People generally think of a strike as being where employees walk off the job. But there are a range of actions employees can take which fall short of a complete withdrawal of labour and which are still regarded as a lawful strike. This is because the definition of “strike” includes the act of a number of employees in breaking their employment agreements, or discontinuing their employment, whether wholly or partially, or in reducing the normal performance of their work.
In recent years we have seen increasingly creative approaches taken to “partial strikes”, including employees refusing to accept payment from users of the employer’s service, refusing to attend to paperwork or other tasks at particular times, refusing to wear the required uniform, and even defacing their employer’s property.
There is a fine line as to whether damaging property amounts to a legitimate strike, or a criminal activity, but the argument is that it is a breach of an employment agreement and therefore falls within the definition of a strike. This is important because employees are protected under the Employment Relations Act when they engage in lawful strike action.
Partial strikes of this nature can be debilitating for employers as they can drag on for weeks and months, unlike a full strike which is usually short and sharp. The reason for this is money - employees are not entitled to be paid when they do not turn up to work at all.
But there is currently no financial penalty for employees engaging in partial strike action. In this situation, provided the striking employees attend work, they are entitled to be paid even if they are not undertaking their full duties or are engaging in some other form of protest action.
The only real measure of control employers have is to bring matters to a head by suspending or locking out the striking workers as they are not entitled to be paid in this situation. However many employers are reluctant to take these measures as they are viewed as extreme and aggressive and can have long term negative impacts on employment relationships. They may also result in the business closing down altogether which may be worse for an employer than tolerating partial performance.
The coalition Government believes that the current lack of sanctions for employees engaging in partial strikes is encouraging more industrial action of this nature and this is bad for business. They have therefore introduced a new Bill to bring back financial penalties for all forms of strike action.
The Employment Relations (Pay Deductions for Partial Strikes) Amendment Bill has completed the select committee stage and is now before parliament. The Bill effectively reinstates the position that existed in 2015-2018, under the former National led Government, and provides for employers to reduce employees’ pay by a minimum of 10% or by assessing the proportion of the role not being performed and docking pay accordingly.
An employer must notify the union of its intention to make pay deductions, and this can be challenged if the union disagrees with the calculations made.
There are some limited exceptions to the ability to reduce pay, including where the strike is based on health and safety grounds, and where there is a refusal to work overtime or perform call outs and employees would otherwise receive special payment for this work.
Not surprisingly, the Labour Party and the Greens oppose the Bill. They say it will tip the balance of workplace negotiations too far in favour of employers and enable discriminatory treatment of workers engaging in lawful union activity.
The basis for this opposition to the law change does not necessarily stack up. The other way to look at it is that currently employees can engage in partial strike action with impunity, or at least with no adverse financial impact, whereas employers have to put up with compromised business performance with no levers to avoid this. Arguably imposing some element of financial penalty levels the playing field as there are consequences for both parties.
Further imposing a “proportionate” reduction in pay does not seem unreasonable where employees are refusing to perform their full duties. This is consistent with the work – pay principle.
One area in which Labour and the Greens may have a point is that introducing a financial penalty for partial strikes is likely to result in employees instead opting to engage in full strikes. This may well be true but the duration of strikes compromising a complete withdrawal of labour will be shorter for the simple reason that striking workers will receive no pay at all during the strike.
Ultimately a balance needs to be struck. Where that tipping point falls depends on whether the emphasis is on empowering employees to negotiate better pay and conditions, or on driving business growth. Regardless, the Bill appears to be supported by all of the coalition partners and will therefore become law, at least for the term of this Government.
Originally published in The Post
