Monday, September 29, 2008

Choices: employment relations

Now that Parliament has dissolved and the election campaign is officially underway, its time to start the serious election coverage. Elections are about choices. On the surface, we choose who gets to occupy the government benches for the next three years - but the real choice we are making is about what policies get implemented. So, over the next six weeks, I'll be looking at what our choices are on issues such as health, education, and the environment. The focus will primarily be on the major parties, as rightly or wrongly they will form the core of any post-election government. Minor party policy is of interest primarily as a source of ideas for the majors, or as a possible veto if they are forced together.

I'll start with employment relations. This is one of the classical divides between left and right, and it matters to almost everyone's life. By setting the ground rules for employment relationships, employment relations policy determines the balance of power between employees and employers. On the individual level, this means it affects workplace entitlements like meal breaks and sick leave, how much we get paid, how many holidays we get, and the security of our lives. On a larger scale, it helps determine the distribution of wealth in society. Changes to employment law or entitlements can make a real difference to people in need - or it can enrich the already rich at the expense of everyone else.

Labour's policy in this area has been simple: firstly, give unions the power to fight for wage increases, by restoring rights removed in the Employment Contracts Act. Secondly, use monetary policy to create a labour shortage by including full employment in its Policy Targets Agreement with the Reserve Bank. Thirdly, make regular large increases to the minimum wage, boosting incomes at the bottom of the pile and providing an argument for better wages for those further up. Then let nature take its course. The result has been a period of sustained wage growth, which has significantly benefited ordinary New Zealanders and seen our income distribution begin to return to its pre-revolutionary state. Around the edges, they've increased annual leave to four weeks (thanks to the Alliance), introduced flexible working arrangements (thanks to the Greens), and protected meal breaks - but the core has been creating an environment where unions can be effective in performing their basic function of getting benefits for their members.

National has tried to give the impression they would retain these policies. In fact, they plan significant changes. The headline changes are a 90-day probationary period during which employees could be fired at will (effectively stripping them of all employment rights), and giving employees the "choice" to sell their fourth week of annual leave (a "choice" which is likely to be dictated to them by their employer, on the employer's terms). These are both bad moves, which will significantly restrict workers' rights and job security at the bottom end of the market. But more fundamental are their moves to restrict union access to workplaces and remove the union monopoly on collective bargaining. The former would restrict the ability of unions to represent their members; the latter would allow employers to sideline them in favour of their own "bargaining agents", supposedly representing the employee but in fact appointed by and working for the employer. If this sounds horribly familiar, its because its the situation we used to have under the Employment Contracts Act; it effectively crippled unions, lowered wages, and funnelled the fruits of growth into the pockets of the rich.

(As for those minimum wage increases, you can kiss them goodbye. According to National MP John Hayes, National "believe[s] in tax cuts, not the minimum wage". They have said nothing about possible changes to monetary policy, and some journalist should probably ask them about it...)

As for the minor parties, ACT stands for "more freedom of contract" (which means fewer rights for employees), United Future for the status quo, and the Progressives and Greens for further improvements within labour's basic framework. The Maori Party don't seem to have released a formal policy, but have talked about a $15 / hour minimum wage and have voted for every progressive piece of legislation on this issue, so they're probably in the "left" camp (as - broadly - are NZ First). Which means National is going to have real trouble actually implementing its policies in this area if they end up lacking an easy legislative majority.

We have a clear choice in employment policy between a party which uses it to benefit the many and a party which wants to use it to benefit the few. You might want to think about which one you prefer.