Helen Kelly: Zero hour exploitation

Helen Kelly: Zero hour exploitation

Fast food workers rally against zero hour contracts outside Grey Lynn McDonald's, February 14, 2015

The wellbeing of families is threatened when workers feel insecure, writes CTU president Helen Kelly

We have seen such public concern about the types of arrangements being used to exploit Kiwi workers lately.

Deductions from wages for runners at petrol stations and restaurants; zero hour contracts; breaches of minimum wage laws on farms and in hospitality; serious recurring accidents in industries such as forestry and farming; severe exploitation of our migrant workforce; and below living wages in important industries like aged care.

Is this the new normal?

All of these issues – hours, wages, deductions, and safety – would be regulated by collective bargaining, as they are in countries which recognise the importance of work to society and families. In countries such as Denmark – with high productivity and wages – collective bargaining is the mechanism that brings parties together to regulate labour practices, ensuring all sides to the bargain get a fair benefit.

This country has one of the most deregulated labour markets in the OECD and has some of the lowest collective bargaining coverage. The results are that competition between businesses can be won by exploiting the labour force, at a huge cost to us all. It seems likely this will only continue.


Recently, one of our district health boards changed the requirements of its contracts to rest home providers in its region. It wanted all permanent workers to undertake basic training.

In response, one rest home called in all its permanent staff and told them they would all now be casual. Provided they were available 24/7 on call, they would get enough hours – but there would be no more permanent roles.

The centre was a 24/7 operation, as many of our businesses are – fast food, bars and restaurants, hotels and even shops are opening for longer and longer hours. The contradiction between business being open longer and longer, but secure hours being fewer and fewer, can only be explained by exploitation. And the exploitation can only be explained by the lack of protection in our employment laws.

Insecure work takes many forms – almost all of it is designed to shift the risk of employment to the worker. Zero hours is one form. The employment agreement offered to Burger King workers says that because of "highly variable" customer demand, the work schedules need to be flexible. It says team members are not guaranteed a fixed number of hours a week, or shifts a week, and that weekly hours of work may be varied from one week to another.

It is inconceivable Burger King cannot offer a guarantee of hours to any of its staff – it is open almost all day, every day. It is lazy and lacks respect for its workers’ interests.

For Burger King, there are lots of advantages of this type of arrangement. It can use it to control its workforce by ensuring it does not object to any demands, or demand anything better. It can control its pay, and if any worker seeks something more Burger King can respond by simply not rostering them on.

Insecurity breeds deference in the workforce and is intended to by design. Insecure work includes workers on fixed-term agreements, casual contracts, labour hire agreements, 90-day trials, non-permanent and fluctuating hours and seasonal work. It is estimated that 635,000 New Zealand workers are engaged in some form of insecure arrangement. Those on these types of arrangements describe the impact they have on them and their families – being unable to get a mortgage, unable to play sport or commit to family events, tiredness, financial insecurity, accepting dangerous or poor terms, unfair dismissals – all of these are unhealthy for our economy and society.

This deterioration of working conditions is by design. While the Government makes the odd noise of concern and has its inspectors running around expressing shock and horror, only better work rights will fix this up.

Recently, Workplace Relations and Safety Minister Michael Woodhouse said he was interested in doing something about zero-hour contracts – he suggested outlawing any contracts that stopped workers taking on extra work if they did not have any hours guaranteed in a work deal. But that is not outlawing zero hours – that is accepting them.

Basically, he is shifting the burden of them on to the worker, demanding they try to mitigate it with additional shonky contracts.

The reality is, a worker often cannot take another job because there aren’t any or because the worker needs to be available 24/7 in the job he or she has.

Woodhouse is also considering a penalty for late cancellations of work – but this is not an issue. The issue is that there is no work, or the worker is called at the last minute. There are also numerous stories of short shifts – an hour here and there. It is all by the design of the Governments of this country who have failed to recognise that work underpins the wellbeing and future of all our families – 85 per cent of our households earn their primary income from wages. We do not have rentals, shares, interest from savings in the bank – we work.

The quality, opportunity and benefits of that work are of vital interest to us. We are by far the majority. These days, if one of our children gets a "normal" job – good wage, Monday to Friday, regular hours, training, and security – we gasp in surprise and dance for joy. When did that become the exception, and what will the future be like if this is the trajectory for the next generation?

Late last year, the Government deregulated the labour market even further by dismantling much of the code for collective bargaining and even removing the right to a tea break. A recent "good employer" charter, proposed for the Canterbury Rebuild, reads: "Unless there is a good reason not to, we will ensure our employees receive at least a 10-minute rest break every two hours and a 30-minute meal break every four hours". This is now seen as "best practice". Having removed it from law, the Government is scrambling to introduce "voluntary" arrangements for the "best" of our employers, to give their hard-working construction workers a lousy cuppa.

By Helen Kelly

– NZ Herald