Retail industry not happy with 'fair pay' proposal, union says they'll come around

One of the country's biggest unions says new proposed rules around 'fair pay' will be good for businesses by putting more money in the back pocket of locals.

But the retail industry isn't so sure, saying the changes will drive up costs. 

Workplace Relations and Safety Minister Michael Wood on Friday unveiled how unions and employers will work together in the future to set minimum standards. 

"Fair pay agreements are about a range of different conditions, not just pay," E tū assistant national secretary Annie Newman told Newshub.

"It might be establishing health and safety standards for a particular industry; it might be establishing hours of work and rosters; it might be establishing processes for employers and workers to talk together...; it could be talking about penal rates. So there is a big range of topics that could be included in a fair pay agreement." 

Under the proposal, based on ideas from a working group led by former Prime Minister Jim Bolger, unions can initiate fair pay bargaining if they have the backing of at least 10 percent or 1000 employees in a particular industry or occupation. 

"Fair Pay Agreements will help good employers by stopping the race to the bottom we've seen in various industries and encourage competition that isn't based on low wages, but on better products, services, and innovation," said Wood.

"We're excited, we're thrilled.. we know that it's going to make a big difference to workers in precarious work, who are quite vulnerable in their employment and who I think are struggling to make ends meet," said Newman.

What we've seen in New Zealand is an enormous amount of in-work poverty - we've got some people who earn an enormous amount of money in this country, and others who can't pay the rent on their earnings. There has to be a significant shift to change this so people live decent lives that in a wealthy developed country, we should be able to have."

She's convinced employers will come around eventually.

"The more money workers have in their pockets, the more flourishing the local economies where those workers live will be." 

The retail industry however isn't convinced. 

"It's really not a good idea," Retail NZ chief executive Greg Harford told Newshub, saying the industry already pays enough.

"The average wage in retail is already well above the minimum wage, and there's been significant movement in it over the last few years. If you're trying to add more costs into a sector that's already struggling on the back of large increases in the minimum wage and it's bracing itself for the new sick leave and Matariki proposals, it's not going to be pleasant."

He said bosses would scale back employees' hours and be more reluctant to make new hires, so the proposals should be opt-in for both employers and employees.

"There's already provision in the current framework for multi-employer collective agreements. The Government has a lever called the minimum wage where it can set a floor where it thinks wages should be set."

The Council of Trade Unions, unsurprisingly, supports the proposals.

"In the past year, we have all clearly seen the essential work that people working in our supermarkets, our cleaners, and security guards do. But they continue to be paid the minimum wage or close to it. Wages have been driven down simply to improve profit margins," said president Richard Wagstaff.

"Fair pay agreements will improve the lives of many New Zealanders and their families by lifting the wages of some of our lowest-paid."

The Taxpayers' Union doesn't, calling it "wage control" and suggesting "bureaucratic, inflexible wage agreements will create avenues for costly litigation".

The National Party called it "that '70s policy", sharing on social media an image of Wood edited to make it look like he's dressed up for a disco.