Employment relations the new frontier

13 Jun 2018

Robot human hands apple

This Government has launched reviews of education and tax, plus it has created a new Climate Change Commission. It has also announced a shake-up of workplace laws. The education review is timely. More work on climate change is inevitable. But a tax review is not necessary as we have an efficient and effective tax regime. 

This Government’s next frontier is employment relations. It has two pieces of law being considered by Parliament. One, designed to restore the primacy of unions and the other, to make business owners responsible for workers not in a direct relationship, but employed by their contractors. How these new two laws will fit with new Fair Pay Agreements working group, also set up by this Government, is a mystery. We are told this Fair Pay Agreements review will help design a collective bargaining system to lift wages and productivity in New Zealand. While these are laudable goals, how realistic is such a workplace environment for the next decade, or is this just further winding the labour relations clock back in time?

With most industries in New Zealand struggling to find enough reliable and skilled workers to sustain current productivity and growth, how is this going to help? The key to sustainable higher wages is sustainable higher productivity – but wages do not come first. Flexibility, versatility and trust drive productivity and business success. So this working group has its work cut out, when the employment law before Parliament runs counter to lifting productivity and building trust and may well push people out of business.

Consideration should instead be given to how the world is changing. Robotics and artificial intelligence will radically change the work environment. There will always be jobs where a human touch is what a consumer wants. But the rules-based professions, such as law, are at risk of being replaced by artificial intelligence that can process the rules fast and with accuracy. Different skills and workers will be needed. What we should be doing is linking the needs of the future workplace to the education review to keep our competitive advantage in our export markets and to sustain and grow productivity.

Let’s leave that 1950's battle between employers and workers in the past where it belongs. The world has moved on. Work place influences are not determined solely by the New Zealand Government. We live in a global environment and worldwide influences are technology-based. If we want to be part of that, we should be preparing our work force for the change ahead and not winding the clock back to the labour market dynamics of yesteryear.

- Mike Chapman, CEO