Red Alert

Archive for the ‘low pay’ Category

Marginalising young workers

Posted by on March 22nd, 2013

This week, the government passed its Minimum Wage (Starting Out Wage) Amendment bill by one vote. The Bill was introduced late last year by Kate Wilkinson before she was sacked and has been taken up with enthusiasm by her replacement, the Hon Simon Bridges.

From 1 May, 16 and 17-year-old workers can be paid 80% of the adult minimum wage ($11.00 an hour) for six months. If they start a new job, they can start again on youth rates, regardless of previous job experience. 18 and 19-year-olds, who may have previously had jobs paying adult wages, can also be paid sub-minimum rates if they have been unfortunate enough to be on a social security benefit for six months, including the invalids benefit and sickness benefit.

Cutting workers’ rights and pay is classic National Party. They’ve already made it impossible for young workers to challenge any unfair treatment and dismissal in the first 90 days of employment, which was supposed to open up thousands of jobs. They have failed to address youth unemployment in any way, shape or form, which is a national scandal. And so, they’re resorting to their tried and failed policies of last century.

The bottom line is this : cutting workers pay does not create jobs. Employers take on workers when there is work to be done, not because they can pay them less. Full stop.

MoBIE openly admitted that it had very little way of telling whether this bill will meet its government’s claim that it will reduce youth unemployment. They came up with a “best guess” that it could create 400 to 1,100 net jobs. I’m wary of these numbers. Who can forget the 2011 Budget projection of 170,000 new jobs by 2015?  Not much sign of that as unemployment continues to rise, more good jobs are lost, and our youth unemployment is up there with the worst in the OECD.

Other advice on the bill was worrying. Treasury suggested that paying sub-minimum wages is something that could be extended in the future to other workers who have a high unemployment rate – so look out Maori and Pasifika workers, or those who live in areas where jobs are scarce. The Ministry of Education warned that youth rates were at odds with the Government’s own stated education goals and would impact on the incomes of working students, thus creating barriers to gaining qualifications.

The Government did not listen to the more than 520 submissions opposed to this bill. It ignored the business community who said youth rates are not a silver bullet and the Government needs to do a lot better on youth unemployment.

It seems to me that the government’s accepted that a low wage, low skill economy is our future, where people are paid less and work longer, where good jobs are off-shored because of a lack of investment and hands-on economic policy and where those who are young and can’t escape overseas to a better life are consigned to economic marginalisation.

The contractor trap – more flexibility, no rights

Posted by on October 14th, 2012

This was published on the Radiolive website on 5 October.

There’s an old Kiwi maxim: a fair day’s pay for a fair day’s work, but that doesn’t ring true for many thousands of Kiwi workers.

For the past three decades there has been a steady growth in what is described internationally as non-standard work, including temporary workers, casual and labour hire workers and a substantial increase in the use of independent and dependent contracting.

Some contractors are highly skilled, entrepreneurial individuals, who are able to extract a significant premium for their efforts outside traditional employment.

However, for many, the opportunities of earning a secure and stable income are remote. Their classification as contractors effectively gives them no rights to the minimum protections provided for those classed as employees under New Zealand Law. For these workers the employment relationship, with its rights and obligations, under current law has become meaningless.

Look around you. Many fast food delivery workers, truck drivers, couriers, construction workers, caregivers, security guards, cleaners, telemarketing workers, forestry workers, even actors and musicians are contractors.

While Labour is pushing for the minimum wage to be $15 an hour, these workers have no guaranteed minimum wage.

While we enjoy our Christmas breaks, these workers have no paid holidays.

If we are treated unfairly at work, we can challenge our treatment under the law, but contractors have no such right.

If we want to join a union and bargain for a collective agreement, we are guaranteed that right, but that’s prohibited under competition laws for contractors.

Over the past few years many contractors have been in touch with me to talk about their situation. When Telecom announced that its two biggest network Engineering contractors, Transfield and Downer EDI had lost their contracts for the Northland and Auckland network to a new company, Visionstream, 700 skilled lines engineers were told if they wanted work they would have to move from being employees to contractors.

These workers were powerless. If they wanted a job they had to give up secure income and employee protections, buy their own vans and equipment and take all of the risks of the job on themselves. Many did. And they’re now struggling.

Some horrific stories from truck drivers hit the headlines. They had mortgaged their houses to buy the rig, and then the companies they were contracted to slashed hundred of dollars off their weekly pay claiming the drivers were overpaid. They showed me the figures; many are earning below minimum wage. Every week sometimes dies on the road through a truck related injury. We respond with ever-stricter safety laws, but does anyone ever think that the drivers are speeding, cutting maintenance, working over legal hours because that’s the only way they can make a living as owner-drivers?

Courier drivers are in a similar situation. As vehicle drivers have been converted from employees to contractors, courier drivers have been required to provide their own vehicle, pay for vehicle maintenance, insurance registration, and other running costs.

New Zealand is not alone in this phenomenan. Studies are taking place around the world and some governments have implemented new legislation to regulate dependent and independent contracting.

In this dog-eat-dog world of increasing competition, firms often turn to contracting as a means of avoiding the costs of employing someone directly. Others do it in a cynical attempt to avoid labour laws.

The International Labour Organisation has dedicated many conference discussions to finding a solution, saying that the protection of (all) workers “is at the heart of the ILO’s mandate and all workers, regardless of employment status, should work in conditions of decency and dignity.”

While Labour accepts there are advantages for businesses in different contracting arrangements and for that matter, advantages for some highly skilled workers, these must be balanced against the fundamental rights of fairness and equality.

There is a lot of discussion and thought required on this topic. But in the end, Labour doesn’t believe that it is the Kiwi way for the “law of the jungle” to prevail.

If we fail to regulate the growing incidences of independent and dependent contracting, we expose growing legions of workers to having no rights at all.

And in doing so, we make every other job that relies on the foundations of the employment relationship vulnerable to unacceptable competition.

On Fairness and Courage

Posted by on September 2nd, 2012

As the excited crowd left the public gallery of Parliament on Wednesday evening, the Speaker had to pause the business of the House. There was a buzz in the air following the vote on Louisa Wall’s marriage equality bill. It was a great night for fairness, equality and courage. The journey New Zealand has been on since the passing of the Homosexual Law Reform Bill in the 80s, through Civil Unions in 00s took another important step in giving all New Zealanders a fair go. We saw some courageous testimonies in the days leading up to the vote and some courageous speeches and voting on the night.

When the crowd had dispersed, and the gallery was deserted, my friend and colleague David Clark got up to introduce his private members bill to raise the minimum wage to $15 per hour in line with Labour’s 2011 manifesto commitment. The crowd should have stayed. He gave a great speech. So did Darien Fenton who followed on from him focusing on the plight of the cleaners in Parliament. Have a look at the speeches, they are thoughtful and heartfelt pleas for a fair wage for all workers. The response from the government speakers was as predictable as it was out of touch.

Those National MPs should all have listened to the courage of Sosefina Masoe a cleaner who spoke the next day at the Wellington launch of the Living Wage campaign. She has spoken publicly before of her story of working for just on the minimum wage while trying to support her children and wider family. Talking to her afterwards it was hard not be moved by her hopes for a better life for her children. It is what all New Zealanders would want. She deserves far better than a $13.50 minimum wage, she deserves a living wage. Our Bill is a first step.

I would have loved the crowd who so enthusiastically supported marriage equality to have stayed and cheered on a fair go for our lowest paid workers. The issues come from the same well-spring. Its all part of the agenda of a fair go for all New Zealanders and a society where we reject exclusion and unfairness and embrace and value the contribution that all Kiwis can make to our society.

I am proud that Labour had two Bills in a row on the order paper on Wednesday that pursued the core progressive values of fairness and equality. We must, and will, continue to show the courage to propose the measures to build the better and fairer society, in all its many forms.

Planet Reality

Posted by on July 23rd, 2012

When the National Party talks about Planet Labour, they think they are being very funny. Actually, I believe they’re the ones living on another planet, and it’s certainly not Planet Reality.

I just met a couple of great women who know Planet Reality. They are caregivers in an aged care facility, which includes a dementia unit, some with years of service. Most of them are on minimum wage.

They and their fellow workers were on strike three days last week to get a collective agreement. They haven’t had one since the Home was sold by the Baptists to a private owner in 1997.

They want a pay scale that recognises their experience, skill and service, that isn’t dependent on minimum wage movements or the will of the boss. They want a way to ensure that taxpayer funded increases are passed onto the workers when they are intended to be.

They’ve been bargaining with their employer since last October. They’ve been in mediated bargaining since February. They’ve done everything they can under the law to get their employer to agree to a new agreement and they will do more – at least while they still can.

The government’s going to change the law so employers don’t have to keep bargaining. When they’ve had enough, they can say, that’s it, had enough, bargaining over. Bad luck. Back onto your individual contracts where you belong.

Minister Wilkinson tries to soft soap this by saying this change will return the law to how it was under Labour until 2004. But the law was changed because some employers were “surface bargaining” – going through the motions until they could pull the plug by saying bargaining was concluded.

I know this doesn’t mean much to a lot of people. It certainly means nothing to those who don’t understand the realities of low wage workers and how hard it is to get a collective agreement settled when your employer doesn’t want a union on the job, because it’s a whole lot easier to have all the power.

I just hope these women get a deal before Wilkinson manages to get the law changes before parliament.

Total Employment Change from 2008 Reveals Imminent Crisis

Posted by on February 21st, 2012

Increase in unemployment under National

Increase in unemployment under National

The Household Labour Force Survey Survey report of the December 2011 Quarter released last week revealed that our unemployment rate slipped slightly to 6.3% from 6.6%. While a rate of 6.3% in itself doesn’t necessarily mean we have reached crisis levels, the focus on the overall unemployment rate does conceal detail about our employment situation that if brought to the surface will shine light on what I believe is an immiment crisis looming in our economic horizon.

Since JohnKey’s National took office in November 2008, 53,000 New Zealanders have joined the unemployment ranks. That’s a 54% increase in the number of people unemployed to a total of 150,000. For these people, National’s promise of a ‘brighter future’ has utterly failed to materialise, especially if you have a mortgage and teenage children you are supporting through school.

While the impact of the recession cannot be ignored, the number of people unemployed has actually increased since the recession officially ended in mid-2009. The official unemployment figures only tell part of the story. Many more people are without work but are not counted as being unemployed. Many are described by the Salvation Army as being “discouraged unemployed”. They would like to work and would accept a job offer if given, but they would not be deemed as actively seeking work because for instance looking for work through a newspaper does not meet the threshold of “actively seeking work”. The number of Kiwis jobless has increased by almost 100,000 under National’s watch to now 261,300 people as of December 2011. In the meantime 59,964 people are receiving the Unemployment Benefit as at December 2011 a fall of 7% from 67,084 as of the December 2010.
So is this it? Is this the brighter future promised to all New Zealanders?

Number of people jobless

Minimum Wage misery

Posted by on February 8th, 2012

The government’s announcement today of a 50 cents an hour increase in the minimum wage has left me feeling both relieved and depressed.

I’m relieved because at least the increase is 50 cents an hour, rather than the miserly 25 cents an hour in last year’s minimum wage increase –  even  if it still leaves a minimum wage worker only 20 cents an hour better off in real terms than they were after National’s first minimum wage increase in April 2009.    

But I’m depressed because of another lost opportunity to do something tangible about soaring income inequality in New Zealand.

The government, despite its crocodile tears and phony concern about poverty and the impact on families and children has ignored what would have been a significant step in addressing income inequality.

But I’m relieved that there is almost a majority in parliament for increasing the minimum wage to $15 an hour, with Labour, the Greens, Maori Party and NZ First all condemning the government’s short sighted decision today.  The only party that stands in the way of that happening is the one man band ACT  Party – whose only comment today has been to criticise the government’s increase in the new entrant and trainee rate to $10.80 an hour. (Sorry, United Future could be a game changer on this, but don’t hold your breath).

Should be an interesting one to watch.

TINA’s back

Posted by on October 21st, 2011

Since Labour announced its Work and Wages Policy, there’s been the editorials repeating the “TINA” (There is no Alternative) lines of yesteryear and arguing for trickle down. Then there’s those who have an in-built opposition to anything that might improve the lot of working people, and an aversion to those dreadful organisations called “unions” – the 370,000 New Zealanders who are part of today’s unions.

This is old National at their worse.  It’s they who haven’t changed and who are out of touch. They need to catch up with the reality of work and wages for most New Zealanders and they need to tune into the debate that’s happening around the world about the failure of the orthodoxy of the last 20 years.

When Labour introduced the Employment Relations Act (ERA) in 2000, we heard the same rubbish from some National MPs who are now Ministers and others best forgotten.  The ERA was going to be the end of the world, while today, most will concede that it was very modest regulation indeed.

Eleven years ago, this is what Jenny Shipley, Max Bradford, Gerry Brownlee and Richard Prebble said in Parliament.

Rt Hon. JENNY SHIPLEY (Leader of the Opposition):  Welcome to Jurassic Park. This is a step backwards for New Zealand…… Taking New Zealand back to ideas that most people thought were extinct is no way to forge the future for this country. I do give notice here that the Government would have been far better to build on the strengths of the Employment Contracts Act, rather than destroy them and try to reintroduce some notions that most people thought had seriously gone 50 years ago, or more.

Hon. MAX BRADFORD (NZ National): …  why is the Labour-Alliance Government digging up all the old processes, the old institutions, the old dinosaurs of the past in order to get it? One of the reasons that the Employment Contracts Act was introduced in 1991 was the old system under the industrial relations legislation, the Labour Relations Act, was not working. Yet here we have a grand march backwards into the past to try to assert—because that is all it is; an assertion—that somehow or other employment relationships will improve, growth will improve, and we will get more jobs out of this approach to industrial relations……. there are people who are waiting to leave this country because it will be too difficult under this legislation to employ people and to invest.

Hon. RICHARD PREBBLE (Leader—ACT NZ):…. Who do the Alliance, the Labour Party, and the Greens think they are fooling? This bill is compulsory unionism by the back door. We know what the consequences will be. It is well known that the country’s port unions have already been meeting. They have already agreed that they will be asking for a collective agreement. When this bill comes into effect on 1 August, they will be making a demand to every single port in the country for a collective agreement—in other words, a national award. They are prepared to go on strike to get it. It is already well known that the North Island freezing works sheds—the unions—have already met. They have already agreed on their collective agreement, and the moment this law comes into effect they intend to exercise industrial muscle to get that agreement.

GERRY BROWNLEE (NZ National—Ilam): ……  This bill, dressed up as a herald of integrity and individual choice in industrial relations, is nothing more than another step on the long march backward that this Labour-Alliance Government is determined to inflict on New Zealand. This bill rips out any element of trust and mutual respect from industrial relations in this country. It is based on the premise that the employer is always wrong. It is based on the premise that there is an intrinsic, irreconcilable difference between employers and employees. Always it is the employer who is the guilty party, regardless of the circumstances. This bill is the most unbalanced legislation that could ever have been introduced in the industrial relations area.

Eleven years ago, according to the National Party, employment law change was going to be the end of the world. Did the world end?  No, of course it didn’t. In fact we had good growth, low unemployment, no debt and an improving social outlook.

Thank goodness there are some real thinkers contributing to the modern conversation about how we build a better and fairer economy and society.

Here’s a good piece on wages from Bill Rosenberg today.

“We need more cheap foreign fishermen”

Posted by on October 17th, 2011

An outrageous submission (and in the current Rena situation, unfortunate) from SeaFIC on the first day of the hearings of the Ministerial Inquiry into the treatment of crew on Foreign Chartered Vessels in the Fishing Industry.

New Zealand’s fishing industry needs more cheap Asian labour not less, the Seafood Industry Council (SeaFIC) told a ministerial inquiry into the use of foreign charter vessels (FCVs).

SeaFIC says New Zealand-flagged fishing boats cannot get local crews and they now want to import low wage labour as well. Despite high unemployment it was hard to get New Zealanders to work on fishing boats.

SeaFIC says FCVs hiring Asian crews was no different to companies going to low wage countries.

“Many New Zealand businesses have exported jobs previously done in New Zealand to other countries with wage rates considerably less than minimum wage rates in New Zealand.”

New Zealand was seen in other countries as a source of cheap skilled labour and pointed to Qantas hiring New Zealand crews at rates lower than Australians would get. The New Zealand film industry was based on cheap labour, SeaFIC said. (hah, funny that!)

SeaFIC say there is no evidence that FCV companies are failing to pay their crews according a code of practice which requires crews to receive the New Zealand minimum wage.

New Zealand’s reputation is not a function of compliance by the companies, but the result of public opinion.

“The intensity of comment in the media, whether based on fact or allegation, may present risk to international reputation.”

Yeah right.

Courier Drivers – a small business issue

Posted by on October 9th, 2011

Good piece in the Sunday Star Times today about the reality of working as a Courier Driver.  The impact of cut-throat competition, unfair contracting and a lack of minimum protection for dependent contractors is illustrated well.

Courier drivers are struggling to earn a living wage, with incomes stalled at about the same level as they were 20 years ago, while running costs have exploded. Urgent Couriers’ managing director Steve Bonnici said prices had been slashed due to cut-throat competition, which only intensified during the economic downturn of the past few years. Bonnici said prices have been cut to “ridiculous levels” – and it wasn’t just small, fly-by-night operators doing the cutting. As contractors, drivers had few of the benefits of employees, yet they were still obliged to wear a corporate uniform, work certain hours, apply for annual leave, and work exclusively for one company – as well as providing their own vehicles.

I’ve been on about this for some time now, including calling for SafeRates and better protections for all drivers. My Minimum Wage and Remuneration Bill, which would have provided at least minimum wage protection to these contractors was voted down early in the term of the National Government.

The National government, despite claiming it is the party for small business, has ignored the problems for small business operators like those in the Courier Industry.

“Anecdotal evidence from couriers looking for work indicates some firms are paying less than the minimum wage of $13 an hour. That’s not enough to live on, especially for drivers with families and mortgages”, Bonnici said……

“It’s sad what’s happened to our industry; there are plenty of owner-drivers out there whose revenue before expenses is barely the minimum hourly wage. After they have paid costs out of this revenue they are below the poverty line,” said Paul Holdom, who developed CourierPost Urgent for NZ Post and is now sales manager at Inter City Urgent.

The  industry is now coming around to the view that regulation might work better so that there is protection for small business operators who are totally dependent on one firm for their income.

“Every other industry has the minimum wage. You can’t put an ad in the paper offering employment at $7.50 an hour”, Bonnici says.

I’ve had a lot of contact with courier and other drivers over the last three years. Some of their stories are shocking.

Another piece in today’s SST  gives an insight into what Labour’s policy will include when it is announced on the 18th October.

Karl Anderson, First Union’s representative for transport and logistics in the Northern Region, said legislative protection was coming in Australia and it was the union’s desire to see it here too.

“I don’t think we have a bolter’s show under a Key government, which is ironic, given they say they are the saviours of small businesspeople,” he said.

Sadly, he’s right.

Uh oh – here it comes

Posted by on June 8th, 2011

John Key told the Seafood Council today that if National is re-elected in November, further changes will be made to employment law. 

I’m guessing they won’t be good changes for workers, especially when he boasted “trade unions won’t like them.”

He claims a flexible labour market is good for employers and workers.  Does he mean the one in five women employed in the public sector who work overtime for no extra pay as reported today by the PSA?  Does he meant the contribution they make of an estimated 2.5 million hours of unpaid work a year, worth about $54.5 million and equivalent to 1360 full-time jobs?

What I’m hearing repeatedly from John Key’s National Government now is that working people make no contribution to the economy – they have no role in productivity, should have no say in the workplace and most of all, should not expect either to have rights or to know anything about them.

Although the government has made some pretty hideous changes to employment rights, I thought we’d got past the real ideological crap of the past. 

But it’s heading our way in force.  Cuts to workers rights, low pay, asset sales and welfare changes – to name just a few things. 

Sounds like a government with no plan to me.

Have the Maori Party conceded in Te Tai Tokerau

Posted by on May 26th, 2011

It has become clear over the last couple of weeks that only Kelvin Davis can beat Hone Harawira. The Maori Party want him out of parliament even more than we do. That might explain their choice of a low profile candidate yesterday. As the Herald said :-

…. old party launched Solomon Tipene’s bid to win the Te Tai Tokerau byelection.

The great-grandfather was the surprise pick for the Maori Party, which also interviewed lawyer Mere Mangu and actor Waihoroi Shortland, tipped by many in the north as the frontrunner.

the Hone shotgun scenario on is creating lots of interest including some criticism.

When being a union member makes a difference

Posted by on May 25th, 2011

The Guardian has an instructive article on the rights of abused workers in the States. It is based on the current Strauss-Kahn case and shows the danger of unfair dismissal laws of the type Kate Wilkinson and John Key aspire to.

One very important fact has been largely absent from the coverage of the sexual assault case against Dominique Strauss-Kahn, the former head of the International Monetary Fund (IMF) and, until latterly, leading candidate to be the next president of France. The hotel housekeeper whom he allegedly assaulted was represented by a union.

The reason that this is an important part of the story is that it is likely that Strauss-Kahn’s alleged victim might not have felt confident enough to pursue the issue with either her supervisors or law enforcement agencies, if she had not been protected by a union contract. The vast majority of hotel workers in the United States, like most workers in the private sector, do not enjoy this protection.

A Brash reminder on minimum wage and benefits

Posted by on May 7th, 2011

Brash on Health 2

Tell the Government: Don’t Cut Our Future!

Posted by on April 27th, 2011


t Cut Our Future

Remember when Key wanted to close the wage gap with Aussie – now English is proud of it

Posted by on April 9th, 2011

John Key’s promise to close the wage gap with Australia was an important policy plank.

Yesterday Bill English formally abandoned that policy and used the fact that our wages are 30% lower to try and sell New Zealand as a long term investment option.

The fundamental competition is for capital, including Australian capital, he said, and over the next few years New Zealand’s advantages would become more apparent.

“One is the wage differential. We have a workforce that is better educated, just as productive and 30 per cent cheaper,” he said.

I suppose it should be refreshing to see honesty from the government but I do feel sad the the first appearance of a plan openly involves keeping wages low.

Glad government listens (very occasionally)

Posted by on March 29th, 2011

News just in from the Ministry of Health regarding the sleepovers case – where the Court of Appeal determined that disability support workers were working when they stayed over in IHC premises, and therefore should be paid minimum wage for every hour worked.

“The Government, health and disability service providers and unions have agreed to enter negotiations on payments for staff who work sleepovers in the light of the recent Court of Appeal decision. These discussions are due to start on 1 April 2011.”

Good. That’s what Labour said they should have been doing way back.  They should have saved the expense of joining the Court of Appeal case and got on with doing the right thing.

Still, better late than never.

The car washer dudes are back

Posted by on March 29th, 2011

Don’t know about you, but I’ve noticed a lot more car window washers on intersections lately. My local one is back after not seeing him for years, because they mostly disappeared during the nine years of almost full employment under a Labour-led government.

But they’re back. They’re part of New Zealand’s informal economy, where in hard times, people are forced to make a living in whatever way they can because they cannot find jobs or are unable to start businesses in the formal economy.  These are part of the working poor who are working very hard but who are not recognised, recorded, protected or regulated by the government.

There’s no question that New Zealand does have an informal (or underground) economy.  The question is how big is it and is it growing?

Unfortunately, we have no idea about the size of the underground economy in New Zealand because people working in the informal economy are not registered as businesses or employees and they do not pay taxes.

But think about the workers that you see around the place.  There’s the flower and strawberry sellers on the side of the road.  There’s those who do jobs “under the table” to top up their meagre income or unemployment benefit.  There’s those who work from home and even in garages as sub-sub-sub contractors making things, sewing or putting things together, there’s those who mow the lawns, do a bit of catering on the side and there’s the street vendors selling jewellery, fake watches and sunglasses in the streets.

Increasing poverty and the growing gap between rich and poor is one of the underlying reasons for the growth of the informal economy – even in first world countries.

It is is poverty that forces people to take up unattractive jobs in the informal economy and the low incomes that such jobs yield create a vicious cycle of poverty.

It’s not good for our economy or society either.  No taxes paid, no ACC levies funded, no health and safety, no minimum wage, no other protections. 

It’s almost like the car washers are a barometer of the state of our ecconomy and the well-being of New Zealanders.  If it is, then we’re in big trouble.

Sadly, with a government with no plan for jobs, I fear I’m going to see a lot more of my local car window washer.

They won!

Posted by on February 17th, 2011

A Court of Appeal decision yesterday confirmed a previous Employment Court ruling that “sleepovers” performed by disability support workers is “work” and should be paid at the adult minimum wage of $13 for every hour of their shift.

My congratulations to the disability support workers and their unions for their persistence and determination in pursuing this outcome.  They’ve had everything thrown at them since the 2007, including an Employment Relations Authority hearing, an Employment Court case in 2009 and the Court of Appeal. 

The government joined the appeal through the Attorney General to argue that the Minimum Wage Act enables averaging of the minimum wage across a pay period, but now the Court of Appeal has also disagreed.

The Court noted the union lawyer’s comment that “no-one had ever heard of the averaging theory until it was created for this case, and most unions, workers and employers consider it to be bizarre”. It seems that this argument had been dreamed up to avoid the obligation to pay minimum wage to these workers.

The Court has left it to the parties to reach an agreement over how the decision will be applied, with the option of returning if agreement can’t be reached.  The government needs to meet with unions, disability support providers and representatives of service users to find a durable solution that will ensure a quality service can continue to be provided with workers being paid their basic entitlement to minimum wage.

It will mean that the government will have to fund providers to pay their staff the legal minimum wage and that clearly has significant implications for the health budget.

But New Zealand has relied on the goodwill of caregivers in disability support for years.  These workers and the people they care for should now be able to rely on the government’s support for the important work they do.

In God’s own country

Posted by on January 31st, 2011

Last Sunday, the Sunday Star Times surprised and delighted by leading, no less, with a story about a survey showing people are increasingly concerned at the growing gap between rich and poor in this country, God’s Own which once prided itself on being egalitarian.

Yesterday it followed up with a major feature providing more detail, including a graph from the book The Spirit Level which shows NZ was 18th out of OECD 23 nations in terms of the gap between the richest and poorest 20%.

At Labour’s excellent Summer School over the weekend, Otago University academic David Craig reproduced GINI data which suggested in fact we are now the most unequal society. (He’s sending it and I will post up the link.)

Yesterday’s SST article quotes Brit Tory leader David Cameron as saying of The Spirit Level that it showed that “among the richest countries, it’s the more unequal ones that do worse according to almost every quality of life indicator…”

“We all know, in our hearts, that as long as there is deep poverty living systematically side by side with great riches, we all remain the poorer for it.”

Cameron is doing more than mouthing the words. Last year he appointed former Observer editor and long-time campaigner on equality and a ‘stakeholder’ society, Will Hutton, to head a pay equity review. (I am currently reading Hutton’s latest book Them and Us but more on that at another time.)

So you might think there is the chance for a reasoned debate here in NZ, if not Government pick-up?  Accompanying the SST feature yesterday was commentary from both CTU economist Bill Rosenberg (agreeing) and Roger Kerr, director of the Business Roundtable.

I can’t find an e-version of Kerr’s comments (although the BRT website carries this but he starts by saying: “Other things being equal, I prefer less inequality in incomes and wealth rather than more…”

Kerr then goes on the pan the book and story and dismisses the idea of better equity by saying:  “Equalising incomes, was, of course the socialist goal…”  No one is talking about equalizing incomes, that’s stupid and out of line even with a Tory Prime Minister. What we are talking about is a more equitable society, where the gap between rich and poor is reduced because otherwise everyone suffers.

It is simply obscene, for example, for the Westpac  chief executive in this country to be commanding a salary of $5m+ a year as we struggle out/through a recession for which banks have to take some responsibility. Banker JP Morgan had a rule that his executives should not earn more than 20 times that of his lowest paid employee. Westpac call centre people earn around $45,000 a year. That would take their CEO to around $1m.

That’s the sort of ceiling in place for state sector chief executives. Even then you have to ask why some SOE CEOs are earning twice + what the Prime Minster earns.

John Key is unlikely to follow the line taken by David Cameron. He is more likely to support Roger Kerr’s defence of the growing pay inequity gap and argues opposition is the politics of envy; that we should simply stop redistributing wealth (as if no redistribution has happened) and look at growing the economic pie.

No argument with that if the growth is sustainable but there’s no evidence provided that this is enhanced by paying someone 50 or 100 times what their workers earn.

Moreover, The Spirit Level graph of inequality appears to suggest that more equitable societies are more stable. Spain at tenth on the list of most equitable is the first truly troubled economy to be listed. The USA is second most unequal, just ahead of Portugal.

Neither our economic stability, nor our growing equality gap now perhaps the worst in the western world will be helped by tax cuts heavily favouring top earners. And another dose of state asset sales pushing up power prices won’t close the gaps either.

Let’s talk about these green jobs

Posted by on January 30th, 2011

A few years ago, before I became an MP, I attended a property services conference in Helsinki, run by the Global Union for Cleaners, UNI.

I was struck by a presentation from ISS, a global facilities service provider, who talked about how cleaning jobs could be revolutionised, particularly with the growing emphasis on green buildings.

At that stage, most cleaners (including NZ) were employed in the traditional way. As the office staff clocked out, the cleaners clocked in – out of sight, out of mind, working for low wages – working at multiple sites and for multiple employers, often wandering from site to site during the night.

ISS talked about this could change – how cleaning could take place during the day, with cleaners working alongside other staff and perhaps expanding their skills beyond cleaning to pick up other facilities work.

So I was interested to read in Saturday’s Dom Post “that there is office cleaning revolution gathering pace in NZ, where the days of mops and wringer buckets filled with unsafe chemicals and sloshed along office corridor floors and noisy vacuum cleanings trailing long chords are numbered.”

ISS NZ is changing the equipment issued to cleaners to lightweight adjustment aluminum mops, microfibre cloths and battery powered quiet vacuum cleaners. Beginning at Te Papa a couple of years ago, ISS, who employs around 4000 cleaners says that the new system has now been adopted by 25% of their clients.

And the biggest change : changing from nighttime cleaning to daytime cleaning, bringing savings for companies in electricity and security.

While ISS says the savings are great for companies, I think the changes can create a revolution for the traditional job of a cleaner, in a number of ways. Firstly, they are more integrated as part of the building staff, not a group of “fairies” who magically appear while we’re at home sleeping. The higher visibility of cleaning staff during the day should raise the overall awareness of the process and more respect towards cleaners, especially when they see them working to keep the building clean. Coming face to face with the cleaner means greater care is often taken by staff and visitors to keep the building clean.

Secondly, daytime work offers much more family friendly options for cleaners and could make the work much more desirable.

I’ve always said cleaners are undervalued. They are responsible for millions of dollars worth of equipment, and now they’re at the forefront of sustainablility in our downtown offices, our airports, schools and hospitals.

The big question is whether that means cleaners’ jobs become worth more (currently, the rate is set at $13.10 an hour), whether there can be decent, full time jobs created through upskilling to take on other work in the day to day life of an office.

NZ’s model of competitive tendering means that more often than not, cleaners are transferred to a new employer who expects them to do the same amount of work for fewer hours.

So, let’s have a revolution in office cleaning, but if it’s still work for vulnerable workers who have to work two or three jobs to make a living, it’s only a revolution for the better off.