NE'N WORLDS AND FRESH CHOICES? CONTINUITIES AND DISCONTINUITIES IN INDUSTRIAL RELATIONS PRACTICES IN NEW ZEALAND'S RETAIL GROCERY SUPERMARKETS. A thesis submitted in partial fulfilment of the requirements for the Degree of Doctor of Philosophy in Political Science at the University of Canterbury By Alistair Pringle .-; 1996 iii LIST OF CONTENTS. CHAPTER PAGE LIST OF TABLES viii LIST OF FIGURES x LIST OF APPENDICES xi ABBREVIATIONS xii ACKNOWLEDGEMENTS xiii ABSTRACT xvi PREFACE xviii 1. TOWARDS A FRAMEWORK OF ANALYSIS: HISTORICAL, CONCEPTUAL AND THEORETICAL 1 CONSIDERATIONS 1.1. The study of industrial relations in New Zealand: past and present 1 1.2. Wage bargaining in New Zealand: a brief, historical overview 9 1.3. The place of in-depth analysis 18 1.4. Reworking the labour process debate 23 1.5. Politics and power in the employment relationship 26 1.6. Conclusion 31 iv 2. THE SAME BUT DIFFERENT? FEATURES AND OUTCOMES IN THE DEVELOPMENT OF THE RETAIL GROCERY INDUSTRY IN NEW ZEALAND 33 2.1 Introduction 33 2.2. From grocer store to supermarket: a brief comparative review 39 2.3. Growth and concentration: national and international trends 46 2.4. Co-operatives to quasi-corporates 50 2.5. Price-cutting and trading hours: 54 catalysts of change 2.6. An indust~y transformed 60 2.7. Conclusion 63 3. INDUSTRY PROFILES 70 3.1. Introduction 70 3.2. Foodstuffs 71 3.3. The Progressive Enterprises Group 78 3.4. Dairy Farm International 84 3 . 5 . Conclusion 89 4. THE PURSUIT OF FLEXIBILITY 92 4.1. Introduction: competition and cost reduction 92 4.2. Re-negotiating the work of consumption: self-service and a reconstructed workforce 94 4.3. Technology: a way to cost-cutting and control 97 v 4.4. The pursuit of flexibility: continuity and discontinuity 98 4.5. Internal Labour Market Flexibility: forms and variations 105 4.6. External Numerical Flexibility 107 4.7. Internal Numerical Flexibility 108 4.8. Functional Flexibility 111 4.9. Wage Flexibility 112 4.10. Procedural Flexibility 113 4.11. Summary 115 4.12. Conclusion 119 5. BEYOND FLEXIBILITY: MANAGEMENT STRATEGIES AND THE RECLAMATION OF POWER 122 5.1. Introduction 122 5.2. Human Resource Management: a brief critique 124 5.3. HRM and product markets 129 5.4. Changing the pattern 133 5.5. "Ideal Types" and real classifications 135 5.6. Individual Contracts 138 5.7. The "external" collective 142 5.8. The "internal" collective 144 5.9. Conclusion 147 vi 6. UNION RESPONSES: RE-POSITIONING RESISTANCE 152 6.1. Introduction 152 6.2. Background: unionism in decline 153 6.3. The problem of "exit": consequence and outcomes 158 6.4. Unionism and the Arbitration System: an uncertain legacy 170 6.5. Exit, Voice and Members: reshaping the equation 178 6.6. Organising in transition: deregulation and member attitudes 182 6.7. Long-term strategy vs short-term tactics 189 6.8. Conclusion 193 7. REVIEW AND CONCLUSION 198 7. l. Re-visiting theory 198 7.2. Industrial relations in transition: a brief review 202 7 . 3 . Retail grocery in New Zealand: local and international operators 208 7.4. Managerial dilemmas: conflict and consent 213 7.5. Union quandary: future problems and problematic future 219 7.6. Industry trends: forward to the past or back to the future? 225 7.7. Conclusion 229 vii REFERENCES 236 OTHER SOURCES CONSULTED 257 LIST OF INTERVIEWS 258 APPENDICES 260 viii LIST OF TABLES. PAGE Table 2.1. Retail Supermarket Trade in New Zealand - distribution between owner operated and chain stores 37 Table 4.1 Forms of contract covering terms of employment in the retail food industry (as at March 1995) 103 Table 4.2. Examples of external numerical flexibility provisions noted in a range of collective employment contracts in the retail food industry (as at March 1995) 107 Table 4.3. Examples of internal numerical flexibility provisions noted in a range of collective employment contracts in the retail food industry (as at March 1995) 109 Table 4.4. Examples of functional flexibility provisions noted in a range of collective employment contracts in the retail food industry (as at March 1955) 111 Table 4.5. Examples of wage flexibility provisions noted in a range of current collective and individual contracts in the retail food industry (as at March 1995). 112 Table 4.6. Examples of procedural flexibility provisions noted in a range of collective employment contracts in the retail food industry (as at March 1995) 113 Table 6.1. Rates of unionisation in selected countries 155 Table 6.2. Trade Union membership by industry 160 Table A.1. Contract distribution by industry 274 ix Table A.2. Average minimum adult weekly rates by industry 275 Table A.3. Average hourly rates - industrial sector/age 276 Table A.4. Average annualised base wage rate movements by industry (1991-1995) 277 x LIST OF FIGURES PAGE Figure 3.1. Ownership - Foodstuffs 72 Figure 3.2. Estimated share of retail grocery sales (August 1994) 76 Figure 3.3. Ownership - Progressive Enterprises Ltd 79 Figure 3.4. Ownership - Dairy Farm International 86 xi LIST OF APPENDICES PAGE Appendix 1: Methodology 260 Appendix 2: Contract Distribution by Industry (1995) 274 Appendix 3: Average Weekly Rates by Industry (1995) 275 Appendix 4: Average Hourly Rates by Industrial Sector and Age (1994) 276 Appendix 5: Wage Movements - Breakdown by Sector 1992-1995 277 Appendix 6: Parties to the Woolworths (NZ) Supermarket Contract 278 Appendix 7: Example of "Buy Union" campaign card 279 Appendix 8: Extract from Finsec training manual 280 xii ABBREVIATIONS. ACTU Australian Council of Trade Unions AIEU Australian Insurance Employees Union BIL Brierley Investments Ltd CER Closer Economic Relations (with Australia) CTU Council of Trade Unions DWU Distribution Workers Union ECA Employment Contracts Act EFTPOS Electronic Funds Transfer at Point of Sale FINSEC Finance Sector Union FOL Federation of Labour GUS Grocers United Stores HRM Human Resource Management ICA ACT Industrial Conciliation and Arbitration Act IGA Independent Grocers Association ILO International Labour Organisation IRA Industrial Relations Act LRA Labour Relations Act MOA Municipal Officers Association (Australia) NDU National Distribution Union NDWU Northern Distribution Workers Union NZBRT New Zealand Business Round Table NZEF New Zealand Employers Federation PSA New Zealand Public Service Association U.K. United Kingdom U.S. United States xiii ACKNOWLEDGEMENTS. This project would not have been possible without the kind assistance and encouragement of a large number of people. My sincere thanks are due to my two supervisors, Terry Austrin and John Henderson. To Terry, for keeping me motivated and focused during the long gestation period of the thesis and for his rigorous and painstaking critique of my draft manuscripts. To John, for agreeing to step into the supervisory role at a late stage in the proceedings and for his subsequent solid support, constructive criticism and many thoughtful suggestions. I must also acknowledge the assistance of two former members of my supervisory team, Rob Steven and Jim Lamare. To paraphrase Oscar Wilde, II •• • to lose one supervisor may seem like a misfortune, to lose two seems like carelessness". In this case however, not carelessness but overseas appointments were the reason for their respective departures and I am most grateful for the help and support they provided during the early stages of my research. I am also deeply indebted to Professor Keith Jackson for reading my drafts. That the project finally reached xiv completion is due in no small measure to his sage advice and constant encouragement. My thanks too, are due to Pat Regan and Martin Holland. To Pat for his ongoing interest in my progress and for much valuable advice: to Martin for encouraging me to enter the Ph.D programme in the first place as well as for help and guidance with the preliminary survey. I also owe a special debt of gratitude to Jill Dolby, for the benefit of her computer know-how and for her inf~nite patience in helping me bring order to my erratic disks. It would be inappropriate if I did not also acknowledge the contribution made by the people this thesis is all about. I owe a great deal to the many workers, managers, operators and union officials engaged in the retail grocery industry who gav~ so freely of their time during the interview programme. I am particularly indebted to Maureen Hilston and Paul Piesse, of the former Canterbury Shop Employees Union, Lew Stribling and Peter Conway of the National Distribution Union, David Wise of the Foodstuffs Group and Bruce Boock - the then President of the National Association of Retail Grocers - for their ready cooperation in my research. Needless to say, I accept full responsibility for all errors of fact and interpretation which may appear in this thesis. xv My thanks too, are due to others who have been of particular help along the way; to David Miller, fellow post-graduate student and part-time supermarket worker; to Richard Whatman, for his timely comments on the final draft of the thesis; and to Sarah Oxenbridge, whose ongoing interest in the progress of my research was a welcome source of encouragement. I would also like to express my thanks to the New Zealand Institute of Industrial Relations Research Inc. for the financial assistance of an Industrial Relations Scholarship. My thanks too, to the Editor of the New Zealand Journal of Industrial Relations for publishing some of my early research work. Finally, I acknowledge the great debt I owe to Barbara, whose constant support, encouragement and affection made it all possible; and to ~Jhom I dedicate this thesis. xvi ABSTRACT. A recurrent theme in recent industrial relations literature is that analysis should go beyond the study of institutions and systems.