Free-riding in New Zealand: Incidence, Motives and Policy Implications

Abstract

Union leaders in New Zealand argue that free-riding is a significant problem. Drawing on the New Zealand Worker Participation and Representation Survey 2003 we find that 45 percent of workers with a union that they could join in their workplace are not members, indicating that free-riding remains at high levels under the Employment Relations Act. These ‘technical free-riders’ tend to be concentrated in the construction and private sector service industries and among the highest and lowest income and education groups. We distinguish between ‘calculating free-riders’, ‘passive beneficiaries’ who say that people in their jobs don't join unions, and those for whom the costs of membership outweigh the perceived benefits. The article concludes with a discussion of the implications for public policy and union strategy.