Equal Pay Amendment Bill

Members, we now come to the debate on Part 2. Part 2 is the debate on clauses 50 to 55, “Consequential amendments to other Acts”. The question is that Part 2 stand part.

Thank you for the opportunity to talk on Part 2. My questions are ones of language, really, and relate both to clause 52 and to clause 54 as well. That’s on pages 28 and 29 of the bill in front of us.

What this part of the bill is doing is bringing across those new terms into related legislation, being the Employment Relations Act 2000 and also the Public Service Act 2020. As we’ve discussed already in the Part 1 debate, there is this big change from whether a claim is “arguable” to whether it “has merit”. I asked some questions in that Part 1 debate about what will be new section 13F and the meaning of “merit”, and there is some similarity to the existing law but some important differences. One of those differences that was traversed in questions was that all of these requirements have to be met by the use of “and” in what will be new section 13F. Where the current legislation, back at 13F, has things that are included for consideration, and that happens at subsection (3)—it uses “including”—at subsections (1) and (2), it has to be everything; there are “ands” included.

Why I’m focusing on that is that new section 13F is a fundamental mechanism in what the Minister for Workplace Relations and Safety’s policy plan is to change. At clause 54, there is an amendment to the Public Service Act, and that is: when forming a view on whether the claim is arguable—“arguable” being the word that was used in the existing legislation—it has changed to “forming views on whether the claim meets all requirements set out in section 13E of the Equal Pay Act”. What I’m interested in is why there is that change of language from forming “a view” to forming “views”, in relation to section 13E—and I realise I was just talking about 13F—this important difference between when something is “arguable” versus now “has merit”. Why does “arguable” have a singular—“forming a view”—to something having merit needing “forming views”? I’m happy for the Minister to correct me if I’m wrong on this. I thought that you either meet the requirements of section 13E or you don’t. If she could comment on whether or not it should be “views are being formed” or whether it’s just “a view”, and it would be helpful for the Hansard, then, if she could go through what those different views might be that section 82 of the Public Service Act is referring to. There could be quite a few in there.

Then I note, going back to clause 52, which is about the Employment Relations Act, this is about the jurisdiction of the authority, and there’s quite a lot in this section. It’s very important. But, on my use of language and the difference between having to consider everything in a subsection—“and, and, and”—and whether it’s optional, “including”, we have here at new section 161(1)(qd)(ia), “determining whether a pay equity claim meets all requirements set out in section 13E of that Act”. So that’s section 13E, as referred to again in clause 54, which I was just talking about. At clause 54, you form “views”, but under the jurisdiction of the employment authority, they have to look and see if it meets “all” the requirements. Is that a purposeful difference in language—that, in one piece of legislation, they’re thinking about all the requirements being set out in section 13E being met, whereas under another piece of legislation, being the Public Service Act, it is “views” on the claim? Does it meet all the requirements or not? Why is there that “-s” in clause 54?

Then, if we look at other parts of clause 52, we see some important changes to this jurisdiction of the employment authority, and a lot of this relates to policy decisions that, of course, have been discussed in the Part 1 debate. We see there that the repeal of section 161(1)(qd)(vii) means that past grievances can’t be considered. That’s taken out. And then also there’s the repeal of (viii), which is the start date. I’m not sure why that one needs to be repealed—what the policy logic there for repealing (viii) is—but we have this new insertion that we can all see in the bill, at subsection (6), which is a new (va), “determining whether remuneration agreed by the parties to a pay equity claim is to be increased to the agreed level in phases and, if so, the particulars of those phases”. My overall question with this one, of course, goes back to questions I was asking on the Schedule as well, and it’s whether the Minister has received any advice that this could possibly happen now with the changes that she is making. Will there be any remuneration agreed by parties to a pay equity claim, or is this new clause in fact redundant?

So that is what I would like to know at a policy level and an advice level, and then my other question was about this use of forming “views”—with an “-s”—and why that is different from forming “a view”; that difference between “arguable” and whether the claim meets all requirements for that merit test that is so important to the changes that she’s making now. Is that purposeful? Can she explore the requirements of section 13E for us and why it needs this change in language for the Public Service Act but not for the jurisdiction of the authority, which has to check against all requirements?

Mr Chair, thank you for this opportunity. It is my first opportunity to speak on behalf and to ask questions of the Minister for Workplace Relations and Safety on behalf of my constituents, especially women from South Auckland and thousands of women from Panmure-Ōtāhuhu, who will, unfortunately, be affected by the passage of this bill. It is still shocking to me and I still cannot believe that we are here under urgency debating the Equal Pay Amendment Bill.

I’d like to ask the Minister questions about clause 52(2) of the Equal Pay Amendment Bill. This clause may sound technical, but, in reality, this clause is a direct attack on the rights of women and our most vulnerable workers. This will replace the existing threshold for initiating a pay equity claim from “arguable” to “has merit”. This may seem like a small language change, but make no mistake, this is a calculated move to raise the bar and lock the courtroom doors to thousands and thousands of women across Aotearoa New Zealand, and in particular to Māori, Pacific, migrant, and ethnic community woman.

Under the current law built on the hard-fought gains of the Terranova v Bartlett case, a claim only needs to be arguable. This means that they must bring a credible case of undervaluation worth investigating, not a fully proven thesis before the process even begins. But when this bill gets passed—which will be later on today because we are under urgency—this National-led Government wants to change that. The coalition Government wants women to come armed with legally analysed cases, market data, and evidence before they could even begin the process. That is not access to justice; in my opinion, that is obstruction to justice for our women. It has a systematic silencing of women in low-paid, female-dominated industries, like our care workers, our cleaners, our teacher aides, and our education support workers.

To be crystal clear, when it is “arguable”, the door to justice is more open; when it is changed to “has merit” under this new clause, it bolts that door shut. The Minister knows, her Cabinet colleagues know, that this will mean fewer claims. It will mean more rejections at the starting line and it will mean that more employers who benefit from systematic undervaluation will be handed more power to deny justice right at the beginning of the process. This is not progress. This bill will take our country backwards.

So my question to the Minister is: how will the Minister ensure that the term “merit” is not used to justify historical gender pay gaps disguised as performance-based differences? Also, can the Minister let us know, in the absence of a regulatory impact statement, which we do not have, what safeguards are there under this bill to prevent employers from relying on subjective or biased assessments of merit that may disproportionately disadvantage women. Does the Minister—another question—accept that historical undervaluation of women’s work stems from societal biases, and how does this clause on merit address this rather than reinforce it?

This bill, in my opinion, is economic violence against women, especially our Māori, our Pacific, our migrant, and our ethnic women who do essential work for little pay and even less recognition. This clause is betrayal of the bipartisan consensus that delivered pay equity progress in this country. It ignores the recommendations of experts, unions, and the Human Rights Commission, and it violates the spirit of our obligations under the Convention on the Elimination on all forms of Discrimination Against Women and the International Labour Organization convention No. 100.

Another question for the Minister to consider: who asked for this change? Who benefits from this change? It most certainly isn’t the women of Aotearoa and it is most certainly not fair nor justice for women of Aotearoa New Zealand. Thank you very much.

Thank you very much. I want to take the time to respond, firstly, to Rachel Brooking, who has asked why it is “views”, not “a view”, in clause 54. The word “views” is used because the employer has to make multiple decisions, or two decisions. This is a consequential amendment to reflect the changes made in Part 1 of the bill. It reflects the change made in the bill requiring the employer to consider both whether the claim meets the requirements in section 13E and whether it has merit.

The second question was, in regard to the language used in clauses 54 and 52, why is it different—is that for a reason? Yes, the language is different, and in the new section 161(1)(qd)(i)(ia), the authority is only looking at the requirements in 13E. In clause 54, the employer is considering both whether the 13E requirements are met and if the claim has merit.

The third question was in relation to clause 52 and the changes to the authority’s jurisdiction—why is this the case? Once again, this is just a consequential amendment reflecting the changes in Part 1 of the bill, so that’s why it is—in particular, section 13ZY, which sets out why the authority can make the determination.

Jenny Salesa has asked and made comment on the change of wording from “arguable” to “merit”. Once again, this change from “arguable” to “merit” is a consequential amendment reflecting the changes made in Part 1, which has already been debated and voted on.

Thank you, Mr Chair. This is my first call in this debate. I do have some questions on clause 51, the repeal of section 33(2)(d) of the Employment Relations Act 2000. Before I go into that, I want to echo the sentiment that many others have made in this House around how appalling this piece of legislation is, how little analysis has been done, and how women and migrant workers particularly will be disproportionately affected by this.

I wanted to ask about clause 51, which is “Section 33 amended (Duty of good faith requires parties to conclude collective agreement unless genuine reason not to)”. If we go to the Employment Relations Act 2000, there’s a list of reasons here laid out in section 33(2), which include things like “(a) opposition or objection in principle to (i) bargaining for, or being party to, a collective agreement; or (ii) including rates of wages or salary in a collective agreement; or (b) disagreement about including a bargaining fee clause under Part 6B in a collective agreement; or (c) the existence of an unsettled pay equity claim between an employer and a claimant under the Equal Pay Act 1972, or”—which is the part that this bill is repealing, “(d) the existence of a requirement to review a pay equity claim under the Equal Pay Act 1972.”

Now, in this bill, what we are seeing is simply a repeal of that requirement and, to me, it does leave a void then, because by the looks of that—and I’d be keen to seek some clarification—it is not being replaced by any other language that seeks to at least create an equivalent, and for the future as well. That, to me, seems to be concerning because then it’s just kind of treated as a consequential amendment to this Act, but to me it just feels like it leads to a void.

I wonder whether this is just in line with the Government’s policy intent of simply lifting the threshold and making it harder for people to achieve pay equity, or whether the Minister explored a replacement of that specific section 33(2)(d) with something else. So I’m keen to understand the policy intent and the thinking behind just simply repealing that section. That’s something that I think we could have actually explored at the select committee stage. We haven’t been able to, so I think, in this process, I’d be keen to seek clarification very specifically on this specific repeal.

I have some other questions that seek to unpack the broader implications of this bill. But, for now, I’m keen to talk about clause 51. I think, to me, why I say this is that often—and why this is particularly problematic—already workers are having to take up cases even to other authorities when they feel like their employer is not engaging in good faith. This actually does happen often. Unfortunately, we’re in an environment where employers have, in many cases, been quite hostile when it comes to negotiations and being able to get to a collective agreement. This is why I think this specific clause just feels egregious and problematic, because it’s kind of painted as consequential, but I feel, to me, it’s also politically motivated. So any clarification as to the intent would be particularly useful.

I’ll take another call later to make sure I can unpack particularly—just to give the Chair some warning—the implications around immigration settings as well as child poverty reduction targets. Thank you.

Thank you, Mr Chair. This is my first call in Part 2, which deals with the consequential amendments, and I did note the Minister for Workplace Relations and Safety’s response to the excellent contribution by my colleague Hon Jenny Salesa, talking about how we had covered the issue around merit previously. But I would draw the Minister’s attention to the fact that these consequential amendments primarily focus on changes to the Employment Relations Act 2000 and then—which we haven’t got to yet—amendments to the Public Service Act 2020.

So it is actually a different proposition to look at how the changes that she’s wanting to put through will fit into these different pieces of legislation. It is not the same as talking about it within the primary, in my view, Equal Pay Act. So I do think it is worth making sure, being as that we haven’t had a select committee process, that these changes do actually fit within these very important, significant pieces of legislation, and I don’t think the arguments are exactly the same as they were with the primary Act. So I would ask that the Minister please engage with the questions that we have in Part 2 because, although it is a smaller section, these do deal with significant pieces of legislation and it is important that we’re not making changes in this Chamber today without the benefit of going through select committee, without the benefit of a regulatory impact statement, that do not work with the existing legislation. I think the contribution that Ricardo Menéndez March made in that regard highlights how important it is to make sure that these pieces of legislation are consistent.

So I do have an amendment that I’ve tabled in Part 2, which I will speak to in this contribution if I have time, but I would like to make sure that I have the opportunity to go over that amendment. But I just thought the first thing that I would start with is also to look at 52, but look at 52(ib), because this is when the employment relations—well, we looked at jurisdiction of the Employment Relations Act, and this looks at whether the employees work is the same or substantially similar to the work that is the subject of a pay parity claim in relation to comparators.

So I think this is a really important point for the House to note: when selecting a comparator, the only way that a comparator will be successful is if that comparator is the same as or substantially similar to the claimant. So this idea that these kind of outlandish, totally inappropriate comparisons are being made is just not true because, if it was true, the claims would not be successful and there would be no benefit to it. So I think it’s really important to note that and note the wording in the Employment Relations Act because I think that does help the committee to see that.

The other question I have in relation to the Employment Relations Act is: the Minister will be aware that the fundamental, overriding duty in the Employment Relations Act is the duty to act in good faith, and I have some questions around the duty of good faith and how that does apply to the changes that she is making today to the legislation. Is it good faith to extinguish claims—and I appreciate some of them may be able to be moved under the new legislation, but not all of them. Is that good faith when there is a bargaining agreement in place? Obviously, it’s permissible for the Government to override good faith, but my question to her is whether she’s considered that overriding duty because she is making changes to the Employment Relations Act.

The next question I have for the Minister is 52(2). It changes—and my colleague the Hon Jenny Salesa was speaking about this, but the point I want to make around this is very different. She is changing the Employment Relations Act and she is adding “has merit” into that, and I want to know: has she received advice around the use of the word “merit” in the Employment Relations Act and whether this use of the word “merit” is consistent with that? It’s something I don’t know; I’m interested to know the answer to that.

Another thing that I would like to know, and it does come to the process, is we have talked about—and this particular section talks about consequential amendments, and obviously there is a regulatory component to that. So I want to know from the Minister: will she or does she envisage that that aspect of this bill will be scrutinised by the Regulation Review Committee at a subsequent date? Because sometimes the Regulations Review Committee does scrutinise decisions that have already been made, or, in fact, if it’s just the regulatory component of that which would go to the Regulations Review Committee. I do think that if the Minister wanted to do away with some of the damage that this bill has brought forward, then it would be good to have the answer to that in relation to whether she sees that being part of the process of this in the scrutiny; that would obviously come after the passing of this bill.

The other thing that I wanted to know is: does she envisage a role for the usual select committee that this bill would usually go to—and they do have a role in overseeing the Employment Relations Act, which is the bill that we are amending in Part 2. Would she see that there is a role for the Education and Workforce Committee to, after the fact of the passing of this bill, have the opportunity to invite submitters to a select committee hearing or briefing or inquiry into this Act to allow people the opportunity to actually express their view on this piece of legislation? I don’t accept the reasons that this has been brought under urgency. I think it’s absolutely terrible and I think it’s a shame on this Government led by the National Party, but I do think that it would be better than nothing to have a select committee be able to look at this, and so I want to know: will she do that?

If we were to have that select committee hearing, post-dating the passing of this bill, it would be the appropriate time where we could look at the Employment Relations Act and the changes that she’s making and really get detailed advice from officials as to whether these changes she is making in terms of language in the Employment Relations Act is consistent with the rest of the Act, does work with the rest of the Act, is workable. It’s just not time for us to be able to make those detailed assessments in this particular bill, heard under urgency. So I would like an answer to that from the Minister.

The other thing I just wanted to add—and it does relate to a point which I did want to come back to in Part 1, but I was unable to get a call on it—was looking at phasing, and that’s in Part 2, 52(6). So that talks about the agreed phases, and I had an amendment—which, unfortunately, was not successful in the first part—looking at phasing. The Minister criticised me for putting that amendment down, and I wanted to just have the opportunity to explain that the reason I was concerned about phasing is because I genuinely think that when people are in negotiations and when they can agree to something which is appropriate for their workforce, they often make good decisions which people are happy with. The more restrictions we put on the types of negotiations that people can have, in a complex mettle like equal pay, often we are stuck with results that might be quite difficult. So the Minister, in what has passed in the first part of this, has suggested that we should only be able to agree things up to three years, and I think a longer period of time in some instances, if agreed between the parties, might result in a longer period of time where they were able to have their pay equity topped up through that period of time.

So I don’t accept the criticisms from the Minister, and I wanted to ask her, in relation to Part 2, clause 52(6): the jurisdiction that the authority would have in relation to agreed phasing, because in the other part of the legislation we had that three-year limit, does this apply to 52(6)? That’s a question that I have for the Minister. So a few questions there. I haven’t had the opportunity yet to talk to my Amendment Paper. I’ll let the Minister answer those questions.

Mr Chair, thank you very much. I very much have actually been waiting to take a contribution in relation to that member Camilla Belich’s desire to see phasing in of pay equity settlements take longer.

I think every member outside this House, every member of society should listen to Camilla Belich when she says that she’s standing up for workers and wishes to see people who have agreed to a pay equity settlement have a longer time frame to see that money in their pockets. That member has made multiple contributions. This is a member who believes in pay equity and she’s suggesting to people who are successful with pay equity that instead of a three-year phased settlement that this Government is suggesting ends up in people’s pockets, that it’s up to 10 years until they would see the money that they may get for their settlement.

I think everybody should take note of that and I thank the member Camilla Belich for the insight into the Labour Party and the potential desire for that member in the party to see members who are successful in a settlement have a longer time frame to receive that money in their pockets. Thank you very much for that contribution.

Back to Ricardo Menéndez March and the question about removing section 33(2)(d). Does it create a void? No. Good faith, of course, continues to apply in all employment matters. I will take my leave now and answer further later.

Thank you very much, Mr Chair. I wanted to follow up on some comments that the Minister made just now in her call around money in people’s pockets. It flows on quite well because—and I thought this would be better suited to ask in Part 2 again—of the kind of stuff we would have actually very easily tried to unpack in select committee. One of them is I wanted to understand why there was no child impact assessment being done. I say this because one of the Acts that actually, while not here in writing, is very related to this whole issue is the Child Poverty Reduction Act that we have.

One of the reasons why I want to tie it in with this bill is because we have heard from another Minister that work and people entering work is going to be seen as one of the primary ways we’re going to be reducing child poverty. Yet the way that this bill is laid out risks undermining the growth of wages for women in particular, which then in some ways has a flow-on effect on the Child Poverty Reduction Act and the Government’s actual obligations to meet our child poverty reduction targets.

So I’m curious to know: if she doesn’t think that, actually, there is any consequential impact in the Child Poverty Reduction Act, despite the Government saying that work is going to be one of the primary means of achieving those goals, and there was no child impact assessment done as part of preparing this bill—something we could have very easily actually asked for at the select committee stage—I’m curious to know whether she had any engagement at all with Minister Louise Upston, in her role as child poverty reduction Minister, to evaluate whether the delay in wage increases as a result of the existing pay equity claims would have had a negative effect on meeting our obligations under the Child Poverty Reduction Act. I think that’s important because, to me, there seems to be a direct contradiction between the stated goals of this Government and what we’re seeing in this bill.

The other question I had in relationship to interactions between the changes here and other parts of legislation and policy—and, again, this would have very easily been asked and answered by officials or the Minister herself during a select committee—is whether there had been any engagement in what’s being laid out here, particularly because there’s a lot of migrant workers in the areas where there’s pay equity claims, and many of them often require specific wages to be able to qualify for some residency pathways. The conversations that I have had in the past with some of the migrant workers in some of those areas is that the pay equity claims could have actually boosted people’s wages to a level that would have allowed them to access residency or other visa pathways.

But without these—I am curious to know again, whether the Minister engaged with anyone, whether it’s the immigration Minister, or anyone in the immigration sector, to actually understand the flow-on impacts of this bill on migrant workers who are in the workplaces affected by this bill, and, if there wasn’t any engagement, what certainty can the Minister give us on the impacts of this bill on our obligations to meet the Child Poverty Reduction Act, as well as any immigration policy? Those things are completely related to what’s happening in this bill, because of the direct impact on people’s wages.

Other people have already talked about the groups that are disproportionately affected. So I’m curious to know as to whether she thought that the Child Poverty Reduction Act should have been amended at all as part of this bill. I just can’t see how the Government will meet its obligations under that Act as a result of these changes, if they’re relying on paid employment to reduce child poverty.

I’ll take the time to respond to a few more of the member Camilla Belich’s questions. Firstly, in relation to whether or not the duty of good faith applies to the changes made in the bill, I have already answered that by another member. Good-faith obligations will continue to apply in the pay equity process.

Secondly, will the bill be scrutinised by the Regulations Review Committee at another date? If any regulations were made, then they would be subject to the Regulations Review Committee, as is always the case. The bill will not be scrutinised by the Regulations Review Committee as it’s going through the robust parliamentary process, which is how we deal with legislation.

Camilla Belich had another question in relation to the consequential amendment to the Employment Relations Act to section 161(1)(qd)(iv), if this relates to the selection of comparators. Section 161(1)(qd)(iv) sets out the Employment Relations Authority’s ability to make a determination about whether an individual employee’s work is the same or substantially similar to work that is the subject of a union-raised claim and therefore should be covered.

She also referred to her Amendment Paper to delete clause 54. The change made to the reference from “arguable” to “merit” in this section is a consequential amendment that has already been voted on in Part 1.

Thank you, Mr Chair. I’d like to take up the issue of the use of the word “merit”. I think it is relevant that we’re talking about the Employment Relations Act here, which has been highly successful because it’s taken a term which is actually a virtue. We all strive for good faith. We strive for being a good employer and being a good employee, and it does the world of good to us. What we’ve done in that Act is we’ve signalled to people something that’s really important for them to strive for that virtue.

What I’m concerned about here is about the use of the word “merit”. I appreciate the point that it’s been used in the previous part, but actually to say something “has merit” is a very powerful statement. So if you’ve got somebody who is in the 68 percent industry but has been discriminated against, their claim “has merit” in the common parlance of that word. They have been discriminated against and they’re missing out here. So to talk about “having merit”—and we’re supposed to use plain language—is fairly insensitive and it sends the wrong signal to people.

What I’d ask the Minister to do is: would she entertain using a more neutral phrase there? She could say something like that it has passed the threshold of merit in Part 1, because that shows that she’s making a judgment call and it doesn’t devalue the person who was before a process like this, who actually has been treated unjustly by the system but has not actually been recognised as such by a system. It’s clearer in Part 1 that that’s what’s going on, that there’s an arbitrary nature to the threshold, although I’m not comfortable with it. It’s not clear at all in Part 2, when the use of the words “has merit” actually sends a signal to people that every other claim doesn’t have merit. So would she consider using a term which unpacks this, that is more neutral, that is more professional about that and does not send that signal to people? I’d also note that this is also happening in clause 54, which is the Public Service Act amendments—so, again, that the claim “has merit”. It would be easy enough to amend it so that the language was much more neutral in that case too.

I also wanted to ask the Minister about—it’s actually on the same page, page 29 in clause 52(6)—the insertion that is going in here that talks about phasing. I wondered whether there had been discussion or advice on what the parameters of that phasing were, and whether it was reflected in this language—is it possible for the authority member to create phases which might be uneven in the amount that is being paid out and that calculate in the loss of the use of money? So all the interest that’s being lost, are we visiting that on the individuals, so that the working women who are not being paid out—it’s been recognised, the claim, “Yep, you’re being treated unjustly and you haven’t been paid right. We’re going to take three years to pay you.” Are we now, as the authority, able legally to go “Part of our job is we’ve got three phases, and each one of those—the first one, you’re going to get this amount. The second one, you’re going to get this plus this because it’s the use of money—we’ve had the benefit of your money in the meantime. The third one, you’re going to get an extra amount.” Is that possible under these words or do we need to include words so that that happens? Because anything else, I put to the Minister, seems unjust.

So my third question is, and I’d like an answer to this: does she accept that it’s very unjust if all of the damage done by that payment scheme—which is, in this situation, not agreed; it’s determined—if all that is visited on the poorest person in this situation, which is the worker who has been discriminated against and hasn’t been paid. Thank you.

Thank you, Mr Chair. I just wanted to reflect on a couple of the questions. Firstly, a question in the name of Camilla Belich about what jurisdiction the authority has in relation to phasing. Does the three-year limit apply? The changes to the Employment Relations Act reflect the changes made in Part 1, in relation to determinations of the authority—the requirements as specified in Part 1, which included that three-year phasing. So that’s that.

“Why is there no regulatory impact statement?”—from Ricardo Menéndez March. Look, the Government has been working to ensure there is a robust pay equity scheme, and it’s clear that the legislative settings are not working as intended. However, the substantive policy in the bill is included, in fact, in Part 1.

Ricardo Menéndez March asked about the engagement with, I believe, the Minister of Immigration. I already answered that question during the debate in Part 1, and the Minister of Immigration is in Cabinet and was involved in those decisions.

Members, the time has come for me to leave the Chair. The House will resume at 2 p.m.

Sitting suspended from 12.56 p.m. to 2 p.m.