Controversial legislation that seeks to ensure a guaranteed minimum wage for contractors is now facing defeat after United Future leader Peter Dunne pulled his support.
"My decision on this Bill followed constructive discussions with both the Hon David Parker and Hon
Michael Woodhouse as well as many members of the public who have contacted me about this Bill," said Dunne.
Dunne voted for the Bill on its first and second readings – which it passed by 61 votes to 60 – but has since expressed doubts over its ability to tackle the problem at hand.
"While the intent of this Bill, to provide protection to vulnerable contractors who fall outside the usual bound of the employee/contractor relationship, is sound, in the end I did not consider it to be the appropriate mechanism to provide the necessary protections to vulnerable contractors,” he continued.
A number of employer organisations – including the Employers and Manufacturers Association and BusinessNZ – are opposed to the Bill over fears it’s too prescriptive and could make many contracts unworkable.
Dunne went on to suggest that the legislation could actually end up causing more harm than good.
“The Bill blurs the distinction between contractor and employee in such a way that it could result in an unintended consequence of confusing the interpretation of employment law in those sectors identified in the Bill to the extent of actually placing the contractor in a worse remunerative position,” he said yesterday.
"There is also a lack of clarity as to how pervasive the problem facing contractors is, as there is, on the face of it, little empirical evidence to suggest there is widespread exploitation of contractors,” he continued.
"Vulnerable contractors do not win in that situation; the only ones who do are employment lawyers.”
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