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Fair Pay Agreements

Written By: - Date published: 9:23 am, January 31st, 2019 - 36 comments
Categories: business, capitalism, class war, Economy, employment, jobs, minimum wage, poverty, Unions, wages, workers' rights - Tags: , ,

The Working Group set up in June 2018 to consider reform of the wage bargaining system in NZ industry has reported back to the Minister, Iain Lees Galloway.

The Minister says that the Coalition Government “has committed to improving incomes and working conditions for New Zealanders, focusing first on the wages and conditions of those who earn the least.”

He notes that as it currently stands, “employers who pay their staff a fair wage are being undercut by competitors paying below a fair rate. It’s a classic race to the bottom that’s damaging people’s prospects and holding many industries back.”

Image result for workers railway workshops nz

 

The report is substantial, detailed and appears determined to level the industrial playing field. You can read it here.

So, good news for workers, bad news for exploiters.

The Working Group, chaired by former Tory PM Jim Bolger, was tasked with making recommendations to the Government on a model for a system of bargaining to set minimum terms and conditions of employment across all industries and occupations.
 
This should mean that workers in an industry will have certainty that they will receive the going rate in an industry, regardless of who their employer is. It has significant benefit to business as well, forcing the rat bags in an industry to meet the mark. At present, good employers are competing with companies who use poverty wages as a business model.
 
To use the Talley Group as an example, the fourth largest meat company can offer better rates to farmers for stock because paying lower wages than others in the industry is an effective subsidy at the farm gate.
 
Predictably, employers reps on the working group don’t like the compulsory aspect of the proposal. For some bosses, compulsion is a good only when they have the power to force compliance. For example, I don’t recall too many employers complaining about 90 day fire at will trials.
 
The way the system will work if adopted is broadly similar to the Aussie model; industry wide minimums negotiated centrally, without resort to industrial action. Then unions and employers will bargain on top of those minimums in the usual way, with industrial action a possibility, as it is now.
 
Obviously, if workers want to get the best of both, they’ll have to join a union. That’s a good thing.
 
The proposal will still have to make it through cabinet, and then Parliament, but I have a sneaking feeling that the Minister is determined to see this process through.
 
Currently exploited and undervalued Kiwi workers will have reason to thank Iain Lees Galloway every pay day if he can get it over the line.
 
 

36 comments on “Fair Pay Agreements”

  1. Unicus 1

    This is the real ILG – not the phoney fumbler the National Party press crowd attempte to create

    As the Aussie model proves – workers and buisiness both benefit when they manage workplace reward together.

  2. rata 2

    After 50 years following politics I am skeptical of promises.
    1. With all policy/promises until it has
    been active for 2-3 years we just don’t know.
    2. As with all policy/promises there is often the
    give with one hand and take with the other.
    3. How will these policies fare when a New Gov’t comes in?

    • ianmac 2.1

      Sorry rata but your opinion matters not as by your own pen you have eliminated value on any and all opinions.
      “Rata: 6.2
      31 January 2019 at 11:31 am

      Just the usual selective bias cherry picking info
      and juxtaposition to ” prove” a point
      Some one else comes along and through similar
      cherry picking juxtaposition proves the opposite.
      Does get tiresome .
      No shortage of cherry pickers in this country.
      There are thousands on social media 🙂”

      • rata 2.1.1

        @ianmac .
        Not at all in fact I have enhanced my view
        that there are different ways of seeing things.
        I like the “proposals” but
        Newton’s third law states:
        For every action, there is an equal and opposite reaction.
        That’s why waiting to see the proof of the pudding is the true test.
        And changes of Gov’t so often see “corrections”.
        When Governments are at the whim of a Winston Peters
        nothing is set in stone. Never.
        Always stay vigilant.

        • veutoviper 2.1.1.1

          rata, I am trying to keep an open mind re your comments here.

          So, excuse me if I have over-stepped the mark, but I looked at your comments and thought, it is not what rata is saying, but how it is presented.

          I am very good using things like PS, laptops etc but hopeless using mobiles, smart phones and similar. I have a real mental block to the latter.

          So I thought I will try to convert your comment here into how it might appear I if presented on a laptop, PD etc. So here goes –

          rata 2.1.1
          31 January 2019 at 7:15 pm

          @ianmac .

          Not at all; in fact I have enhanced my view that there are different ways of seeing things.

          I like the “proposals” but Newton’s third law states:
          “ For every action, there is an equal and opposite reaction.”

          That’s why waiting to see the proof of the pudding is the true test.

          And changes of Gov’t so often see “corrections”. When Governments are at the whim of a Winston Peters, nothing is set in stone. Never. Always stay vigilant.”

          Sorry, that makes a lot more sense to me. I can now see much better what you are saying.

          I will butt out now …

    • patricia bremner 2.2

      So, you prefer to moan and have this Government do nothing?
      If a new Government gets in and tries to change this again, workers will fight tooth and nail.
      Voters will punish them at the ballot box.
      Workers now understand “United we stand, divided we fall back into a spiral of ever lower contracted wages”

      Jim Bolger was stunned that working people were living in cars struggling to cope.
      This bad system of contracting is at the bottom of undercutting in transport, building and retail including banking and insurance.
      Jim still comes from a “deserving poor” perspective, but even he could see it had become a “How low can you go?” leading to imported workers “Paying” for jobs and employers cheating on holiday pay basic wages, breaks accommodation etc.

      The employers will fight this because they must get a decent model of employment which for some will show up in their balance sheets as “different from before”.
      That will mean less for their shareholders and employers may have to face explaining to shareholders banks and the tax department.
      Try to be more like your name.

  3. DJ Ward 3

    What do you compare it with. Many buisinesses compete with companies paying $2 hour. It’s resulted in business closures so there is no jobs.

    If wage increases forced legislatively result in an unprofitable Buisiness then you end up with no jobs.

    If wage increases affect the budget of a Buisiness they will hire less workers investing in technology instead, then you end up with no jobs.

    If wage increases increase government spending then they can spend less on other things, or have to tax more, resulting in less jobs.

    …………

    You can create more gain for low income workers by addressing our obscene rental market, childcare, food costs, electricity costs. IE the gains are in cost of living.

    • patricia bremner 3.1

      Rubbish, if profits were shared more evenly then families could eat and the shareholders might buy a slightly cheaper car. Life is more than money, but that is the exchange medium. Unfortunately people like you think everyone but the workers should be first in line. There is a shortage of workers not work so your argument is fallacious. Funny how you all compare our poor wages with Aus and go “Why?”
      Australia has had this system we are introducingfor 30 years.

      • DJ Ward 3.1.1

        Well I have been a minimum wage worker. I just took steps to gain skills and qualifications to improve my income earning potential. I left $13.50 with time & 1/2 after 40 hrs to $9 fixed 40 hrs to improve myself. I lived in a caravan for 4 1/2 years. I have also never once gone to an employer asking for a pay rise. They have just given me them because of my work ethic, and trust. I have also been employed by a boss that was to an extent exploitive. The result was less loyalty from me. At the other end I was in a tough position and offered my services for $40 and the employer responded by saying it wasn’t fair and paid me $55.

        People like me?

        No you think workers should get everything, the people who risk everything nothing. I on the other hand when I work for a boss I put them first, make decisions that minimise expenditure, maximising there profits. Then I’m rewarded because I’m valuable to the boss. I don’t just turn up, go through the day watching the clock, moaning at everything, and expect to be treated like I can’t be replaced.

        I’ve seen people being replaced by technology and foreign wages. I started a job with 10 staff that increased to 14. They purchased robotic printers, and outsourced the other jobs to Asia. There final products were cheaper than just our material costs. End result was a reduction to just me and one other worker increasing to 3 because they cut back a bit much.

        The main factory closed down with hundreds of job losses. They were on strike only a few years earlier asking for more pay.

        • patricia bremner 3.1.1.1

          Offering regulated fair pay is “communism by stealth. ”

          “You(Me) believe workers should get everything”

          So believing in a fair days pay for a fair days work, means I’m a communist who wants everything”

          That is a stretch.
          Look I come from a working family, my Dad was a Miner’s Union Rep, so by your rules you come up with” Communism and everything.”

          I have talked of law to reign in exploitative employers who see underpaying workers, ignoring the few protections they have as a right. Not all are like that.

          There will always be sunset industries which will die a natural death as technology speeds up. That will happen which ever Government is in.

          Engineers in ship building went through that. Telecom workers thought they had a job for life.

          Jacinda has stated change in work and in climate will impact heavily, and she wants to improve the chance of people developing resilience to cope.

          Fair pay, free education, good low cost health care, more houses to stabilise the market, protection for our exporters by agreements, R&D etc.

          Now we do not have the power to influence those who throw up trade barriers,
          or make a huge impression on climate change. I am proud they are trying.

        • Kevin 3.1.1.2

          Happy to be exploited? That’s a new one on me. Imagine how much you COULD have earned if you hadn’t relied on employer generosity.

    • Underpaid workers are already heavily subsidised by the state, DJ. Working for Families doesn’t just ease the burden on families, its a subsidy for the boss too. Saves the boss having to pay a living wage.

      There is no solid correlation between wages and new technology. If there is a machine available, any boss would be mad not to investigate it. It won’t matter if the workers it replaces are on $17.50 or $27.50. If the machine can do it next to nothing, that’s what’s going to happen.

      Wage rises are a tonic for the economy. Workers on the average wage and below spend every cent they get. A wage rise is therefore good news for supermarkets, petrol stations, burger bars, pubs, the local dairy and so on.

      • DJ Ward 3.2.1

        Yes, I’ve seen it first hand.
        When a company makes a profit they pay tax.

        I totally agree WFF is a Buisiness subsidy. It’s also a Landlord subsidy indirectly.

        Who brought that in?

        I’m not saying if companies can increase profits that they should ignore workers and just make more. It’s got to be a balance. If a company is struggling then sorry but the workers shouldn’t ask for anything. If a company is doing well then they should give a share of profits as a bonus, as well as a wage rise.

        Making things compulsory risks lower performing companies viability.

        It’s communism by stealth. Trending all workers to the same pay. You end up with ridiculous comparisons like retirement home workers with prison officers.

        • Pat 3.2.1.1

          I”t’s communism by stealth. Trending all workers to the same pay. You end up with ridiculous comparisons like retirement home workers with prison officers”

          Is that a comparison you really want to advance?

        • Shadrach 3.2.1.2

          In early 2004, after Don Brash gave his Orewa speech, National’s popularity skyrocketed, with the Nats enjoying “the biggest single gain by a political party in a single poll in Colmar Brunton’s polling history” (https://en.wikipedia.org/wiki/Don_Brash). Labour were spooked, and Helen Clark pulled out one of the greatest political bribes in history. And WFF was born.

          WFF is a massive and inefficient redistribution of income. We could achieve virtually the same impact with a generous tax free threshold, a slight drop in the lowest tax rate, and a matching lift in the highest tax rate. And we could tell the bureaucrats administering this farce to bugger off.

        • KJT 3.2.1.3

          you mean “if, a company is not successful it should be subsidised by it’s workers”.

          What happened to capitalism? “If a company cannot pay for the resources it uses, it should be allowed to fail. To make room for one that uses those resources more efficiently”.
          Where does it say “a failing company should be propped up by it’s employees, and tax payers”?

    • Siobhan 3.3

      Most companies are already having their wage bill artificially lowered thanks to Family Tax Credits etc, so their profits are already being propped up by our tax system.
      And we allow them to import labour from third world countries..because those workers are the only people who think these wages are good, because they are back home. They wouldn’t be if these workers actually had to live and raise a family here in NZ full time.

      Time they started paying fair wages BEFORE profit.

      Case in point…Chorus..massive profits and a system that means workers have to be exploited…

      https://www.odt.co.nz/business/chorus-six-month-profit-329m

      https://www.newshub.co.nz/home/new-zealand/2018/10/chorus-subcontractors-exploiting-migrant-employees.html

      and the Hawkes Bay Horticulture, apple pickers. The wages are so low that even the backpackers aren’t interested.

      http://www.scoop.co.nz/stories/BU1805/S00699/nz-apple-industry-leads-the-world-four-years-running.htm

      https://www.nzherald.co.nz/hawkes-bay-today/rural/news/article.cfm?c_id=1503457&objectid=11489341

      https://www.radionz.co.nz/news/national/351595/fruit-growers-need-to-pay-pickers-more-minister

      and Dairy…etc etc..

      • patricia bremner 3.3.1

        Thank you Soihban, Well constructed points.

      • Patricia 3.3.2

        Part of my work is with young vulnerable workers experiencing financial difficulties.
        I frequently see abuse of labour laws. Underpaid / no lunch breaks / no pay slips / deductions without consultation for uniforms + work boots. And if the young people challenge their employer then out the door they go and often without a final pay. Single people do not get a lot of extra government assistance to top up their low wages.

  4. mary_a 4

    This is a good move, hopefully promoting some fairness in the workplace for a change, something that has been lacking for far too long. Unbalanced and unfair working relationships fail every time, having a negative impact on both business and employees.

    I have been an employer in the past and I learned this … treat your staff with respect, treat them well and they will do likewise in return. Good employer/employee relationships work all the time.

    What I’d like to see is the abusive, greedy, rogue employers hit hard till it hurts! No more low below liveable wage standards, which is a disgraceful blight on society! It can be done if we let it!

    Now it will be quite interesting to see which politicians from all sides of the house will vote in favour for this. I’ll be watching this one very closely.

    • patricia bremner 4.1

      Quite right Mary_a I will watch their vote very carefully. This is vital.

    • Grantoc 4.2

      mary_a

      You can hit exploitative employers without compulsory unionism. For starters they’re a very small minority of employers.

      Compulsory unionism is a blunt one size fits all instrument that will do more damage than good to the economy and therefore to workers.

      For a variety of reasons (technology; diversity, labour market flexibility etc) companies throughout NZ face different circumstances, which require different solutions. This includes how you remunerate staff. To have this one size fits all compulsory unionism forced upon them by a centrist government and bureaucracy will negatively impact many companies and drive many out of business and/or to employ fewer workers.

      Watch business confidence fall if the government gets serious about this recommendation.

      Its ironic that last year this government was promoting the need to strategise for the future of work. If they impose compulsory unionism on the the workplace, supported by an out of touch relic from the National Party, they’ll actually be turning their back on any serious consideration of the future of work and returning to the history of work, i.e. the 20th Century. This will hardly enable NZ to adapt to the changes ahead re the future of work.

  5. Reeee 5

    Labour WANTS as many as possible of the most vulnerable, lowest-paid workers in the country to get replaced by a machine where you press buttons to place your order, and then swipe your card to pay.

    I can think of no other outcome to this policy to make unionism compulsory whether your staff want it or not.

    It is a recruitment drive for the unemployment benefit.

    See, look. The machines took your jobs. You need a benevolent welfare state to take care of you in this cruel, neoliberal age. Capitalism has failed. Where would you be without your friend, the Labour Party?

    • patricia bremner 5.1

      That could happen any way. Are you saying laid off workers in such an employment situation would get better help under National? What bloody planet are you on? Planet Key?

  6. Alan 6

    only 14 comments, are you not confident this report will go anywhere???

  7. I’m not a left wing person but there are too many people who are now struggling to make ends meet (this doesn’t include those who can’t manage their money).

    I think this is a good thing for NZ – our housing costs are making life too hard.

  8. infused 8

    yeah, good luck with this.

    it’s a dog, and will be exploited by unions as only unions can do. like above, you’re just going to see a loss of jobs.

  9. -_- 9

    A paltry 1000 people get to dictate to workers what their employment terms will be. Fuuuuck off.

    This is only good for unions, not workers.

  10. patricia bremner 10

    Amazing how people speak of Unions as if they are not helping the workforce,

    • More amazing still is the agendas of these posters who deliberately forget why Unions came into existence in the first place,… unless of course they want a full return to Dickens time with children climbing up chimneys , factory girls dying of fossy jaw and miners dying down mine shafts ( oh wait – we’ve had that in recent history under the most virulently anti union PM Con Key… )…

      Maybe they like seeing workers family’s living in cars… or paying immigrants token wages… and happily crack open a can of tuna when reading about slave labour out on the fishing boats…

      Or maybe they are just total wankers.

      Who don’t know about history and Massey’s Cossack’s and furthermore don’t want to. Or , most probably , see themselves on the side of Massey’s govt.

      The minority far right wing neo liberals have had more than their share of fun in the sun for three decades. Three long decades of theft, rort , plunder and guile. Yet, as a historical scientist once observed , ‘ what goes up , must come down’.

      To coin a phrase by others , – their ideology is a sunset one.

      As is the whole Employment Contracts Act 1991 of Ruth Richardson.

      The Former Pm has realized the whole system was designed to impoverish workers from the get go and overruled and overturned the former Finance Minister.

      Just a pity it took half a lifetime for him and others to do it.

    • Exactly! And sad how many righties don’t acknowledge that unions are voluntary and democratic and that union membership consists of workers and nothing but workers. While it’s often disputes that make the news, unions carry on doing terrific work behind the scenes making sure their members get the help, advice and support they need. That’s not just employment law stuff, it’s also taking health and safety cases, battling ACC etc. For less than the price of a pint, union membership is a dead set bargain.

  11. Ruthanasia – Wikipedia
    https://en.wikipedia.org/wiki/Ruthanasia

    Mother of all Budgets – Wikipedia
    https://en.wikipedia.org/wiki/Mother_of_all_Budgets

    Defeat the Bill! The struggle against the Employment Contracts Bill, 1991
    https://iso.org.nz/…/defeat-the-bill-the-struggle-against-the-employment-contracts-bill-…

    The 1913 General Strike: relevant to us in 2013? | Redline
    https://rdln.wordpress.com/2013/01/…/the-1913-general-strike-relevant-to-us-in-2013…

    Friar Tuck explains the divine nature of beer – YouTube
    Video for friar tuck making beer robin hood prince of thieves you tube▶ 0:19

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