Labour has been warned Fair Pay Agreements (FPAs) pose "significant risks", sparking claims from the Opposition it is ignoring advice.
The revelations come from a Government document dump on Thursday, related to the public sector and Labour's recently announced plan to forge ahead with FPAs now that NZ First is out of the picture.
All employees will be covered by FPAs under Labour's scheme, even if they aren't part of a union. Any union will be able to initiate the FPA process as long as it can demonstrate support from either 10 percent or 1000 employees in the industry or occupation.
Ministry of Business, Innovation and Employment (MBIE) officials recognised "a number of significant risks" associated with FPAs, particularly how, in Labour's proposal they will be compulsory.
"The compulsory nature of FPA bargaining and the bar on industrial action may not comply with New Zealand's international labour obligations and a rights analysis is needed," MBIE officials said.
They also noted how there is "a lack of incentive for employers to participate in the FPA system, with the main motivation for employer participation likely to be the desire to avoid a determination on FPA terms".
Officials also noted how the proposal lacks the support of Business New Zealand.
The preferred approach for MBIE is to "strengthen existing mechanisms in the employment relations system, combined with setting targeted sector-based minimum standards where there are problematic outcomes for employees".
MBIE warned the Government that FPAs will "reduce employer and labour market flexibility and productivity growth'", "result in terms and conditions which mean employers' abilities to compete, adapt to changing market conditions or innovate may be lessened", and '"impact on competition if some employers cannot afford to comply with the new standard and exit the market, or may choose to not enter due to the new barriers to entry".
FPAs could also give contractors an advantage, because contract workers won't be covered under the legislation.
According to the documents, the Ministry of Transport is concerned that workforces such as Uber drivers may gain competitive advantage over taxi drivers due to contractors being initially excluded from FPAs.
National's workplace relations spokesperson Scott Simpson says Labour ignoring advice is not a good look.
"Making unionism all but compulsory infringes on a person's right to freedom of association through forcing nationwide sector agreements negotiated for them by unions they have little choice but to join," he said.
"Individuals should always have the right to choose to join a union or not."
ACT leader David Seymour says FPAs should be dumped.
"Labour's plan for compulsory unionism is anti-democratic and anti-freedom and it must be scrapped. Labour has been told by its officials that so-called 'fair pay agreements' would wreck the economy and undermine freedom of association."
Workplace Relations Minister Michael Wood has argued that FPAs will improve wages and conditions for employees, encourage businesses to invest in training, and level the playing field so that good employers don't get undercut.
The document dump also shows how the public sector, under Labour, has ballooned. But this is for a number of reasons, not least of all COVID-19.
In the past year, the number of public service employees has increased by 4521, or 8.6 percent, to 57,149. Of the 36 public departments, 30 of them increased their full-time staff.
Ministry of Social Development staff increased by 1060, driven by increased funding to meet the rise in demand from COVID-19 and to improve support into sustainable work.
Oranga Tamariki staff shot up by 609, due to more funding for additional social workers and support roles in youth justice.
MBIE has 534 more workers, driven by increased funding for immigration intelligence, compliance and investigations.
Ministry for Primary Industries staff increased by 328 in response to the Mycoplasma bovis, and
Corrections staff were up by 351, due to an increase in prison and parole officers.