Employment Relations (Statutory Minimum Redundancy Entitlements) Amendment Bill

By rotation, the Government would have the next call.

It is an enormous pleasure to have this opportunity to take a relatively short call on this Employment Relations (Statutory Minimum Redundancy Entitlements) Amendment Bill, which Sue Moroney, our colleague across the Chamber, has brought to the House. It is a member’s bill in the name of Sue Moroney set down for the first reading and we are picking up the baton, as we have had a number of speeches on this issue before.

I regret to say to my colleague across the House that it is, unfortunately, not a bill of principle. And why is this? Well, there are a few reasons.

💬 Andrew Little: Because you hate workers.

What was that? I am a horny-handed son of toil myself, Mr Little. I just ask this question: if this is so important, why did Labour not do anything about it in its 9 years? Why was that? Why was that? OK, Labour did introduce the Employment Relations Act 2000. This was a major overhaul, the Employment Relations Act, of the labour legislation in New Zealand. It was also the first major piece of legislation introduced by the last Labour Government, and it was touted at the time as a great reform—and, to be fair, it was a great reform for the labour sector. It was meant to cure all the supposed inequality in bargaining power between employers and employees. Yet at no point—at no point—did Labour members talk about redundancy requirements. I do not recall them talking about redundancy before. They never mentioned it. Why was that? It was because they knew it was too much of a burden upon our businesses.

But let us look at what a previous Labour Government Minister has said about the labour market and, in fact, the Employment Relations Act, which the Clark Labour Government passed. You might remember this gentleman’s name. Phil Goff said: “The Labour Government has moved away from the type of interventionism that saw our economy become less adaptive, less competitive, more debt-ridden and bureaucratised, and that saw our living standards fall over time and employment rise.”

💬 Rt Hon Winston Peters: Who wrote that?

It was Phil Goff, actually—Phil Goff. “It is a Government that has sought more market influence and efficiency going forward.” So that is what Phil said—

The ASSISTANT SPEAKER (H V Ross Robertson): Order! Order!

That is what Mr Phil Goff, the Hon Phil Goff, said. That is what he said.

We are committed as a Government to creating jobs and fostering economic growth. Statutory redundancy provisions, we believe, act as a barrier to employers taking on new staff, because we believe that redundancy entitlements generally are a matter for employees and employers to bargain for in an employment agreement that is relative to their industry and the size of their business. Small and medium sized businesses may be disadvantaged and are unlikely to be able to cope with significant redundancy payments.

It is worthwhile considering just what some of these costs to business would be. At the current minimum wage of $13.75 per hour, an employer would be required to pay a full-time, 40-hours-per-week employee who had worked for 1 year $2,200 gross.

💬 Simon O’Connor: How much?

$2,200 gross. That will increase by an additional $1,100 a year every year the employee remains. So it is not insignificant. The male median hourly earnings figure is $22 an hour. That is $3,250 gross after 1 year, and a maximum of $22,000. So it is not insignificant. Employees, as we said, have the opportunity to bargain for redundancy payments that they think are appropriate.

We introduced the ReStart package in 2008, which provides for workers made redundant and focuses on helping them back into work. We are focused on getting people into work, not placing more burdens on employers. When the previous Government looked at the issue in the Public Advisory Group on Restructuring and Redundancy report, 14 of the 22 submitters supported the status quo. In other words, they did not want change. What were some of the downsides to statutory redundancy provisions noted by the public advisory group? They were, one, disincentives to hire more staff; two, reduced wages; three, more temporary and contract workers; and, four, additional stress on businesses that are struggling already, resulting in further job losses and actually putting business viability at risk. Thank you.

It is a pleasure to take a call on this very important, somewhat essential, Employment Relations (Statutory Minimum Redundancy Entitlements) Amendment Bill, and I begin by lamenting what was a shocking, despicable, miserable contribution from Dr Cam Calder. He began his speech by asking why Labour did not do anything about it. Well, I have got news for Dr Cam Calder, and it is that, first of all, Labour commissioned the very group, the Public Advisory Group on Restructuring and Redundancy, that investigated, reported, consulted on, and came up with the recommendations. They were not just any recommendations; they were consensus recommendations, which means that the employer representatives and the union representatives on that committee agreed with the recommendations.

I want to say that I know a bit about that public advisory committee—and this may come as a shock to Dr Calder and, indeed, to some other members opposite—because I was on it. I know the hard work that went into it. I know the discussions. I know the people, who are all decent people, and we came up with a consensus set of recommendations. So the second answer to the question that Dr Calder asked, which was “What did Labour do about it?”, is that Darien Fenton, one of the many hard-working Labour MPs in this Labour caucus and, indeed, in the previous one, put together a member’s bill—which actually looked very similar, on the face of it, to this one—to introduce minimum redundancy entitlements.

Dr Cam Calder’s speech and, indeed, all of the National members’ speeches illustrate their attitude towards working people and working life. They hate workers. They do not like workers having good-quality rights. They do not like it. They see work and workers as a cost to a business, as something to minimise, to reduce, to deduct from, and to discriminate against. They see workers as a pest to a business. They do not meet the 21st century standard that good employers actually have towards workers. They come from the 19th century view about workers that they are pests and that they need to get them out of the way as much as they can, take away their rights, treat them like dirt, and give them no rights at all.

I want to say this: redundancy plays a very important role in the labour market. It is compensation for the loss of job, for the loss of office. It is about tiding people over while they are between employment, while they are looking for work. Why is that important in the labour market? Because the reality is that when a worker is tied up with an employer they face an opportunity cost. They are not out there in the labour market elsewhere, and the longer they spend with an employer the less active they are in the labour market, apart from the fact that they are working and providing value to the employer, helping that employer generate a profit, and being paid from that profit. But when they are pushed out of that employment at the employer’s initiative for no other reason than that the employer decides that they no longer want them and can run the business without them, then it is entirely appropriate that the labour market provides some compensation for that worker. That is all it is about. There is nothing particularly radical about it. It is orthodox labour market economics. It has happened before. It should happen again.

Let us understand the history about redundancy in this country. Redundancy compensation was fought for by unionised workers back in the 1970s. It started with the Māngere Bridge, a project that National has spent years, if not decades, lamenting. But actually it has had a very important effect. It introduced the first redundancy rights. It led to a law change that allowed specific awards for redundancy compensation.

Of course, the biggest beneficiaries of that ever since were not workers. Actually, it was those in middle management and upper management who have gone along to their boards of directors and senior managers and said: “Oh, you can’t do without me. If you want to get rid of me on a no-nonsense basis, you write me out a big, fat cheque and you pay me bucketloads of money.”, which is what has been happening ever since. That is the background to it.

If it is good enough for the senior managers, and if it is good enough for directors and others, to walk away with big, fat cheques when they get pushed out of their jobs, then it is actually entirely appropriate that when hard-working, front-line workers—

💬 Hon Member: What about the ones that aren’t hard-working?

Oh, here is the National Party again. That is it. The prejudice had to come out—the prejudice had to come out. He cannot resist. Those members hate workers. National members hate workers. Everything they do is about taking away rights and expressing their hatred for workers, and their opposition to this bill is just that. That is why we are supporting it. That is why we have good MPs like Sue Moroney and Darien Fenton who put up these ideas, and we will be voting for this great bill.

Thank you very much. It is important to rise and speak tonight. I want to acknowledge the previous speaker, Andrew Little, who has fallen into the continual trap of the Opposition: he spends a lot of time saying what National supposedly is talking about. National is not against the workers. National is not attacking the workers. We are not trying to keep the man down. This is not that Hegelian master and slave dynamic. That is always and only said—only said—by the Opposition about the National Party. We are a party committed to jobs, to growth, and to Kiwis who are prepared to be part of that growth agenda. So I am pleased to stand here and speak to the Employment Relations (Statutory Minimum Redundancy Entitlements) Amendment Bill, and pleased to stand in opposition to this bill.

I was standing in my office an hour or so ago, and I was trying to get my head around why this bill had been put up by Ms Moroney and others. Why was redundancy such a major issue for members of the Labour Party? Then it dawned on me. It dawned on me that they are worried about David Shearer. They are actually compassionate, empathetic people worried about the impending redundancy of David Shearer. They are wanting to make sure, to assuage their consciences, that when they put the knife in his back and push him out in the coming days or weeks they will be able to look after him—they will be able to look after him.

Is it Iain Lees-Galloway on the redundancy issue? We have to worry there. Is that the issue of the day? Is it Ms Moroney? Is she concerned about the redundancy? For her to step away from whatever shadow policy she is involved with it needs at least 4 weeks’ support. We find very quickly, I think, the motive here. This is an attempt to assuage one’s Labour guilt around redundancy for the impending issues around their leader that we hear. They have all of a sudden gone incredibly quiet. We wonder which of the members across the way have already put their ladders down.

One of the key things that ultimately comes out of this is a mind-set. It is a mind-set. We could summarise it like this from the Labour Party. It is very simplistic—very simplistic. Karl Marx would be pleased with it. It is the belief from the Labour Party that ultimately every employer is a crook. It is also a belief that every employee is an idiot. We know that neither of those two statements is true. We believe that employers and employees—Kiwis—can go around the bargaining table and have a conversation. We can stand on our own two feet, be we an employer or an employee.

The party in Opposition—and it is the reason it is in Opposition—does not believe that. If you listen to those members’ speeches in this House, time and time again they are always about control. They are always about control. No one bar the Labour Party has the knowledge, the insight, and the great belief—no one other than the Labour Party—to make the decisions! The National Party stands here with a belief that Kiwis can stand on their own two feet and negotiate their contracts. They can negotiate around their own redundancy payments if they so choose, as members, I am sure, on all sides of the House have done in their time.

It is about choice. You see, the Labour Party falls back again. It does not want choice. And why does it not want choice? Because it wants to make the choice for everybody else. This is that hands-on politics. This is the hands-on politics we heard from David Shearer and the Labour Party. And I have said it before. They want their hands on your wallet and around your neck. This is all about control.

Also, it lacks economic understanding. You see, in a very basic way, if a company, a not-for-profit organisation, any organisation, or a small business is moving towards redundancy, it means things ain’t good. Let us put it in very simple, colloquial language. It ain’t good. It does not have the money for these sorts of dynamics. Why is it going under? I am not saying that it is the case in every situation, but things ain’t good, to use a bit of Kiwi colloquial-speak for the Opposition. So this bill is crazy at a number of levels.

As Dr Calder pointed out earlier, Labour had 9 long years to fix this, but as I also noted as I began this speech, I think I understand the motive. There is a lot of talk about making a certain leader of the Labour Party redundant, and to assuage those members’ guilt they are willing to try to push this bill through to make the ending of David Shearer a little smoother.

I raise a point of order, Mr Speaker. I want to move an extension of 5 more minutes for Simon O’Connor, so that in the next 5 minutes he can make more sense than he made in the previous 5 minutes.

The member knows that that is not a point of order. That is a frivolous point of order.

That speech was from the party of privilege. Was that not enlightening? From the party of privilege, people apparently choose to be made redundant, under the National Party’s view. Apparently, there is a freedom of choice about your job being taken away from you. Well, I would like those members to share exactly how that works. I think that nothing shows more about how out of touch that Government is with the day-to-day realities than the sorry speeches we have heard from the National Party on this Employment Relations (Statutory Minimum Redundancy Entitlements) Amendment Bill tonight.

I am really proud to bring this bill before the House, but I am not proud of the circumstances in which this bill becomes so relevant today. Since we started the first reading debate on this bill just a few weeks ago there have been hundreds more redundancies announced in this country—and that is just in the weeks since we started the first reading debate. That is something that the Government needs to take responsibility for. Since this debate started, 500 jobs have gone at New Zealand Post, right throughout the country. In Hamilton, where I come from, 129 jobs have gone from that city alone.

When I did my speech at the beginning of this process, I warned about the tsunami of redundancies. I warned about the second wave that was coming. That is the beginning of the second wave. When 129 pretty reasonably decent jobs, well-paying jobs like New Zealand Post jobs, come out of a community like Hamilton, those wages get sucked out of that economy as well. And when those good wages get sucked out of the economy, guess what happens next? More redundancies start happening because money is not getting spent any more at the companies and the local businesses where those people once spent their wages. So the next wave of redundancies is not the one that you will read about in the newspaper. The redundancies will be the one job here, the two jobs down the road, and the three jobs at the other company down the road as well. They are the ones that we will not hear about.

The National Party has focused on this somehow being a personal choice. Those 129 workers at New Zealand Post in Hamilton and the 500 of them throughout the country have apparently got a personal choice about being made redundant. Well, here is the reality: they do not. They do not have a personal choice about being made redundant. Fortunately, they are members of a union and they will get redundancy pay, but those ones, twos, and threes—the redundancies in those other small companies that I talked about that are coming round the corner—are the ones where people have not had the personal choice to actually negotiate redundancy.

What is it that makes the National Party feel so comfortable about the thousands of people being made redundant in this country every month and the fact that 80 percent of them—yes, 80 percent of them—have no entitlement to any redundancy protection? Because that is the reality. That is the National Party’s personal choice for us: the personal choice to actually have your job taken from underneath you—not you, Mr Assistant Speaker, but thousands of New Zealand workers—and have no rights and no protection at all. That is what the National Party has just told us it is completely relaxed about. Well, it is all right for the National Party to be relaxed about it, but those workers and their families are not relaxed about it, because they are facing no income and the prospect of no job. When those 129 jobs go in Hamilton, I can tell you, those people will be lining up with hundreds of others for minimum wage jobs at the local supermarket. That is the destiny that they have in place for them.

It is clear. It is clear with this debate which party is focused on the real issues—the real issues that affect New Zealand today. Because here we are debating a very real issue, which was promoted by the Labour Party and voted against by the National Party. Can I, in closing, thank the Green Party, New Zealand First, the Māori Party, Mana, and Brendan Horan for having the decency to stand up for everyday New Zealanders in support of this bill. Thank you.