Rankin: Employment Relation - Some Reflections

Published: Thu 16 Mar 2000 10:11 AM
Employment Relations: Some Reflections
Keith Rankin,
16 March 2000
The Employment Relations Bill - introduced into Parliament this week - establishes a midpoint between the 1991 Employment Contracts Act and the previous labour relations' regime which lasted in various guises for 97 years.
As such, I have no criticism. We need a system of workplace relations that encourages businesses to see their workforce as a valuable resource that should be invested in rather than treated as a disposable commodity. As a synthesis of the best of the past few decades, the ERB represents progress in the evolution of our social institutions. Unlike Labour's response to National's introduction of voluntary unionism in 1984, it is not a leap forward into yesterday.
Is the ERB really much different from Jim Bolger's 1984 "voluntary unionism" Act? Labour fought tooth and nail against that legislation, which was only passed by John Kirk's turncoat vote. The irony is that National's 1984 labour reform was a very mild form of liberalisation compared to Labour's reforms that followed.
The 1984-90 Labour Government immediately repealed Bolger's Act, thereby ensuring that there would be a very right-wing labour relations system once National was returned to power. Ideology in one direction begets ideology in the opposite direction.
My only reservation about the ERB is that, while the 20th century world economy (indeed 20th century society) has revolved around the class-relationship that we call "employment", this is unlikely to be so for the centuries of the third millennium. While the 1991 ECA helped to muddy the waters that distinguish employer-employee relationships from customer-producer contracts, dynamic capitalism, which created the wage-worker class in the 19th century, is becoming the main agent in the demise of the waged worker. Labour as a factor of production will be nothing like as important in the 21st century as it was in the 20th.
In the 21st century, we are likely to return to a language of work more like that of the eighteenth century. We have already heard the restoration of the term "journeymen"; eg with reference to the employment policies of the Auckland Warriors rugby league team. Another term on the verge of making a comeback is "artisan". Indeed, we may soon find our family farmers being called "yeomen", and our traders might once again be called merchants. This style of language is individualist, non-corporate, yet vaguely inclusive. It is the language in which small businesses with specialist skills become the workplace norm. On the other hand, the term employee is most useful when applied to the large but diminishing group of people who work for large organisations in return for a collectively negotiated wage or salary, and whose identity as a producer is defined by that organisation.
The most important word that is likely to make a comeback this new century is that of "guild". A trade union is a guild. But the word has the much wider connotation of a collective of artisan entrepreneurs.
In 1990s' New Zealand, trade unions might have been pushed into the background, but our producers' associations are as strong as ever. Hence the bargaining weakness faced by employees. Employers have become stauncher in promoting their collective interests than have employees. The term "guild" emphasises the commonality of interest between wage workers and employers in particular industries; in particular crafts. The guild concept could be a useful part of a 21st century social contract.
The dominant mode of capitalist production is now sub-contracting. Journeyman subcontractors fall into that no-mans-land between demanding clients and wage workers. Bulk-funded schools, tertiary education providers, hospitals and research institutions are also subcontractors; ie subcontracting institutions. They are simultaneously employers and employed; contracting and contracted.
Forward-looking labour legislation will need to provide protections for subcontractors if it is to protect subcontractors' employees. Subcontractors' guilds will need to be strong enough to bargain equitably with their clientele, who typically have some monopoly power. Subcontracting institutions must learn to bargain with, rather than meekly comply with, the government which is in many cases their monopsonist employer.
An interesting new industry is that of telephone call centres, the emerging sweatshops of the early 21st century. Corporate and government employers will increasingly contract out their call centre operations. Vigorous competition for such contracts will see working conditions eroded for both contractors and their employees. Employees' unions may gain more power to strike than they do now, but their undercapitalised subcontractor employers, caught between a rock and a hard place, will fold rather than pay what they cannot afford. The real employers will simply recontract when a subcontractor folds.
Real progress will be made when subcontractors' guilds join forces with their employees' unions. For example, hospitals will refuse to - or not be allowed to - take over the contract of another hospital that is immobilised by a labour dispute. And manufacturers will join forces with their employees to resist Dr Brash's monetarism.
The good thing about the present government is that it requires some input from the Green Party. Unlike Labour and the Alliance (New Labour), the Greens have no labourist tradition to live up to. Rather, its traditions are in craft entrepreneurship. They are able to represent the interests of many small business subcontractors. The Greens are not blighted by a heritage of class warfare, by a perceived need to settle old scores.
Labourism versus capitalism was the old century's political economy. This century can be one of socially responsible producer coalitions, of guilds of worker-entrepreneurs, of principled employment relations based on commonality of interest - interdependence - rather than on class antagonism. Workplace bargaining should be understood as a means to mutual gain, not as a winner-screws-loser stand-off. I hope that the next National-led government will regard the 2000 Employment Relations Act as an historic compromise; something to be built on rather than to be torn down.
© 2000 Keith Rankin
Thursday Column Archive (2000):
Keith Rankin
Political Economist, Scoop Columnist
Keith Rankin taught economics at Unitec in Mt Albert since 1999. An economic historian by training, his research has included an analysis of labour supply in the Great Depression of the 1930s, and has included estimates of New Zealand's GNP going back to the 1850s.
Keith believes that many of the economic issues that beguile us cannot be understood by relying on the orthodox interpretations of our social science disciplines. Keith favours a critical approach that emphasises new perspectives rather than simply opposing those practices and policies that we don't like.
Keith retired in 2020 and lives with his family in Glen Eden, Auckland.
Contact Keith Rankin

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