Archive for 11 November 2012

John Key’s track record on raising wages – 10. A New Government’s Response

11 November 2012 4 comments


Continued from: John Key’s track record on raising wages – 9. Conclusion



Hopefully someone in Labour, the Greens, NZ First, and/or Mana, is  keeping careful track of every one of these nasty, neo-liberal,  “reforms”.

Once in power, a Labour-Greens-NZ First-Mana Coalition must act decisively to undo and repeal every single one of these “reforms”.

Not one strand  of their repugnant legislation must be allowed to stand – not one.

Only a fool could still believe that National’s labour “reforms” are in any way designed to raise wages. They are not.

The true intent of   so-called “labour market reforms” is to make the workforce more “flexible” (exploitable); undermine the last vestiges of Unionisation; and drive down wages so that our workforce is a cheaper option than Australia.

It is a plan to turn this country into an “anglocised China” or “Southseas Mexico“.

The good news is that undoing National’s legislative obscenities should be a reasonably easy task.

The harder job will be for an incoming government to enact new legislation to enshrine workers’ rights forever. We simply cannot afford  National coming to power ever few years and repeating their destructive policies  against workers.

It’s one thing for Middle Class New Zealand to have a rush of blood to their heads and vote for a National “government” that will eventually end up screwing them over. But workers should not have to pay for this kind of Middle Class masochism.

Not if we want,

  • fairness in the workplace
  • real high wages (not National’s fantasy-variety)
  • and young New Zealanders encouraged to stay here, instead of migrating to Australia

We went through this batshit in the 1990s and now we’re going through it all again now.

Enough already.

It’s time for sanity to prevail.






Addendum 1


Date: Sunday, 11 November 2012 3:11 PM
From: Frank Macskasy <>
Subject: Industrial relations, raising wages,  and worker’s rights in this country
To: Darien Fenton “”,
    Denise Roche “”,
    Brendan Horan “”,
    John Minto “”

Kia ora Darien, Denise, Brendan, and John,
I have blogged a critique of John Key’s pledge to raise wages for New Zealand workers. John Key has made numerous statements in 2008, ’09, ’10, ’11, and this year, endorsing wages being raised.
I have matched reality with his rhetoric, and comes up with the following results, here, with these eleven short blogposts;
John Key’s track record on raising wages – preface Key’s track record on raising wages – 1. The “Hobbit Law” Key’s track record on raising wages – 2. The 90 Day Employment Trial Period Key’s track record on raising wages – 3. Ports of Auckland Dispute Key’s track record on raising wages – 4. Rest Home Workers Key’s track record on raising wages – 5. The Minimum Wage

John Key’s track record on raising wages – 6. Youth Rates

John Key’s track record on raising wages – 7. Part 6A – stripped away

John Key’s track record on raising wages – 8. An End to Collective Agreements

John Key’s track record on raising wages – 9. Conclusion

John Key’s track record on raising wages – 10. A New Government’s Response

As this country’s natural coalition-government-in-waiting, I would welcome your comments on the critiques I have written. Specifically, please outline your Party’s policies,
1.  regarding National’s track record thus far,
2. your policies regarding the issues I have raised,
3. what aspects of National’s so-called “reforms” you intend to repeal.
Any response you provide will be added to my above article as an addendum to “A New Government’s Response”, with full acknowledgement of your Party, spokesperson, etc.
Thank you for your consideration of this matter and I look forward to your reply,

-Frank Macskasy,




Previous related blogposts

The betrayal of our young people

“I was wrong about rising unemployment” – Blogger

Additional to “The Hobbit” Law

Radio NZ: Parliament debates Hobbit law change

Helen Kelly (NZ Council of Trade Unions): The Hobbit Dispute

Employment Relations (Film Production Work) Amendment Bill

Legislative History: Employment Relations (Film Production Work) Amendment Act 2010 No 120, Public Act

Labour vows to repeal Hobbit law


Parliament: Employment Relations Act 2000, Section 67A – the 90 Day Trial Period (March 2009)

Fairfax: Low wages ‘advantage’ for NZ – English (10 April 2011)

Fairfax: ‘We need more cheap foreign fishermen’ (17 Oct 2011)

TVNZ: Aussie wage gap now 40% – Brash (7 Nov 2011)

TV3:  Raising minimum wage won’t cost jobs – Treasury (10 Nov 2011)

Fairfax: Jackson pulls back from port comments (12 March 2012)

Fairfax: Calls to end shipping lines’ price fixing (25 April 2012)

TV3: Aus wage rise increases gap with NZ: Union (2 June 2012)

Otago Daily Times: Minimum wage increase: results may surprise (22 Aug 2012)

That was then…

NZ Herald: Salary and wage rates increase by record amount (5 May 2008)

NZ Herald: The miracle of full employment (7 April2008)

This is now…

Fairfax: Wage rises lowest since 2001 (3 Feb 2010)

TV3: Unemployment up to 7.3pc – a 13 year high  (8 Nov 2012)

Other blogs

No Right Turn: Turning a blind eye to exploitation

The Standard: John Key Selling (out) New Zealand



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John Key’s track record on raising wages – 9. Conclusion

11 November 2012 4 comments


Continued from: John Key’s track record on raising wages – 8. An End to Collective Agreements



Thus far we have seen no concrete  indications that John Key is implementing his  promises in 2008, 2009, 2010,  2011, and this year,   to raise wages.

Instead, Key and his cronies in National have been studiously  implementing law-changes that will inevitably result in the opposite;  a dismantling of hard-won working conditions; an  undermining of worker-representation in negotiations, and an eventual lowering of wages .

The only conclusion  that can be made is that Key has wilfully deceived voters. His public statements advocated raising wages whilst in back-rooms, he and  National Party ministers have been contriving to achieve a diametrically opposite agenda.

It serves National’s undisclosed agenda to lower wages, to attract international ‘investment’, and to allow corporations to increase profits on the backs of low-paid workers.

The process has already begun. As Bill English said on TVNZ’s  Q+A, last year,

Well, it’s a way of competing, isn’t it? I mean, if we want to grow this economy, we need the capital – more capital per worker – and we’re competing for people as well…


we need to get on with competing with Australia. So if you take an area like tourism, we are competing with Australia. We’re trying to get Australians here instead of spending their tourist dollar in Australia.” – Bill English, 10 April 2011

See: Low wages ‘advantage’ for NZ – English

The result was wholly predictable, and the headlines tell the story,


Full story


Full story


Full story




How does this raise wages?

Answer: it doesn’t.

Next and final chapter: 10. A New Government’s Response



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John Key’s track record on raising wages – 8. An End to Collective Agreements

11 November 2012 6 comments


Continued from: John Key’s track record on raising wages – 7. Part 6A – stripped away



8. An End to Collective Agreements


National’s covert agenda to resurrect the Employment Contract’s Act involves the following,

  1. The Employment Relations Authority can declare in certain circumstances that collective bargaining has ended.
  2. A duty of good faith does not require the parties to conclude a collective agreement.
  3. Employers can opt out of multi-employer bargaining.
  4. Partial pay reductions in cases of partial strike action.
  5. Removing the 30-day rule that forces non-union members to take union terms and conditions.

Items 1, 2, and 3 have only one purpose; to ensure that an employer can walk away from the negotiating table; scrap any collective agreement; and re-hire workers on individual contracts.

It is solely designed to destroy unions once and for all.

Had Items 1, 2, and 3 been in force this year, POAL (Ports of Auckland Ltd) would have been able to abandon the bargaining table after a mock “negotiation”; locked out any worker on strike; and issued take-it-or-leave-it individual contracts.

The worker’s negotiating agent,  the Maritime Union, would have been dis-empowered and destroyed.

Only the current provisions of good-faith bargaining in the Employment Relations Act 2000 and the Employment Relations Authority were able to stop POAL from unilaterally walking away from the negotiating table. (On 27 March this year, the Employment Court issued a judgement severely admonishing POAL for their actions, and ordering them to return to negotiations.)

The same happened when Talleys locked out workers. Talleys was demanding that workers quit their Union and sign individual contracts.

See previous blogpost: If anyone wants to see the Working Class

See previous blogpost: Help Talley’s Affco Workers!

See previous blogpost: Immovable and Irresistable forces – combined!!

See previous blogpost: The Talleys Strikes Back

All this will change – and not fot the better –  if National proceeds with implementation of their draconian law-changes.

They will serve the purposes of business – whilst leaving employees totally vulnerable and at the mercy of their employers.

This is Third World banana republic stuff.

This will drive wages down, and will send more New Zealanders packing for Australia.

Item 4 is self-evident, and is designed to dissuade employees from strike action. Using financial pressure to control workers would be the inevitable outcome of this law-change.

Again, it would leave workers totally vulnerable to employer demands.

Item 5 – What better way to prevent workers from learning about the benefits of union-membership – than by denying workers the benefits of Union-won  conditions? It means that an employer can hire staff at lower pay, or sub-standard conditions.

Labour Minister Kate Wilkinson’s own cabinet paper confirmed that the 30 Day Rule  would permit  employers to offer lower wages to new workers than those on the collective agreement. What other reasonwould there be for such a radical  change in our labour laws?

With unemployment now at 7.3%, more than 175,000 people are now competing for fewer and fewer jobs. If National proceeds with it’s miserable labour “reforms” it will simply result in unemployed job-seekers willing to accept lower and lower pay, and reduced conditions. It will become a dog-eat-dog labour market.

This may satisfy free market fanatics, but it does nothing to fulfill Dear Leader’s pledges to raise wages, or create new jobs.

As usual, Key promises one thing whilst his Minister work quietly in the background to achieve the polar-opposite.

In polite society, this is called duplicity.

How does this raise wages, one may rightly ask?

Next chapter: 9. Conclusion



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John Key’s track record on raising wages – 7. Part 6A – stripped away

11 November 2012 5 comments


Continued from: John Key’s track record on raising wages – 6. Youth Rates



7. Part 6A – stripped away


One of the most far-reaching aspects of National’s covert agenda to make the country’s workforce  “more flexible” (translation; more exploitable)  is their stated intention to remove Part 6A  of the Employment Relations Act (ERA),  which continues (or transfers under similar conditions and pay) the employment of  low-paid employees such as caretakers, cleaners, catering workers, hospital orderlies and laundry workers,  after a business is restructured or sold.

See: Part 6A – Continuity of employment if employees’ work affected by restructuring

Part 6A gives vulnerable, low-paid workers, the right to keep their jobs on the same terms of employment when  transferred to the new contractor.

See: Labour law changes announced

Labour Minister Kate Wilkinson has assured the public that this law-change will apply only to  small and medium-sized businesses with less than 20 employees.

Pardon me? Didn’t they say the same thing for the 90 Day Trial Period law? Oh yes, I believe they did,

Trial employment periods for up to 90 days for workplaces with fewer than 20 employees will be available from April 2009.” – Kate Wilkinson,  11 December 2008

See: National policy – 90-day trial period to provide job opportunities

Once National’s so-called “reforms” were bedded in, they changed it, implementing the policy they they had wanted all along,

The 90-day trial period is to be extended to enable all employers and new employees to have the chance to benefit from it.” – Kate Wilkinson,  18 July 2010

See: National Policy – 90-Day Trial Period extended to all employers

Sneaky, these Tory politicians. Ya cain’t take your eyes offa them, even fer a minute, Jethro!

This blogger has zero doubt that the same means of  removing Part 6A will first apply to small business with fewer than 20 staff – and then later (a year?) will be extended to all employers.

Once Part 6A is removed from the lawbooks, the lowest-paid workers in our communities will be vulnerable. A new employer will  be able to re-write their contracts at whim; reduce  their pay; change their conditions, or dismiss them altogether. There are many such small business and the impact on their workers could be severe.

Are we detecting a common them with National’s labour “reforms”?

Green Party industrial-relations spokeswoman, Denise Roche, was 100% on-the nose when she described these – and other “reforms” as,

This decision is straight from the Bill Birch era of industrial relations.”

This is indeed a return to the Employment Contracts Act – by stealth. National is too gutless to face the country by honestly presenting a manifesto returning to the ECA.

Remind us,  Mr Prime Minister, how scrapping Part 6A  will raise wages, as per your promises?

Next chapter: 8. An End to Collective Agreements



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John Key’s track record on raising wages – 6. Youth Rates

11 November 2012 6 comments


Continued from: John Key’s track record on raising wages – 5. The Minimum Wage



6. Youth Rates


When Labour was elected into government in 1999, replacing the highly unpopular Shipley-led National administration, one of their first actions was to radically reform the  Youth Rate,

  1. From 2001 to 2008 the adult minimum wage applied to employees aged 18 years and over. Prior to that, the adult minimum wage only applied to those aged 20 years and over.
  2. From 1 April 2008, the adult minimum wage applies to employees aged 16 years and over, who are not new entrants or trainees.
  3. The youth minimum wage applied to employees aged 16 and 17 years. From 1 April 2008, the youth minimum wage was replaced with a minimum wage for new entrants, which applies to some employees aged 16 or 17 years.
  4. The training minimum wage was introduced in June 2003.

See: Dept of Labour – Previous minimum wage rates




It did not appear to unduly impact on unemployment, which consistantly tracked downward in the 2000s, until the down-turn caused by the Global Financial Crisis began to impact on our economy, in 2007/08.

On 9 October, Labour Minister Kate Wilkinson announced that National intended to introduce a new Youth Rate, to take effect in April, next year. The rate would be set at $10.80 an hour – compared to the minimum rate of $13.50 an hour currently, and would include 16 to 19 year olds.

As reported,

That equates to $10.80 an hour, or $432 before tax for a 40-hour week. From April next year, the ‘Starting Out Wage’ will apply to 16- and 17-year-olds in the first six months of a job, to 18- and 19-year-olds entering the workforce after spending more than six months on a benefit, or 16 to 19-year-olds in a recognised industry training course.”

See: NZ teens face $10.80 an hour youth wage rate

It is doubtful if National’s Youth Rate will actually create new jobs. More likely, a drop in youth wages will simply create more ‘churn’ in employment/unemployment numbers.

As David Lowe, Employment Services Manager for the Employers and Manufacturers Association, inadvertently revealed,

Without an incentive an employer with a choice between an experienced worker and an inexperienced worker will choose experience every time.”

See: Starting-out wage will help young people onto job ladder

So there’s no new job for the  younger worker – s/he is merely displacing an older worker. Which probably results in  older workers joining the migration to Australia.

End result; a loss of skill and experience for New Zealand, and a gain for our Aussie cuzzies.

Nice one, Mr Key. Remind us when you took on the role of staff recruiter for Australia?

On top of this, we have this bizarre rationale from Kim Campbell, CEO of the Employers and Manufacturers Association, who is arguing that young people should be paid less because they have less to pay for. I kid you not.

She said,

Remember these people are not raising a family or running a household on this money –nobody expects them to – but it does give them some money to get started on.”

Campbell’s remark are offensive on several levels.

Firstly, National’s intention to return to  Youth Rates for 18 and 19 year olds, as well as 16 and 17 year olds, is simply unreasonable. These people are  young adults, and those studying  at  polytech and  University Students will soon be earning less,  even while having to pay Student fees; course-costs; and living expenses like rent, food, power, and other financial committments.

Secondly, 18 and 19 year old are as able to have families as their older counterparts.

Thirdly, by what logic is it of  Ms Campbell’s business  that “these people are not raising a family or running a household on this money“?! It’s none of her damned business what 18 and 19 year olds spend their wages on.

Conversely, does that mean Ms Campbell will encourage companies to pay a higher,  living wage,to those workers who do happen to have families?!

Yeah, right.

If  National has a secret agenda to motivate more young people to head overseas, such a plan will succeed beyond their wildest dreams.

18 and 19 years olds – old enough to get married; old enough to get drunk; old enough to get killed in a warzone – but not old enough to be paid the same adult rate as a 20 year old?

National should take note;  it’s true that 16 and 17 year olds can’t vote.

But 18 and 19 year olds can – and do. I bet they just can’t wait to vote at the next election.

And precisely how does this raise wages, as per Dear Leader’s promises?

Next chapter: 7. Part 6A – stripped away





In June last year  Prime Minister John Key said the prospect of a new youth rate was unlikely,

“I don’t think there’s a high probability. Whether we’d actually bother embarking on that it’s far too early to say.”

Source: Govt reintroduces youth wage

Ten months and one election later, preparations are under way to legislate.

Is ten months “to early to say“?



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John Key’s track record on raising wages – 5. The Minimum Wage

11 November 2012 7 comments


Continued from: John Key’s track record on raising wages – 4. Rest Home Workers



5. The Minimum Wage


From 2004 to 2008, the minimum wage rose from $9 to $12 – an increase of $3 in four years.

From 2009 to 2012, the minimum wage rose from $12 to $13.50 – an increase of $1.50 over three years.

See: Dept of Labour – Previous minimum wage rates

Last year, Labour, the Greens, NZ First, and Mana campaigned to raise the minimum wage to $15 ($16 for Mana).

When a worker at a fast-food outlet asked John Key to raise the minimum wage to $15 an hour, he  rejected the proposal, saying,

It will go up, but it won’t go up straight away.”

See:  Raising minimum wage won’t cost jobs – Treasury

Key’s right. At the glacial speed that National increases the minimum wage, it will take another three years to deliver $15 an hour.

Yet it took only a couple of years to implement two massive taxcuts that gave hundreds, thousands,  of dollars a week, to the top income earners.

Priorities, eh?

The real insult is that  Key and English both admit that the minimum wage is difficult to live on.

Key said,

Look, I think it would be very difficult for anyone to do that.”

See:  Ibid

GUYON:  Okay, can we move backwards in people’s working lives from retirement to work and to wages?  Mr English, is $13 an hour enough to live on?

BILL ENGLISH:  People can live on that for a short time, and that’s why it’s important that they have a sense of opportunity.  It’s like being on a benefit.

GUYON:  What do you mean for a short time?

BILL ENGLISH:  Well, a long time on the minimum wage is pretty damn tough, although our families get Working for Families and guaranteed family income, so families are in a reasonable position.

See: TVNZ’s Q+A: Transcript of Bill English, David Cunliffe interview

The Department of Labour claimed  a rise in the minimum wage  would cost 6,000 jobs.

But Treasury disagreed, saying,

This has not been true in the past. The balance of probabilities is that a higher minimum wage does not cost jobs.”

Raising the minimum wage would certainly benefit SMEs (Small-Medium Enterprises), as low-income earners spend their entire wages on goods and services. Any rise in paying wages should be offset by increasing till-takings with customers spending more.

So it appears blatantly obvious that no good reason exists not to raise the minimum wage.

After all, in 2009 and 2010, National gave away far more in tax cuts for the rich.

And precisely how does this raise wages, as per Dear Leader’s promises?

Next chapter: 6. Youth Rates



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John Key’s track record on raising wages – 4. Rest Home Workers

11 November 2012 9 comments


Continued from: John Key’s track record on raising wages – 3. Ports of Auckland Dispute



4. Rest Home Workers


Amongst the lowest paid workers in this country, Rest Home caregivers earn around $13.61 an hour – just barely above the minimum wage of $13.50.

Human Rights Commissioner, Dr Judy McGregor, found out first-hand what the job entailed,

Spending hours on her feet, lifting, hoisting, feeding, bathing, dressing and toileting her charges took its toll – and for just $14 an hour, the Human Rights Commission’s equal opportunities commissioner compares it to a form of modern-day slavery.

“The complexity of the job was actually a surprise for me. It’s quite physical work, and it’s emotionally draining because you are obliged to give of yourself to other people,” she said.

“Saint-like women do it every day so that older New Zealanders can have a quality of life”.”


Full story


When this was point out to John Key, the following exchange took place on morning TV,

Key acknowledged there were problems with rural rest homes workers paying for their own travel, effectively reducing their wage below the minimum wage of $13.50 an hour.

“Travel is one of those areas where we are looking at what we can do,” he told TVNZ’s Breakfast programme.

However, the Government could not afford to give DHBs the $140 million required to enable rest homes to pay their staff more.

“It’s one of those things we’d love to do if we had the cash. As the country moves back to surplus it’s one of the areas we can look at but I think most people would accept this isn’t the time we have lots of extra cash”.”


Full story


But there seemed plenty of cash – taxpayer’s money – to give politicians some fairly generous salary increases,


Full story


And a “lack of money” certainly didn’t stop the country from spending over $200 million of public money on a sporting tournament,

Budget blowouts have pushed public spending on the Rugby World Cup well above $200 million – without counting $555 million in stadium upgrades and $39 million in direct losses from hosting the tournament. “

See: Blowouts push public Rugby World Cup spending well over $200m

If  Key was serious about raising wages, he should clearly have made the lowest paid his Number One Priority. The 2009 and 2010 tax cuts would have made an excellent opportunity to give the biggest tax cuts to the lowest paid workers.

Instead, those tax cuts went to the very top. On top of that, the rise in GST from 12.5% to 15% would have impacted the hardest on those on minimum wage.

Double whammy.

So precisely how does this raise wages, as per Dear Leader’s promises? (Or could it be that when Key promised to raise wages – he was referring to his own?)

Next chapter: 5. The Minimum Wage



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