Fair Pay Agreements Bill: Biggest shakeup to workplaces in generation coming from Government

The biggest shakeup to our workplaces in a generation is coming with the Fair Pay Agreements Bill officially introduced by the Government.

It says the new law will mean better pay and better conditions for workers. But the employers' association says it's a bad thing because it will mean a return to mealtimes and overtime.

Kura Leka cleans Auckland Transport's bus and train stations, but the pay's not great.

"Cleaning rate, $22.75. No thank you, we're worth more than that," she says. 

Kura thinks the hard graft of cleaning up after the public is worth more like at least $25 an hour. 

"For 30 years, the critical work and contribution of Kiwis performing some of the most essential work in our country has been systematically undervalued," Workplace Relations and Safety Minister Michael Wood said. 

The minister has finally introduced his fix, the long-promised Fair Pay Agreements - sector-wide bargaining for conditions. To trigger one, a sector will need 10 percent of its workforce or 1000 workers. Workers and employers will each have a representative.

Legally they'll have to agree on minimum wages, hours overtime and penalty rates, such as working weekends or public holidays.

"Meal breaks, triple time, all of those things that we went away from in the 1990s because they were so problematic - we're going back to that, why do we need to do that? What's the problem?" the Employment and Manufacturers Association's Alan McDonald said.

But unions say if flexibility is what employers want, then negotiate it.

"In fact, anything that the parties felt should be on the table could be discussed in an FPA," said E tū's Annie Newman.

For example, cleaners like Kura could negotiate a better base pay but their bosses could, for instance, counter that by not offering overtime rates at weekends.

"The key question is whether it's going to make our economy stronger or not. We firmly believe it won't," said National's Paul Goldsmith. 

Wood said: "We can actually become a more productive economy if we shift the focus of our economy from competing on the basis of low wages to competing on the basis of better products and services."

When the minister took Fair Pay Agreements to his Cabinet colleagues he warned better pay and conditions could drive up costs for employers - and businesses may pass that on to consumers. That's not exactly what the Government wants as it's being hammered over the cost of living.