A bit too casual

A bit too casual

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Fast-food worker David Cannon has experienced the pitfalls of casual work. 

By Shane Gilchrist on Mon, 26 Oct 2015.

(Reprinted from the Otago Daily Times)

Labour Day may be less of a moment to celebrate hard-won workers' rights of the past, and more an opportunity to reflect on where they have gone. Shane Gilchrist reports.

It's been a few years since David Cannon approached his bank for a loan so he could pay for repairs to his car yet, clearly, the episode still rankles.

''I was on a zero-hours contract, so the bank refused me because I had no guaranteed income,'' the Roslyn KFC worker recalls, adding he had to ask his father to act as guarantor.

''I was 26. I had been working for Restaurant Brands since the age of 21 so that would have been five years of employment, but ...

''I worked up to 35 hours a week, but there were weeks where I'd only get 10 hours.'' 

The 33-year-old is, of course, not alone. He is just one face of New Zealand's casualised workforce. A significant number of workers today can no longer rely on a full week's work, and indeed, hardly know what their hours are going to be from one week to the next. The Ministry of Business, Innovation and Employment notes zero-hours approaches are more likely to be adopted by businesses in the service sectors - the retail, accommodation and food services sectors, which employ nearly 320,000 people.

Statistics New Zealand's Survey of Working Life, last carried out in December 2012, gave figures on casual employment. Though it didn't investigate zero-hours employment, it did reveal 91,500 employees were in casual work and that 66,400 permanent employees had ''no usual working time''.

Recent research at Auckland University of Technology shows that even after taking into account education, industry, occupation and other factors, the hourly rate for casual workers is 20-25% lower than for permanent workers. In fact, that margin could be worse, given casual hourly rates are often boosted by an 8% annual leave loading.

The issue of zero-hours contracts - in particular, those involving fast-food workers - hit the headlines earlier this year and the publicity prompted some companies to change their workplace practices.

Significantly, most have agreed to collective contracts that guarantee staff a minimum number of hours: typically, once staff have been at a workplace for three months, they will be assured at least 80% of the weekly hours they've worked.

KFC's collective agreement came into effect on on July 1; McDonald's rolled out at the start of this month; meanwhile, Burger King has just signed a collective agreement, which will begin in about three months.

Other major players are close, too, according to Mike Treen, national director of Unite Union, which has about 7500 members, representing more than 30% of those working for the fast-food industry's major players.

''Wendy's staff should have got their number [of allocated hours] this week. We have written to other companies - Domino's, Burger Fuel, Hell Pizza - and asked for their position on zero-hour contracts. Domino's have responded and set up a meeting later this month,'' Mr Treen says.

Essentially, zero-hours contracts allow an employer to be able to demand an employee be available for work whenever the employer wants, yet not guarantee a minimum number of hours.

New employment legislation

In March, Workplace Relations and Safety Minister Michael Woodhouse announced the Employment Standards Legislation Bill, an umbrella piece of legislation he claims will improve workers' rights.

''Serious breaches of employment standards will be heard in the Employment Court and will carry a maximum penalty of $50,000 for an individual and the greater of $100,000 or three times their financial gain for a company,'' Mr Woodhouse told the Otago Daily Times in response to a series of questions related to the Bill.

Employers can be publicly named if they are found to have breached minimum standards and individuals can face being banned as employers if they commit serious or persistent breaches of employment standards.

However, the Employment Standards Legislation Bill has prompted a backlash from unions and others, who claim it won't end zero-hours contracts at all. In fact, they believe there is a real risk it could entrench such employment arrangements.

The crux of the negative reaction lies within the Bill's compensation clauses or, more specifically, its lack of any definitive recompense. 

For example, the Bill proposes to stop employers from cancelling a shift without ''reasonable notice or compensation'', yet no minimum level of compensation is stated, meaning that point has to be nutted out by respective employer and employee.

As David Cannon points out: ''If a 17-year-old rocks up to a fast-food joint wanting a job, he's going to agree to anything. They are young; they might have just left home for the first time; they are looking for their first job.''

Ian McAndrew, head of the University of Otago department of management, backs up Mr Cannon's assertion. In reality, he says, a lot of employees at the lower end of the labour market don't have an ability to negotiate effectively.

''It all comes back to what's agreed between the employee and employer, and it is often a very one-sided negotiation. A lack of any suggestion of minimum level of compensation essentially codifies zero-hour contracts.''

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Les Ingram had no intention of becoming a union delegate when he started work at Bunnings' Dunedin hardware store two and a-half years ago. He'd been there done that.

A former branch secretary for the Rail and Maritime Transport Union, Mr Ingram had worked at Hillside Engineering Workshops for eight years before he was made redundant in 2012. Government-owned KiwiRail's decision to award an almost $39million manufacturing contract to a Chinese company turned out to be a terminal blow.

But back to the present.

Prompted by his observation a lot of ''younger'' colleagues seemed to lack an understanding of their employment rights, the 62-year-old has recently become a delegate for First Union, which represents workers in the retail sector.

''It is quite a different environment in terms of employer and employee,'' Mr Ingram says.

''At Hillside, which had 100% union membership, we operated on a no-surprises basis. We'd talk about issues and attempt to resolve them.

''Here, at Bunnings, union members comprise about a third of the 120 or so workers. We have recruited quite a few recently due to this contract issue.''

According to First Union, negotiations with the hardware chain, owned by Australian firm Wesfarmers, reached an impasse when the company's offer was formally rejected by 99% of union members, who are seeking a new collective contract.

The biggest source of concern is around proposed changes to rostering. Under the current agreement, rosters are set by mutual agreement between workers and management. According to First Union, Bunnings wants to remove the requirement for mutual agreement, thus compromising family time and other out-of-work commitments.

Mr Ingram is a realist. He understands retail is a seven-day-a-week affair and weekends are the busiest times for many businesses in the sector. His full-time job includes working one day at the weekend. He thinks that's fair. But he believes it'd be unfair if he and others were forced to work both Saturday and Sunday.

Bunnings general manager Jacqui Coombes says the ''fundamentals'' of rostering will remain the same.

''Team members normally receive notice of their proposed rosters six weeks in advance and at a minimum, four weeks in advance. This will not change. If there are times when a team member has other commitments or challenges (for example, day-care arrangements) then, of course, we will work with them to best accommodate their needs, just as we do now. Each store sets its own rosters. ''Bunnings is still actively involved in negotiations with First Union and will continue to strictly adhere to the process in good faith.''

Phil O'Reilly, chief executive of Business NZ, says the model of a 40-hour-per-week job might not be under imminent threat, yet it is unlikely to be the norm in the future.

A lot of what we are going through in New Zealand around how work is performed is a mirror of what is happening worldwide, he notes, adding companies are restructuring more often than they used to.

''The global 'mega-trend' is for other forms of working, be it contractually, working for several employers or part-time work.

''One of the reasons the old model is dwindling is because people themselves are more comfortable with other forms of work. Of course, such arrangements don't suit everybody, but to suggest it is a wholly bad thing is wrong.''

To outlaw casual work could exclude a lot of people on the margins of the labour force from getting their first job, he says.

Mr O'Reilly emphasises most employers believe people should be treated with respect and that there should be rules to protect both employees and employers, as well as provide flexibility around how work is performed.