Understanding the collective agreement process is crucial for employers in New Zealand as the legally binding agreement outlines the terms and conditions of employment for a group of employees represented by a trade union.
Employers who understand this collective bargaining framework are generally better equipped to negotiate effectively with trade unions, make informed decisions that align with their business goals, and maintain positive employee relationships.
It also plays an important role in understanding your obligations to your employees under the collective agreement.
The New Zealand Educational Institute (NZEI) is one of the most prominent trade unions representing employees in the education sector. The NZEI works to advocate for the interests and rights of its members, often through the collective bargaining system.
Through this process, the NZEI negotiates with employers to reach a collective agreement on behalf of its members.
In this post, we will explore the role of the NZEI, provide an overview of the collective bargaining process, and highlight some of the most significant collective agreements reached in recent years so that you’re better equipped to understand your obligations under an NZEI collective agreement.
What is the New Zealand Educational Institute (NZEI)?
It was founded in 1883 and has since become one of the country's largest and most influential unions, with more than 46,000 members across early childhood, primary, and secondary education.
The NZEI's mission is to advocate for the rights and interests of its members, and it works to improve the quality of education for all New Zealanders.
The union is involved in various activities, including collective bargaining, professional development, and lobbying for education policies that benefit its members and the wider community.
What are Collective Agreements?
The union and the employer negotiate the agreement through collective bargaining, and it covers various aspects of the employment relationship, such as wages, hours of work, leave entitlements, and other workplace conditions.
You might be interested in reading our guide on the differences between collective and individual employment agreements.
Examples of collective agreements that the NZEI has negotiated with employers in the education sector include:
- Primary Teachers Collective Agreement
- Area School Principals Collective Agreement
- Early Childhood Education Collective Agreement (ECECA)
- Support Staff in Schools Collective Agreement (SSSCA)
You can find all their collective agreements on the NZEI website.
What Does the NZEI Collective Bargaining Process Entail?
New Zealand governs this process through the Employment Relations Act 2000, which outlines the key stages and requirements.
The collective bargaining process typically begins with the initiation stage. This stage involves the NZEI and employer agreeing to start bargaining, usually by exchanging written notice. The notice must contain specific details, such as the parties involved, the scope of negotiation, and the time and place of the first meeting.
There are specific requirements for initiating bargaining, depending on whether it is a single-party or multi-party negotiation:
- If it is a single-party negotiation, a union member or employer can initiate bargaining within 60 days of the existing collective agreement expiring. Alternatively, the union can start bargaining anytime if there is no collective agreement.
- For multi-party negotiations, the NZEI can initiate bargaining if there is no collective agreement or if the current agreement is set to expire within 60 or 120 days. An employer can also initiate bargaining if the existing collective agreement expires within 60 or 120 days.
The next stage of the collective bargaining process is the negotiating stage.
During this stage, the NZEI and the employer negotiate the terms and conditions of the collective agreement. The process may involve multiple meetings, where both parties can present their positions and discuss options.
The negotiation can cover a wide range of employment matters, such as wages, hours of work, leave entitlements, and health and safety.
The NZEI and the employer must act in good faith throughout the collective bargaining stages. This means they must be open, honest, and respectful in their dealings with each other. The good faith requirement also means that both parties must be willing to consider and respond to each other's proposals and make genuine efforts to reach an agreement.
If the parties reach an agreement, it is put into writing and signed by both parties. The collective agreement must then be sent to the Ministry of Business Innovation and Employment and becomes legally binding on the NZEI and the employer.
Should either party encounter difficulties during the process, they can request that the Employment Relations Authority (ERA) facilitate. Examples of situations where the ERA can agree to facilitate the bargaining include where:
- there has been a serious and prolonged violation of good faith that has undermined the process,
- bargaining has been excessively long, and previous attempts to resolve differences have failed,
- if there has been a prolonged and contentious strike or lockout, and
- if a strike or lockout has been proposed to significantly impact the public interest.
Example: NZEI Negotiating a Fair Pay Agreement for the Early Childhood Education Sector
The NZEI has already initiated a campaign to have the Early Childhood Education (ECE) Sector to be among the first to negotiate a Fair Pay Agreement.
They first need to gather 1000 signatures to initiate bargaining, after which they can enter negotiations with representatives of the ECE employers. If they successfully initiate the negotiation stage, both bargaining can work towards coming to an agreement on a set of employment terms.
After the bargaining sides agree and confirm that the proposed Fair Pay Agreement meets the legal standards, employees and employers within that sector who are affected will have the opportunity to vote on whether they approve of the terms or not.
If the majority of both sides agree, MBIE (Ministry of Business, Innovation and Employment) will verify the voting process and outcome, and the Fair Pay Agreement will be officially completed, legally
binding and cover:
- Standard hours
- Minimum base rates
- Overtime and penalty rates
- Training and development
- How much leave an employee can have
- How long the agreement will apply for
How Can Cloud Payroll Help?
However, with the help of advanced technology and machine learning algorithms, it's possible to automate this process and make it much simpler and more efficient.
One way to do this is by using cloud payroll that automatically interprets collective bargaining pay conditions based on timesheet entries. Systems like Employment Hero are designed to analyse employee timesheets and identify any entries that match the specific pay conditions outlined in the collective bargaining agreement.
For example, if the agreement specifies that employees should be paid time-and-a-half for any hours worked on weekends, the system would be able to identify those hours and automatically calculate the appropriate pay rate.
Similarly, if the agreement includes provisions for overtime pay, holiday pay, or other types of compensation, the system would be able to interpret those conditions and apply them to each employee's timesheet accordingly.
By automating this process, organisations can save time and reduce the risk of errors or inconsistencies in pay calculations. This can also help ensure that employees are paid fairly and in accordance with the terms of the collective bargaining agreement.
Of course, implementing a system like this requires careful planning and testing to ensure accuracy and reliability. However, with the right tools and expertise, it's possible to streamline the process of interpreting collective bargaining pay conditions and make it more efficient for everyone involved.
Key Takeaways
Through the collective bargaining process, employers and unions negotiate the terms and conditions of employment, including wages, hours, and benefits. Therefore, employers must understand this process and the good faith requirement to comply with legal obligations and maintain positive employee relationships.
By recognising the importance of collective bargaining and working collaboratively, employers and unions can create employment agreements that benefit both parties and foster a more productive and positive workplace.
If a collective agreement governs your sector, you may want to consider implementing cloud payroll software to automate your compliance.
Pay Cat can help support you with this process.
