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'Good faith' bargaining can fix pay issues

NZN 7/06/2016 Paul McBeth

The government should introduce a set of principles to guide firms on paying their staff fairly and install a process to allow for "good faith" bargaining, says the working group tasked with addressing a landmark Court of Appeal ruling interpreting the Equal Pay Act.

State Services Minister Paula Bennett and Workplace Relations Minister Michael Woodhouse say they are considering the joint working group's recommendations, which they've been sitting on since May 24.

The working group - made up of incoming governor general Patsy Reddy, Council of Trade Union head Richard Wagstaff, former BusinessNZ boss Phil O'Reilly and public servants Paul Stocks and Lewis Holden - based its recommendation on the idea that parties to a pay equity claim sort out their issues as quickly as possible under the good faith bargaining arrangements of the Employment Relations Act 2000.

"Our preferred approach may be summarised as having the parties who would benefit from the claim bargain in good faith, using a set of principles designed to identify and confirm, assess and resolve a claim," the group said.

The working group was a response to a Court of Appeal ruling in the case of Kristine Bartlett, an aged-care worker, and the Service and Food Workers Union against private rest home chain Terranova Homes and Care.

The court rejected an appeal by Terranova and the NZ Aged Care Association in upholding an Employment Court ruling in 2013 that in female dominated work the Equal Pay Act 1972 "requires equal pay for work of equal value (pay equity), not simply the same pay for the same work", a change from how the law had been interpreted in the past.

The retirement village sector has estimated a hike in the average hourly pay for caregivers would add an extra $500 million a year to their costs and probably lead to some failing.

If the recommendations are accepted legislation would need to be amended to recognise pay equity claims and the government would probably need to provide a level of resourcing to give workers and companies support through the process.

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