Reinstating pay deductions for partial strikes

In the latest in a round of proposed employment law changes, the government has introduced a bill to allow employers to deduct employee pay in response to partial strikes.

Partial strikes are industrial actions that usually involve employees turning up to work but only performing some parts of their role.

The change will only affect employers who have employees on collective employment agreements (i.e. union members).

Currently, if an employee is engaged in a partial strike, the employer cannot deduct their pay unless they suspend the person or issue a lockout notice.

The change reinstates previous legislation that the Labour government reversed in 2018.

Introducing the Employment Relations (Pay Deductions for Partial Strikes) Amendment Bill, Workplace Relations and Safety Minister, Brooke van Velden said the change will help rebalance the rights and consequences of industrial action and should encourage both parties to negotiate agreements sooner, while also minimising community impacts.

“While I recognise the entitlement of employees to strike in support of their collective bargaining claims, the disruption to public and customer services that has resulted from partial strikes should not continue without consequence,” she said.

How will the change work?

The proposed partial strike change will give employers two options (either/or but not both) when deducting pay:

• Reducing an employee’s pay by a proportionate amount (calculated using a specified method based on identifying the work that the employee will not be doing due to the strike).
• Deducting 10% of the employee’s wages.

Employers will have to provide written notification to employees that they will be reducing their pay before the deduction is made (the deduction amount won’t be required).

Unions will be able to request to see information on how an employer calculated a deduction and if they disagree, they must advise the employer as soon as practicable.

The union can apply to the Employment Relations Authority, who can determine whether the employer has calculated the correct deduction.

When will this happen?

The bill has passed its first reading in parliament and is currently under review by the select committee. Public submissions are open until 20 January 2025.

Read the bill and make a submission at the NZ Parliament website.