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PSA members push back the worst aspects of the State Sector Bill.

The select committee considering the State Sector and Public Finance Bill has reported back to parliament with some substantial changes to the original bill.

In making these changes, select committee members have told the PSA how impressed they were with the quality of the submissions from PSA members. MPs heard from PSA members first-hand what the bill's original proposals would mean in real life and how unfair they would be.

Here's a summary of most significant changes:


The original bill would have meant that an employee who was made redundant from one department could lose their redundancy compensation if they refused a job offer elsewhere in the state sector.

This provision has been substantially changed. The changes will mean:

A public service employee whose position has become redundant cannot be forced to accept a position elsewhere in the state sector or lose their redundancy compensation. If, while serving out the notice period, the employee chooses to apply for and is offered an alternative position elsewhere in the state sector, they will lose the right to redundancy compensation but only if:
•    the position is similar to their former position; and
•    the terms and conditions are no less favourable; and
•    the position is in a similar location.

In such a case, the employee’s service will be deemed to be continuous and service-related entitlements will be retained.

Currently, an employee who is made redundant is paid redundancy compensation according to the provisions of their collective agreement, regardless of whether they have another job to go to elsewhere in the state sector.

There is no question that new constraints on redundancy compensation are being imposed. However, compared to the original proposal, together we have achieved a real victory.

Workplace orders

This is the other major improvement to the original bill.

The original bill allowed for government to use Orders in Council (a form of regulation) to intervene in collective bargaining between the union and the employer and, for example, prevent the employer agreeing to a pay rise.

The select committee has dropped this provision. Instead, the new bill allows the State Services Commissioner to issue workforce policy statements, but these specifically exclude pay and conditions.

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