Nick Leggett chief executive officer
FAIR PAY AGREEMENTS:
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he implementation of Fair Pay Agreements (FPAs) has been anticipated since Labour took office back in 2017. Unfortunately, despite the best efforts of the business sector, it will be imposed on us sooner rather than later now that the legislation has been introduced into Parliament. FPAs, like the national awards schemes of the 1970s, will set minimum terms and conditions for all workers in an industry or occupation nationwide. They were established as a response by the ever-weakening union movement to the modern world of individual bargaining and increased workforce flexibility. Ia Ara Aotearoa Transporting New Zealand is opposed to centralised wage bargaining. Road transport businesses need to have flexibility regarding their workforce and how they structure their operations. An FPA will come about if a union requests one, as it only requires support from 10% of the workers in that industry. Even if 90% of the industry’s workforce don’t want it, the 10% along with the union will be able to force pay negotiations where industry representatives must bargain on behalf of all businesses in the industry. An August 2021 report by consultancy PWC sets out the impact this process will have on businesses: “At a high level, the introduction of the FPA system will force SMEs, many of which have never been around a bargaining table before, to be involved in the industrial relations process. For many owners and operators, it may be quite confronting to have unions visit their businesses and seek access to their workplace and workers for the first time. Many businesses could feel disengaged from the process and unsure how to have their say in a decision that has the potential to significantly impact them and their most important asset, their people.” Road transport businesses could also
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be forced into pay rates they can’t afford. Because it will apply nationwide, an FPA will affect a small operator running out of provincial New Zealand the same as a transport business in Auckland or Wellington. This will impose significant extra costs on the provincial operator, making their business significantly less competitive and that will inevitably mean that freight rates are forced to increase. For workers, the shame of fair pay agreements will be that high-performing workers can’t be paid what they deserve. They will only get the same as everybody else in their position across the industry. It will be illegal for operators to recognise
the skills, experience and commitment of staff through remuneration. FPAs will also make the road-freight industry less attractive to those who want flexibility in their working lives. The macro-economic impact of all this will be another drag on the economy when New Zealand can least afford it. The Fair Pay Agreements Bill was recently introduced to Parliament and with Labour’s absolute majority will have no problem passing all stages by the end of the year. Despite the bill’s passage basically being a fait accompli, we, along with Business NZ and other industry bodies, will be fighting it all the way.
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oad transport operators up and Hall of Fame in 2017. He also received down the country, particularly the Institute of Road Transport members of Transporting New Engineers of New Zealand Transport Zealand, will know the name Kerry Award for Outstanding Industry Arnold, who is retiring at the end of Service in 2013. March. With his retirement pending, we For 35 years, Kerry has led the New asked Kerry what he thinks the future Zealand Road Transport Association/ opportunities are for the industry. I’d Road Transport Forum/Transporting like to leave you with his response New Zealand technical because I believe it is policy team and has extremely sage: “Today, worked with successive the future is in so much governments, including upheaval – market changes, literally hundreds of international conflicts, transport officials over the skilled labour shortages, years, to represent our and technology that is industry’s interests. insufficiently bedded down. There probably isn’t a The opportunities will accrue person who knows more for those who can adapt about the technical aspects the quickest. My view is After 35 years working of road transport in New not only does the industry on behalf of the industry, Zealand than Kerry. His have to be analytical, not Transporting New expertise and the invaluable anal, the operators have to Zealand’s manager of technical assistance and utilise their intuition because technical and roading historical knowledge he it’s this latter aspect Kerry Arnold has retired. provides to our membership that’s made the industry will be greatly missed. innovative, inventive and able to adapt An illustration of the high regard to its circumstances.” Kerry is held in by our industry was his We all wish Kerry a very enjoyable induction into the NZ Road Transport and relaxing retirement.
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