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Progress of Fair Pay Agreements Bill 2022

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Fair Pay Agreements were a 2020 Labour manifesto commitment, with the long-anticipated Fair Pay Agreements Bill introduced to Parliament at the end of March 2022.

  • The Bill had it’s first reading on 5 April 2022
  • Consultation on the Bill closed on 19 May, 2022
  • The Fair Pay Agreement system is expected to commence shortly after the Bill has passed, anticipated to be at the end of 2022.

The Bill focuses on lifting the wages of those on low to medium incomes by proposing a framework for collective bargaining of Fair Pay Agreements (FPA’s) that would set minimum employment terms across specific industries or occupations. In many respects it takes New Zealand back to a system of national awards.

There are certain things that are mandatory to be included in an FPA, such as

  • when the FPA comes into force and expires (an FPA must apply for no less than three years, but no more than five years),
  • its coverage,
  • the normal hours of work,
  • minimum base wage rates,
  • overtime,
  • penalty rates and any superannuation entitlements.

Some other topics must be discussed but don’t have to be agreed, like redundancy, leave, and health and safety. Other employment terms can be included if the bargaining sides agree. You can find out more about the steps to the Fair Pay Agreement framework here.

The increasing compliance burden continues to take its toll on many of our members and the Association does not agree that that the Fair Pay proposals will achieve what they set out to achieve. Placing further compliance pressures on employers will create a more challenging employment market when we currently already operate in an environment with extremely robust minimum standards in place, that provides wide-ranging protection for employees. Low unemployment and minimum wage levels also provide enough incentive for employers to put their best foot forward with regards to pay and conditions – increases to minimum wage rates, have resulted in New Zealand’s minimum wage being one of the highest in the OECD.

The Association strongly supports an environment that provides fair working conditions for all that are employed in New Zealand, however, we oppose the procedures proposed through the Fair Pay Agreement system.

Find out more about the Fair Pay Agreements Bill here.

How you can help

Campaign – Restaurant Association and Business NZ

The Restaurant Association and Business NZ are calling on all Kiwis to reject FPAs and join our campaign calling for a smarter way of working. Supportive voices demonstrating the FPAs impact on real people will be critical to the success of this campaign. We are looking for NZ employers and employees who will be affected by the proposed system and would be happy to share your views publicly in support of the campaign.

This could be in the form of:

  • Short video message
  • Written testimonial
  • Image and testimonial
  • An interview with media should they request to speak with you.

Business NZ and the Restaurant Association will work in with whatever you are comfortable with in terms of involvement. Any employees that would like to take part would be asked to speak about how their current working arrangement has allowed them to negotiate your conditions and how your employer has been able to be flexible as needed.

For employers, you would speak to how this flexibility has enabled you to retain staff and create a sustainable
employment model that suits your team. You wouldn’t need to reveal details of your working conditions or pay, you would just need to speak to them at a general level.

Make your voice heard
If this sounds like you, and you’re willing to be in the campaign or would simply like to have a discussion about how you can show your support, we would love to hear from you. However you choose to participate, we will ensure the arrangements suit you.

Having your say – Your Work, Your Way

Employers and employees that are also concerned about the proposals have signed an open letter opposing Fair Pay Agreements through the Your Work, Your Way campaign. You can sign the open letter here.

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