What’s with the cuts?

Posted: June 19, 2011 by Admin in National Party NZ, Unions - NZ, Workers' rights

by Daphna Whitmore

While union membership remains at record lows and strike struggles are few and far between, why is the prime minister signalling more anti-union laws to come?

John Key is no ideologue. When the National Party ditched Don Brash in  favour of Key as leader they knew their new guy came without political baggage, or for that matter political policies. Key is the ultimate pragmatist.

This rather apolitical politician has turned out to be a real asset for National: a leader with a keen sense of public opinion who doesn’t like to pick unnecessary fights and is quick to say he’s “relaxed” about a policy if it rouses deep hostility.

He’s also stated on many occasions that he thinks wages in New Zealand need to rise and, like others, has talked of matching Australian wages.

Of course words are cheap, it’s what politicians do that count. So Key’s latest promise of more attacks on workers’ rights shows something’s not adding up here.

It’s not as if the country has been shaken by industrial upheaval.  Quite the opposite: the past two decades have been marked by declining struggles, and record low numbers of strike days lost.

Interestingly, big business is not clamouring for attacks on unions; for instance, companies like Telecom have indicated they won’t even bother using the 90-day sacking laws now available to employers. Furthermore, unionised worksites tend to have collective agreements with clauses preventing the 90-day sacking free-for-all and those agreements usually are mirrored in the non-union staff’s individual employment agreements in these workplaces.

So if the most influential and powerful section of the employers are not pushing for the anti-union attacks why is Key signalling there’s more to come?

It seems the small- and medium-sized employers have the government’s ear.

Their existence is always a precarious one, balanced between making a small profit and going bust,  and they want much more labour market flexibility. In their minds the rights workers currently have are out of step with the times.

There is a downside not appreciated by the smaller capitalists who only see the immediate gains of curtailing union rights and getting more for less out of workers. The past twenty years have seen productivity decline as employers chose to extract profits by squeezing workers harder – making them work longer and more intensely for less pay –  rather than invest in better plant and machinery.

Union membership started its decline from the mid-1980s then slumped after the introduction of the Employment Contracts Act in 1991. The legislation made collective bargaining difficult, restricted union access and ended the old Award system of setting wages.

In 1985 union membership was 70 percent of  the workforce, today it is just 17.4 percent.

While in the 1990s under a National government union membership was in free fall, in the 2000s the Labour Government failed to stop the fall, let alone deliver a recovery for the union movement.

Despite better workplace access rights for unions, the number of people covered under collective agreements dropped by 30 percent between 2000 and 2008. Today 90 percent of private sector workers do not belong to a union. Nor do they seem particularly interested in joining. For instance, Unite Union over the past 8 years has made heroic efforts to unionise hospitality workers but that sector still has union membership of around 2 percent. Other unions have also run extensive recruiting drives, all with modest results.

Workers in New Zealand are mostly atomized; struggles are few and far between, and victories are scarce. Having found very little resistance, small- and medium-sized employers have worked up an appetite for more anti-union measures. They and the government feel emboldened to move further.


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