State sector pay expectations released

The State Services Minister Tony Ryall today released the Government's Expectations for Pay and Employment Conditions in the State Sector, and says there is recognition in the state sector that the private sector is hurting.

Mr Ryall said, "The worsening financial outlook is strongly influencing the new terms under which State sector chief executives will negotiate employment agreements with their staff.

"The new expectations reflect the new Government's priorities, and the worsening economic and fiscal situation."

The key points are:

• Any changes to pay must not lead private sector movements and must take into account the total cost and value of employment conditions.
• State sector agencies that are required to consult with the State Services Commission regarding changes to conditions of employment are expected to demonstrate that outcomes are fiscally sustainable within baselines, responsible, and demonstrate value for money.

As part of the new package, the two pay and employment equity investigations that are underway will be discontinued. They generate an additional form of remuneration pressure that is unaffordable in the current economic and fiscal environment.  However departments will still be expected to continue to address equality issues  as part of being a good employer.  

The previous government's directive to implement common leave provisions has also been rescinded and maximum levels of leave have been set.  Introducing common leave provisions represents a significant non-wage cost which in at least several cases is unaffordable within baselines.  In future, any changes to leave provisions within the maximum are to be agreed by the relevant Public Service chief executive within baselines.

The Government's overarching policy for employment and workplace relations is based on demonstrating good faith, natural justice, human rights, good employer practice and requirements, and relevant legislation.

The State Services Commissioner will hold chief executives to account for meeting these expectations in their performance reviews.  Crown entities will also be expected to keep their responsible Minister informed about proposed actions not in line with the expectations.

A copy of the expectations document is attached.