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Part 6: Application of Employment Relations Act 2000

340 The Commissioner's role in employment relations is set out in parts 6, 7 and 7B of the SSA as well as certain other Acts. The key issue was to establish the Commissioner's appropriate role and apply it consistently.

State Sector Act 1988 Crown Entities Act 2004;SOE Act 1986 New Zealand Public Health and Disability Act 2000 Individual Acts  25
Public Servicedepartments Education Service
(excl. TEIs)
Tertiary Education Institutions Crown Entities and SOEs District Health Boards Departments outside Public Service
Chief Executive conditions of employment

*  Determined between SSCer and Chief Executive [s38(3)]  26

*  SSCer must first obtain agreement of PM and MOSS [s38(3)]

School principal may have collective or individual agreement - see below

*  Council negotiates

[s77ID(3)]

*  Council must obtain SSCer's written concurrence [s77ID(3)]

*  Crown Agents, ACEs, ICEs & their subsidiaries must consult SSCer [CEA ss98, 117]

*  SOE may request SSCer's assistance [SSA s11(6)]

*  Board negotiates

*  Board must obtain SSCer's consent

General Manager of Parliamentary Service: SSCer determines terms & conditions with Speaker's agreement (not remuneration -  Remuneration Authority)
Collective Agreements

*  SSCer responsible for negotiating (except for GCSB: s34 GCSB Act)

*  SSCer must negotiate with employees' union and consult chief exec [s68(3)]

*  SSCer may delegate to chief exec [s70(1)], who must consult SSCer [s70(2)]

*  SSCer responsible for negotiating [s74(1)]

*  SSCer must negotiate with employees' union and consult chief exec of MoE [s74(4)]

SSCer may delegate to employer/s [s74B(1)], who must consult SSCer and MoE chief exec [s74B(2)]

*  Chief exec of TEI responsible for negotiating [s74C(2)]

*  Chief exec must consult SSCer [s74C(3)]

*  Crown Agents, ACEs, ICEs, Crown entity companies & SOEs must consult SSCer only if required to do so by OIC (NB no such OIC issued to date)

*  Crown entities & SOEs may request SSCer's assistance [SSA s11(6)]

*  OIC requirement to consult SSCer not applicable to DHBs

*  Chief execs of DHBs to consult the Director General of Health

Parliamentary Service; Office of the Clerk; PCO: heads of depts must consult SSCer

Police; NZDF Civil Staff: Police Csser and CDF must consult SSCer who has right to participate in negotiations

NZSIS: no SSCer involvement; ERA does not apply

Individual Agreements
*  Employer negotiates *  Employer negotiates: must obtain SSCer's written concurrence [s75(2)] *  Employer negotiates: for senior positions, must consult SSCer [s74D(1)] *  Employer negotiates: may request SSCer's assistance *  Employer negotiates NZDF Armed Forces: CDF must consult SSC: has right to participate

Role of Commissioner

Background

341 It is evident from the summary of the various statutory provisions in the table on the previous page that the Commissioner's involvement varies from agency to agency, at three levels:

  • chief executive conditions of employment
  • collective employment agreements
  • individual employment agreements.

342 Historically, the Commissioner has delegated the responsibility for negotiating every collective agreement applicable to employees of any department of the Public Service to the chief executive responsible for the employees in his or her department. There are good reasons for this. Departmental chief executives are best placed to understand the specific issues relating to their employees and understand their business requirements; and in negotiating terms and conditions for their employees (including collective agreements), they retain responsibility for the management of their departments consistent with their overall responsibilities under the Act.

343 The thrust of the most recent statutory amendments to the Commissioner's role in employment relations was to devolve the Commissioner's influence. The general principle underpinning the relevant provisions in the Crown Entities Act 2004 is that:

  • the Commissioner's role should be at the chief executive level: the board of a statutory entity and of a subsidiary of a statutory entity (Crown Agent; autonomous Crown entity; independent Crown entity) must consult the Commissioner over a chief executive's terms and conditions
  • at the level of collective agreements applicable to other employees, Crown entities should be free to negotiate terms and conditions of employment without the Commissioner's involvement
  • however, it is desirable to retain a 'reserve' or 'safety net' mechanism whereby an entity could be required by Order in Council to consult the Commissioner over collective agreements. The same applies to State-Owned Enterprises following an amendment in 2004 to the State-Owned Enterprises Act 1986.

344 When considering an appropriate contemporary role for the Commissioner in employment relations, it should be recognised that the Government is responsible for ensuring that conditions of employment are fiscally responsible and services to the public represent value for money. The Commissioner's role now requires him or her to communicate government policy and promote adherence to it; to promote an appropriate measure of consistency across government so that unreasonable variants or extravagant levels of remuneration are avoided; to promote workplace productivity; and to maintain an overview of the system to ensure it meets these requirements.

345 The way in which the Commissioner could best acquit these responsibilities was not certain when SSC commenced its review of the SSA. The Commissioner's statutory role lacked consistency and – more importantly – did not reflect the overview role now played, as described in the previous paragraph. Moreover this overview role was increasingly being contested by some parts of the State services who wished to have independence in decision making in this area, which in turn resulted in the Commissioner being less effective in employment relations than Ministers expect.

Commissioner's role: options

346 The SSC's initial broad proposal was that, as part of the Commissioner's system leadership role, the Commissioner's mandate in workforce matters should extend beyond bargaining processes to encompass broader aspects of workforce and employment arrangements. The dimensions would encompass strategic workforce planning and development activity, pay and employment conditions, and bargaining processes. Leadership and talent development were closely related, and are discussed in relation to part 4 of the SSA.

Chief executive conditions of employment

347 The current regime for chief executive conditions of employment generally works well, whereby:

  • Public Service conditions are determined between the Commissioner and the chief executive, with agreement of the Minister of State Services and the Prime Minister. However, the SSC considered it would be desirable to grant the Commissioner some flexibility to consult the Minister and Prime Minister rather than being required seek agreement in every case. This progressed as a separate proposal in relation to part 3 of the SSA.
  • TEI councils and DHB boards must obtain the Commissioner's concurrence and consent respectively
  • boards of statutory Crown entities and their subsidiaries must consult the Commissioner.

Workforce and employment relations

348 There appeared to be three broad options to form the statutory basis for the Commissioner's role, based around the current mandate regarding collective employment agreements: status quo; centralised control; uniform compliance with the Commissioner's expectations.

349 The first option was to maintain the status quo in legislation. But this did not reflect the actual role that the Commissioner currently performed and did not adequately address the need for consistency and impact.

350 A second option could be to formally devolve responsibility for collective bargaining to the chief executives of every agency, but require the Commissioner to consent to all collective and individual agreements before they could take effect. This would in effect require agreements to fall within bands or ranges for groups of positions as set by the Commissioner, and would result in more centralised control over employment terms and conditions. This option would counter the devolution process and return to a central control model similar to that existing prior to the commencement of the current SSA. This would militate against chief executives' independence in setting the terms and conditions of employment for their employees.

351 A third option would be to confirm in legislation the current practice within the Public Service and generally extend those arrangements to other parts of the State services. The Commissioner would provide expert advice to the respective employers on employment relations issues across the system, to assist them in making informed and prudent decisions on employment matters. Heads of agencies would be formally responsible for collective agreement negotiations and would be required to comply with any expectations set by the Commissioner and to consult the Commissioner.

352 Preliminary thinking within SSC was that the third option could include the following details:

  • agencies would be required to comply with any guidelines that the Commissioner may set regarding the workforce
  • the purpose of the guidelines would be to give effect to Government policy around employment and workforce matters. Examples of current items that would fall into this category included the Government's Expectations for Pay and Conditions in the State Sector, and Workforce Strategy Guidance
  • the SSA would need to include a definition of "workforce". Given the variable and changing nature of workforce matters, the definition would comprise a non-exhaustive list of key components, for example:
    • matters relating to strategic workforce and employment issues arising across the State sector system
    • matters relating to the pay and conditions of State sector employees
  • the Commissioner would be able to provide advice to assist agency compliance with the guidelines. There would need to be an ability for the Commissioner to require the provision of information to assess whether or not the guidelines are being complied with
  • agencies would be required to consult about proposed collective bargaining, and then have regard to the Commissioner's consultation feedback
  • if the workforce guidelines were not being complied with or regard wasn't being given to consultation feedback, the Commissioner would need the ability to require the employer (e.g. chief executive of a department or board of a Crown entity) to obtain the Commissioner's approval to a proposed course of action
  • the Commissioner would not have the power to step in and conduct bargaining, either alongside or without the employer, other than for military personnel in accordance with the Defence Act 1990 and for the New Zealand Police. The Commissioner's ability to intervene would be as above, i.e. an ability to require approval rather than consultation if an employer was not complying with the workforce guidelines or having regard for consultation feedback.

Recommendations to Cabinet

353 Iterative discussions throughout the preparation of the BPS Cabinet papers led to a range of modifications and refinements to the early proposal in option three above. In the end, no proposal was put forward to formally devolve responsibility for collective agreement negotiations to the heads of agencies, while retaining an ability to require them to seek the Commissioner's approval if they do not act consistently with the Government's Expectations. SSC considered it was just as effective in practice to leave the responsibility with the Commissioner who delegates to the heads of agencies, on the proviso that they consult the Commissioner.

354 Other aspects of the proposal advanced. These are set out in relation to part 5 of the SSA, where the respective legislative provisions are located in a new subpart 1 to part 5.

 

25 Statutes and Drafting Compilation Act 1920; New Zealand Security Intelligence Service Act 1969; Clerk of the House of Representatives Act 1988; Defence Act 1990; Parliamentary Services Act 2000; Policing Act 2008

26 SSA s38(3) does not apply to the Solicitor-General or Director of the Government Communications Security Bureau

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