costs. Those businesses may now have to keep a closer eye on what others in their sector are doing, particularly if new entrants offer lower pay.

 

Looking ahead

With the Fair Pay Agreements Repeal Act 2023 having been enacted just over a year ago, any ongoing negotiations under the FPA system may have continued in the same manner. In many cases, however, collective bargaining would have reverted to the familiar structures of individual employment agreements or smaller-scale union negotiations.

 

Unions and advocacy groups are now working on other ways to improve working conditions, such as lobbying government for different legislation or regulations. Meanwhile, most businesses wanting to be seen as good employers have developed their own internal policies to offer competitive pay and benefits. Despite the repeal, it’s unlikely the debate over fair pay will disappear. The broader issues of cost of living, pay equity and income inequality remain hot topics, particularly for Māori, Pasifika, women and young people.

 

Final thoughts

By repealing the FPA, the government returned New Zealand’s industrial relations framework to a more traditional form of negotiation. That shift has had significant effects on those who had hoped the FPA would boost minimum wages and conditions.

 

Whether you are an employee wondering about your pay, a union leader planning next steps or an employer seeking certainty around labour costs, the key takeaway is the same: make sure you understand your current rights and obligations, and be ready to adapt.

 

If you’re unsure about how this change has affected you, do talk with us. With the future of workplace legislation still in flux; staying informed and being proactive will serve you best.

 

 

DISCLAIMER: All the information published in Commercial eSpeaking is true and accurate to the best of the authors’ knowledge. It should not be a substitute for legal advice. No liability is assumed by the authors or publisher for losses suffered by any person or organisation relying directly or indirectly on this newsletter. Views expressed are those of individual authors, and do not necessarily reflect the view of Edmonds Judd. Articles appearing in Commercial eSpeaking may be reproduced with prior approval from the editor and credit given to the source.
Copyright, NZ LAW Limited, 2022.     Editor: Adrienne Olsen.       E-mail: [email protected].       Ph: 029 286 3650

Postscript

Commercial, First Job, News, Your Own Business
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Fair Pay Agreements legislation passed

The new Fair Pay Agreements Act 2022 worked its way quickly through the House and comes into effect on 1 December 2022.

 

The government’s objective is to provide a framework for collective bargaining of pay agreements. It stated that the legislation will improve employment conditions by enabling employers and employees to bargain collectively (by occupation, for example), rather than on an individual basis.

 

The Minister for Workplace Relations and Safety, the Hon Michael Wood said, “By increasing bargaining coordination to agree minimum employment terms within a sector, outcomes for vulnerable employees will be improved and we will see growth in the incomes of New Zealand employees. This is especially the case for Māori, Pacific peoples, young people and people with disabilities who are over-represented in occupations which will benefit from a Fair Pay Agreement.”

 

As we noted in the Winter 2022 edition of Fineprint, the provisions in this legislation have been welcomed positively by unions although not so warmly by many employers.

 

If you would like help in any pay negotiations, please don’t hesitate to be in touch.

 

Some plastic products now banned

Since 1 October 2022 it became illegal to provide, sell or manufacture the following plastic products in New Zealand:

  • Single use plastic drink stirrers
  • Single use plastic cotton buds
  • Degradable plastics such as oxo and photo degradable (such as some dog poo bags)
  • Certain PVC food trays and containers
  • Polystyrene takeaway food and beverage packaging, and
  • Expanded polystyrene food and beverage packaging.

These new regulations may affect the way you do business. To find out more, go to www.environment.govt.nz and search for ‘plastic phase outs’ and scroll to the end page.

 

 

DISCLAIMER: All the information published in Fineprint is true and accurate to the best of the authors’ knowledge. It should not be a substitute for legal advice. No liability is assumed by the authors or publisher for losses suffered by any person or organisation relying directly or indirectly on this newsletter. Views expressed are those of individual authors, and do not necessarily reflect the view of Edmonds Judd. Articles appearing in Fineprint may be reproduced with prior approval from the editor and credit given to the source.
Copyright, NZ LAW Limited, 2022.     Editor: Adrienne Olsen.       E-mail: [email protected].       Ph: 029 286 3650

Postscript

First Job, Your Own Business
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Fair Pay Agreements Bill

The Fair Pay Agreements Bill was introduced earlier this year; it proposes a framework for collective bargaining of fair pay agreements. The Select Committee is working its way through submissions and will report back to the House in early October.

 

The government believes the current situation of an employer and employee being free to negotiate the terms of employment without being subject to fair pay obligations (provided employment law minimum entitlements are met) marginalises some employees. The draft legislation would introduce a regime where an agreement is established across an entire industry or occupation for mandatory minimum employment terms (such as wages or hours of work).

 

It is fair to say, no pun intended, that the proposed legislation has not been met with open arms by employers. Unions, however, have greeted the provisions in this Bill much more positively. We will let you know the status of this legislation in the next edition of Fineprint.

 

Scams: be vigilant

Scams affect us all – in our bank accounts, credit cards, over the phone, social media, via email or simply being sent a ‘strange’ communication offering you some ‘benefit.’

 

If you are contacted unexpectedly – always hesitate and consider that a communication from someone you don’t know could be a scam. Never, ever click on a link that you don’t know. Keep an eye on your credit card statement; unsavoury characters can hack your credit card details and ‘phish’ your money in the blink of an eye.

 

For help and information on scams, go to www.consumerprotection.govt.nz and click on the Scamwatch button. Netsafe New Zealand is also very helpful, go to www.netsafe.org.nz.

 

New whistleblowing legislation now in force

The new Protected Disclosures (Protection of Whistleblowers) Act 2022 came into force on 1 July.

 

The government says this new legislation provides clearer protection for people to speak up about wrongdoing, while protecting the whistleblowers themselves. It ensures confidentiality around who has made the disclosure, immunity from disciplinary action for making the disclosure and protection from retaliation through the Employment Relations Act 2000 and the Human Rights Act 1993.

 

If your business hasn’t already done so, we recommend you urgently review your whistleblowing policies and procedures so they comply with this new legislation. If you would like some help with this, please be in touch.

 

DISCLAIMER: All the information published in Fineprint is true and accurate to the best of the authors’ knowledge. It should not be a substitute for legal advice. No liability is assumed by the authors or publisher for losses suffered by any person or organisation relying directly or indirectly on this newsletter. Views expressed are those of individual authors, and do not necessarily reflect the view of Edmonds Judd. Articles appearing in Fineprint may be reproduced with prior approval from the editor and credit given to the source.
Copyright, NZ LAW Limited, 2022.     Editor: Adrienne Olsen.       E-mail: [email protected].       Ph: 029 286 3650

Business briefs

First Job, Latest news, Your Own Business
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Fair Pay Agreements Bill on the table

The long-awaited Fair Pay Agreements Bill was recently introduced in Parliament proposing a framework for collective bargaining of fair pay agreements (FPA).

What is an FPA? An FPA is an agreement that establishes mandatory minimum employment terms (such as wages or hours of work) across an entire industry or occupation that exceed the minimum entitlements outlined in employment law. Currently, an employer and employee are free to negotiate the terms of employment without being subject to fair pay obligations, provided the minimum entitlements in employment law are met.

What is the FPA process? A union initiates the bargaining process by applying to the Ministry of Business, Innovation and Employment (MBIE). If MBIE approves the application, the union begins bargaining with an employer association (that represents employers in the relevant industry).

What does this mean for employers? If the negotiation is successful, all the employers in an industry covered by an FPA would have to provide their employees with at least the minimum entitlements required by the FPA, regardless of whether the employer engaged in the bargaining process.

The Bill also proposes granting employees and unions other rights such as the right for a union to enter a workplace without an employer’s consent to meet with employees to discuss FPAs. This may be confronting to some employers, particularly smaller businesses that may be new to collective bargaining.

Next steps: Public submissions on the Bill closed on 19 May 2022, so we now await the Select Committee’s report. The Bill is expected to become law by the end of 2022.

Proposed legislation to address modern slavery and worker exploitation

The government has released a consultation paper proposing new legislation to reduce modern slavery and worker exploitation in New Zealand and internationally. As currently proposed, the legislation may have a material impact on the way businesses operate in this country.

The paper defines ‘modern slavery’ as severe exploitation that a person cannot leave due to threats, violence or deception, including forced labour, debt bondage, forced marriage, slavery and human trafficking. ‘Worker exploitation’ is behaviour that causes material harm to the economic, social, physical or emotional well-being of a person, which essentially includes non-minor breaches of New Zealand employment standards (such as providing no less than minimum wage or annual holiday entitlements).

The legislation as proposed would require:

  • Organisations to take action if they become aware of modern slavery or worker exploitation in their operations or supply chains
  • Medium and large organisations to report on steps they are taking to address modern slavery or worker exploitation in their operations or supply chains, and
  • Large organisations to undertake due diligence to prevent, mitigate and remedy modern slavery and worker exploitation in their operations and supply chains.

Although this proposed legislation is not yet law, businesses should start considering now how these changes will affect the way they operate, and the consequences associated with any breach such as monetary penalties and reputational risk.

Incorporated societies – what’s next?

After many years of consultation and deliberation, the new Incorporated Societies Act 2022 was finally passed on 5 April 2022. The Act’s changes will affect all of New Zealand’s 23,000+ societies.

The legislation puts in place a modern framework of legal, governance and accountability obligations for incorporated societies and the people who run them.

All existing societies have at least until 1 December 2025 to ensure their constitution complies with the new requirements and to apply to re-register under the new Act. Societies that do not re-register by that date will be removed from the register.

Although the Act is now in place, there are still regulations to be developed before existing societies can start the re-registration process. These regulations are expected sometime in the next 12 months.

We can help if you are unsure of your obligations under the Act or would like some help with the transition.

 

Next stage of vaping legislation coming into effect

Changes made to New Zealand’s vaping laws are being phased in, with the next changes taking effect over the coming months. The latest changes require all packaging for smokeless tobacco products and vaping products containing nicotine to include specific labels warning of the health dangers and addictive nature of the products. Critical dates for this labelling are:

  • 11 May 2022: manufacturers and importers (should be achieved by now)
  • 25 June 2022: distributors, and
  • 11 August 2022: general and specialist vape retailers.

The staged approach is to allow for stock rotation of products with non-compliant packaging.

You can find more information on vaping regulation here or don’t hesitate to talk with us if you need some help.

 

DISCLAIMER: All the information published in Commercial eSpeaking is true and accurate to the best of the authors’ knowledge. It should not be a substitute for legal advice. No liability is assumed by the authors or publisher for losses suffered by any person or organisation relying directly or indirectly on this newsletter. Views expressed are those of individual authors, and do not necessarily reflect the view of Edmonds Judd. Articles appearing in Commercial eSpeaking may be reproduced with prior approval from the editor and credit given to the source.
Copyright, NZ LAW Limited, 2021.     Editor: Adrienne Olsen.       E-mail: [email protected].       Ph: 029 286 3650