The Government today announced as part of its 100-day plan it's getting rid of fair pay agreements and restoring 90-day trials for all employees.
Workplace Relations and Safety Minister Brooke van Velden announced the changes at the regular post-Cabinet press conference, alongside Prime Minister Christopher Luxon.
Van Velden said extending 90-day trial periods to all employers would give businesses confidence to hire new people, and it would increase workplace flexibility.
The Government would adopt ACT MP Todd Stephenson’s member’s bill on 90-day trials, she said, enabling the bill "to progress quickly and provide certainty to businesses".
Van Velden said the Government was also "moving quickly" to remove Fair Pay Agreements legislation before fair pay agreements were finalised and the "negative impacts are felt by the labour market".
She said fair pay agreements undermined the flexible labour market which had been a "pillar for New Zealand’s economic success for the past three decades".
So, what are they?
Fair pay agreements
The Labour government ushered in fair pay agreements last year, in what it labelled a “historic day for everyday workers”.
The law allowed for binding agreements on minimum employment terms for all employees at an industry-wide level.
National and ACT each opposed the law at the time, saying it was “compulsory unionism” that harmed productivity. Both parties promised to repeal the law if elected.
No workers have yet received a fair pay agreement, but six sectors had successfully applied to start negotiations including cleaning, security and hospitality.
A petition to keep fair pay agreements saw over 13,000 people sign.
Van Velden had previously said the agreements were a "blunt tool" that the new Government was "moving quickly to remove".
A leaked Cabinet paper suggested the move to scrap the agreements would "disproportionately hurt groups like disabled people, women, Māori, Pacific people, and young people".
90-day trials
John Key’s National government brought in 90-day work trials which allowed businesses to fire staff within the first 90 days of employment without having to give a reason and without having to face legal action for unfair dismissal.
Jacinda Ardern’s Labour government curbed that law, offering greater protections for employees in larger businesses, but keeping the 90-day trial in place for businesses with fewer than 20 staff.
National said it would return the 90-day trials to the old settings, saying employers would be more likely to hire people.
A Treasury-commissioned study in 2016 found 90-day trials did not help jobseekers and did not boost employment numbers.
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