Fair Pay Agreements to improve pay and conditions for essential workers

Workplace Relations and Safety

The Government is delivering on its pre-election commitment to implement Fair Pay Agreements which will improve wages and conditions, as well as help support our economic recovery, Workplace Relations and Safety Minister Michael Wood announced today.

Fair Pay Agreements will set minimum standards for all employees and employers in an industry or occupation. The Government today released the details of the process unions and employers will go through to agree set minimum standards that are relevant to their sector. These proposals substantively implement the system proposed by the Rt Hon Jim Bolger led Working Group in 2019.

Michael Wood said Fair Pay Agreements are about investing in our people which is part of the Government’s COVID-19 recovery plan.

“Fair Pay Agreements will improve wages and conditions for employees, encourage businesses to invest in training, as well as level the playing field so that good employers don’t get undercut and disadvantaged.

“For too long New Zealanders working in critical roles like cleaners, supermarket workers, and bus drivers whose work was essential to keep our country going during the pandemic, have been undervalued by our workplace relations system. Fair Pay Agreements are about turning that around and ensuring that working kiwis get a fair go again.

“We’re taking a balanced approach and have designed Fair Pay Agreements to be negotiated between business and unions who are familiar with the particular sector or occupational group being negotiated for. Industrial action cannot occur during Fair Pay Agreement negotiations.

“Fair Pay Agreements will help good employers by stopping the race to the bottom we’ve seen in various industries and encourage competition that isn’t based on low wages, but on better products, services, and innovation.

“We’re committed to helping both businesses and unions through the process. We intend to provide support for both BusinessNZ and the Council of Trade Unions to help them coordinate FPAs, as well as potentially providing a support person and direct financial assistance to bargaining parties,” Michael Wood said.

The Government will now draft legislation, which will be introduced later this year, and is expected to pass in 2022.