30 Oct 2012

Protections for lower-paid workers at risk

10:19 pm on 30 October 2012

The Government has agreed to change the Employment Relations Act which could threaten the jobs of some people working in the cleaning, catering, orderly and laundry industries.

The Cabinet has signed off on changes to part 6A of the act after a review found significant operations issues around transferring workers' entitlements to new employment.

At present, part 6A guarantees workers in those industries the right to keep their jobs if the company they are employed by is sold to a new business or restructured.

However, the Government plans to exempt small- and medium-sized businesses with fewer than 20 workers from taking on existing employees.

Labour Minister Kate Wilkinson says larger companies have adapted to the requirements, but smaller businesses have faced greater proportional costs.

Ms Wilkinson told Radio New Zealand's Checkpoint programme on Tuesday that workers set to lose their jobs under the changes will still have some protection.

"They still will have an existing employment contract with the outgoing contractor and there will be obligations under that that will have to be complied with.

"I do not envisage people losing jobs at all. Actually, I envisage more jobs because it's encouraging new businesses to start up and smaller businesses to expand."

But Jill Ovens of the Service and Food Workers' union told Checkpoint the decision to remove the right of many cleaners to keep their jobs when a buisiness is sold is cheap and nasty.

"Now, everything will change for them - their terms and conditions, they may not have a job. And then they and their unions will end up in endless litigation trying to get some kind of justice for these hard-working people."

Ms Ovens believes thousands of jobs for cleaners will be at risk if the law is changed.

The Government also plans to change the duty of good faith under the act so parties to a collective agreement do not have to conclude bargaining.