Ian Powell: Threat to the right to strike in DHBs?

Ian Powell: Threat to the right to strike in DHBs?

The right of employees to strike is an internationally recognised employment right that has been a feature of New Zealand’s industrial relations system for over a century, albeit with different constraints and limitations at different times. Although more restricted, this right even continued under the anti-union Employment Contracts Act (1993-2000). It is a basic right that tries to provide some limited balance to the inherent unequal employment relationship between employers and employees in favour of the former and with its origins in the historical master-servant relationships. It is not just the taking of strike action that can provide some balance in this relationship. Arguably more so, it is the mere existence of this right, even when it is not taken, but known that it might be.

But there is a possible threat to the continued existence of the right to strike in the public health service, particularly for the employed workforce of district health boards (DHBs). The public health service is one of the most labour intensive sectors in the country and DHBs are often the largest employers in their region.

Statutory basis

In 1948 the International Labour Organisation (ILO – part of the United Nations family comprising government, employer and union representatives from its member states) adopted Convention 87 on the ‘Freedom of Association and Protection of Right to Organise’. Although not specified, the right to strike stems from this convention. In various statements since 1952 the ILO has recognised strikes as a basic democratic right of nations. The right to strike is no less relevant today than it was over 70 years ago.

Strikes are one of the principal means by which employees and their unions may legitimately promote and defend their economic and social interests. While there is not a definition of the forms of strikes, the ILO rejects the notion that the right to strike should be confined to industrial disputes over a collective agreement. It does accept, however, the need for constraints in ‘essential services’.

Directly relevant to the right to strike is the right of employees to collective bargaining for their employment agreements. This right was first established by the ILO in 1949 (Convention 98) and further developed in 1981 (Convention 154). Collective bargaining reinforced by the existence of the right to strike reduces the pro-employer imbalance in the employment relationship.

Our current industrial relations legislation, the Employment Relations Act (ERA), came into force in October 2000. Significantly, in the Act’s objects is the express obligation to promote the observance of the underlying principles of the above ILO conventions on freedom of association and the right to organise and bargain collectively [3(b)].

The right to strike is not simply ‘downing tools’ and walking off the job.  It includes partial actions where employees continue working but some parts of their jobs are discontinued. For example, in 2003, senior doctors employed by the South Canterbury DHB, whose union was the Association of Salaried Medical Specialists, undertook four six-hour strikes over a four week period. The strikes meant that planned routine work (such as elective operations and clinics) were called off but senior doctors were available to handle emergencies and acute admissions that clinically should not be deferred.

The right to strike is limited under the ERA. There are only two grounds for lawful strikes – to support the negotiation of a collective agreement (including multi-employer agreements), which is the most common and where there are grounds for safety and health concerns. Sympathy or solidarity strikes in support of strikes with other employers and political strikes are deemed unlawful.

Application of right to strike in DHBs

The ERA (Schedule 1, Part A) defines some sectors as ‘essential services’ requiring at least 14 days’ notice. DHB run public hospitals are an example.  Others ‘essential services’ include petroleum (production, processing distribution and sale), fire brigades (non-volunteer), prisons and ambulances.

There is a further schedule (1B) in the ERA specific to DHBs titled ‘Code of good faith for public sector’. This statutory code has strong good words reinforcing the importance of productive employment relations in DHBs, including recognising the value of collective arrangements and the role of unions.

The code goes on to impose limits on the right to strike which are laudable given the special circumstances of hospitals whose patient care responsibilities include emergencies and acute admissions. When formal strike notice by a health union is given, at least 14 days before its commencement, as part of contingency planning the union and DHB(s) are required to reach agreement over ‘life preserving services’. These include the agreed necessary workforce to be available during the strike to ensure crisis intervention for the preservation of life. It includes risk of permanent injury and urgent diagnostic procedures on potentially life-threatening conditions. Specific timeframes are outlined within the 14-day window. This includes provision for adjudication over disagreements by an agreed clinical expert. On paper it is a significant curb on the right to strike but one which is self-obviously justified.

Potential threat for DHB employees

Already there is an immediate threat to the right to strike outside the health system with the Screen Workers Bill currently being considered by a parliamentary select committee. Instead of repealing the infamous anti-employee collective rights ‘Hobbit law’ in the film industry as was intended by the Labour Party, this Bill seeks to entrench the loss of employee status, including the loss of the right to strike. This Bill, if enacted, would set a political precedent for other sectors of the economy with more vulnerable and casualised workforces.

There is a potential pernicious different threat to the right to strike in the review of the health and disability sector commissioned by the Minister of Health. The review was conducted by a panel chaired by experienced political operator Heather Simpson. Its final report was completed on time in March but put on hold due to the understandable priority of Covid-19. When Health Minister David Clark releases the report is uncertain, but he may want to digest it thoroughly himself and seek advice from his Health Ministry first.

However, last August the review panel released an interim report. Although it contained no draft recommendations it still provided a useful insight into the thinking of the reviewers. They signalled significant recommended changes in employment relations that would strengthen the negotiating position of DHBs as employers at the expense of this highly unionised workforce.

The panel accepted uncritically DHB claims that collective agreement negotiation processes are inefficient and drawn out and that strikes have significantly increased.  But there is no acknowledgement that collective negotiations are one of the few occasions where there is a level playing field in the determining of core employment negotiations.  The rubber usually hits the road over either the size of the pay increase, or where workforce rights in areas such as working hours and rostering challenge managerial prerogative.

The panel does not consider whether hard-line approaches by DHBs have contributed to inefficient negotiations or increased strikes.  In last year’s bitter negotiations with junior (resident) doctors represented by the Resident Doctors Association, the DHBs sought to address the linked issue of after-hours safe rosters and training by seeking to enhance the control of chief executives and weaken the union’s ability to represent its members. The DHBs chose to reject third party initiatives to resolve this complexity in a non-adversarial process away from the industrial arena.  Instead they preferred to pursue their objectives through the blunt instrument of industrial bargaining.  Avoidable defensive national strikes became inevitable.

The other recent strikes involved various allied health professional groups, such as psychologists and radiation therapists, represented by the APEX union.  Some of these separate negotiations involved strikes because of the DHBs’ ‘one size fits all’ approach insisting that every settlement should be confined to the same specified percentage salary increase.  This insistence applied regardless of whether there were serious retention and recruitment problems causing severe shortages in the various occupational groups.  Where shortages existed higher salary increases were advocated.

But the DHBs inflexibility was so extreme that, for those groups not affected by serious shortages, proposals to have a smaller salary increase than the DHBs offered position and instead have more spent in elsewhere such as professional development were rejected.

Worsening the situation were lengthy delays from the DHBs over resuming negotiations partly due to increased Health Ministry control and partly due to internal resourcing issues.  When delayed settlements led to a loss of backpay another ingredient was added to the cookbook of frustration.  Strikes not only became inevitable but eventually contributed to resolution.

It was astonishing that the panel failed to acknowledge the statute based code of good faith including the obligation of parties agree on life preserving services in advance of a notified strike commencing. This is a sensible constraint on the right to strike which, to the best of my knowledge, does not exist in other essential services.

The problem is not striking.  Strikes are the consequences of poor relationships.  DHBs fail to recognise that there is not one single labour market in DHBs; there are several labour markets some of which are affected by competition from the private sector, some by higher level of occupational specialisation, and some by international markets.  A ‘one size fits all’ approach would mean that the hospital specialist crisis of high burnout, shortages of around 25%, and an over 60% pay gap with Australia will never be addressed.

Outside the interim report the panel has verbally indicated that they might recommend the replacement of the right of DHB employees (mainly doctors, nurses and other health professionals) to strike with a form of compulsory arbitration called ‘final offer’.  Final offer arbitration applies to the police due to their unique role in relationship to governments (Schedule 2 of Police Act).  It is an all or nothing outcome.  The arbitrators are only allowed to choose one of the two final offers.  They can’t determine a middle ground for example.

Further, the criteria are restrictive.  They include recruitment and retention, fairness and equity, changes in job content and skills, changes in productivity, and relativities.  Critically they are all linked with the word ‘and’ rather than ‘or’.  Consequently, one must win the argument on all or most rather than one of some.  The chances of all of them being materially applicable concurrently is low.

This inflexibility means that the furthest the position of either the employer or the union to the status quo, the more it is likely to fail.  It would obstruct the opportunity to improve employment conditions in order to retain and recruit enough health professional to provide accessible quality of care for patients.

No health worker wants to strike. Strikes are the classic last resort.  What is more decisive in achieving outcomes in negotiations is the existence of the right to strike.  Knowing that the right exists modifies behaviours and increases the likelihood of settlements without exercising it.  But when it is exercised it is often successful within its objectives.  Resident doctors were able to ensure that representation rights through their union were preserved and some DHB employed health professional groups were able to improve their retention and recruitment situations.

The right to strike should not be got rid of so lightly as has been suggested. In DHBs it is important both for its employees most of whom are health professionals and for better healthcare for patients. Strikes can not only be beneficial for health professionals. Patients benefit as well.

Ian Powell was formerly the Executive Director of the Association of Salaried Medical Specialists for over 30 years until December last year.  He is now a health commentator based in Otaihanga on the Kapiti Coast.


Photo: John Kirk Anderson/Fairfax NZ

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