Government’s Fair Pay Agreement work to begin

The Government’s work on establishing Fair Pay Agreements, helping design a collective bargaining system to lift wages and productivity in New Zealand, will be led by former Prime Minister the Rt Hon Jim Bolger, says Workplace Relations and Safety Minister Iain Lees-Galloway.

“The Government has a vision for a highly skilled and innovative economy that delivers good jobs, decent work conditions and fair wages, while supporting economic growth and productivity,” says Mr Lees-Galloway.

“The best way to create a high-wage economy is through productivity growth, and we must ensure that workers and businesses benefit from economic growth. While wages have generally grown in the top-two and bottom-two deciles, wages for middle New Zealand have not kept up and as a result feel squeezed by rising costs, particularly in housing.

“We can and must do better for middle New Zealanders. Fair Pay Agreements will establish a framework for employers and employees to work together constructively to lift wages and productivity.

“Workers and employers know their sector best. By working together through effective engagement and bargaining cooperatively, workers and employers can set standards that are relevant to their sector and support productivity and growth.

“The aim of FPAs is to prevent a race to the bottom, where some employers are undercut by others who reduce costs through low wages and poor conditions of employment.

“Through the team led by Jim Bolger, the Government intends to introduce legislation to allow employers and workers to create Fair Pay Agreements that set minimum employment terms and conditions for all workers in the industry or occupation covered by the agreement.

“Fair Pay Agreements will help lift wages and conditions and ensure good employers are not disadvantaged by paying reasonable, industry-standard wages.

“It is time to move toward new models of bargaining. It is time New Zealand adopts a sector-level approach that is common across the developed world.

“Mr Bolger will lead the team of ten to develop recommendations on the design of a Fair Pay Agreement system, which is due to report back by the end of the year, and we will work closely with businesses, organisations and workers to develop a new and enduring framework that is good for employers and workers,” says Iain Lees-Galloway.

The team includes worker and business representatives, those with practical on-the-ground experience and experts in law, economics and bargaining systems.

Members of the Fair Pay Agreement team:

Rt Hon Jim Bolger – 35th Prime Minister of New Zealand, former Minister of Labour

Dr Stephen Blumenfeld – Director, Centre for Labour, Employment and Work at Victoria University

Steph Dyhrberg – Partner, Dyhrberg Drayton Employment Law

Anthony Hargood – Chief Executive, Wairarapa-Bush Rugby Union

Kirk Hope – Chief Executive, BusinessNZ

Vicki Lee – Chief Executive, Hospitality NZ

Caroline Mareko – Senior Manager, Communities and Participation, He Whānau Manaaki o Tararua Free Kindergarten Association

John Ryall – Assistant National Secretary, E tū

Dr Isabelle Sin – Fellow, Motu Economic and Public Policy Research, and Adjunct Senior Lecturer at Victoria University of Wellington

Richard Wagstaff – President, New Zealand Council of Trade Unions

The terms of reference are available at MBIE’s website.