Backing workers with Fair Pay Agreements

We've now delivered on our election commitment to back Kiwi workers with Fair Pay Agreements.

Fair Pay Agreements make it easier for workers across an industry or occupation to bargain for better wages and working conditions.

For too long, New Zealanders working in critical roles like cleaners and bus drivers have lacked bargaining power to improve their wages and working conditions. At the same time, employers trying hard to offer fair terms to their workers are disadvantaged, being undercut in a race to the bottom.

Fair Pay Agreements will help tackle these issues, by enabling minimum standards to be negotiated across industries and occupations. This will not only improve wages and working conditions, it will also encourage businesses to invest in training and level the playing field for employers trying to do the right thing.

There are lots of reasons why Fair Pay Agreements are good for workers, businesses and our economy. Here's a quick overview: 

What are Fair Pay Agreements?

A Fair Pay Agreement sets out minimum terms and conditions for workers across an industry or occupation. It means all workers in a certain industry would be covered by the same base wage rates, hours and overtime arrangements, even if they have different employers.

Here’s how they’ll ensure hardworking Kiwis get a fair deal.

At the moment, most workers are only able to bargain for better conditions and wages with their employer, not across an entire industry or sector.

This can allow employers to undercut each other by offering lower wages – creating an incentive to underpay workers.

This isn’t the vision we have for New Zealand. We want a highly-skilled, productive workforce where everyone shares in the benefits of economic growth.

Fair Pay Agreements will ensure all workers across an industry are covered by the same minimum working conditions, like pay and working hours. This will improve wages and conditions for employees, and level the playing field so that employers who are trying hard to offer fair terms don’t get undercut and disadvantaged.

Fair Pay Agreements also mean good employers aren’t punished for doing right by their workers.

Without industry-wide minimum terms and conditions, many businesses have felt forced into a race to the bottom on wages in order to compete. Good employers who pay a fair wage are left behind.

By setting industry-wide agreements on fair pay and conditions, we can encourage businesses to compete on the quality of their products, customer service and innovation – not on undercutting their competitors on wages.

Fair Pay Agreements will help to boost New Zealand’s productivity too.

Without Fair Pay Agreements, the current race to the bottom on wages undermines New Zealand’s productivity.

That’s because poor working terms and conditions can lead to a high staff turnover, and employers don’t have the same incentive to invest in upskilling their workforce and increasing productivity.

Fair Pay Agreements are just one way Labour is backing Kiwi workers.

Introducing Fair Pay Agreements is just one of the ways we’re supporting workers. Since day one, we’ve worked hard to lift wages and better protect people while they are at work, as well as growing jobs and investing the economy.

We believe that a hard day’s work deserves a fair day’s pay. That’s why we’ve boosted the minimum wage – bringing it to $21.20 per hour. We’ve also passed equal pay legislation to ensure people who perform work of the same value are paid the same.

To make sure workers get a fairer deal we’ve strengthened employment law. This includes bringing back meal and rest breaks after National scrapped them, and limiting 90-day trials to businesses with fewer than 20 employees.

We’re helping to keep workers safe and supporting them to balance their work with other commitments. We’ve extended paid parental leave from 18 to 26 weeks, and we’ve doubled the minimum sick leave entitlement to 10 days to make sure no one feels pressured to go to work when they’re unwell.

As our economy continues to gain momentum, we’ll continue to put people at the heart of our economic plan. We know that when we invest in New Zealanders, they have greater opportunities to prosper, provide for their families, and contribute to our country’s success.

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