The Council of Trade Unions has done a lot of work on why wages are low for many workers in New Zealand and how they can be increased to close the wage gap with Australia. They offer six proposals:
Increase the minimum wage to at least $15 per/hour
We know from the painful experience of hundreds of thousands of Kiwis during the 1990s that if the minimum wage doesn’t go up, wages for low-paid jobs (not just those on the minimum wage but also those close to it) don’t go up. If we want wages to go up at the lower end, we need minimum wage rises. Higher minimum wages encourage more people into the workforce.
Improved collective bargaining
Collective bargaining redresses the inherent power imbalance between employer and employee. When workers are divided and forced to compete against each other a race to the bottom occurs and wages drop. When workers are permitted to stand united, wages rise. While New Zealanders lost work rights in the 1990s, Australians didn’t. That’s when the wage gap opened up.
Build union capacity
The end of industry-wide bargaining means that each union has to bargain individually with each business in which members are employed. This situation was created on purpose to undermine workers’ ability to bargain for better wages. To counter this support for unions could include more research, expanded mediation services, funding for bargaining initiatives, and advocacy training.
Good employer and responsible contractor policies
A lot of work is contracted out by the public service. Workers don’t have the same protections working for these contractors that they do working directly for the government. The public service should refuse to work for contractors that don’t meet acceptable benchmarks.
The two biggest things that are needed to help this happen is for workers to get their fair share of increased productivity (labour productivity is up 42% since 1988 but wages have not gone up anywhere near that much) and more capital investment.
Close gender gap
If women earned as much on average as men, the wage gap would be much smaller. Many women work in industries with low rates of unionisation, which prevents them getting effective wage increases.
Good stuff. Looks a lot like the Greens’ work rights policy and the EPMU’s Work Rights Checklist. It’s good to see the Left thinking along similar lines. We’re still waiting on Labour’s policy but word around the traps is it will be good. Hopefully, they’ll have the sense to run hard on it.