Henry Broadhead.

State regulation of labour and labour disputes in New Zealand. A description and a criticism online

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G. E. Stechert & Co

State Regulation of Labour and Labour
Disputes in New Zealand.



3eopetary to the Ganterhury Employers' Association, Ghristchureh, N.Z., and for some
years Member of the GanterbLiry Qoneiliation Board.

Christchurch, Wellington and Dunedin, N.Z. ;
Melbourne and London:






Among the countries that have attempted, during recent years',.
to solve the Labour Problem by means of Legislation and State-
Regulation, New Zealand has occupied a conspicuous place.
The operation of our Industrial Conciliation and Arbitration
Act has been keenly watched by manj^ throughout the civilised
world, who recognise that New Zealand is conducting a bold
experiment in regulating the conditions of labour by law.
Many visitors, most of them representatives of Governments,
have come to our shores for the purpose of enquiring into our
Arbitration system, and into the truth of the widespread reports
that it has been an unqualified success, and has been the chief
^ factor in producing a period of unprecedented prosperity within
^ the Dominion.

^ Indeed, nearly all the books and reports which have hitherto

5 dealt with the Arbitration Act, have been written by men who

r live outside New Zealand. Admirable as many of these

publications are from some points of view, they hardly touch

^' more than the surface of the subject. My experience leads me

CO to the conclusion that, in order to be able to study thoroughly

e the working of the New Zealand Act, one must reside in the

"^ country for at least a few years, and be continually in touch

with the system. Having occupied the position of Secretary to

K the Canterbury Employers' Association for more than seven

U; years, and having been a member of the Canterbury Conciliation

Cj Board for nearly three years, I have had exceptional oppor-

\^ tunities of closely observing the manner and effects of the

regulation of labour by the State. This, I think, will be obvious

when I state that the Secretary to an Employers' Association in

New Zealand must be conversant with the provisions of the

Arbitration Act, and with many of the awards of the Court,

while his more responsible M^ork includes the assisting of

employers in preparing cases for the Court, in attending

conferences between employers and workers, and in representing

employers before the Court. The Secretary is also constantly

consulted as to the interpretation of awards, and thus becomes

acquainted with the troublesome points which not infrequently

confront employers in their endeavours to adhere to the terms

of the awards.



The aim of the present work is to give, in the smallest compass,
a comprehensive and unprejudiced view of the working of
compulsory arbitration in New Zealand. By way of introduction
a brief account is given of the two important labour events — the
Sweating Commission and the Maritime Strike — which heralded
the advent of the Hon. Mr. Reeves ' Conciliation and Arbitration
Bill. The passing of the Bill having been dealt with, the main
provisions of the Compilation Act of 1905, and those of the
Amending Act of the same year, are summarised, with
explanatory comments wherever these have been thought
necessary. The succeeding chapters describe the operation of
the Act and its effects on industry and commerce, and contain
numerous decisions bearing upon the points discussed.

Great care has been exercised in the preparation of the work,
which was begun nearly two years ago. Since then a number
of important decisions have been given, and these have had to
be incorporated in the various chapters from time to time. Only
a few months ago the Industrial Conciliation and Arbitration
Act Amendment Bill, by which drastic alterations in the Act are
proposed, was introduced into Parliament by the Minister for
Labour, and a summary of this measure has been given as an
Appendix. The work is, therefore, in every respect quite

Regarding the opinions I have ventured to express throughout
the book, I wish it to be clearly understood that they are my
private opinions, and that they must not be taken as representing
those of the body with which I am officially connected. Whether
they agree or disagree with these opinions, all interested in labour
questions will, I hope, find the book useful as a work of
reference for years to come.

H. B.
Christchurch, N.Z.,
7th December, 1907.
















HisTOEicAL Introduction

(i.) The Sweating Commission, 1B90

(ii.) The Maritime Strike, 1890 ...
Enactment of the Industrial Conciliation

AND Arbitration Act
The Industrial Conciliation and Arbitration

Acts Compilation Act, 1905 ...

(i.) Title

(ii.) Interpretation

(iii.) Administration ...

(iv.) Eegistration

(v.) Industrial Disputes in Related Trades

(vi.) Industrial Agreements

(vii.) Industrial Districts and Clerks

(viii.) Boards of Conciliation

(ix.) Special Boards of Conciliators

(x.) Functions and Procedure of Conciliation

(xi.) Court of Arbitration

(xii.) Jurisdiction and Procedure of the Court

(xiii.) General Provisions as to Board and Court

(xiv.) Government Eailways

(xv.) Other Crown or Government Departments
Conciliation Boards in Operation
Arbitration ...

(i.) Introductory

(ii.) Origin of an Industrial Dispute
Disputes Before the Court of Arbitration
The Minimum Wage
The Incompetent Worker
Breaches op Awards ...
Preference to Unionists
Apprentices ...

Interpretation op Awards
Dissatisfaction with the Court and its Awards

The Labour Department
Conclusion ...

-Industrial Conciliation and Arbitration
Amendment Bill (1907)




























state Regulation of Labour and Labour
Disputes in New Zealand.


The labour conditions, as they existed in New Zealand
for some years prior to 1892, have been frequently referred
to as having led to the introduction of the Hon. Mr. Reeves'
measure in that year. Only recently an American writer states
that that measure "was the outcome of a study of the problems
brought forcibly to view by the great maritime strike of 1890,
which devastated New Zealand as well as the Australian

It was, of course, after the maritime strike had terminated
that the labour party agitated for legislation which would, it
hoped, enable it to secure conditions it had failed to obtain
through the strike, but it need not be inferred from this that
the industrial conditions of the Colony generally were at any
time such as to call imperatively for the special legislation
asked for.

It is proposed in this chapter to give a short account of
the two chief labour events of the year 1890, namely, the
Sweating Commission and the Maritime Strike, and this, it is
hoped, will enable the reader to form a fairly accurate opinion
of the actual condition of things as it prevailed in that year.

(i.) — Sweating Commission.

It having been alleged that sweating to some extent prevailed
in the Colony, a Commission was appointed "to enquire into
the mode and terms in and on which persons are engaged or
employed in shops, in wholesale and retail trading and
manufacturing business establishments, and in hotels and other
licensed houses of public resort — and in particular as to the
mode and terms in and on which persons are engaged or


employed in any manner in supplying or making goods or
articles for the owners or occupiers of such shops or wholesale
or retail trading or manufacturing places of business or other-
wise, and upon the relations generally of employer and employed,
and the best machinery for determining matters and questions
arising between them and relating to their respective interests."
The Commission held sittings at the four chief centres, and in
May, 1890, issued its report, from which the following are
extracts : —

' ' With satisfaction we report that the system known in London
and elsewhere as 'sweating,' and which seemed at one time
likely to obtain a footing in some of our cities, does not exist.
It is true there are complaints in many cases of long hours
and of reduced rates of pay, but these seem almost inevitable
wherever competition is keen, unless checked by a healthy public

"That the employment of those young persons to the exclusion
of skilled and trained workers is the chief grievance among
artisans in the various trades. Where trades unions have
been formed, the proportion of lads to men has been strictly
defined, in some cases with the avowed intention of keeping
up the supply of skilled workers, but in the majority of cases
only with a view to self-preservation, and without regard to
the larger question of finding employment for the hundreds of
youths growing up in our midst."

Of the nine commissioners, three disagreed with the finding
of the Commission with regard to the existence of "sweating."
Their opinion was that sweating existed, "although only to a
very limited extent."

The Commission recommended, among other things, that the
Factories Act should be amended in the direction of conferring
larger powers on the inspectors, providing for sanitary work-
rooms, and limiting the employment of children. It also
recommended that regulations should be made for providing
for seats for saleswomen, that a bureau of labour statistics
be established, and that steps should be taken to establish
boards of conciliation and arbitration "based upon an equitable
representation of labour and capital."

As a reflection of labour opinion at the time concerning
the powers of the suggested Arbitration Court, it may be worth
while to quote from the evidence given before the Commission
by Mr. R. Slater and Captain Millar. The former is the present
representative of the workers on the Arbitration Court, while


the latter has been one of the leading representatives of labour
in the House of Representatives for some years, and is now
Minister for Labour.

Mr. Slater: I would not approve of Boards of Arbitration that
would take the power of striking out of the hands of the Union.

After giving his opinion as to the constitution of a Court of
Arbitration for the settlement of disputes, Captain Millar said : —

I do not mean that the decision of the Court should be binding for-
all time, but for six or twleve months.

(ii.) — The Maritime Strike.

The Maritime Strike had its origin in Australia, and broke
out in New Zealand purely out of the local workers' sympathy
with the Australians. As early as ten years before the strike
took place, the aggressiveness of the Maritime Labour Council in
Australia was keenly felt. When any employer did not bow
to the dictation of the Council, he was boycotted, and had to-
go under. It was not until 1890 that employers combined to-
protect themselves, stern necessity compelling them to do so.
The following will serve as an example of the coercive demands-
made at this time by the Council : — At Adelaide, it was required
that any men not members of a Union, or of the Working
Men's Association, or of the Seamen's Union, should not be
allowed to handle any goods that were to be shipped in ketches
or steamers trading out of the port, and that draymen should
not be allowed to handle any goods touched by storemen or-
others in warehouses not members of the Union. The employers
refusing to give way, the strike followed. The former, however,
made a very determined fight, which resulted in the unconditional'
surrender of the Council.

The general maritime strike, in which all the Australian
States were involved, afterwards followed, the leading facts of'
the dispute being as follows: — The Seamen's Union demanded
an advance in wages, which the shipowners declined to grant
on the ground that they could not afiiord it. Public sympathy
was not with the Union, and it therefore hesitated whether it
should withdraw its demands or strike. Just at this time the-
steamship officers came to the Union's assistance in an
unexpected manner. The officers asked for an increase of pay,
but before doing so had, with the view of strengthening their'
position, become affiliated with the Trades Hall in Melbourne.
The shipowners expressed their readiness substantially to grant,
the increase demanded on condition that the officers withdrew


from the Trades Hall. They contended that the shipowners
had to rely for the protection of their interests upon the
officers, and that being so, the existence of the necessary
confidential relations between them and the officers would be
impossible if, at any moment, the officers and all labour employed
in the shipping trade, were liable to take combined action against
them. The officers refused to break off their relations with the
Trades and Labour Unions, and the great strike then began.
The Seamen's Union, which was apparently unwilling to strike
on its own account, quickly took advantage of the difficulty
with the officers, and threw in its lot with the latter.

Shortly afterwards the strike spread to New Zealand. The
Seamen's Union called out the men on board the Union Steam-
ship Company's steamers, the reason given for the interference
with the Union Company being that it belonged to the Ship-
owners' Association, which had been formed in Australia as a
result of the maritime trouble. A further reason given for the
action of the Seamen's Union was that the Union Company had
begun to man the steamers in Dunedin with free or non-union
labour. A manifesto issued by the Union Company from
Dunedin in August, 1890, sums up the situation from its point
•of view: —

"The directors of the Union Steamship Co. of New Zealand
have arrived at the conclusion, with much regret, that the present
policy of the labour unions of all Australasia, which has led
to the imminent paralysis of trade in all the Colonies, and which
has kept up constant irritation and unbearable uncertainty in
all departments of trade for some months past, is the outcome
of a general determination on their part to try their strength
with all employers of labour. There has been no dispute of any
serious character in New Zealand, and the disputes in Australia
cannot be considered to bear any relation to the measures
adopted by the unions. The directors have therefore no alter-
native left but to fall in with the resolutions of the Steamship
Owners' Association and other employers of labour, and to
support them to the utmost of their power in opposing the
encroachments of labour unions by every possible means until
it is found that negotiations can be re-opened and some prospect
•of such a settlement as will enable them to conduct business
with some degree of comfort and confidence. They have no
hesitation in declaring that the wages paid by them for many
years are such as they have a right to regard with satisfaction,
.and therefore unhesitatingly throw the whole responsibility of


the very serious disorganisation which is about to ensue upon
the shoulders of the leaders of the unions."

To this there was a prompt and lengthy reply from the
Maritime Council. It denied that the labour unions had been
anxious to have a trial of strength, but that "the Steamship
Owners' Association, seeing that the various unions throughout
Australasia were becoming, in their opinion, too powerful,
decided to endeavour to crush them out with the object of
effecting a rupture." It considered that "it was arbitrary
and unjust" on the part of the shipowners to seek to prevent
the officers from affiliating with the Council, while the ship-
owners themselves exercised the right to band together. It
alleged that efforts had repeatedly been made by the officers
and seamen to have their demands considered, but that they had
proved fruitless "owing to the offhand and contemptuous action
of the Shipowners' Association." The Council admits that it
had no direct quarrel with the Union Company, "but the Union
Company being portion of an Association which has openly
expressed its intention of crushing labour unions, cannot expect
to be allowed to run through."

A daily newspaper, commenting on the reasons given by the
Maritime Council for attacking the Union Company, remarked
that "the whole Colony of New Zealand is to be put to all this
turmoil and distress on account of a private quarrel between
the shipowners and the other Colonies and their men, with
which the New Zealand labour market has nothing to do."
The same paper also pointed out that the men of the Union
Company had not asked for the wages the Australian shipowners
had refused to concede to their men. As a matter of fact,
nothing but a feeling of loyalty to the strikers in Australia
made the seamen and a certain number of the officers in the
Union Company's service quit their posts when requested by
the Maritime Council. Many, indeed, expressed regret at

To effect a complete paralysis of trade between the various
ports, it was necessary that there should be no wharf labourers
to load the vessels, and acordingly the Maritime Council called
these workers out. Soon afterwards it was feared that the
railway hands would cease work. At one centre at least, they
met and passed a resolution expressing sympathy with the
strikers, and declaring their readiness to come out whenever
required. The Railway Commissioners showed their disapproval
of this action by dismissing four servants, and no further step


was taken by the men. It was evident from the commencement
of the strike that the general public had no sympathy with it.
A general stoppage of trade in all quarters was hardly likely
to find favour with the people, no matter what grievances the
Australian officers and seamen had against their employers. It
was not merely the business community which suffered. The
price of coal alone advanced fully 100 per cent., and the general
condition of things was, of course, felt worse by the working
people. There can be no doubt, however, that a number of the
unionist artisans in the Colony sympathised with the strikers.
There were fears, indeed, that all trades would be called
out, and thus ' ' try their strength with all employers of labour. ' '
It was because of a threatened general rising of Labour against
Capital that employers' associations were formed in the chief
centres. Their object was to take combined action in combating
the demands of labour unions, and otherwise to protect their
interests. A somewhat novel association was formed at Napier.
It was styled ' ' The Free Association of Employers and Workmen
of Hawke's Bay." At the public meeting at which this organ-
isation was started, reference was made by the speakers to the
strike leaders and their responsibility for the labour agitation
then going on. The Chairman said :

A large part of the community were being led by a certain number
of agitators into a line of action which five men out of six did not at
all agree with. . . . Yet they had been firmly impressed with the
idea that they must join the unions, not because they knew why or
had any grievances, but because they were told so.

Another speaker said :

If they knew what the Maritime Council had to complain of, they
would be able to see whether there was any grievance to redress. But
all the men said they were very sorry to strike, but had to do so
because they were told to do so by the Council.

In an article explaining the objects of the combination of
employers and workmen, the "Hawke's Bay Herald," of
September 5th, 1890, says:

The Association is not directed against unionism in its legitimate
exercise of power — but it is distinctly directed against the surrender of
individual liberty to an irresponsible central power like the Maritime
Council at Dunedin. In short, it aims at two things — first, the thoroughly
efficient protection of free labour against the attacks of illegitimate
unionism; and second, at bringing unionism back into its old and
legitimate channels in which it was a power for good instead of for
widespread mischief.

Fortunately for the workers as well as for the employers,
the persistent efforts of the labour leaders to bring about a


general labour war in the Colony were unsuccessful. There
was, for a short time, trouble with the workers in one small
industry which attracted a good deal of attention owing to the
excitement prevalent at the time, but the other trades appeared
to have no real grievance. The struggle between the Union
Company and the Maritime Council was itself serious enough,
until the Company succeeded in filling the gaps left by the
strikers. As has already been stated, the general public had no
sympathy with the strike, and when the wharf labourers came
out, there was, as we learn from one newspaper, quite a rush
on the part of men to help to load cargoes. Farmers and
employers of labour furnished assistance, and the Railway
Commissioners sent permanent railway hands to work at the
docks. Some feeling was, of course, manifested by the strikers
against the ''blacklegs," but the precautionary measures taken
hy the authorities prevented any serious disturbance.

The strike, which lasted barely three months, ended in a
victory for the employers. The labour unions involved naturally
felt sore over the employment of free or non-union labour,
but in their terms of capitulation, they were understood to
agree to the following: — (1) That employers retain the men
engaged during the strike; (2) that the unions admit the right
of employers to employ either free or union labour; (3) that
the unions agree to work with free labour.

In Australia, the labour unions were obliged to agree to

similar terms. In the Annual Report of the New South Wales

Employers' Union for 1891, we find the following references

to the strike: —

On the 7tli of November last [1890], the 'Labour Defence Com-
mittee, ' finding that they were defeated, and being unable to carry on
any longer declared the strike 'off,' and the intention of the body which
had been published throughout the country, to 'reconstruct society,'
was for the time abandoned. . . . The employers having, in self-
defence, and with a view of carrying on the business of the country,
filled the places left vacant by the strikers it became impossible that the
free labourers should be sacrificed to find places for those who had
deserted their posts. A heavy indictment lies against the leaders who
arrogantly dragged the men into an utterly unprovoked industrial war,
which ended in a disastrous rout.

It must be admitted that the strike, viewed merely from the

financial standpoint, was a most deplorable one. The loss in

wages alone must have been enormous; in one Australian

Colony it was estimated to exceed half-a-million pounds




About a month after the termination of the strike, the'
triennial general election took place, and resulted in a decided
victory for the Liberal Party. This put great heart into the
Labour Party, as its prospects of being able to accomplish its.
ends were now brighter than ever before. It lost little time in
urging Parliament to pass labour legislation in harmony witk
its views, and eventually, in 1892, the "Industrial Conciliation
and Arbitration Bill" was introduced by the Hon. W. P. Reeves.
A few extracts from Mr. Reeves' speech when moving the second
reading of the Bill are worth giving : —

"I am not blind to the fact that the Bill is more or less-
of a novel character in New Zealand. There is nothing at all
like it on the Statute Book, and it is a measure which may
be distinctly called of an experimental kind. In the first place,.
I may say, that the Bill was one of a character somewhat
troublesome to draw. There are not in the British Empire any
large number of statutes in force for the reference of industrial
disputes to councils of conciliation or courts of arbitration.'^

Online LibraryHenry BroadheadState regulation of labour and labour disputes in New Zealand. A description and a criticism → online text (page 1 of 27)