Back pay ordered for Pact staff

Louise Carr, Pact CEO.
Louise Carr, Pact CEO.
Dunedin-based mental health and disability services provider Pact must pay staff more than $50,000 in back pay after acting in ''serious bad faith'' during pay negotiations.

The order was part of an Employment Court decision that rejected Pact's appeal against an earlier Employment Relations Authority finding that it misled union negotiators and breached the collective agreement in the 2011 bargaining round.

Employment Court Judge Graeme Colgan was damning of Pact's behaviour in the bargaining round, during which it told its ''modestly'' paid staff it could not afford more than a 1% pay-rise - all the while saying it wished it could afford to pay more.

However, this claim was found to be misleading when Pact offered its 150 non-union workers a pay rise of 2% backdated to July 2011, as opposed to the pay rise accepted by union members, which was backdated to November 2011 - amounting to a 1% rise for the entire year.

Judge Colgan rejected Pact's argument that its statements were part of the ''strategic cut and thrust of robust industrial bargaining''.

The statements were made by experienced managers and were not made ''hastily or mistakenly''.

''It was also serious bad faith because Pact acknowledged repeatedly, and apparently solemnly, that it would have wished to have paid its employees ... more than it said it was able and prepared to pay.

''They compared its corporate financial circumstances to those of its employees in refusing adamantly to agree in bargaining to any more than a 1% wage increase but a greater amount than which, shortly afterwards, it offered of its own volition.''

The workers concerned were paid ''very modestly for performing challenging and important social work'', the judge said.

Despite three years passing since the events, there was still a ''significant level of disaffection'' among most of Pact's workforce and ''much bridge building'' was needed.

''Responsibility for initiating that rests with Pact and its management as the party responsible for the relationship deterioration and breakdown.''

Pact was ordered to pay each of the 213 union members employed in November 2011 back pay of 2% of their wages - plus interest for late payment - for the period between July and November 2011.

This amounted to about $249 for each staff member, before interest, and added up to more than $50,000 in total.

Pact was also fined $5000, half of which was to be paid to the court and the other half split between the two unions that represent Pact staff - the Service and Food Workers Union and the Public Service Association (PSA).

Pact corporate services director Paul Chamberlain and PSA national secretary Richard Wagstaff did not return calls yesterday.


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