High stakes legal battle for rest homes

A legal battle over gender pay equality could cost the aged care industry up to $160 million if the unions representing caregivers are successful, the industry body says.

The country's major rest home chains are facing proceedings under the Equal Pay Act after the Service and Food Workers Union and the NZ Nurses Organisation filed hundreds of applications with the Employment Relations Authority (ERA) today.

The move comes after a landmark Employment Court ruling paving the way for gender pay equality.

In August, the court ruled in favour of Lower Hutt caregiver Kristine Bartlett, who argued the $14.32 an hour she was paid by Terranova Homes was a result of gender discrimination under the Equal Pay Act.

Terranova is appealing against the decision, with the case due to be heard in the Court of Appeal in February.

NZ Nurses Organisation aged care industrial adviser David Wait said some 400 applications to the ERA had been filed on behalf of caregivers at homes around the country.

However, the unions had asked the ERA to wait for the outcome of the Terranova appeal before hearing the new cases.

Mr Wait said he anticipated the cases would be heard together, with thousands more workers expected to join the action next year.

The aged care providers facing the new proceedings are Bupa, Metlifecare, Oceania, Presbyterian Support, Radius and Ryman Healthcare.

Aged Care Association chief executive Martin Taylor said the action had been expected.

The unions had been using the Terranova case, which was now being appealed by the association on behalf of the sector, as a test case for the whole industry.

"At a fundamental level, this whole case is about low funding of the aged residential care sector," Mr Taylor said.

"The problem for us is that everyone would love to be able to pay caregivers more, but if we don't get funded [by the Government] to a higher level, we can't pay more.

"So we're having to defend our position because let's say the unions were successful, and caregivers' wages were put up beyond what we're funded - that would cause a very difficult situation for just about everybody in the sector."

Mr Taylor said the estimated cost to the industry was between $120 million to $160 million a year.

That was how much the sector would have to pay if caregivers, who currently earn an average of $14.80 an hour, were paid the same as DHB-employed health care assistants, who earn $17.50 an hour.

Metlifecare, Bupa and Ryman Healthcare referred inquiries to the Aged Care Association, but Ryman did say in a statement that it was committed to paying all its staff fairly.

Presbyterian Support said it had not yet seen the applications and was in no position to comment.

A Ministry of Health spokesman said pay rates were an employment matter between employers and employees but noted the Government is spending a record amount in aged care.

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Priorities

"A Ministry of Health spokesman said pay rates were an employment matter between employers and employees but noted the Government is spending a record amount in aged care."  How's its spending record  on rugby and yachting looking, to date?

I wonder if savings could be made in areas other than aged care, so that employees who do the hands-on work could be paid fairly. 

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