Abstract
Free-riding occurs where an employee gains a benefit without joining the union that negotiated that benefit. New Zealand unions endured a decade of high levels of free-riding under the Employment Contracts Act. This paper establishes that, in New Zealand, collective bargaining coverage has a positive relationship with free-riding whereas union membership levels have a negative relationship. Free-riding in New Zealand has fallen to pre-1991 levels with the re-regulation of employment relations, indicating environment too may be an important factor. These findings have implications for Australia where unions have sought to coerce membership through applying a fee for service to non-members, while the Commonwealth Government recently passed legislation preventing such coercion.
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