Thursday 4 June, 7.30pm. Otago Room, Clubs and Societies building
All Welcome
Part One: The War on Workers
We’ve all heard about corporate losses, the plummeting stockmarket and growing bankruptcies, but of course its not the highly paid executives and corporate millionaires who the recession is hurting the most. Since the beginning of the year there has been a growing assault on workers jobs. Official unemployment in New Zealand has risen in recent months to 5 percent, and is forecasted to rise again to 8 percent by the end of 2009. In tonight’s talk I’m going to begin by having a look at the increasing assault on workers before going on to look at a few strategies that we can take to resist falling pay and job losses. Finally, I’ll conclude by taking a look at the state of New Zealand’s union movement and what makes unions more or less effective in fighting for jobs and fair treatment of workers.
• The year began with redundancies slower in January than in December – 537 as opposed to 1282, although the extent of the crisis was probably hidden by the fact that January is generally a shorter working month than December, many firms taking the first week or two off for summer holidays.
• Early on, however, Telecom set the ball rolling by announcing 37 sackings as it closed its online retail business, Ferrit.
• In February, Air New Zealand “freed” its pilots to take short-term (i.e. 1-2 year) contracts with other airlines, and reduced their hours, after sacking 200 other employees before Christmas.
• Fisher and Paykel also announced 430 redundancies at it Mosgiel plant, to take effect later in the year. In February the redundancies were supposed to be ‘voluntary’, but only 80 workers took this up. Later it emerged that redundancy pay would only be available to workers who left on their redundancy date, disadvantaging the workers who might manage to find work elsewhere.
• In March the onslaught began in earnest. A survey of small and medium enterprises indicated that 22 percent of firms intended to make redundancies in the next 6 months, contrasting from 8 percent when the crisis began to hit last August. The shrinking property market was reflected by 52 redundancies at state-owned valuation company Quotable Value. Sealords cut 130 jobs at its Nelson factory, and another 58 were laid of at nearby Nelson Pine. Workers in textile manufacturing were also hit hard, with the announcement of 60 redundancies at Summit Wool Spinners in Oamaru, with the remaining workers being put on to National’s 9-day fortnight. Clothing manufacturer Pacific Brands moved production to China, shutting down factories costing 38 jobs in Christchurch and 51 in Palmerston North. Workers at Cavalier Bremworth were put on short time, a union-negotiated deal forcing them to make up the 5th day of each week with their holiday pay.
• Christchurch-based jet manufacturer CWF Hamilton also announced 28 redundancies on March 18.
• In April, ASB Bank froze pay increases for 3,500 of its 4,500 employees. Those that didn’t receive a zero pay increase were limited to increases of 2-3 percent. Fairfax media, which owns The Dominion Post and The Press newspapers, announced 70 redundancies in advertising and pre-production as it moved production to ‘regional hubs’. Cuts also began to impact the state sector. 86 of the Ministry for the Environment’s 300 employees lost their jobs after several projects were scrapped, including the carbon neutral ‘Gov3’ programme and the Bioethics Committee. TVNZ announced 90 planned redundancies and the Inland Revenue Department threatened forced redundancies would be necessary if not enough candidates put their hands up for 230 planned cuts. Cadbury’s announced a further 45 jobs were to go in addition to the 145 announced in August 2008.
• In May the onslaught became a landslide. More than 1500 jobs were lost in the first two weeks. The month opened with Hamilton caravan manufacturer Caravans International Munro confirmed 64 redundancies on May 7th, in addition to workers made redundant in February. It now has less than half the staff which it began the year with. In a single ‘black week’, hundreds of redundancies were announced: 144 call centre workers were to be cut by August as Yellow Group contractor TelTech moved it’s operations to a ‘centre of excellence’ in the Phillipenes, Ports of Auckland laid off 28 staff under the threat of strikes, 26 further cuts were made at Cadburys, 60 were lost from the Otautau sawmill and a whopping 200 jobs were sacrificed in ‘efficiency savings’ at the besieged Ministry for Social Development, which is responsible for paying benefits and the dole. Ironically, the New Zealand Herald article announcing the losses read “Savings redirected to help jobless in the recession”. No savings are predicted at the MSD for the current year, and government assistance is paltry. Of the 5913 workers laid off between January 1 and May 27, only 2677 were receiving the MSD redundancy package by mid-May. At the end of the month last Friday, Air New Zealand announced a further 80 cuts while it was still in negotiation with its subsidiary Zeal.
Part Two: Fighting for Jobs
• Labor unions have an important role to play in defending workers’ rights and conditions. They have the power in the workplace to demand decent pay and fair treatment, by enabling workers to effectively protest poor conditions by withdrawing the labor power that turns the wheels of industry, creates profits and generally makes the world go ‘round. The policy of unions during a recession is an important determinant of how hard workers are affected – by limiting redundancies, increasing pay and winning compensation.
• The most effective policy is one of taking militant action on picket lines and in public campaigns – aggressively fighting against layoffs and for compensation when they do occur. Militant action taken by workers in one workplace can help protect not just jobs in one shop, but set the tone for negotiations in others. The Unite union is an excellent example. In the past three years Unite has combined protests and strike action to organize fast-food and low-paid workers, wining pay increases and better rights at work. In April, Unite workers at Burger King successfully added a clause to their contracts for redundancy pay in case of store closures – before any redundancies had occurred. This contrasts with the tactic of other unions that focus on limiting redundancies through negotiation and dialogue. Among examples are the Service and Food Workers’ Union at Cadburys, and the Engineering, Printing and Manufacturing Union at Fisher and Paykel. In both cases the Union’s acceptance of ‘limited redundancies’ simply emboldened the employers to announce further redundancies later on, and in the case of Fisher and Paykel, close down the plant.
• Relapsing into old-style protectionism is not helpful either. At its worst, it simply leads to the dead-end of racism by blaming foreign workers for stealing ‘Kiwi’ jobs. This is manifesting in the union movement where (usually temporary) migrant workers are kept on after locals have been laid off. But foreign workers, usually from places worse off than New Zealand, are not to blame. They didn’t cause the recession, or the layoffs that followed. Indeed – they are usually have less job security, and are paid less than New Zealanders with similar skills and experience. If redundancy means returning to poverty in Asia, they not only start with less, but have more to loose. The recession is international, and demands an international solution.
• Redundancies should be defeated by strikes. Where this isn’t possible, penalty redundancy payments should be levied on employers that close down and move. When firms move to-low wage economies, workers in New Zealand should simultaneously fight for their own right to compensation, and also struggle for union rights for workers at the new location. This will raise wages and conditions for all workers worldwide. Workers didn’t make the recession, and workers shouldn’t be forced to pay, regardless of their race or nationality.
Part Three: The State of the Unions
• The strength of unions to win better conditions, however, isn’t fixed or static. Union membership in New Zealand has fallen since the introduction of the Employment Contracts Act in 1990, which aimed to destroy unions and drive down workers’ pay and conditions. Union membership fell from 684,825 people, or 55.7 percent of the workforce in 1989, to 601,118 – 51.7 percent – in 1991. Membership further fell throughout the 1990s until it hit a low of 329,919 in 2001 (22.0 percent of the workforce at the time).
• Recently, however, there has been some recovery in Union membership.
• Union membership increased from its 2001 level to 373,117 in 2006 (up approximately16 percent).
• The Statistics New Zealand Survey of Working Life calculated in union membership in March 2008 to be 525,500, or 30.1 percent of labor force.
• However, the percentage of the workforce in unions – union density as its called – is not the sole determinant of the union movement’s effectiveness. Structural differences in how the movement is organized also play an important role. This can be seen by contrasting the New Zealand experience with a country renowned for its ‘revolutionary’ working class movement – France.
• In NZ, Council of Trade Unions with 13 members dominates trade union membership (approx. 80 percent). Much of this is concentrated in the biggest Unions – the PSA (approx 57,000 members) and EPMU (approx. 50,000 members).
• In France, union membership actually accounts for a much lower percentage of employees – approximately 9 percent – and is split between several large union confederations.
o The largest are the CFDT – the Democratic French Confederation of Labor, a secular split from the old Christian Labor Confederation of France, and the CGT – the General Confederation of Labor, which has been historically aligned with the communist party.
• Despite this, militant union activity is much more prevalent in France than in New Zealand. Unions were instrumental in the fight to defeat the CPE – a French law similar to our own 90-day bill that took away the rights of young workers in 2006, through a 1 day general strike. Unions also called a national strike against French President Nicolas Sarcozy’s 36 billion euro bailout of the banks.
• The difference is the precedent established by past struggles. The right for workers to strike is enshrined in the French constitution, while in New Zealand it is rigidly restricted by law. In France, small sections of unionized workers are able to lay the foundations for large strikes and full-scale walkouts. In contrast, the right to strike in New Zealand is severely restricted. Only workers directly involved in wage bargaining may take strike action, and only after attempts at arbitration have failed. Solidarity strikes and political strikes are outlawed.
• Both situations are the outcome of struggle. The current constitution of France is the result of whole series of uprisings and revolutions dating right back to the original French Revolution of 1789, each round in which workers, organized in Unions and political parties, played an important, and at times a decisive role. The more fractured nature of the trade union movement reflected political divisions amongst the Unions – for the better part of the 20th centaury a significant part of the French union movement has been explicitly aligned with the communist party. Although the CP were no saints, and frequently worked against the interests of French workers, at key junctures in the class struggle – such as during the Nazi occupation, its members were involved in radical action defending the working class. It provided a political force that was not wholly cemented to Social Democratic reformism and cemented the French working class as a force to be reckoned with.
• In New Zealand, attempts in the 1990s to defeat the Employment Contracts Act through a general strike were met with a timid response from Labour-aligned union leaderships. Rank-and-file moves from militant workers in the Nurses Union were thwarted by bureaucratic maneuvers from above. The lack of effective opposition in workplaces enabled National to bring in their law, which was used as a tool to bludgeon unions. Some unions subsequently loosened their attachment to the Labour Party, without a more radical pro-worker alternative, unionism lost much of the political content that it had. The result was a lack of generalized leadership in the union movement, and a recovery in unionism that is still slower and patchier that it otherwise could be.
What is needed in New Zealand’s union movement is a political content that can reinforce and sustain radical action. To strengthen the union movement, we need to build a workers’ alternative to the Labour Party. Labour lost the explicit endorsement of the more radical unions, because it’s agents in the union movement weren’t willing to lead a real struggle in the 1990s. Likewise, it lost the election last year because it failed to significantly improve the lot of workers while it was in office. An alternative, however, is unlikely to be built overnight. The majority unionized workers still more or less agree with Labour’s vision of society. A workers’ party will only be built by engaging with workers when they are struggling – whether it be fighting to keep their jobs, maintain their pay or conditions, or fighting to keep their rights at work from predatory employers.
Building an alternative in is the task of the International Socialists. If you agree a militant union movement is what is needed to defend jobs, then I encourage you to join us.
