Bill must create a sustainable employment relations framework says New Zealand’s largest industrial employer

AUCKLAND, 23 May 2000 – Fletcher Challenge is fully supportive of the aim of building productive employment relations, Fletcher Challenge Chief Executive Officer, Michael Andrews, said to the Employment Relations Bill Select Committee at its hearing in Auckland.

“We must have a sustainable framework for employment relations in New Zealand into the future. Getting it right is in everyone’s best interests and it is in this spirit that we are making our submission. The bill has many valuable themes, but some provisions have to change if New Zealand, and Fletcher Challenge, are to prosper.

“One of my major concerns,” said Mr Andrews, ”and a concern which I think has been largely overlooked up to now, is that workers whether employees or contractors, are disempowered by this legislation. The bill assumes that workers can’t manage their relationship with their employers themselves and they need a union and rules to do this for them. That’s not my experience.”

Fletcher Challenge has deliberately grown the number of contractors it employs because this develops a sense of personal accountability and ownership, Mr Andrews said. “Many of our contractors, and we now have 6,000, live and work in regional communities and are very happy with being self employed and their own boss. They are motivated by being able to see a direct relationship between the effort they put in, the risk they take and the return they make.”

Mr Andrews said he was speaking from 30 year’s experience with Fletcher Challenge, many spent in the Central North Island Forests. “Over these three decades I’ve learnt New Zealanders have an extraordinary ability to adapt, learn, and take personal accountability for their futures in a changing world. The legendary ‘Kiwis can do’ attitude is alive and well in the new millennium. These are our traditional strengths, and we must use them to build a new future, rather than trying to cocoon New Zealanders by going back to practices, bargaining processes and the supposed job security of decades ago.

“In Fletcher Challenge we don’t talk about jobs for life for employees and contractors we talk about employability for life which is about continual upskilling and portability of skills. We recognise our employees as stakeholders and creating value for them is part of our commitment to social responsibility and sustainability. We have a dedicated Employee Education Fund of approximately $116 million which pays for learning opportunities not just for our employees but for their families as well wherever they work in New Zealand. Training and education, especially when it’s undertaken by choice, is the best way we can empower and assist people to prepare for the future.

“Many of the Bill’s provisions, in attempting to redress a perceived imbalance in bargaining, go too far toward union-based, non-accountable authority. They insert a third party, the union, between employer and employee and place employees’ rights, rather than representation, in the hands of unions. The result is a ‘playing field’ which is skewed in a way which simply isn’t practical for both workers and employers. True worker choice, and sensible commercial dynamism and flexibility, will be limited by it,” Mr Andrews said.

“The Bill increases risk for workers, employers and the economy by limiting communication, inserting third parties, increasing compliance costs, and making the New Zealand workplace generally less attractive. The bill just doesn’t fit in with the needs of a modern economy – it’s like using semaphore in an e-mail age.

“Dramatic social and environmental changes are sweeping through New Zealand and the global economy. Markets are changing rapidly, new forms of working and partnering relationships are being born, the commercial and social impact of the internet, Generation X and their radically different expectations of jobs and careers, and the issues of resource ownership, allocation and sustainability are fundamentally altering the world we live and work in. The Bill needs to be more holistic and more aware of these influences.

“The Bill demonstrates a real and genuine desire to promote good faith behaviour and mediation of differences. However in practice the rigid, over-regulated bargaining framework proposed in the Bill will confound these good intentions and will work against harmonious workplace relations.

“Fletcher Challenge was presenting its submission to the Committee to seek balanced, equitable legislation. The Bill must be responsive to the needs of companies like ours, attempting to survive, compete and grow in both domestic and international markets. For New Zealand companies to prosper in the knowledge economy they must have flexibility and diversity in their employment arrangements. Management has a statutory obligation to fairly manage its business and the Bill constrains this unnecessarily.”

Mr Andrews concluded his submissions to the Select Committee with a message he strongly urged the Government to heed. “Do not underestimate the extent to which Fletcher Challenge, and many, many other companies genuinely acknowledge their employees as key stakeholders, and strive to treat them with the dignity and respect they deserve. We accept this and have always accepted this to be a critical component of our ‘licence to operate’ in our community.”

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