Employment Law – A Call for Change in Voluntary Unionism

A team of academics explore how a union default might work through legal regulation

HAMILTON, 24 JUNE 2019 – A team of academics is calling for a change to voluntary unionism.

Instead of the present non-union default for workers, common in many countries, they would like to see a union default, and they have the support of some of the legal fraternity. Professor Mark Harcourt from Waikato Management School at Waikato University and former Minister of Labour Professor Margaret Wilson from Waikato’s Faculty of Law are two of the four academics investigating how a union default might work through legal regulation in a study funded by the New Zealand Law Foundation.

The other two researchers are Nisha Novell a law student from Victoria University of Wellington and Dr Gregor Gall from the University of Glasgow.

In an article entitled “Implementation of a union default in New Zealand law as an antidote to rising income inequality” published in the March 2019 issue of the Employment Law Bulletin (LexisNexis), the team interviewed 42 employment law experts, 23 practising lawyers, mainly law firm
partners, 11 legal officers, lawyers or equivalent in unions, five employment law or industrial relations academics, and three Employment Relations Authority (ERA) members.

Thirty (71%) of the interviewees liked the idea of a union default, 12 (29%) did not.

Professor Harcourt says for a long time there has been a belief that the rise in income inequality can be partly attributed to the decline in unions and collective bargaining, and research from other countries bears this out.

“We’ve worked out that nearly half of New Zealand workers want union membership but most work for a non-union employer with no union onsite they can join. Establishing and sustaining a union presence on sites is difficult and costly, and harder still if the employer isn’t supportive.”

He is proposing a new policy of default unionism, enacted in law, would help address rising income inequality, declining union membership and collective bargaining, but it was important to discover what lawyers and others working in the field thought about the idea and how it might be implemented.

Among the law practitioners interviewed, those who supported a union default said the most acceptable default would apply to new employees at sites that already had a collective agreement and union representation. At non-union sites, unions would recruit members and then approach the employer to
negotiate a collective agreement. All employees covered by a new agreement would then be automatically enrolled as union members, but with the option to leave the union afterwards.

If there were problems negotiating a new agreement within a set time-frame of, say three or four months, the Employment Relations Authority could arbitrate one and infer coverage from the composition of members thus far recruited, or some other criterion.

It was important to the legal experts interviewed that opting out of a union should be a simple process, but not all agreed on the time they should spend in a union before deciding not to associate. Some favoured 30 days, which would give new employees time to learn of any value the union might bring,
while others said the choice to join or not should be from the start of employment.

Another option was 90 days, if there were a trial period, and some argued for ‘no fees’ during any compulsory membership.

Despite widespread de-unionisation, surveys show roughly half of all workers across richer Anglophone
countries, such as Australia and New Zealand, want to be union members but a majority cannot exercise their preference because they belong to a non-union workplace.

“At the moment inertia keeps people out of unions, but with a union default, inertia would be seen as an advantage,” Professor Harcourt says. “Moreover, a union default would become a perceived social norm — what people deem to be the most prevalent or acceptable behaviour in a group situation, and
which most people comply with.”

In the past, recruitment of members was less of an issue. Unions, once established, could negotiate closed-shop clauses in their collective agreements. Such a clause meant an employer agreed to  employ only workers who were already members of a particular union or had agreed to join once
employed.

In the study, opponents to a default scheme comprised three groups: those with concerns about the freedom not to associate, those who believed unions were generally unnecessary, and those who believed unions were disruptive. Some had concerns about implementation and about people being
pressured to join and wondered how workers who wanted to negotiate their own agreements might fare.

Even those who did not like the idea of a union default agreed it would increase membership and strengthen union bargaining power.

Most interviewees believed that regulation of a union default would not require radical changes to the Employment Relations Act or institutions that administer it. Professor Harcourt says a union default would not automatically facilitate union effectiveness, but a larger, stronger union would help diminish employer resistance to union requests or demands.

“I’m aware people might say this is a backdoor route to socialism, an affront to individual liberty,” says Professor Harcourt. “But people would be able to opt out if they chose to. It’s not a closed shop we’re suggesting.”

About the University of Waikato

The University of Waikato in New Zealand has campuses in Hamilton and Tauranga. Research is a key focus for the university and importance is placed on fostering an active research community and producing critical-thinking, future-focused graduates who are globally aware. Waikato Management
School is among an elite group of institutions worldwide that have triple-crown status from leading accreditation bodies, EQUIS, AMBA and AACSB.

About the New Zealand Law Foundation

The New Zealand Law Foundation – Te Manatū a Ture o Aotearoa – is an independent charitable trust that provides grants for legal research, public education on legal matters and legal training.
Since 1992, the Law Foundation has provided over $30 million in funding for legal research and law scholarships. Its funded projects have produced independent legal thinking, with many influencing major and emerging public policy issues. For more information, visit: www.lawfoundation.org.nz

About LexisNexis Legal & Professional

LexisNexis Legal & Professional is a leading global provider of legal, regulatory and business information and analytics that help customers increase productivity, improve decision-making and
outcomes, and advance the rule of law around the world. As a digital pioneer, the company was the first to bring legal and business information online with its Lexis® and Nexis® services. LexisNexis Legal & Professional, which serves customers in more than 130 countries with 10,000 employees worldwide, is
part of RELX, a global provider of information-based analytics and decision tools for professional and business customers.
About Employment Law Bulletin
The Employment Law Bulletin keeps you up to date with the latest developments in employment law
and is a must for any practitioner or professional dealing with employment law issues. The Bulletin is
highly regarded among practitioners and stakeholders in the employment field, including the Courts.
Each issue contains articles giving expert practical analysis on the most current and relevant issues in
employment law, as well as case notes on key employment decisions.
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