2000 lowest paid public servants get pay boost

All employees in the core public service will receive an hourly rate of at least $20.55, the 2018 Living Wage, Minister of State Services Chris Hipkins announced today.

The new hourly rate – or annualised equivalent of $42,744 – includes full-time, part-time and casual employees and will be implemented by a one-off adjustment in pay with effect by 1 September 2018.

“This decision is about supporting fair pay and employment conditions for a decent standard of living for all New Zealanders,” Chris Hipkins said.

“This government strongly believes that every worker should be in a situation where the pay they receive means they can at least make ends meet.

“Most of the workers who will benefit work in 13 government departments, and work in jobs including clerical and administration workers, welfare workers, contact centre workers and assistant customs officers.

“The departments will meet the estimated $7.23 million cost of the one-off adjustment from within their baselines.

“In subsequent years, the rate will be subject to bargaining between government employers and unions such as the New Zealand Public Service Association.

“We know there is no one-size-fits-all solution to the problem of low pay. This decision for the lowest paid workers in the Public Service is one of a range of initiatives the Government is implementing to tackle the difference between the highest and lowest paid.”

Other initiatives already underway:

State sector

  • Progressing pay equity claims and initiatives to close the gender pay gap in the Public Service, noting that 70 percent of the people benefitting from today’s announcement are women.
  • New Government Expectations on Employment Relations in the State Sector prioritise narrowing the gap between the highest and lowest earners in departments, and closing gender pay gaps.

For all working people

  • Amendments to the Employment Relations Act currently before the House will strengthen collective bargaining and unions’ ability to negotiate decent pay and conditions.
  • Once enacted, proposed legislation will allow employers and workers to create Fair Pay Agreements that set minimum employment terms and conditions across an industry or occupation. Fair Pay Agreements will help lift industries out of a low wage, low productivity cycle, address the widening gap between labour productivity growth and wage growth, and support a broader sharing of the benefits of productivity gains in the economy.
  • We will raise the minimum wage to $20.00 by 1 April 2021.
  • The Families Package announced in December 2017 provides targeted assistance to improve incomes for low and middle-income families with children.

The Cabinet paper is here: http://www.ssc.govt.nz/proactive-releases