General Wage Orders

Press, Volume CIX, Issue 32054, 31 July 1969, Page 14

General Wage Orders

For many years the most important function of the Court of Arbitration has been to decide on applications for general wage orders. This function was conferred on the Court not, as might have been expected by the Industrial Conciliation and Arbitration Act, 1954, under which the Court is constituted, but by regulations issued under the Economic Stabilisation Act, 1948. The general purpose of the 1948 act was “ to promote the economic stability of New Zealand ”. The General Wage Orders Bill, now before the House of Representatives, widens the scope of the legislation. The general purpose of the act is to provide for the making “from time to time of a just and “ equitable review of rates of remuneration in “ awards and industrial agreements and every such review shall be for the purpose of considering whether an adjustment should be made in the rates of remuneration “ in order to maintain and promote “ living standards, so far as it is within the capacity “ of the economy to sustain such an adjustment; [to] “promote industrial harmony; and [to] maintain “and promote exports by New Zealand industry”.

The criteria for determining rates of remuneration are:

(a) Any rise or fall in retail prices. (b) The economic conditions affecting finance, trade, and industry. (c) Any increase or decrease in productivity and in the volume and value of production in all industry. (d) Relative movements in the incomes of different sections of the community. (e) Any increase or decrease in minimum rates of

remuneration. (f) Such other matters as the Court considers relevant

The first criterion omits the phrase “as “ indicated by any index published by the Govem- “ ment Statistician ” which appears in the present regulations. This alteration will enable evidence to be called on changes in the cost of living as shown by a survey of family budgets, as well as evidence based on the consumers price index. The fifth criterion is new; it will require the Court to take note of changes in individual awards negotiated since the previous general wage order. In practice, the Court has taken note of these. changes in determining general wage orders, so that the new criterion merely confirms existing practice. A new proviso to the last criterion directs the Court to give the parties an opportunity to make submissions or present evidence before it takes any “ other matters ” into account.

These and other differences between the bill and the regulations now in force are comparatively minor. The main significance of the bill is that it embodies an agreement between the Employers’ Federation, the Federation of Labour, and Federated Farmers. The regulations issued under the Economic Stabilisation Act could be altered at any time by a notice in the New Zealand Gazette on the instructions of the Cabinet, whereas any future alterations will require an act of Parliament. This is a commendable transfer of power from the Cabinet to Parliament.

The main weakness in the bill, as in the present regulations, is its failure to define the boundary between the powers of Parliament and those of the Court. An anomalous situation could arise if Parliament approved a major fiscal change, such as a shift from direct to indirect taxation. Such a change would immediately be reflected in retail prices, and the Court would be required to take note of that change. It might take note of the drop in direct taxation; but it would be for the Court, not Parliament, to decide whether this was “ relevant ”. Parliamentarians who acquiesce in this delegation of their authority no doubt find it politically expedient to do so; they will have no right to complain if some future decision of the Court thwarts the intention of the Parliamentary majority.