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Changes could be on the horizon for New Zealand employers following election campaign promises

New Zealand
Written by
Kiely Thompson Caisley, New Zealand’s leading boutique employment law firm.
Ahead of the General Election in New Zealand on 17 October, this article examines some of the Labour Party’s policy announcements in the field of employment, including increases to the minimum wage and sick leave entitlement, a commitment to introduce Fair Pay Agreements and new protections for dependent contractors.

New Zealand’s 2020 General Election will take place on 17 October. With overseas and advance voting starting next week and campaigning now well underway, major political parties have begun making detailed policy announcements including on employment and workplace issues.

New Zealand’s Labour Party, which is currently in power, made a suite of Workplace Relations & Safety policy announcements over the weekend.

The announcements by the Labour Party had a heavy focus on support for workers and included an increase to New Zealand’s minimum wage (to NZD 20 in 2021), the doubling of the current minimum paid sick leave entitlement to ten days per year, and a promise to streamline and simplify current laws around holiday and leave entitlements.

Two other announcements, however, could herald significant change for New Zealand’s employment relations landscape.

The first is the Labour Party’s promise to legislate and implement ‘Fair Pay Agreements’.

Similar to systems already in place in Australia, the premise is that Fair Pay Agreements would introduce minimum terms and conditions of employment for all workers across a sector or industry. In New Zealand, such agreements would be negotiated by unions and sector employers through a bargaining process and once agreed would cover all employers in that sector setting minimum industry-wide standards.

This would be an entirely new framework in New Zealand employment law, but would be intended to complement, not replace, the current employment relations and standards system.

The second announcement of particular interest is the Labour Party’s promise to legislate protections for ‘dependent contractors’, a new class of workers.

Dependent contractors are workers who work under the control of a single employer but are not classified as ‘employees’ under the current law. This means that they currently do not receive the legal protections provided to employees.

The Labour Party has promised a statutory regime of protections for these workers. In particular, dependent contractors would be allowed to collectively bargain and would be entitled to other basic employment rights.

It remains to be seen if voters will provide the Labour Party with the power to implement these election promises.

Hannah King
Associate - New Zealand
Kiely Thompson Caisley