Screen Industry Workers Act: one law to rule them all?

The much-anticipated Screen Industry Workers Act (Act) received Royal Assent on 30 September 2022 and comes into force 3 months after that date.

To understand the changes that the Act will introduce, it is useful to understand how this Act sits alongside the 2010 amendments to the Employment Relations Act 2000 (ERA)—commonly referred to as the “Hobbit Law”.

The Hobbit Law – an unexpected journey

The Hobbit Law amended section 6 of the ERA such that, since coming into force, persons engaged in film production work have been expressly excluded from the definition of employee. This means that, save for persons who have signed an agreement which explicitly sets out that the person is an employee, all film workers are independent contractors. The rights and obligations enshrined in the ERA, such as the duty of good faith at section 4 and the ability to make a personal grievance under section 103 ,do not apply to independent contractors. Entitlements to leave set out in the Holidays Act 2003 also do not apply.

Additionally, due to the application of sections 27-30 of the Commerce Act 1986 (the sections which prohibit anti-competitive practices), the Hobbit Law effectively removed the ability of film workers to collectively bargain.

For these reasons, the passing of the Hobbit Law was hugely controversial. Detractors of the Hobbit Law also raised concerns about the way the Hobbit Law came into force, whose initiative the law change was and the speed at which the Hobbit Law passed though the legislative process.

In 2017 (then) Minister for Workplace Relations Ian Lees Galloway promised that the Hobbit Law would be repealed within Labour’s first 100 days in office. The Hobbit Law was not repealed. Instead, the Film Industry Working Group (Working Group) was established to consider the issue. The Act is the result of the Working Group’s recommendations.

Key changes

The New Zealand Parliament website summarizes the key changes the Act will introduce:

“This bill introduces a workplace relations framework that will provide clarity about the employment status of people doing screen production work, introduce a duty of good faith and mandatory terms for contracting relationships in the industry, allow collective bargaining at the occupation and enterprise levels, and create processes for resolving disputes arising from contracting relations or collective bargaining.”

A brief explanation of some of the key changes is set out below.

Employment status

Section 5 reiterates the status of screen production workers established by the Hobbit Law. Those workers whose employment agreement describes them as an employee are an employee and the Act does not apply to them. Those workers who are independent contactors will remain independent contractors.  Where a worker falls within the definition of a screen production worker (as defined by section 11), they are not entitled to invoke section 6(2) of the ERA to determine whether they are an employee.

A screen production worker is defined by section 11 as:

“an individual who is engaged to contribute to the creation of 1 or more screen productions to which this Act applies (see section 12), and who undertakes the work in New Zealand; but excludes any individual who, in relation to that or those screen productions “only provides support services”; or is a volunteer; or is engaged to do the work by an entity that does not primarily engage in work relating to the creation of screen productions.”

The applicable screen productions include computer-generated games, films and programmes.

Good faith

The duty of good faith as set out in clause 12AA of the Act is a truncated version of the duty of good faith as defined under section 4 of the ERA. The extent of the duty is that the parties to a workplace relationship must not do anything (directly or indirectly) to mislead or deceive (or is likely to mislead or deceive) each other.

Mandatory terms for contracting relationships

The Act sets out the responsibilities for the persons or companies engaging film production workers (engagers) in entering individual contracts, including ensuring the individual contract is in writing, that the screen production worker is provided with a copy of the contract intended for negotiation and are advised of their entitlement to seek independent advice and provided with a reasonable opportunity to seek that advice. If the screen production worker raises any issues with the contract, these must be considered by the engager and responded to in good faith.

The Act also sets out mandatory terms which must be included in individual and collective contracts.

Collective bargaining

A major change introduced by the Act is the ability for screen production workers to collectively bargain.

The Act resolves the issues with the sections of the Commerce Act 1986 which prohibit anti-competitive behaviour. Clause 7 of the Act sets out that these sections do not apply in respect of collective bargaining initiated under the Act.

The collective bargaining processes set out in the Act are largely similar to those contained in the ERA.

Under the Act, these processes can take place on two levels: at the occupational level, or at the enterprise level—for instance, within a single production or company. We note that the bargaining at the enterprise level is slightly different to bargaining at the occupational level. It is anticipated that most bargaining will occur on the occupational level.

Under the Act, clause 27 sets out that the parties to a collective bargaining process must conclude a collective agreement. This is a more stringent requirement than that imposed by section 33(1) of the ERA. Under that section, a collective agreement does not need to be concluded if there is a genuine reason, based on reasonable grounds, not to.

Another important difference between the Act and the collective bargaining processes set out in the ERA is that during a collective bargaining process initiated under the Bill, industrial action (striking) is not permitted. Screen production workers may still exercise their right (per section 83 of the Health and Safety at Work Act 2015) to cease to carry out work if it is unsafe.

At the conclusion of the collective bargaining process, a collective agreement will be drafted and must contain mandatory terms including pay, hours of work, breaks and termination processes. For occupation level bargaining, the minimum standards created by the collective contract will be applicable to union and non-union members alike.

If you have any questions or concerns about the applicability of the Act to your workplace, please get in touch with our Employment Law team.

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