Law change threat to low-paid: unions

Proposed changes to minimum wage calculations may affect thousands of workers in Dunedin and Otago, the New Zealand Council of Trade Unions says.

The Ministry of Business, Innovation and Employment this week sent businesses and trade unions a letter outlining a proposal to include a fortnightly minimum wage rate - alongside existing weekly, daily and hourly rates - in the Minimum Wage Order 2014.

Such a change could see thousands of salaried workers at or near minimum wage level paid less, New Zealand Council of Trade Unions general counsel Jeff Sissons told the Otago Daily Times.

At present, wages have to be assessed and paid on a weekly basis.

Salaried workers earning the minimum wage have to be paid $14.25 for every hour they work over 40 hours in a week.

But the proposed changes could see employers avoid paying workers the extra hours by ''averaging'' their hours during the fortnight, effectively making them work more than 40 hours one week and cutting their hours the next, he said.

A worker on the minimum wage working 40 hours a week earns about $29,640 annually.

Census statistics show more than 54,000 people in Dunedin and a further 30,000 in the rest of Otago earn $30,000 or less annually.

While students, part-time workers, the unemployed, beneficiaries and stay-at-home parents would be among those, it showed thousands would be affected by the changes, he said.

They would hit agricultural and migrant workers particularly hard. He was concerned for the growing number of Filipino dairy workers who tended to ''not have a good grasp of their employment rights.

They might not come from a culture where you stand up for your rights and often the only person they know is their employer''.

''We don't see any positive to this [proposed change] at all,'' he said.

''The longer the period you allow the minimum wage to apply over, the worse off the worker is.''

When asked what positive effects the proposed changes would have on minimum-wage workers, a spokeswoman for Labour Minister Simon Bridges said: ''This may provide a solution that balances the needs of employers and employees and allows existing arrangements to continue.''

Mr Sissons said it created a loophole for employers breaking the law.

''The problem with the existing arrangements is they quite clearly breach the laws,'' he said.

''I don't think we should support existing arrangements that breach the law.''

The Labour Party's associate labour spokeswoman, Darien Fenton, said the Government should raise the minimum wage, not make changes to benefit low-paying employers.

''Simon Bridges' latest proposal to change the Minimum Wage Act ... is really about getting minimum-wage workers working more hours for less pay,'' she said.

The Labour Minister's spokeswoman said no policy decisions had been decided.

''There is a targeted consultation under way to understand the extent of the issue and the possible impacts of any change or of no change,'' she said.

A recent court decision had brought the issue to a head, as it highlighted ''that arrangements that have been in place for some time - for example, salaried workers who work more than 40 hours some weeks and less than 40 hours other weeks, but get paid the same salary each week - will no longer be lawful''.

''This is not about leniency for a certain sector,'' she said.

''The expectation is that employers keep an accurate record of hours worked and wages paid, and that at least the minimum wage be paid for the hours worked.

''Nothing being proposed affects that position.''

The consultation finishes on May 16.


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