Your correspondent once lived with the proud assistant manager of a downtown McDonalds restaurant. He would pore over secret work documents furnished by the multinational fast food giant to help him extract maximum efficiency from his staff.

One night, he brought home a guide to the McCafe. This included a numbered twelve step process – with diagrams – for cutting a quiche into slices and placing it in a display cabinet.

That may strike some readers as overkill. But McDonalds doesn’t have to throw out many quiches that have been deformed in the cutting process. And, according to a story published in the NBR in 2006, it has never had a claim for “unjustifiable dismissal” upheld against it.

The two things are connected. Employment law in New Zealand is, like cutting quiche, very concerned with process. It doesn’t matter that the McCafe quiche tastes like cardboard, and it doesn’t matter why you ultimately want to get rid of an employee - the dirty secret of employment law in this country is that if you can afford a sophisticated human resources department you generally don’t have to say you’re sorry.

National confirmed over the weekend it would allow employers in small and medium sized businesses to provide for a 90 day “no fault” probationary period for new employees.

During this probation period an employer would be able dismiss a new staff member without the threat of a personal grievance claim.

The prime minister has said this would give employers the right to “fire at will” and in fact goes further than the dreaded Employment Contracts Act. She’s exaggerating. A new law along those lines would in fact go a long way towards redressing the disproportionate burden small businesses face from employment law.

For one thing, it would only apply in businesses with fewer than 20 employees. This is in line with a number of our trading partners.

Businesses employing between one and 19 staff are 33 per cent of all businesses, and account for 30 per cent of all employees.

Government and unions claimed a Department of Labour report [PDF] from last year effectively debunked the claims of a “personal grievance gravy train,” saying that only 1.5 per cent of employees had a significant employment relationship problem.

But it’s smaller employers who bear the brunt. In businesses with fewer than ten employees, the number of serious problems per hundred employees is 2.9 – almost double the average.

The Department of Labour also concluded that in these small companies problems surface earlier in the employment relationship. That’s unsurprising, since a poor “fit” with the business or a lack of skills becomes more obvious in – and takes a greater toll on - a smaller team.

This is a problem that’s particularly damaging for small, tight-knit businesses, but especially hard for owners to address because it’s difficult to articulate properly, especially for small business people who are more concerned with running a garage or a photography studio than with human resources best practice.

The Department of Labour estimated the median direct cost of an employment relationship problem to an employer in the private sector was $5000 – including around $2800 of payouts to employees and legal representation, investigation costs and any replacement staff.

However there are some largely unpredictable spikes in the payouts and costs of certain cases, which skew the average to about $10,000. More importantly, these big and unexpected headline figures increase apprehension about the whole process across the employer sector.

Once official mediation through the Department of Labour starts, the costs increase by around 50 per cent.

This is a pittance for big organizations. But for a five-person business on the borderline of profitability it can be catastrophic. And it doesn’t begin to count the toll of a long process (the mediation process takes around five months, according to the report) in terms of stress and problems in the workplace.

The government’s own Small Business Advisory Group has repeatedly recommended a probationary period as “the single most important changes[sic] that could be made to the employment legislation.” It said in a report in 2004 that it would “lead directly and immediately to employment and business growth.”

National’s proposed law will likely be similar to the Wayne Mapp’s private member’s bill in 2006. It will not protect employers if they have fired employees for any reason prohibited by the Human Rights Act (unlawful discrimination) or for seeking to uphold their other minmum rights (such as being paid in time). Critics have concerns about how enforceable these provisions may be.

The bill was eventually voted down at its second reading. But other parties’ reaction to that bill is an interesting guide which shows National is hardly outside the mainstream thinking.

Mapp’s private member’s bill was supported by National and Act, but also by United Future. More significantly, New Zealand First and the Maori Party supported the bill on its first reading.

Both decided to oppose the law only at the eleventh hour. Maori party MPs with the exception of Hone Harawira were privately – and early on publicly – supportive because the bill could help those in the long-term unemployed, where Maori tend to be over-represented.

In other words, it is not a die-in-the-ditch proposition for them. This is not rioting in the streets stuff, no matter how the Prime Minister portrays it.

Most of our trading partners – a key point for New Zealand First on a host of issues – have probationary periods in law: in the United Kingdom, for instance, it’s a year. Even in Germany, where companies are governed by “social committees” of worker representatives, employees do not enjoy any protection from dismissal for six months.

One of the chief arguments when Mapp’s bill was before the House was that, with unemployment at record lows of around 3.6 per cent, there was no need for probationary periods. Employers were glad with what they could get.

Entering a period of increased unemployment, there is a greater argument to increase flexibility in early work arrangements: small businesses will be reluctant to hire in any case, and there will be more employees with a history of unemployment who are marked as “high risk” by potential bosses.

National is promising further employment law policy soon. The party could look at restricting employers from paying a “signing bonus” to employees who are part of a collective agreement. (The government has used these a great deal in what looks from the outside very much an attempt to boost public sector union numbers in the PSA.)

The party has also been looking at rules around access for unions to the workplace. Currently union representatives have “reasonable” - which translates roughly as “unfettered” - access to workplaces for recruiting or communicating with members.