Industrial Relations: Historical Development, Dynamics, and Theories

This report provides a comprehensive analysis of industrial relations in New Zealand, tracing its historical development from the early European settlement period to the modern era. It examines key legislations, including the ICA Act, Labor Relations Act, and Employment Contracts Act, and discusses their impact on labor relations. The report explores the rise of the union movement, the effects of economic depressions, and the evolution of industrial relations frameworks. It analyzes major labor disputes, such as the 1951 Waterfront Dispute and the recent dispute between the New Zealand Resident Doctors Association and District Health Boards, highlighting the roles of the Employment Relations Authority and good faith in resolving conflicts. The report also delves into various theoretical frameworks used to understand industrial relations, offering insights into the dynamics and strategies of the parties involved. This report fulfills the requirements of the Industrial Relations assignment, providing a detailed overview of the topic.

Running head: INDUSTRIAL RELATION
INDUSTRIAL RELATION
Name of the Student:
Name of University:
Author Note:

1Industrial Relation
Table of Contents
Answer to part A:.................................................................................................................2
Answer to part B (1):...........................................................................................................6
Answer to part B (2):...........................................................................................................8

2Industrial Relation
Answer to part A:
New Zealand started to form their Industrial Relations when there was a trend for
maintaining the employer and employee relationship during the European settlement. By 1890,
the government of the New Zealand set a commission which would help them to decide whether
‘sweating’ term should be considered by the industries or not. The period during 1890 to 1893
was named as the First Major Strikes. The First Industrial Relational Legislation was introduced
during 1894 to 1889. At this stage the ICA Act became the first most indigenous industrial
relations legislation and they further introduced The Conciliation Boards which was present in
the country divided into six sub-parts. Each sub-part consisted almost similar equal employers
and the trade unions. The Arbitration Court was also formed during this period which helped the
industries to come up with a solution to their issues between each other. The ICA Act also
strengthened the key role of the trade unions where the employers are forced to deal with issues,
it also provided procedure which would help to solve natural conflict between labor and capital,
it also enforced the usage of legal industrial agreements while solving any conflict between two
parties and it also enforced some strict rules which kept a look at the prices to solve the dispute
resolution.
The period from 1990 to 1919 was known as the Rise of the Union Movement where
almost 175 unions were registered under this Act which represented almost 17,000 workers.
However, during this period there was no restriction over the industries and it was considered as
the overseas interest for the New Zealand industrial relations model (Zhou, Liu & Zhou, 2015,
August). This somehow had 2 negative effects like the Conciliation Boards started to act like the
court rather than being genuine and negotiating bodies and it was noted that the system which
was initially introduced as the dispute resolution ultimately became wage fixing system. The

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Second Great Depression happened from 1920 to 1935 in New Zealand. This period showed
almost a different scenario where the prices of some primary products like the meat, butter and
wool were noticed to fall rapidly which happened due to the recession. During this period the
ICA Act started to act for the employers to help them from the inability for adjusting wages and
fight form the depressed economic condition (Luiten et al., 2016). The prices of the exports also
fell by 47 percent during this time. The Welfare State was during 1936 to 1950 when the first
Labor Government was elected with the majority votes which was led by the Michael Savage. At
this period Compulsory unionism increased the total membership of unions by 30 percent of
workforce. Unionism became popular in other parts as well like into the whole-collar and into
the female sectors as well. After this the industrial economy of New Zealand improved but after
Second World War which strike in 1939, New Zealand recovered themselves within just 6 years
and became one of the highest in production because for supporting war effort.
During 1951 to 1973 the Second Industrial Relations Legislation was introduced which
lead to many events. This year saw the biggest labor dispute in New Zealand known as the 1951
Waterfront Dispute. Arbitration Court again proved to be the hostile in the unions during the post
war inflationary economic climate. Employers however did not pass the 15% wage scheme for
their employees which was granted by the Arbitration Court to Watersiders. The government
also responded to few points which was related to the Industrial Relation Act 1973 like they
retained the general structure of arbitration system and the structure of conciliation, they also
introduced new sections which can be registered and get enforced without the involvement of
government, they authorized the trade unions to elect and to bargain directly with the employers.
During the period 1974 to 1986 the Second Industrial Relations Act went through three
Amendments which started from 1983 when voluntary unionism was introduced by National

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government and it was made compulsory during 1985 by the Labor government. Then in the
second amendment in 1984 when Labor government abolished compulsory arbitration. The
union partly accepted this scheme as trade off and the partly because for unions wanted to use
the industrial strength. The third amendment required Arbitration Court to take account of supply
and the demand for skills, change in the content job and equity & fairness.
During 1987 to 1990 the Third Industrial Relations Act led many events to describe few
changes in the LRA (Labor Relations Act 1987) like the Arbitration Court replaced the Labor
Court and Arbitration Commission. The act also allowed the members to move between unions
by breaking the traditional monopoly of the registered unions. Personal grievances was also
implemented to look for any sexual harassment cases in the trade union and punish the guilty.
The Employment Contracts Act in 1991 happened during the Fourth Industrial Relations
Legislation, the LRA had to suffer from two of the major shortcomings. The first shortcoming
was when LRA could not promote their bargaining outcomes and the second shortcoming was
when there was a need to improve the labor market by dis-establishing the mechanism which
regulated the trade unions’ contract and representation which made the labor market more
functional and more efficient. ECA also created 2 different types of employment contracts
named as Collective employment contract and Individual employment contract.
Two specialist institutions were also established by ECA named as Employment Tribunal
and Employment court. In the Fifth Industrial Relations Act known as Employment Relations
Act 2000, the aim to improve confidence and mutual trust between employee and employer,
provide relatable procedures for collective bargaining where the employees had an option to join
their preferred union and make provisions for helping the individual to negotiate conditions of
employment and their wages where they want to join the union. The legislation body also set

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Employment Relations Authority which helped the employees to settle any dispute regarding
their employment which was not noticed during the speedy, non-adversarial and informal way.
Industrial relations was defined by its object rather than just its disciplinary orientation.
There were 9 frames developed for the purpose if references to interact between the dimensions
of the economy and provide the employees with ideal typical frames. Each of the frameworks
understand and think of the relationships within and it is also clear that these practices are still in
use.
 Deliberative Unitarism: this is referred to as the first frame of reference and it can
positively evaluate the market economy. The strategies and intermediate plans, goals of
the enterprises and social relationships of the enterprises with their employees tells the
positive value status.
 High Commitment Unitarism: here the positive evaluation of employment system mixes
with market economy and becomes meaningless. There is basically no difference
between the legitimate political and ethical market action with the technically effective
market action.
 Integrative pluralism: here the economic system not only represents the politically fair or
neutral in itself rather it refers to the interests and values created by a limited group of
society like the capital owners and their management agents.
 Bureaucratic unitarism: here the economic success of any industry is considered to be the
positive for the society and benefitting for the social values. However, it is noted that the
imperatives of market are referred broadly and it is more or less self-evident in a specific
way.

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 Low Commitment unitarism: this is the most preferred concept for the enterprises
because it provides corporate structure to the most meaningless market goals of any
industry. The positive value status will help the lead market actors to stay within the
enterprise even having internal problems.
 Adversarial (standard) pluralism: here it is believed that if industries act as per economic
system demand then it will be similar to act as per certain social group in which the
employees have not joined. As the employees cannot change the situation, so they are
forced to work within the economic system.
 Ethical conflict: ethical, political and moral conflict happens when there is a clash
between the positive market economic system and the illegitimate employment system.
Participants here gets the chance to blame the enterprise for not adopting universally
acceptable frame of reference (Pdfs.semanticscholar.org., 2020).
 Localized conflict: this type of conflicts is seen as social phenomenon and latter it was
seen as something objective. If the participant here fails to agree on the modes of
organization then it will be seen as bad faith, incompetence or ignorance of that
enterprise.
 Class conflict: the actions of participants will be referred as partial values and the interest
of reference beyond the enterprise. Here the enterprise is ultimately divided into “them”
and an “us”. This division will result into conflicts between labor and capital of the
enterprise.
Answer to part B (1):
There was dispute between the New Zealand Resident Doctors Association (RDA) and
the District Health Boards (DHBs). The doctors wanted a “Safe staffing” roster system from the

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DHB. Doctors went on a 2 day strike and after that an agreement was signed by DHB over the
new employment system (Scrap between DHBs and junior doctors heats up., 2019). ERA have
recommended that NZRDA would include new change management process and also change the
working arrangements so that the doctors get proper rest. The settlement between the DHB and
RDA was done with a rise in payment with other employer as collective agreement, this was for
two year period and another lump sum payment was also done. The settlement was at first
suggested by the ERA and finally the junior doctors of New Zealand agreed upon it because the
staffs and the patients were suffering from 11 days and five strong strikes.
DHB’s legal status before the RDA collective agreement was very strict and the junior
doctors faced a lot of problems while doing their duty. NZRDA were not following any safe
roster system where every doctor would be provided with a specific roster system so that each
and every doctor get proper rest and they can deliver their service properly to the patients. This
was a very dangerous situation for the patients because if the doctors did not get proper rest and
if their health is not good then the patients will not get accurate medication and surveillance from
doctors.
RDA can legally take direct action when they feel that their rights are not properly valued
by the employers and DHBs. Doctors took direct action when they got enough votes on a similar
issue and they went on a strike to demand for their rights. Direct action means to demand for an
immediate action over an issue and the term strike means protesting for any change in the action
by refusing to work by the employees for a specific time period which will force the employers
to meet the demand of the employees and compensate with concessions (DHBs and Resident
Doctors fail to resolve dispute | Health Central., 2019).

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Good-faith had an important role in solving the dispute between RDA and DHB. The
employees or the junior doctors had a good faith over their legal system and DHB that their safe
roster needs will be fulfilled because it was a necessity for every doctor too treat their patients
properly. With the 11 day strike and back to back five major strikes the junior doctors proved
that they have a good faith over their employers and their voce will not go unheard. Hence, the
DHB valued their voice and their needs with a collective agreement for safety and safe roster
system for doctors.
Employment Relations Authority (ERA) had the main role in solving the dispute between
RDA and DHB because it used their frameworks to solve the problems and conduct a solution.
ERA works to strengthen relationship between employer and employee by applying some
agreements and techniques where both the parties can agree upon. ERA acts as a neutral agent
where the agents sits with both the parties and listens to both of their clashes and then tries to
come up with a neutral solution which will benefit both the parties. This is the last step applied
by the employers after the Ministry of Business, Innovation and Employment (MBIE) fails
(Essays, Research Papers and Articles on Business Management., 2020).
Answer to part B (2):
There are many factors like internal/external, economic, political and social which have
impacted the industrial relations environment of the dispute between RDA and DHB. The social
factors like social group, social values, social status and social norms have influenced the
industrial relations during the dispute because few of the junior doctors form minor group tend to
realize that they were discriminated (Grimshaw, 2013). The juniors doctors also did strike
because they felt that due to a social gap with their employer they are getting ignored and being
unheard. The political factors of New Zealand also influenced the industrial relation. Due to too

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much involvement of the unions, and political parties the strike happened because it was
supported by many parties. Apart from solving the issues, political factors increased the dispute
and the number of strikes. Economic factors like the organization, individual, company and type
of ownership matters a lot in the industrial relation (Osad & Osas, 2013). Economic factors of
the RDA were very strong and it supported the strike held by junior doctors.
The nature and composition of RDA was not supporting the rights and working
conditions of the doctors and thy needed a proper schedule with safe roster system. Internal and
external factors of the industrial relation helps the managers to understand the actual need of the
employees and to meet them strategically so that there is very less or no conflicts between the
employees and the employers (Wang & Kimble, 2016). External factors helps the managers to
understand the current position of their industry and compare it with the market trend so that they
can improve their product and service for their customers to get good feedback and sustain their
market position. All these factors plays a very important role in the industrial relations
(Era.govt.nz., 2020). The dispute between RDA and DHB was supported by these factors
because every organization and industry needs to gather some information regarding the current
situation of the industry and the market trend to fight with on-going competition. Internal and
external factors helped the doctors to evaluate their working system with other workers in
different industries. Political factors helped the junior doctors to get proper support from political
parties. Economic factors helped the junior doctors to take this strong action of doing strike
because they knew that it would help them to get their voice noticed. Social factors helped the
junior doctors to take certain action for themselves because their social norms and believes
supported their demand. That is the reason why ERA recommended an agreement between RDA
and DHB (NZ Herald., 2020).

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References:
NZ Herald. (2020). Junior doctors settle pay conflict with district health boards, ending lengthy
dispute. Retrieved 14 March 2020, from https://www.nzherald.co.nz/nz/news/article.cfm?
c_id=1&objectid=12257897
Era.govt.nz. (2020). What the Employment Relations Authority Does | Employment Relations
Authority. Retrieved 14 March 2020, from https://www.era.govt.nz/how-the-
employment-relations-authority-can-help/
Essays, Research Papers and Articles on Business Management. (2020). Factors Affecting
Industrial Relations. Retrieved 14 March 2020, from
https://www.businessmanagementideas.com/industries/industrial-relations-industries/
factors-affecting-industrial-relations/19971
Osad, O. I., & Osas, U. E. (2013). Harmonious industrial relations as a panacea for ailing
enterprises in Nigeria. Journal of Asian Scientific Research, 3(3), 229.
Luiten, C. M., Steenhuis, I. H., Eyles, H., Mhurchu, C. N., & Waterlander, W. E. (2016). Ultra-
processed foods have the worst nutrient profile, yet they are the most available packaged
products in a sample of New Zealand supermarkets. Public health nutrition, 19(3), 530-
538.
Grimshaw, P. (2013). Women's suffrage in New Zealand. Auckland University Press.
Wang, H., & Kimble, C. (2016). How external factors influence business model innovation: A
study of the Bosch Group and the Chinese automotive aftermarket. Global Business and
Organizational Excellence, 35(6), 53-64.