By Riley Chance*
This statement is drawn directly from the Labour Party’s website: “The New Zealand Labour Party’s roots lie in activism for workers’ rights and democratic reform, which can be traced back to at least 1840”
I need to start by stating I’m politically left-leaning. If you read the title and hoped to enjoy some Labour Party bashing you will be disappointed like I’m disappointed with the government for what they are doing – or for what they’re not doing.
I have a question. How much is this government prepared to spend on an anti-union campaign in the tertiary education sector? The tertiary education minister Chris Hipkins may argue universities are independent organisations, universities are, however, state owned. As the minister, Hipkins can act or choose to look away.
Given their history and their name you would expect the Labour Party would not condone anti-union activity. Surely, they should encourage staff to join the unions? Here I hoped to add a link to a Labour Party priority around workers’ rights – but there isn’t one. The closest, ‘Securing a strong economy’ is so open to interpretation that it is meaningless, particularly in relation to the rights of working people.
Some Context:
Chris Hipkins has stated that universities are in “good financial shape”, I wrote about that here.
Conversely, Massey University, who I’m using as a base case, would have their staff believe they are in a financial crisis. This year a beaming Jan Thomas, Massey’s vice-chancellor, emailed staff – “In the latest financial forecast, Massey indicated [sic] a -$46.0M deficit**” She went on to extoll staff to focus on cost containment, “turning off lights when not in use”. Sound advice to save money and reduce emissions – I used to give my children the same advice.
I’m reliably informed that senior leaders at Massey have been ringing bells of doom as they inform staff about, amongst other things – budgets, enrolments, staff student ratios, Capex, Opex, headcount, ‘the gurgler’, levers and the mind-numbingly stupid practice of internally charging for floorspace – Ignoring the cries from faculty, what about education and research? The message from the lectern, illuminated by dazzling gaslights, is cost saving, cost saving, cost saving.
This belt-tightening rhetoric comes as inflation is surging. In October this year, union members of universities went on strike as one for a pay increase to keep wages and salaries in line with inflation. The union was demanding 8% to avoid staff having an effective pay cut, the universities individually offered much less. The fight remains unresolved.
In amongst the bargaining demands was an interesting claim that went largely unnoticed. The union wanted to defer passing on any agreed wage rise to non-union employees for six months (now 18 weeks). Massey was only prepared to hold off passing on the wage rise for six weeks (now eight weeks).
The union stance is understandable. They represent fee-paying union members who are taking a risk by striking. Why should non-union staff benefit at all? They are simply freeloading off their colleagues. Before you start typing, let me answer the obvious retort. Yes, some may choose not to be in the union on principle. Fine. Don’t accept the union organised settlement – it’s the same principle. Negotiate your own pay.
On the face of it, Massey’s stance is difficult to understand. The VC and her compliant band of merry senior ‘leaders’ seem desperate to save money – their jolly, pre-Christmas, axe-wielding restructures feature regularly in the media. But the unions have presented them with the perfect opportunity to save money – considerably more than Thomas’ call to switch off lights. Don’t pass on the pay rise for six months. Better still, don’t pass it on at all.
Here’s a table that approximates the amount of money that Massey and the sector (using Massey as the base case) could save under the current claims and offers.
(For those wanting to tear the analysis apart, I have documented the data sources and assumptions used at the end of the article. Tweaking the assumptions changes the numbers not the effect)
To summarise, If Massey delayed passing on the wage-increase secured by the union for its members, it could save between $1.1M to $8.6M (depending on the final settlement and length of delay). If you extrapolate that out across all tertiary institutions, the ball-park becomes $8.7M - $64.8M.
I said it was difficult to understand their position, it is of course easy. There is only one plausible reason for a cost-focused organisation to not snatch such substantial savings – to dissuade people from joining the union.
Again, before you start stabbing your keyboard with angry fingers, I understand that a stronger union will change the balance of power over time. This may make it harder to ignore future pay demands from the people they refer to as their greatest asset (their only productive asset).
Maybe. If you stop for a minute to consider the purpose of our state-owned universities, you get a different perspective.
Like health, education is a public good. If you are about to go under the knife in one of our excellent, publicly-funded hospitals, do you want see highly trained, experienced and motivated clinicians in the room? Or whoever survived a good-old fashioned financial bloodbath?
Nobody in hospital wishes the government had saved more on health.
Our future societal and economic wellbeing relies on having the best and brightest minds possible to solve a range of ‘wicked’ problems we are facing. A low-cost education system that ignores educational quality, reliant on hustling international students is nothing short of ludicrous.
Education, like health, is a public good. To look at it in isolation is to take an immature view.
The quality of education, like health, is directly related to the quality, experience and time staff have to educate. As I wrote previously, ‘The New Zealand Government, as a sovereign currency issuer, can invest as much as it wants in education, assuming it believes more education is better than less education. I certainly haven’t read many arguments that the solution to the wave of mis- and disinformation swamping New Zealand is less education’.
So what?
The point I wish to make, the Labour Party is in power. The public who voted them in expect policies in line with that broader worldview and that includes policies and actions to help workers. What’s happening currently only makes sense if those in power are right-wing, free market proponents of trickle-down – think Liz Truss not Jacinda Ardern. (I did warn you).
So, while I hope Hipkins is working out how to reign in Universities NZ***, I suggest that rather than trying to weaken the union movement and focus on profit rather than education, universities employ their senior managers to run around each evening turning off the lights. It will help the bottom line without impacting on education quality and it is much better use of their time.
Assumptions employed:
**MU announcement. Message from the vice chancellor: Financial performance
***The University Vice Chancellors committee, arguably a lobby group (coming article)
*Riley Chance, a nom de plume, is an author who also works in education and management.
62 Comments
I need to start by stating I’m politically left-leaning.
I've stopped using "left" and "right" to describe political bent. The words have become so corrupted as to be completely meaningless, only useful as derogatory terms for someone you don't like (especially if you supercharge them by tacking "far-" on to the front, or "ist" onto the end).
Politics makes much more sense when you see the political spectrum not as a straight line, but as a circle. Head too far in one direction and you pop out the other side. The logical implication here is that there is very little difference between two positions at the extreme ends of the political spectrum. Labour has gone so far to the left that they've become everything they claim to be opposed to.
Example: remember when freedom of speech used to be a progressive, "left-wing" value? While I couldn't care less about either Twitter or Elon Musk, current events are bringing the discussion once again to the fore. Jacinda Ardern, our supposedly left-wing Prime Minister, is calling for the world to implement global systems of censorship the types of which would make Chairman Xi blush. Here she is at the UN. Worth a watch if you haven't seen it:
The scary part is that there's not really any meaningful choice in our two-party political system. The Overton window has shifted so far to the "right" in this country that we've forgotten what left-wing politics is supposed to look like. The problem is not with any one particular party or politician, it goes much deeper than that. If we're going to "build back better", perhaps we need to start with our electoral system.
100%.
When I was coming up through the ranks at high school and university, the "left" (as traditionally thought) was the side that was in favour of people being able to speak and think freely. Not always, but most of the time.
I don't think that's true any more, at least not with Ardern's Labour. Her attitude towards censorship etc is scary, and the primary reason I could never vote Labour in their current guise. I think their economic platform is better for the average person, but I can't get past the weird obsession with controlling speech, thought and behaviour.
Why can't they just stick to their knitting and focus on giving the working/middle class a fairer shake? Or do all manifestations of "Leftism" (for want of a better term) ultimately march towards the extreme, perhaps as you also see on the right?
It's a bit silly to claim that the universities could save money by not passing on an 8% pay rise to non-union members. If they did that, union membership would soar to close to 100% overnight, the universities would have done the unions a huge favour and saved no $ at all.
Simple solution to that. The pay-rise goes to only those who were members of the union prior to the announcement of the pay rise, or who begin new employment at Massey and join the union upon starting. Of course, loads of people would then join the union in the hope of being covered by the following years' settlement. But then the Uni would be in same position it always was, in that it would be passing in a pay rise to the majority of staff.
I'll grant you the 'two tiers' issue, but in terms of disincentivizing membership - I don't see how it would. Once it's on the table that not being in the union means you don't automatically get the union negotiated pay rise, most people who were planning on sticking around for at least a year (until the next negotiation round) would probably join. And if it does disincentivize membership, then great from the Uni's perspective - they get to save money on the salaries of those who don't join the union.
The main point, I think, is that it's a bit disingenuous for the Uni to tell the union that they can't afford an 8% pay rise for all staff when the union is not asking for that. They are asking for a pay rise for Union staff. If the university then decides to give that to all staff that's their choice to incur those extra costs.
> Once it's on the table that not being in the union means you don't automatically get the union negotiated pay rise, most people who were planning on sticking around for at least a year (until the next negotiation round) would probably join.
Agreed. And that's precisely why, IMO, the unis will never do it.
Sure. But at least they could say the quiet part out loud: we are deciding to spend millions of dollars to pass a union-negotiated salary on to non-union members even though we don't have to, when we are (apparently) so strapped for cash we are reminding people to go round turning out the lights, because we don't want more people to join the union.
As an exercise in adversarial political point-scoring, ok, I guess. But I don't see how it gets you to a better outcome.
The problem, as I see it, is that neither the union nor the unis are prepared to have the grown-up conversation that's required. Uni budgets are not going to grow by 8%, despite fanciful suggestions that the govt would suddenly cough up a few hundred million if only the VCs asked Chris Hipkins nicely. If you want staff salaries to go up by 8% (and personally I do), you have to acknowledge that it means that something else is going to have to shrink in real terms. This isn't a for-profit business where anything kept back from salary ends up in the owners pockets; the money is going to come at the expense of something else. So the real question is, what is that going to be?
I can think of at least one easy win - all NZ based universities can cut their domestic advertising budgets. It's ridiculous that they compete with each other over students. Here's another: VC salaries. The Massey VC earns (at least, as these are 2020 figures) 560k, about 100k a year more than the PM. The Auckland VC is on 750k. I don't see that it would be 'harder' or require 'more skill' or any other justification you care to name to run a university than it would be to run a country. It's funny that the argument 'we need to pay higher salaries to attract the best talent' only seems to apply at managerial level, and not at the level of staff who perform the main functions of the university, given that NZ academic staff salaries are very low compared to other English-speaking countries. Both unis could easily save a quick quarter of a million, and still have VCs earning salaries around three times the median household income.
@real terms: You're right about trade-offs, but wrong that the union isn't prepared to have that conversation. A key sticking point is the VC's unwillingness to throw open their books so that everyone can know how sincere their claims about financial hardship really are. The above point about NZ's ridiculous competitive model is relevant here.
A related point that has specifically been raised by the unions is the necessity of university capital expenditures. VCs and Uni presidents throughout the world would rather build buildings than pay their staff properly. Those types of decision are fair game in any collective bargaining context.
I largely agree with you. The exception, I think, is the idea that tripartite negotiations would be a magic money tree if only the VCs would ask for them. Pure fantasy IMO. Capex expenditures are at least the right order of magnitude to be discussing, and I agree, fair game.
There's a bit of 'the boy who cried wolf' going on here too. The university has a habit of talking up its dire financial situation at negotiation time, giving significantly below inflation pay rises, and then announcing (after negotiations conclude) surprise! we actually made a multi million dollar surplus.
I don't understand why the uni would agree with the union to keep non-unionised pay low. It's none of the union's business.
People avoid joining a union so they can negotiate their own agreements, why should the Union still have a say in what they are paid?
If likely many of the uni's best staff are non-unionised, they'll want the flexibility to pay them what they need to pay to keep them.
The university system is one of the institutions which has not adjusted to the 21st century well at all. It has at least 5 ongoing crises which it seems unable to adapt to.
1. The decreasing quality of education with the lower quality of people coming through university as more and more people go through these institutions.
2. Saturation of post-grads and PhDs and the lack of professorial or research jobs for these people.
3. The bloated administrative class who 'help' fulfill the bureaucratic functions of these institutions.
4. The replication crisis, dysfunction of the academic peer review system and the grant funding system.
5. The dependence on international students to subsidise domestic students for costs.
They are toxic environments to work in and toxic places to be, particularly in post-grad.
Uni model is fairly basic, the more bums on seats, the more government funding, the more likely they keep their jobs. So their number 1 criteria is to get bums on seats, hence years ago they changed the rules so basically anyone after age of 20 can go, and then schools changed grading system so most can get entrance and go.
If the Gnats had their brains engaged , they'd promise to drastically shift the bottom 3 tax bands to help low to middle income earners , and leave the 33 & 39 % bands where Labour put them ...
... then there'd be no way that Robbo could flog that old " tax cuts for the rich " horse ...
The heading ".. education system that ignores educational quality, reliant on hustling international students is nothing short of ludicrous"" dragged me in.
The author is correct about Labour supporting almost everyone except the employed union member.
My working life was 45 years of computer programming - it was a growing industry so I never needed a trade union - in fact a trade union would have delayed the shedding of crap programmers so I was happy. However all my family (including my student employment) was for British rail - a declining business. They needed unions to protect workers rights. For various obvious reasons Universities will become smaller so their staff should join active trade unions.
Nice letter toadying up to management on the big savings blocking the non-union workers from getting a cost of living pay rise.
All the non-union staff at Massey will appreciate how the union is trying to screw them. Hope they all read this union stopping their pay-rises for 6 months whilst inflation soars. Hopefully all "Riley's" union comrades know to clean the mug before using it and park where there are lots of cameras.
Good article for Interest to publish.
If you spend a few hundred bucks a year on Union membership, perhaps lose a few days pay through strike action and otherwise inconvenience yourself with work-to-rule type action, how would you feel if your non-Union colleague gets the exact same benefits as you having suffered none of the costs?
You don't have to think of it in terms of animosity. How about this - in that situation, what incentive do I have to stay in the Union? I know I can leave and get the same pay rise as everyone else with no cost to me, I'd be crazy not to leave and hope enough other people keep paying their dues to maintain the Union.
So perhaps they pick up some overtime as well as not losing wages or paying fees. Win-win-win.
From my experience striking, my (few) non-Union colleagues did not have to pick up additional work on the day. Our management were not permitted to give them any duties they would not normally do. Work was rescheduled or not done.
This logic is ridiculous. There has always been a trade-off between being a union worker or an individually employed worker, and the trade-offs have always been clear.
Union workers take a risk when they sign on to the union - they lose the right to negotiate an individual contract, must pay a fee, and agree to giving up time and effort (sometimes putting their job on the line by joining strikes etc). In return, they get access to a collectively negotiated agreement, which means they get whatever terms the group gets. Workers joining unions generally do so because they think that they can get a better deal by negotiating collectively than by negotiating individually, or that morally it is better to lift the tide for all than try to get a higher individual salary. That's the risk they take and the path they choose.
Individually employed workers take a risk when they choose not to join a union - they choose to forgo the benefits of being in a union, like union-negotiated pay rises/collective agreements. In return, the worker doesn't have to pay fees or join in on union work, and also has the chance to negotiate a better paying or more individualised contract. Individually employed workers generally choose to do so because they think they can get a better deal by negotiating individually than collectively, or that morally it is wrong to collectively negotiate. That's the risk they take and the path they choose.
These trade-offs have always been the trade-offs and will forever be the trade-offs. It is 100% clear to people when they start a new job that they have these two paths and that each has a positive and a negative side to it. So it's so annoying when people who choose not to join unions - because they think they can make more money, or because they think collective bargaining is evil - suddenly cry foul because they aren't getting the benefit of the collective agreement!
I've dealt with this in a number of workplaces in the past, and it is always so annoying, and the same thing over and over - a worker chooses not to be unioninsed because they want an individual contract, thinking they can get higher benefits, the collective agreement overtakes their agreement, and then they throw a hissy because they have to deal with the consequences of their choices. It speaks to the attitude of entitlement which is rampant in this country - I chose not to join the team, or do any work, because I didn't want the bad consequences, but now that things are good, its unfair/immoral/evil because I'm having to face the consequences of my decisions and can't just get money for jam.
On the contrary why should the Union have any say in what non-unionised workers are paid?
If they do, it's suddenly not an individually negotiated agreement anymore is it.
If I'm not in a union I wouldn't want the union deciding I can't get a pay rise for 6 months.
There is nothing stopping you going to your manager and ask to get the same payrise as your union colleagues, at the same time as they do. Your manager will decide whether or not that's a good idea. It is of course likely they will decide it is not, if it affects other agreements that have been made. But it is always the case with individual negotiations that the person deciding whether or not you get a pay rise (and when) will take into account their other commitments and obligations.
Wrong.
The union is saying that the pay rise it negotiated for union workers shouldn't automatically be passed on to other workers. That's not the same as saying that people on individual agreements are prevented from getting a pay rise. If you're on an individual agreement, you can still negotiate with your employer individually.
The union doesn't want union benefits passed on to non-union employees automatically because: 1) it's against employment law, and 2) if employers were allowed to do that, they would kill unions and monopolise compensation negotiations (hence why it is illegal)
Because that's the law: Passing on collective agreement terms » Employment New Zealand
In the past, employers shut down unions by automatically passing on the terms unions collectively agreed to to everyone. The idea was pretty simple: if they could make it that you got no benefits from being in a union vs not being in a union, then unions would die and the employer would have a monopoly on setting salary/wages. To stop that from happening, it is illegal to automatically pass on the terms of a collective agreement. It's completely normal for a union to say that Massey should respect that.
If these laws didn't exist, unions would die, and everyone - including people who negotiate individual agreements - would be worse off in the long term.
The union wants non-union families impoverished for 6 months by denying them cost of living adjustments and since the union has asked first they can prosecute Massey at the employment tribunal if a cost of living adjustment were provided. All perfectly legal of course, by laws the unions wrote.
Also it should be noted that the union is asking for 8% while Massey is offering 3.5%, meaning it is going to end up somewhere between the two. This week we found out in the private sector (where there is much less union involvement) the average is 8.6%.
If these laws didn't exist, unions would have to fight for pay and conditions superior to what was on offer without a union. They would need to show the value, so that people want to join.
That unionized workers think suppressing non-union workers for the benefit of the employer is going to make more people join their bunch of... is one of the reasons unions struggle for members.
But might be wrong, maybe if they make enough children go hungry unions will become super well respected.
""I certainly haven’t read many arguments that the solution to the wave of mis- and disinformation swamping New Zealand is less education.""
This is mine. It requires experience to develop wisdom; to appreciate that new facts may cause you to change your mind; that issues are not always clear but require fuzzy-logic and nuance.
When protesters are arrested, invariably they are students not plumbers. The two wrong-headed anti-vaxxers I know best (both passive protestors and highly intelligent) are graduates. A successful university education leaves the graduate with knowledge but not improved judgement and an appreciation of how the world really works.
""The quality of education, like health, is directly related to the quality, experience and time staff have to educate.""
True of quality. But not of quantity. NZ has too many students. Too many graduates who never use the knowledge gained by their studies. We have double the per capita students as Switzerland; but it is Switzerland that is twice as productive with double the income.
NZ certainly needs great universities and great hospitals but just as a hospital that amputates two legs rather than one is twice as efficient similarly you can have too much tertiary education.
Yes, some may choose not to be in the union on principle. Fine. Don’t accept the union organised settlement – it’s the same principle. Negotiate your own pay.
I'd love to, but the unions (in my case, the PSA) negotiate such mind-numingly dumb things like "unlimited sick leave" (including for "gender transition") that then get automatically unloaded onto staff on IEAs that actually make it hard for me to negotiate things I do want. I can't stand collective bargaining.
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