$2 billion pay equity settlement bill for 55,000 health care workers passes into law

  • Jonathan Coleman

Health Minister Jonathan Coleman says a bill to implement a historic pay equity settlement for 55,000 of the health sector’s lowest paid workers passed into law today with unanimous support from across the House.

The Care and Support Worker (Pay Equity) Settlement Bill was fast-tracked through Parliament to ensure providers of aged and disability residential care, and home and community support services pass on the new wage rates to their workers from 1 July.

“This legislation means from 1 July eligible workers will receive pay rises of between 15 and 50 per cent,” says Dr Coleman.

“For a full-time worker, this means they will be taking home around $100 extra a week, or more than $5,000 a year.

“For the 20,000 of the 55,000 workers currently on the minimum wage of $15.75 per hour, it means from July 1 they will move to at least $19 per hour, a 21 per cent pay rise.

“Existing workers will be transitioned to positions on the new pay scale which reflect their skills, and their experience. For new workers employed after July 1 wages will be based on an individual’s level of qualifications.

“This settlement corrects an historic undervaluation for this group of hard working and predominantly female health workers who care for some of New Zealand’s most vulnerable people.

“With three weeks to go, the focus is now on provider readiness and supporting providers to meet their legal obligations.”

The Ministry of Health is working closely with funders and providers on ensuring the first pay run after 1 July goes smoothly.

To support the implementation the Ministry has held nationwide information sessions, set up an implementation helpdesk, arranged to make advance payments to providers, and released guidance tools to help providers assess eligibility and transition workers to the new pay scale.

Support for providers and employees is also available through DHBs, unions, other government agencies like IRD and MBIE, and care and support industry peak bodies.

The $2 billion settlement over five years follows the TerraNova pay equity claim brought by E tū on behalf of care worker Kristine Bartlett.

The $2.048 billion settlement over five years will be funded through an increase of $1.856 billion to Vote Health and $192 million to ACC.