Collective bargaining procedures
Single-party bargaining
Single-party bargaining may generally be initiated by:
- a union, within 60 days before the expiry of an existing collective agreement
- an employer, within 40 days before the expiry of an existing collective agreement.
To calculate the 60 or 40 days, the union or employer initiating bargaining needs to look at the employees whose work is covered by the proposed collective agreement, and ask:
- Are any of those employees covered by an existing collective agreement?
- If so, on what future date does that existing collective agreement expire, and how many days will pass before that date?
- If there is no existing collective agreement, a union can initiate bargaining at any time. An employer may only initiate bargaining if there is, or has previously been, a collective agreement covering at least some of the employees whose work is covered by the proposed collective agreement.
Multi-party bargaining
Multi-party bargaining may generally be initiated by:
- a union or unions, provided that:
- at least one of the existing collective agreements will expire within 60 days, and
- all the other collective employment agreements will expire within 120 days
- an employer or employers provided that:
- at least one of the existing collective agreements will expire within 40 days, and
- all the other collective employment agreements will expire within 100 days.
To calculate the 60 and 120 or 40 and 100 days, the union or employer initiating bargaining needs to look at the employees whose work is covered by the proposed collective agreement, and ask:
- Are any of those employees covered by existing collective agreements?
- If so, on what dates do those existing collective agreements expire, and how many days will pass before those dates?
If there is no existing collective agreement, a union can initiate bargaining at any time. An employer may only initiate bargaining if there is, or has previously been, a collective agreement covering at least some of the employees whose work is covered by the proposed collective agreement.
Other requirements for collective bargaining
Other requirements are:
- Unions must, if initiating multi-party bargaining, ballot their members prior to initiating bargaining. If an employer or employers initiate multi-party bargaining, unions may decide to ballot their members
- Bargaining must be initiated by written notice identifying the intended employer and union parties and the intended coverage (i.e. type of work) of the collective bargaining
- Employers must, within 10 days (or sooner if possible) of initiating bargaining or receiving notice, advise union and non-union employees whose work comes within the intended coverage
- Employers have the right to request consolidation of bargaining when facing separate notices from two or more unions relating to similar coverage. Employers must do so within 40 days of receiving the first notice.
- At the commencement of bargaining, a union must state what membership ratification process it will follow prior to signing any resulting collective agreement.
What must be in a collective agreement?
A collective agreement must be in writing and be signed by each union and employer. It must contain:
- a coverage clause
- in most cases, a provision setting out how the employer will protect employees in a sale, transfer, or contracting out of their business. (See restructuring section for further information)
- a plain-language explanation of services available to help sort out employment relations problems
- a clause stating how the agreement can be varied
- the expiry date (or the event that will trigger expiry)
- a provision that complies with the Holidays Act requirement for employees to be paid at least time and a half for work on public holidays.
Mediators can assist
Mediators from the Department of Labour are available to help parties during different phases of collective bargaining. This may occur in the form of early assistance when bargaining is being set up by the parties, when the bargaining process arrangement is being negotiated, when negotiations are stalled, or during the final settlement phase. Their services are free of charge. Mediators can:
- provide the parties with relevant information
- help with bargaining
- suggest options or provide recommendations for resolving any issues the parties disagree on.
For assistance from a mediator, contact the Mediation Service directly.
Here is a flow chart of the key steps [pdf file 300kb] involved in resolving a collective bargaining dispute.
Bargaining fee arrangements
In some circumstances the parties to collective bargaining can agree to a bargaining fee arrangement.
Employment Relations Authority can assist in certain circumstances
Where collective bargaining runs into difficulties, one or more of the bargaining parties can ask the Employment Relations Authority to assist them resolve their differences ("facilitation").
The Authority can only facilitate bargaining in certain circumstances. These circumstances are where:
- there has been a serious and sustained breach of good faith that has undermined the collective bargaining
- the bargaining has been unduly protracted and extensive efforts to resolve the parties' differences have failed
- there has been a protracted or acrimonious strike or lockout action, or
- a strike or lockout has been proposed that would substantially affect the public interest.
If the Authority agrees to assist the parties, the Authority member providing the facilitation will decide what process will be used to assist bargaining. The facilitation will be conducted in private.
During facilitation bargaining continues, and employers and employees are not prevented from using strikes and lockouts.
At the end of the facilitation process, the authority can make recommendations about one or both of:
- the process the parties should use to reach agreement
- the terms and conditions of the collective agreement.
The parties do not have to follow the Authority's recommendations, but they must consider the recommendations in good faith and cannot reject the recommendations without first considering them.
The Authority may choose to make their recommendations public in the interests of encouraging a settlement.
Remedy for serious and sustained breach of good faith
A party to the bargaining may apply to the Employment Relations Authority to fix the provisions of a collective agreement. The Authority may, however, only fix the provisions of a collective agreement where there has been a serious and sustained breach of good faith in relation to the bargaining, other alternatives have been exhausted and fixing the provisions of the collective agreement is the only effective remedy available.
Parties to send copies to Department of Labour
The parties to a collective agreement must ensure that, as soon as practicable after they enter into the agreement, a copy of the agreement is sent to:
Chief Executive
Department of Labour
P O Box 3705
Wellington
Attn: Executive Officer – Labour Group
Alternatively you can send a signed pdf copy to contract.account@dol.govt.nz.
They must also include any other document referred to by, or incorporated into, the collective agreement unless that document is publicly available.
It is requested that parties also include the number of employees covered by the collective agreement and the negotiated wage movement (% increase) for statistical purposes.
