The Ports of Auckland’s push for increased labour flexibility is not taking place in isolation.
The next release of annual work stoppages data is due shortly and promises to show an upward curve.
Contracting out, particularly to non-union labour, is seen by many companies as a way to increase workplace flexibility and generate greater productivity in a business environment fuelled by global competition and financial crisis.
In the Ports of Auckland case, additional pressure has come from the Auckland Council, which has given the port a target of a 12% return within five years – a doubling of its current return.
Employers sometimes justify the use of contract labour by the nature of the business, which may involve various operational segments. But overseas research shows that the contracting out and casualising of workforces does not necessarily improve productivity long-term.
For example, workplace tensions can develop when a system of recruitment is used that gives permanent employment status to one set of workers and contract status to another. The latter may be used to provide cheaper, less trained and less committed workers, and to reduce union presence in companies.
There is also concern that such new forms of work arrangements will lead to a race to the bottom in labour standards, not least because most contract workers – as they would be in the Ports of Auckland case – are denied the right to organise and benefit from collective agreements.
Emerging trend
The use of contract workers by the Ports of Auckland also reflects a growth in the use of external labour in the public sector.
This is taking place within an intensifying programme of public sector restructuring in New Zealand and beyond.
The dispute also highlights corporate ownership issues, with some concerned that the use of external labour and closed board decision-making is a step towards privatisation.
The government also wants to extend a programme of employment law changes begun during its first term in office.
The proposed measures have a particular resonance for the Ports of Auckland case and what could follow in other sectors. This could include the removal of the requirement for parties bargaining for a collective employment agreement to continue negotiations until a collective is concluded.
If the changes go ahead, employers will also be allowed to opt out of multi-employer collective agreement negotiations, and be able to reduce workers’ pay where they engage in partial strike industrial action.
The Ports of Auckland dispute has now reached a critical stage due to economic, social and political pressures on the organisation, its unionised workers, and other stakeholders, and due to the Employment Court’s involvement in the case from mid-March.
With the court due to determine the legality of the port’s mass dismissal of workers in mid-May, the coming weeks will test the mettle of the port and the union to genuinely act in good faith, restore normalcy to the port and find a solid premise for win-win bargaining arrangements.
Dr Jane Parker is Associate Professor of Human Resources Management and Employment Relations at Massey University.
