Benefits of shipping:
Resilience for natural disasters or emergencies.
Ships carry hazardous / dangerous cargo more safely than road, rail and air.
15% of New Zealand's inter-regional freight is carried by sea
Ships can handle oversized, heavy and bulky cargo that road, rail and air can't.
Freight volumes are forecast to increase 50% by 2040.
It won't all fit onto our roads!
New Zealand’s total freight task: 278.7 million tonnes.
Coastal shipping carries approx 10 million tonnes (3.5%).
1.15m people are transported across the Cook Strait every year
The volume of domestic freight moved by shipping has increased 50% over the last 10 years.
Approx $28 billion road and rail freight is shipped between the North and South Islands each year
1 standard container Auckland to Christchurch:
road: $2200-$3000
rail: $1300 - $1900
ship: $850 - $1300
418,470 containers are moved around the NZ coast per annum
Shipping: one-eighth the emissions of road per tonne of freight moved
Benefits of shipping:
Lower emissions per tonne of freight moved.
Increasing total freight carried by ship by just 2% would reduce total transport emissions by 16%.
Benefits of shipping:
Greater control over our domestic supply chains.
Shipping: 60% the emissions of rail per tonne of freight moved
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Submission on Employment Relations Amendment Bill (2017)

Submission to Education and Workforce Select Committee

Employment Relations Amendment Bill

30 March 2018

The New Zealand Shipping Federation began in 1906 and is the key representative body for New Zealand’s coastal ship operators.Members of the Federation are:

Coastal Bulk cargo
Coastal Oil Logistics (COLL) Strait ferry
KaiarahiCook Strait ferry
KaitakiCook Strait ferry
China NavigationAotearoa ChiefCement of CanterburyContainer cargo
Silver Fern
Strait Strait ferry
Strait FeroniaCook Strait ferry

The Federation is committed to working with decision-makers to ensure that the best policy settings are in place for the benefit of all New Zealanders.We are happy to work proactively to bring sector knowledge to support the policy-making process.

The Federation is committed to safe, secure and clean shipping.

The term “coastal vessels” is used in the sector to describe sea-going ships that work around our coast, generally only going internationally when required for dry docking.They operate according to New Zealand terms and conditions, e.g., in respect of manning levels and pay rates.This can be contracted with so-called international ships which are foreign-going as a matter of routine, e.g., international ships carrying cargo.We also differentiate the cruise sector, fishing sector, small boats and recreating vessels.

Life at sea is not like a job on terra firma.

Any discussion about the law relating to employment at sea needs to be based on a sound understanding of life at sea.

Members of the Federation operate their ships around the New Zealand coast.This means they are not at sea for extended periods as would be the case with ships working internationally but they are away from their home ports.They are subject operational requirements and that does not just mean the weather.

Much of the terms and conditions of employment at sea are governed by international conventions.These originate mainly from the International Maritime Organisation (IMO) but also from other international organisations such as the International Labour Organisation (ILO).Maritime New Zealand is the regulator in this country responsible for ensuring international obligations are met.By way of example, there are specific requirements about returning a seafarer to their home port at the end of their roster.The regulator, working with IMO parameters sets the minimum safe manning on a vessel.

Ships work on a 24/7/365 basis.This means that officers, engineers and ratings need to be on the ship and working 24/7/365.Other than the Cook Strait ferries, vessels are unlikely to be back at the home port each night.Some vessels respond to the changing needs for their cargo and can be diverted at short notice to new destinations on the New Zealand coast.The terms and conditions of employment reflect this.

The norm on seafaring vessels is to work and live on the ship for a period of weeks with a balancing period fully paid but not at work.By way of example, the roster could be 2 weeks on, 2 weeks off.The rostering tends to be vessel specific, based on the requirements of the vessel operator and the type of cargo.

Some seagoing staff are employed on walk-on, walk-off terms.This means that they are likely to be working 12 hour shifts followed by 12 hours off work and would walk off the vessel at the end of their shift.Examples of this amongst Federation members would be most of the hospitality staff working on the 5 Cook Strait ferries.These are the exception to the seafaring norm although numerically they are quite large especially during the peak tourism season.

Remuneration levels are not set by international agreement.Officers, engineers, ratings and hospitality staff all have specialist seagoing qualifications. There would be no seafarer on a coastal vessel working on a minimum wage.Coastal shipping in New Zealand is not part of any low wage economy.

At sea the Master is in charge of the vessel and is responsible for all matters on board.This is an important aspect of life at sea and also in ensuring the safety of all those on board.It is important that the authority of the Master is not undercut by external forces.

It is useful for the committee to think of the crew on board as a family.Living together and working together.

How the Bill impacts on the coastal shipping sector

It is difficult to see how a multi-employer collective agreement would work as between the various operators, some of whom are directly in competition with each other, such as the Cook Strait operators.Even pre-1998, in the days of award bargaining, the different ships had different terms and conditions.

On the New Zealand coast there has never been a one size fits all approach to the employment requirements of the various vessels.This would be impossible anyway.Different vessels have very different tasks and their work reflects this.Even 2 vessels on the same route can differ greatly in their manning requirements, e.g., based on the different technology on board or the size of the vessel.The Cook Strait ferries have significant seasonality in both their cargo and passenger loads.

On the New Zealand coast, there are a variety of operators of coastal vessels, not all of whom are Federation members.The operators do not have a single view or even a unified objective.They may choose to operate their vessels differently on matters as diverse as holiday entitlements, the operation of rostering, trade-offs between holidays and pay.

The Federation is concerned at any law change that facilitated cherry-picking terms and conditions from across the sector to produce a unified golden contract that does not reflect the various trade-offs and accommodations that each vessel operator has made in respect of that vessel or that company’s operations.

The Federation is concerned about any law change that linked independent employment agreements (IEA) with collective agreements preventing free negotiation by individuals.

The Federation is concerned that law changes may allow switching between an IEA and a collective agreement allowing the individual to cherry pick both.This also applies to the provisions of proposed section 62(3)(b) which gives a new employee the best of both the collective agreements and the IEA, allowing the, to cherry-pick without regard to trade-offs that have been made in either the IEA or the collective agreement.

The proposed provisions in clause 38 favouring reinstatement as a primary remedy in cases of unjustified dismissal are a significant cause of concern, given the nature of life at sea.The employer faces a double risk in respect of this.Vacancies must be filled to satisfy the safe crewing requirements of MNZ otherwise the vessel cannot proceed to sea.But if a person is then reinstated to their previous role, there is a problem of what to do with the reinstated crew member without disadvantaging the newly appointed person.There is an additional problem that arises from the nature of life at sea and the disruption that can arise when a person returns to a vessel after the existing family-type relations have been disrupted.The better remedy may be financial rather than a return to the vessel.

The Federation would like to make an oral submission.

Thank you for the opportunity to comment on this Bill.

Contact details

Annabel Young

Executive Director

NZ Shipping Federation

Phone (04) 499 6222

Mob. 021 429 216

PO Box 10739

The Terrace

Wellington NZCoastal