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By Kristen Barrett

Over the past month there’s been heated discussion around the proposed 90 day probationary period law changes.  The fundamental argument between workers rights and the power of the employer has been provoked in force.

One area that’s been overlooked is how this proposed law change could affect the professional contracting and temporary staffing market in New Zealand.

Extending the 90 day probationary period from SME’s (companies with 20 staff or less) to all businesses, is designed to ‘de-risk’ the employment process and encourage employers to ‘create’ more job opportunities.

John Key believes that the 90-day trial scheme for SME’s launched in April last year has been a success. According to Key, “The results…have been stunning. It’s ensured that a lot more New Zealander’s had the opportunity to engage in work.  Employers have been willing to take the risk.”

However, according to a senior Union representative – Andrew Little, to date not one single employer has been able to show that they “created” a new job because of the probationary law.

I’d like to point out that using contract and fixed term staff is an existing option open to all employers, as a means to create jobs, with less danger of facing personal grievance cases. Job creation – whether it’s permanent or temporary work is great news for New Zealander’s. But it seems in this debate we’ve over-looked the fact that creating contract and fixed term jobs is a savvy way for employers to engage with new staff – without risk.

From a job-seeker’s perspective, the creation of more contract and fixed term work is a valuable proposition. If more employers used this option, there would be sustainable job opportunities for more contract and temporary workers.  This would be particularly positive for the groups who’ve been most severely affected by increasing unemployment rates. These groups include Youth unemployment (15-19 year olds) which is currently tracking at 25.2%, Pacifica unemployment – 14.4% and Maori unemployment – 14.2%.

Sure, some people seek the security of permanent work, but with the possible introduction of this law, the burning question is how much will this ‘security’ be diminished?  A Survey by the EMA of its members showed that 72% of respondents had used the scheme.  From the 400 employers surveyed, 48 had fired someone within the 90 days.

It’s definitely still early days.

In a recent survey run by Crackerjacks with HR Managers across the nation – cost was the number one barrier to hiring contractors. But this myth that contractors are too expensive is no longer stacking up. Contractors, in certain industries have actually lowered their rate expectations because of the recent flat trading conditions.  Crackerjacks run a six monthly Rate Guide to show the current direct rate expectations of contractors across a number of professions. To have a look at these download the report here.  We have the next report coming up in September – to receive a copy of this we invite you to join our mailing list (drop us a note on business@crackerjacks.co.nz if you are interested).

Contractors can often churn work out faster than traditional employees when given specific project time-frames.  An experienced contractor knows how to hit the ground running and the right questions ask to get up to speed quickly. Time is money.

I encourage employers and job seekers alike to look at this new dimension of the 90 day probationary period debate, and consider the opportunities that are open to us now.