Living wage promoted for city council workers

Wednesday, 16 May 2018

Union spokesman John Shennan presented the case for the Palmerston North City Council to pay the living wage.

Pressure is mounting on the Palmerston North City Council to pay its workers the living wage – at least.

The council has been consulting the public about whether it should pay permanent staff the living wage of $20.20 an hour from 2019/20.

It received an overwhelming vote in favour, with 51 submissions in support, including a petition from nearly 150 people

Only two submissions opposed the suggestion outright, and seven others commented on it.

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Unions Manawatū spokesman John Shennan said the living wage of $20.20 an hour would go a long way toward correcting huge inequalities between New Zealand's lowest paid workers, and its managers and chief executives.

But the council has been hesitant, based on estimates that paying the living wage and maintaining pay relativities with other staff would cost between $325,000 and $1.3 million a year.

Shennan disputed the costs.

Workers marched though Wellington to support the living wage.

He said if a move to the living wage meant a 2 per cent increase for the lowest paid, there was no need to increase all pay rates through to the top of the organisation by 2 per cent.

There would need to be some increases for supervisors and foremen to stay ahead of their staff, but the flow-on costs would be small.

Shennan said some council staff had already accepted a deal that meant lower rises for those on higher salaries in order to afford increases for the lowest paid.

Palmerston North ctiy councillor Vaughan Dennison argues for a regional living wage.

'They have been prepared to have some skin in the game – this is the decision of your employees.'

Shennan said the city council could become an example to other private sector employers by adopting the living wage.

It would also need to protect its City Enterprises employees by insisting that the contractors they competed with for work treated their staff the same.

He said there were legal opinions that supported the council's right to include a clause in tender documents requiring contractors to pay their staff the living wage.

Shennan said the council should not focus on the cost of paying staff a decent wage, and instead consider who was essential so to achieve its ambitions for the city.

Cr Vaughan Dennison has put the case several times to consider a 'regional' living wage, given the lower cost of living in Palmerston North compared with Auckland.

The council currently paid a minimum hourly rate of $17.50, which was $1.75 an hour above the minimum wage. Dennison said this was close to what Palmerston North's regional living wage would be.

But Shennan said regional variations in the cost of living were already factored in to calculations about what a living wage should be.

The level would be a lot higher than $20.20 if it was based only on the Auckland figures.

The Labour Party electorate committee also spoke in favour of the living wage.

'We find it extremely concerning that many people who are earning a full-time wage find it difficult to earn enough to cover basic costs.'

Other comments were that there was no justification for not paying a decent income to residents, that it was essential, and would help attract and retain skilled staff.

Others, such as the Manawatū Chamber of Commerce, said the living wage was unrealistic and unnecessary given pending significant increases in the minimum wage.