Labour Reforms in New Zealand, and Lessons for Australia

Australia can learn much from the policy leadership of the Ardern Government in New Zealand and its reforms to address stagnant wages and rebuild a more inclusive workplace relations framework, according to new research from the Centre for Future Work at the Australia Institute.

As Australia's debate over wages and workplace rights heats up ahead of this year's federal election, important changes in labour policy are also being implemented right across the Tasman Sea. Under the Labour-Green-NZ First coalition government which came to office in New Zealand in 2017, several progressive changes in labour law have already been enacted. Others are in development.

Economist Alison Pennington reviews the policy reforms underway in New Zealand, and considers their relevance for Australia, in a new paper published by the Centre for Future Work.

Pennington provides a timetable and analysis of seven specific reforms in New Zealand, including:

  1. a landmark pay equity judgement and development of a bargaining principles approach to facilitate pay equity claims and settlements economy-wide;
  2. the introduction of industry bargaining agreements;
  3. restoration of employee and union rights to collectively bargain;
  4. legislation tabled to extend greater protections against unfair dismissal to labour hire and agency workers, and new collective bargaining rights;
  5. government commitments to significant annual increases to the minimum wage;
  6. the establishment of broad civil society alliances in a campaign for a "living wage"; and
  7. the passage of legislation for a universal employee entitlement to 10 days paid domestic violence leave.

Together they represent an ambitious and multi-dimensional effort by the new government in New Zealand to address low wages, inequality, and poor job quality. In every case, Pennington notes, the reforms emphasise the importance of collective representation and unions: not just to lift standards directly through collective bargaining, but also to play a central role in implementing other reforms (such as pay equity and domestic violence leave).

New Zealand's experience with these reforms holds several lessons for the Australian debate over workplace policies. The ambition and scope of the New Zealand reforms certainly confirms that there is great potential for national governments to act forcefully to respond to growing public concern over work, wages, and job security.

“Australians have been touched by the tragedy in Christchurch, and impressed by the compassionate and effective response from the Ardern Government. And it seems there are other areas where we could learn from our New Zealand neighbours, including their new workplace policies,” said Pennington.

Please see the full report, Workplace Policy Reform in New Zealand: What are the Lessons for Australia?, by Alison Pennington.


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