'NZ has to change how it does business' - Council of Trade Unions

New Zealand needs to change how it does business, says the NZ Council of Trade Unions. Photo/123RF

There's little doubt for many New Zealanders, perhaps even the majority of New Zealanders, that work can be better. A lot better.

In a nation with some of the longest work hours in the OECD, better means better for people doing the work and for their families.

It means better job security, which means people are free to make real choices about their lives.

It means better incomes, so your stomach doesn't churn a little every time a bill arrives, so you can aspire to own your own home or dream of having kids.

It means dignity, respect, and a voice when you are at work.

But, to do this - and this is the big picture - it means changing how we do businesses.

We need to move away from our reliance on a low-wage economy where companies compete by paying people less.

We need to remove the temptation to throw more cheap labour or longer work-hours at a problem, and make investment in skills, productive capital and innovation the better option.

Over the past 30 years, more than $350 billion has flowed out of New Zealand's economy to overseas banks and foreign owners of our assets.

In the same time, the share of the economy going to working people has fallen from over 50 per cent to just over 40 per cent, cutting $20b a year from pay packets.

That's not a coincidence. Reducing employment rights and, more specifically, reducing the rights of New Zealanders to build economic power has led to a massive transfer of wealth away from the majority of Kiwis - our families, our communities and small businesses.

The changes to industrial relations announced by the Government will make a real difference to a lot of New Zealanders.

Basic stuff like ensuring people can have a meal break and are protected from discrimination are fundamentally good things, but they are also largely focused on the margins.

They reinstate some bare minimums you'd expect in a first world nation like ours.

NZ Council of Trade Unions president Richard Wagstaff. Photo/supplied

These changes alone won't be enough to achieve the Government's vision of safe, well-paid and productive working lives for all New Zealanders.

And they won't rebalance the economy so the working Kiwis who produce most of our wealth get their fair share.

That's because too many decisions about the work we do nowadays are made outside of employment law altogether.

You see it for the people who are pushed to become dependent contractors and take all of the risk and little of the reward - that's tens of thousands of drivers, utilities technicians, and construction workers over the last decade alone.

You see it in the boardroom level decisions to re-tender whole workforces on lower terms and conditions by changing contractors (even though they end up largely employing the same people).

We're seeing this play out for hundreds of bus drivers in Wellington right now.

And you see it in triangular employment relationships, a rather bureaucratic term for the far too prevalent situation where casual temp labour - most often via an offshore owned labour hire agency - is contracted by the 'real' employer with little responsibility for employment conditions and no job security.

The flipside is that there is also no personal investment from the workforce in the company and often no incentive to upskill.

Put simply, there are too many loopholes and too many people are falling through them.

Some of the legislation the Government will bring in in the next twelve months, such as protections for contractors and industry minimum standards, will help narrow those loopholes, but decision-makers need to recognise that how we deal with employment is the critical piece in creating a fair society and a strong economy.

In the long run, strong stable jobs provide the basis for adaptable, resilient New Zealanders – and they'll need to be, to meet the challenges of the future of work.

If we get that right we won't just do well in our work, we'll do well in the world.