Labour Rolls Back 90 Day Trial Periods

January 26th, 2017

26 January 2017

The 90-day trial period is kept, but limited, tea breaks are restored, and collective bargaining is strengthened. Do these changes, as the Government says, put fairness back into the workplace and employment relations? Or do they, as Business New Zealand says, fetter business opportunity and growth? We consider the Government’s proposed changes.

Given that 97% of business in New Zealand are small businesses, the retention of 90-day trial periods for small businesses (i.e. those with less than 20 employees) does very little to change the status quo. This represents a significant dilution of the Labour Party’s campaign stance to eliminate trial periods and introduce a referee system for grievances raised in the first 90-days.

It is also worth noting that given the Employment Court’s very strict interpretation of the rules around 90-day trial periods, most of the unjustified dismissal claims that make it to Court are successful.

The unions say the changes don’t go far enough. However, the changes herald the start of things to come.

Over the coming months, the Government says it will be looking at equal pay law and the gender pay-gap, it will increase the minimum wage to $20 per hour by 2021 and it will provide a framework for employers and employees to create fair pay agreements. No details have yet been released.

So, is this the beginning of a return to the past, some minor enhancements to appease the party constituents, or advanced thinking that will create new job opportunities and assist growth and productivity?

The answer is in the detail, which is yet to be released. We look forward to seeing the detail and having an opportunity to actively critique the Government’s effectiveness in attempting to balance the respective interests and hopefully create fairer, harmonious workplaces.

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