Thank you very much, Madam Speaker. Look, it’s a pleasure to talk to the House, and to those watching, on this member’s bill in the name of Laura McClure. Sometimes it’s the way these debates fall, but, unfortunately, Laura spoke to this bill at the last members’ day, so I will sort of, I guess, reintroduce it and give people a little bit of an overview and just explain our position on this bill and where we hope this goes through select committee and what we hear.
Look, the member’s bill in Laura’s name is seeking to amend existing provisions under the Employment Relations Act (ERA) to enable termination of employment through mutual agreement between employer and employee. It allows for protected negotiations—discussions shielded from use in personal grievances—between employers and employees to end their employment relationship. The purpose of it is to help employers and employees avoid costly unfair dismissal or personal grievance processes and claims, reduce legal costs, and more quickly come to a mutually agreed outcome for both parties.
So look, for National, and for a National-led Government of course, we are very much on the side of self-responsibility, individual rights, competitive enterprise—you name it. For us, it’s very important that a workplace has the efficiency and freedom to operate, and is prioritising the relationship between the employer and the employee.
To make some points here, I think the thing that is most interesting to me here is the increased flexibility for employers and employees as described above. Something that we hear often from Opposition, in certain areas where we debate certain issues, is the ability to have an efficient workforce or an efficient labour market. I believe this would add to that. That allows people to be able to move from roles that are not suitable, that they’re not necessarily happy in—for either reason from both parties—rather than going through a difficult process.
Something just to add from a context point of view, I think it’s very important to acknowledge that we have around about 97 percent of our businesses in New Zealand that are small businesses. Small businesses don’t have the resources to have an HR department to go through these, to go through them thoroughly, to go through them properly. The amount of times that people come unstuck because they go through what they think is a normal or a natural process, say what they think needs to be said, and then people walk away and find that there’s an opportunity to take a case through the lack of process being followed, and then it uncovers itself into months, if not years, if not very costly situations for both employer and employee.
So look, I think it’s very important to note that while we support this bill, we really do want to go through a thorough select committee process. We agree to support it to select committee. There are a number of things that we’d be very keen to investigate further and really get some good insight into. I think the importance for us is to understand what the process would look like—timing, the pressure on both parties to go through the process, and what that would look like.
Of course, comparative to international situations—just to mention, of course, the United Kingdom’s protected conversations model, which has demonstrated efficacy in supporting the balanced consensual terminations. It would be very interesting to see this around the rest of the world and, of course, what the international precedent would look like.
Just going back to some other points within existing ERA requirements, currently the ERA—or Employment Relations Act, for those that don’t like acronyms—requires employers to demonstrate a substantive justification, a redundancy misconduct, and comply with strict procedural standards to lawfully terminate employment. There are many businesses that have gone through it. There are many businesses that take other actions to avoid doing that, employees that take other actions to avoid going through those processes, and for many people it ends in more distress, more financial implication, timing implication. Things can get messier and messier.
So I do appreciate the foresight or the thought of the member to bring this to the House, given that while this particular bill is not a coalition agreement, the coalition does have a view that what we want to do is simplify personal grievance procedures, and, of course, this leads to that. This is certainly an aspect of that as well.
Look, something else to add to it, of course, and why we’re really keen to hear from people—because, naturally, when we go through the select committee process, we’re hearing from businesses, we’re hearing from employees, we’ll always hear from people that have gone through difficult situations. We always hear from people that have wished or hoped that something like this would’ve been available when they’d gone through a process. But, of course, we also hear from legal areas, associations, business associations, and it adds significant context. Of course, naturally, the member’s bill process, while not Government bills, you know, we tend to hope that the select committee process irons out a number of kinks and works out the workability which we would hope that this process will determine for us.
Like I mentioned earlier, quite keen to see how the workability of the relationship between the employer and the employee in the process goes through this to avoid any implication of pressure on that process, or the relationship, and what this would do to streamline and smooth out that process as well.
So just to say that, you know, we’re certainly in support of small business, the ability to do what—in this particular case, a mutually agreed process would have us come to that conclusion and give people a far more simple approach. I tell you, some employers, especially in the case of trades, the trade industry—often, the case is that a builder has come up through an apprenticeship, worked for somebody else, created relationships, gone on their own, decided to start a business, gets into a position where they go well enough to employ someone else. They never went through business school; they went through, you know, the Building and Construction Industry Training Organisation, let’s just say—got their apprenticeship, earned their stripes, but never studied employment law. Actually, you just about need a PhD thesis to understand the Holidays Act, for one part, and, of course, the rest of the Employment Relations Act—said by Dr Carlos Cheung.
Look, those people are the backbone of our economy, and this is something that we believe, with the right measures in place and making sure that the workability is certainly there and that can be gone through that process, is there to support those people in business that don’t have large HR departments and the funding for legal advice and the ability to work through all this stuff and follow those tick boxes, that have mutual agreement.
I think it’s really important to reinforce that this is not about giving one person more power over the other; it is about supporting and facilitating a mutually agreed process where neither party know where each other stands unless they go through a very complicated and expensive process.
So look, with that, as I mentioned earlier, we support this bill to select committee, really look forward to hearing the submissions. To anybody watching online or thinking about those that they know in business that are watching at home on TV, please get involved in the select committee submission process, because it is very important that we have a wide range of views, experiences, and expertise that are part of that because it does genuinely allow us to see all sides of the coin and what we can do to make sure that we make all of our legislation the best possible. So, with that, I commend this bill to the House.