Farmers in New Zealand have received welcome news as the new Workplace Relations and Safety Minister, Brooke van Velden, announced the government’s decision to repeal Fair Pay Agreement (FPA) legislation by Christmas 2023. This move has been particularly significant for the agricultural sector, which had expressed strong opposition to the FPAs.
Richard McIntyre, the Feds employment relations spokesman, explained that farmers viewed FPAs as unnecessary and restrictive. He described them as “a solution looking for a problem,” highlighting concerns that FPAs could lock employers and employees into national pay and conditions agreed upon by a minority, thereby removing the flexibility to negotiate terms suited to individual needs and local conditions.
The FPA legislation, introduced by the previous Labour-majority government, was criticised by the National and Act parties as a form of “compulsory unionism” that could hinder productivity. Business NZ had also warned of potential upheaval in the agriculture sector due to FPAs.
Chief Executive Kirk Hope noted that the government aimed to target all sectors with FPAs, which could be easily triggered in the farming sector due to its employment structure.
Minister van Velden remarked that FPAs were a blunt tool that could be initiated by a union and a small number of employees, yet applied to all workers and employers within the coverage. She assured that the repeal of the FPA legislation would not impact current employment terms, as no fair pay agreements had been finalised to date.
Additionally, the new government is fulfilling its commitment to extend the availability of 90-day trial periods to all employers. This scheme, first introduced under John Key’s National-led government for businesses with fewer than 20 employees and later extended to all businesses in 2010, was restricted by Labour in 2018 to businesses with under 20 employees. The National-led coalition now plans to revert to the original legislation, allowing all businesses to utilise the 90-day trial periods.
