NZ Mitre 10 chairman Dippie's Mega stores ordered back to negotiations after misleading union

Wednesday 13th January 2016

Mitre 10 (New Zealand) chairman Martin Dippie's Jacks Hardware and Timber has been ordered back to the negotiating table with First Union after the Employment Court ruled it misled the union to prevent strike action.

Jacks Hardware, which trades as the Mitre 10 Mega stores in Dunedin and Mosgiel, misled or deceived the union between mid-December 2014 and Feb. 20 2015 when it didn't resume bargaining after promising to do so to avert a pre-Christmas strike in 2014, and instead unilaterally declared the talks to have ended, according to Employment Court chief judge Graeme Colgan's Dec. 17 judgment.

"The parties have failed to conclude a collective agreement, principally because of Jacks's unilateral declaration that it would not do so, which is in breach of its good faith obligations," Judge Colgan said. "Jacks's refusal to participate in collective bargaining since February this year has been serious in the sense that is has precluded any bargaining at all from taking place when it should have been."

The judge agreed to First's application for facilitated bargaining, though didn't put a time limit "as it may not be conducive to the parties' resolution of their collective bargaining." He also said some of the evidence he heard at the November hearing indicated "the parties may no longer be in precisely the same intractable positions as they were previously, particularly around remuneration."

The union kicked off talks with Jacks Hardware for 25 of the company's 170 staff in October 2013 when employees were unhappy with the hardware and building supplier's control over rosters and the amount of notice given for changes to shifts.

Judge Colgan said Dippie, who bought the Jacks Hardware business about 20 years ago, was a central actor in the case, and that his "explained absence" from the hearing was "puzzling". Dippie handed over responsibility for employment relations to Neil Finn-House two months after talks with the union began.

Like other family businesses, Jacks Hardware responded to the introduction of a union presence with "puzzlement and disappointment," and took a cautious and careful manner in approaching the collective talks, the judgment said.

A major sticking point between the union and Jacks Hardware was on the inclusion of wages in a collective agreement and linking increases to length of tenure and position, as well as the company's performance measure.

Many of the staff affected were paid marginally above minimum wage, at between $14 and $16 an hour, which the judge said "makes it particularly appropriate (not to mention usual) that the matter of their wages is to be the subject of negotiation including as part of collective negotiations for a collective agreement."

Jacks Hardware baulked at the union's initial proposals, which it estimated would add about $2 million to its annual wage bill of $5.6 million if passed on to its entire workforce, though that evaluation was later found to be out of date and inaccurate as bargaining went on.

By the time the company pulled out of negotiations, First had dropped its claim for redundancy compensation which would have halved the projected increase, and withdrawn or changed other claims to further limit the rise in Jacks Hardware's labour costs.

In his ruling, Judge Colgan said this will likely be one of the last under now-amended legislation imposing a duty of good faith to conclude a collective contract.

The judge awarded costs to the union.

BusinessDesk.co.nz

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