Historically New Zealand has had an industrial relations system based on the principles of collective bargaining, with union and employer representatives negotiating minimum terms and conditions of Work. The Industrial Conciliation and Arbitration Act of 1894 established the principles of; wage setting through conciliation and arbitration; multi-employer awards; general coverage of conditions; compulsory union membership; and mandatory arbitration. This system has served New Zealand for almost a century with only minor modifications. However, during the 1980s and 1990s, the government's push for market-oriented policies led to legislation that brought about a major change and reorganization of industrial relations. The Industrial Relations Act 1987, the Private Sector Act 1988 and, more directly, the Employment Contracts Act 1991 were laws that brought about significant changes for employers, employees and trade unions. Prompted by the economic shocks of the 1970s, the Muldoon government intervened in the labor market to deal with rising inflation: general wage orders, a freeze on wages and prices, were introduced. By the mid-1980s National was replaced by the fourth Labor government in the 1984 general election and strategies were reversed. A policy was implemented that aimed to deregulate what was at the time one of the most regulated Western economies (Department of Labor, 1998). Although compulsory arbitration was immediately abolished, further labor market reforms were implemented a few years later through the Labor Relations Act 1987. The law retained the essential ethos of the existing conciliation and arbitration system. It envisaged registered trade unions, guaranteed bargaining rights, enforced agreements, personal pain... middle of paper... a neutral and perhaps more all-encompassing perspective sees it as favorable only to a small minority and less so to the larger majority. Works CitedBoxall, P, 1991, 'New Zealand's Employment Contracts Act 1991: An Analysis of Background, Provisions and Implications' in Australian Bulletin of Labour, vol. 17(4), DecHarbridge, R & Crawford, A, 1997, 'The Industrial Relations Impact of New Zealand Employment Contracts Law' in Californian Western International Journal, vol. 28, no. 1Kerr, R, 1997, 'New Zealand's employment contract law: its implementation, enforcement and implications' in Californian Western International Law Journal, vol. 20, No. 1Maloney, T, 1994, Has New Zealand's employment contract law increased employment and reduced wages?, Auckland, Auckland UniversityStreet, M, 1998, Lecture: Employment Relations, Auckland University, September 22