Chorus has commissioned an independent review of the employment practices of subcontractors rolling out its broadband network, following an investigation by the Labour Inspectorate that found almost all of them to be breaching employment standards.
The independent review will be undertaken by former deputy state services commissioner, Doug Martin, of Martin Jenkins, a registered provider of consultancy services to government in the business and finance category.
Chorus contracts most of its build and provisioning work to primary contractors VisionStream, Downer, Broadspectrum and UCG. In turn these primary contractors often sub-contract that work to smaller businesses.
Martin was previously engaged by Christchurch City Council to improve the performance of its consenting function following the Council’s loss of accreditation as a building consent authority, and as crown negotiator for pay equity negotiations for care support works in aged care successfully concluded that settlement.
He also reviewed the performance of the New Zealand Qualifications Authority following difficulties with the 2004 scholarship and led an independent review of WorkSafe New Zealand on behalf of the Minister of Workplace Relations.
Chorus CEO Kate McKenzie said the company was extremely disappointed in the findings of the Labour Inspectorate and would co-operate fully with the ongoing work of the Labour Inspectorate, and expected all its primary contractors to be fully co-operative with the independent review.
“While we have immediately sought further information from MBIE regarding the cases, we also need an independent view to ensure all people working on Chorus’ behalf are always treated fairly and within the law. This is an absolute priority, with the full support of the board."
However McKenzie should have been well aware of the issues. In December 2017 New Zealand’s largest private sector trade union, E tū, called for a government enquiry into installation practices for the Ultrafast Fibre Broadband network, saying the current model with multiple layers of contractors and subcontractors was broken.
Following revelations about the work practices at Frontier Communications — a subcontractor to Chorus UFB cabling contractor, Visionstream — E tū’s industry coordinator for communications, Joe Gallagher, described the pyramid nature of contracting as insidious.
“The further you get away from the source, the harder it is to hold companies to account,” he said. "We need an industry framework which provides clear employment conditions, sound parameters for health and safety and delivers a good outcome for the consumer.”
The Labour Inspectorate's enquiry has vindicated this view.