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Source: Post Primary Teachers Association (PPTA)

The government is currently consulting on the introduction of fair pay agreements.

Fair pay agreements are supported by the PPTA and other unions because they are a way of improving our system of employment rights and protections in sectors and industries where collective agreements have not been successful. 

What are fair pay agreements? 

Fair pay agreements are a set of terms and conditions of employment for an occupational group or sector. They will be agreed through bargaining between affected workers and employers, and will then become legal requirements in that sector.

Why do we need them? 

Under our current system there are many barriers for unions to organise workers. This means there are large tranches of workers in New Zealand with only the minimum employment rights under the law. This is exacerbated by industries where competition has caused a ‘race to the bottom’ largely based on paying lower wages. Good employers who want to have better terms and conditions then get undercut by less scrupulous employers prepared to give their employees the bare minimum.

Fair pay agreements take control of this situation by providing agreed terms and conditions for that sector that employers must abide by. They create a level playing field that is specific and relevant to a particular sector so good employers are not disadvantaged by providing reasonable, industry-standard wages and conditions. For workers it provides them with a decent life. As a country we benefit because higher wages and productivity provide better economic growth.

How are fair pay agreements different from collective agreements?

Fair pay agreements cover all workers and employers in a particular sector – for example all farm workers and their employers. Unions would be involved in negotiating fair pay agreements however they would form the standards for the occupation covered regardless of whether the worker was a union member or not. Fair pay agreements are aimed at industries and workers who have not been able to influence their terms and conditions through collective agreement negotiations.

The mechanisms for negotiating fair pay agreements will be quite different then we have for collective agreements, if employer and workers can’t agree on terms and conditions then there will be a system of arbitration to set them, this recognises the fact that striking and other forms of influence that organised workers have would not be effective in  largely non-unionised sectors.

Will collective agreements continue? 

Collective agreements would continue where they already exist or where workers can be organised to negotiate new ones. 

It may be that the introduction of fair pay agreements and the exposure workers will have to representation and better terms and conditions will provide a launching pad for more unionisation and collective agreement coverage in those sectors. 

Do other countries have these sorts of agreements? 

Yes. Many other countries, especially in Europe, use sector-wide agreements as part of their employment relations systems. The OECD recommends a model of combined sector and employer level bargaining, because it is associated with higher employment, lower unemployment, a better integration of vulnerable groups and less wage inequality than fully decentralised systems like ours. Some countries also link wage increases to skills and training pathways, with the aim of increasing productivity and sharing its benefits.

Will a fair pay agreement cover teacher or principals?

Given we already have a strong collective agreement and union membership there is no need for a fair pay agreement for teachers or principals. They are intended to cover industries where this is not the case.

How can I learn more? 

The report of the independent Fair Pay Agreements working group is here:

Fair Pay Agreements – Supporting workers and firms to drive productivity growth the share the profits (PDF mbie.govt.nz) 

How can I have my say? 

You can use the NZCTU submission form here: 

Have your say on fair pay (together.org.nz) 

Last modified on Tuesday, 19 November 2019 16:46

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