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Fair Pay Agreements

Written by Vanessa Williams on February 13th, 2019.      0 comments

What would be the Impact of Fair Pay Agreements on small business?

The work that former National Party leader, Prime Minister and Minister of Labour, Jim Bolger, was doing on fair workplaces is in and Bolger is urging calmness.

payroll wages salaries-423But in a statement, according to the Herald, National workplace relations spokesman Scott Simpson said the report's recommendations would hurt the economy, damage productivity and was "democratically offensive".

The Fair Pay Agreement working group, chaired by Bolger, delivered almost 50 recommendations. The group, which was formed in June last year, recommended fair pay agreements cover all employers and that workers should be able to initiate a Fair Pay Agreement if they can meet a minimum threshold of 1000 people, or 10 per cent of workers in the sector or occupation, whichever was lower. These recommendations appeared to be the ones which both National and businesses were most worried about.

BusinessNZ chief executive Kirk Hope, who was also a member of the Fair Pay Agreement working group, said the compulsory nature of fair pay agreements and the risk of industrial action and productivity loss were key concerns. "Being covered by a fair pay agreement would be compulsory for everyone in an industry or sector. We disagree with this and think the decision to enter any employment agreement should be voluntary."

Bolger, who became Prime Minister in 1990 and previously was Minister of Labour, said he wanted National to respond to the report with "calmness and just say there are issued raised here that we as a party in Parliament need to reflect on". "The most disappointing [outcome] would be if they were to dismiss [the report] it as of no consequence. "My old party has to accept, as they do, that the world is changing and we have to change to keep ahead."

So, anything to fear or be concerned about?

Actually, I do not think so if you are a well-run company paying staff what they are worth. Most collective agreements cover trades at present as will Fair Work deals. Most smaller businesses are not in manufacturing and are import and service businesses and small enough not to attract attention. The employment market is so hot that good staff always go where the rates are best anyway.

It will be a long time before industry-wide agreements will start to penetrate smaller work sites who by then will be paying competitive rates anyway to hold staff in place. Finally, the entry criteria for a Deal are so steep that I doubt that many arrangements will be made.

If you would like to talk with Ross Henderson about a recruitment requirement or any other HR or employment law project please call 027 294 0301 or email Ross.
Topics: Payroll, staffing
 

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