Wellington City Council and Chamber of Commerce both claim living wage victory

Friday, 13 May 2016

Rea Williams from The Fresh Desk cleaning company after the 2016 Living Wage rate was announced in February. It will be implemented from July 1.

A living wage stoush between Wellington City Council and Chamber of Commerce has concluded, with both sides claiming victory.

The chamber was trumpeting success on its part after announcing future external contractors for the council would not have to be paid a living wage.

The council had agreed to consult with the chamber on any extensions and, if necessary, it would seek legal judgment to clarify any disagreements.

However, the council says it has not backed down, and its original decision still stands, with a living wage to be paid to the council's core cleaning staff from July 1, along with security staff.

* New Zealand living wage rate of $19.80 to kick in July 1

* Pay rises all-round for Wellington City councillors this year**

To confuse matters further, the final term of the agreement states it is not intended to be legally enforceable – meaning each side is basically free to do as it pleases.

Taxpayers' Union executive director Jordan Williams said it appeared the council had backed down on implementing a living wage requirement for its contractors and had second thoughts about the legality of its actions.

'This backdown means that, at least in the short term, the chamber and the Taxpayers' Union will not be challenging the council under judicial review.

'The result means that Wellington ratepayers will be able to keep more money in their pockets.'

On the union side, E tu congratulated the council for sticking to its guns and securing the living wage for some contracted staff.

E tu assistant national secretary John Ryall said the result was the chamber agreeing that remaining contracts for this year would provide the living wage to contractors.

It would mean a big pay rise for about 15 security guards and 20 cleaners, he said.

'This is a marvellous victory that's been a long time coming. It means a pay rise of about 25 per cent for these workers.'

Paul Barber, spokesman for Living Wage Wellington, said it was good news the council had now committed to paying a living wage to cleaning and security staff.

'This is what we have been asking them to do. This is a welcome step forward.'

The council and the chamber came to the agreement at a public-excluded meeting on Wednesday night – the same meeting at which councillors voted unanimously, without any debate, to accept a rise in their own salaries.

The agreement ends months of negotiations after the chamber signalled its intention to bring judicial review proceedings against a council decision to apply the living wage to its external contractors.

The chamber was seeking to find out if the council's move was within its ability under the Local Government Act.

Multiple sources said the council's solution to keep the chamber happy was to bring more contracted services in-house, meaning the council could set whatever wages it liked for those employees.

Deputy mayor Justin Lester said in the future the council had the option to bring the contracts in-house, which would not require it to consult with the chamber.

The chamber had overstated the outcome, which came across as misleading, he said.

The council would consult the chamber about its intention, as it would with other parties, he said.

'This outcome was negotiated in good faith so that we did not have to go to court. However, the original council decision to pay a living wage still stands, and we have extended this to the cleaning staff. It's a good win for our cleaners and security staff.'

Councillor Paul Eagle said the council had paid its own staff a living wage since 2013 and the agreement was a victory for the living wage.

'The chamber has essentially backed down and conceded that we will be paying two external contractors a living wage.'

The chamber dug in its heels when the council started requiring private businesses to pay their staff a living wage for any services they performed for the council, he said.

'Wellingtonians support the living wage … and we won't be held to ransom by the chamber or anyone else over this.'

Wellington Mayor Celia Wade-Brown said the council was encouraged to pay a living wage when evidence showed it improved productivity and loyalty.

Chamber of Commerce chief executive John Milford said the council had agreed to discuss paying any other external contactors a living wage.

'[The] council will not require future external contacts to pay staff the living wage. As part of this successful outcome we acknowledge it had been agreed to pay the cleaning staff.'

There would be future discussions with the council and if they did not work out, then the issue would go to court for a ruling, he said.