Living wage for public service contractors

Economic and Regional Development

Some of the lowest paid workers in government will be moved to the living wage, with a direction to extend it to contractors in the cleaning, catering and security guard sectors.

Public Service Minister Chris Hipkins says core Public Service departments and agencies have been directed to ensure that contracts for cleaning, catering and security guards signed or renewed after 1 December pay at least the living wage rate of $22.75 per hour.

Fixing low pay is a priority for this Government. We committed to extend these living wage guarantees in our election manifesto,” Chris Hipkins said.

“Cleaners, caterers and security guards on Public Service contracts with third parties do valuable work, but are not always paid at levels that allow them a decent standard of living.

“Many departments have already moved to address low wages for these workers. But Government needs to send a clear signal to give greater certainty for workers, departments and private sector businesses who hold these contracts,” Chris Hipkins said.

“Government agencies have incredible buying power. We are using the levers of central government procurement to drive real and progressive change,” Stuart Nash said.

“We have signalled we will use procurement to enhance opportunities for diverse businesses and for women, Maori, Pasifika, youth and disabled workers; to help achieve climate change goals; and in this case, ensure people are paid a wage they can live on.

“I congratulate agencies like MBIE who have implemented the living wage in contracts for MIQ facilities. All staff across the 32 facilities are now on living wage equivalent or higher, and there is a provision built in for wages to continue to increase as the living wage increases,” Stuart Nash said.

We have made real progress to address low pay since 2018 by increasing the minimum wage every year, making it easier to raise pay equity claims, and agreeing to bring in Fair Pay agreements. The extension of the living wage is another milestone alongside these decisions,” Michael Wood said.

“The living wage will improve living standards for workers and their whānau, which is even more important during the global COVID-19 pandemic. Low-paid workers are particularly vulnerable to the economic impacts of the crisis.

“I want to acknowledge the work of the Living Wage Movement Aotearoa and its allies in pushing for this change. We committed to extend the living wage in our manifesto, and for the Public Service to lead by example,” Michael Wood said.

Note to Editors: The departments and agencies affected are those listed in Schedule 2 of the Public Service Act 2020.

Public Service Core Departments

  1. Crown Law Office
  2. Department of Conservation
  3. Department of Corrections
  4. Department of Internal Affairs
  5. Department of the Prime Minister and Cabinet
  6. Education Review Office
  7. Government Communications Security Bureau
  8. Inland Revenue Department
  9. Land Information New Zealand
  10. Ministry for Culture and Heritage
  11. Ministry for Pacific Peoples
  12. Ministry for Primary Industries
  13. Ministry for the Environment
  14. Ministry for Women
  15. Ministry of Business, Innovation, and Employment
  16. Ministry of Defence
  17. Ministry of Education
  18. Ministry of Foreign Affairs and Trade
  19. Ministry of Health
  20. Ministry of Housing and Urban Development
  21. Ministry of Justice
  22. Ministry of Māori Development—Te Puni Kōkiri
  23. Ministry of Social Development
  24. Ministry of Transport
  25. New Zealand Customs Service
  26. New Zealand Security Intelligence Service
  27. Oranga Tamariki—Ministry for Children
  28. Public Service Commission
  29. Serious Fraud Office
  30. Statistics New Zealand
  31. Te Kāhui Whakamana Rua Tekau mā Iwa—Pike River Recovery Agency
  32. The Treasury

Departmental Agencies

  • Cancer Control Agency
  • Health New Zealand
  • National Emergency Management Agency
  • Māori Health Authority
  • Ministry for Ethnic Communities
  • Office for Māori Crown Relations—Te Arawhiti
  • Social Wellbeing Agency