Source: Workers First Union
Workers First, the union for supermarket workers, says that all four policy suites announced by political parties in recent weeks will fail to solve the duopoly’s excess profitability or market dominance without addressing the fundamental competitive “zero-sum” game that remains on wages and conditions in the industry.
Rudd Hughes, Workers First Deputy Secretary, said that in the absence of a sectoral bargaining mechanism like a Fair Pay Agreement, the most meaningful competition between Foodstuffs (Pak’nSave and New World), Woolworths and any new entrant to the market is on wages, not prices.
“The policies announced by National and NZ First will not work because they overstate the effect of market competition and understate the role that low wages play in fuelling the duopoly’s dominance,” said Mr Hughes.
“Wages are a significant spend for supermarkets, and keeping most workers as close to minimum wage as possible is a big factor in enjoying a high margin on their retail price.”
“If companies can continue to compete on wages and conditions but not the price of goods or market share, it will be a race to the bottom to maintain the current margins, and workers are the ones who will be made to pay for the rest of us to enjoy cheaper prices.”
“Changing who owns which bits of Foodstuffs does nothing to solve the issue of excess profitability. Even introducing an Aldi or a Tesco to the mix wouldn’t solve the fundamental problem that the duopoly’s margins are made from underpaying and understaffing their workforce.”
Mr Hughes noted that neither the National nor NZ First policy releases appeared to consider the effect of splitting Foodstuffs on the supermarket workforce or their wages.
“Labour’s price gouging ban could succeed in combination with a Fair Pay Agreement for supermarket workers, but not without a floor on wages and safety expectations, or workers will pay to keep the current margins alive,” said Mr Hughes.
“The Greens’ KiwiMart proposal has some merit, but only if its affordability mandate comes with a genuine sectoral floor on pay and conditions, modelled on something like Australia’s Fair Work Commission modern awards system. Without that, a state-owned supermarket chain becomes just another competitor with the same incentive to beat its rivals on wages.”
Mr Hughes said the union was currently in bargaining with Woolworths and several Foodstuffs stores around the country and the message from supermarket bosses was the same: “They want wages locked in low for two to three years, beneficial conditions cut from collective agreements, and redundancies, in many cases.”
“This is how they operate during what we’re supposed to pretend is a ‘tough time’ for them economically.”
Woolworths New Zealand’s profit rose 8.8% to $163 million in the year to June 2026, with half-year earnings up more than 22%. Foodstuffs is doing even better: the Commerce Commission’s latest Annual Grocery Report found both the North Island and South Island operations rank among the most profitable supermarket businesses in the developed world, ahead of Woolworths Australia, Coles, Walmart and Tesco, with duopoly margins holding steady.
Workers First’s recent report on a survey of more than 2,400 supermarket workers revealed that 59 percent had experienced customer abuse or harassment in the past two years, and workers in permanently understaffed stores were more than twice as likely to report a safety incident as those in well-staffed ones.
“It’s a really tough job and the pay supermarket workers get does not reflect the level of danger or difficulty that their jobs entail,” said Mr Hughes.
“We estimate that more than half of Pak’nSaves and New Worlds are paying minimum wage or just above it, so if you see slightly lower prices on some goods in some of those stores, the workers were the ones who paid for them.”
Mr Hughes added that while the ACT Party did not appear to have released any specific policy on supermarkets, their idea of a three-year minimum wage freeze and a new 60% training wage for under 20s were “positively dystopian”.
“I suppose in a way that ACT are the only party who have considered the workforce in this equation and pondered how an employer could extract even more labour for their dollar,” said Mr Hughes.
“Supermarkets would likely be happy to take them up on the offer – but stopping this sort of exploitation is the reason unions like ours exist.”
Workers First is calling on all parties to commit to sectoral bargaining that sets a genuine floor across the grocery sector, taking wages out of competition entirely so supermarkets are left to compete on the things that should actually determine who wins: efficiency, service and genuine value.