A Living Wage

A Living Wage Next Step, Election 2017

- Annie Newman

Annie Newman is the National Convenor of the Living Wage Movement Aotearoa NZ. CAFCA is a member. And both CAFCA and the Anti-Bases Campaign are committed to paying the CAFCA/ABC Organiser the Living Wage (currently $20.20 per hour). Ed.

With a major victory under our belt, the Living Wage Movement has now set its sights on central Government to deliver its employed and contracted staff a minimum Living Wage. The Living Wage Movement formed in 2013 and after four years has succeeded in getting Wellington City Council to agree to becoming accredited, which means no less than $20.20 per hour (at current levels) for some 3,200 workers in the Council and its Council-controlled organisations (CCOs) who are either directly employed or delivering services through regular and ongoing contracts, such as cleaning.

Further, Auckland Council, with a somewhat surprising majority in favour of a Living Wage delivered at the 2016 local body elections, is also well on the way. The recent Annual Plan resulted in a 17/3 vote in favour of paying directly employed workers across its business (including CCOs) at least a Living Wage. More than 2,000 workers will benefit from increases of up to 28% - unheard of in modern collective bargaining (the Christchurch City Council voted, in August 2017, to implement the Living Wage, but only for its actual staff, not the workers of Council-controlled organisations. It has requested a staff report into how the Living Wage could be extended to these workers. Ed.).

If unions are to move beyond the meagre increases of 0-3% that have dominated bargaining in the last 25 years, new tactics must supplement the old in the struggle against the age-old exploitation of workers. The victory in the Kristine Bartlett equal pay case, initiated by E tū, will raise wages by up to 30% for some 55,000 “care and support” workers – not to mention the flow-on effect for other female-dominant sectors, such as school support staff and women’s refuges. This action tackles head on the persistent inequality for women in female “ghettoes,” where women’s work has been traditionally undervalued and underpaid.

A Different Response To Poverty

The Living Wage Movement is a different response to the growing poverty of workers who are the victims of a repressive employment relations regime. Not only are there constraints for unions but the bargaining framework excludes negotiating with the real “employer” who funds workers’ wages. These are the contracted out, franchised, temporary, and labour hire workers whose employment is at the mercy of a competitive tendering process where the principal service provider, such as a government, university or licensing trust, abdicates responsibility while holding the purse strings. Work is not a way out of poverty any longer.

The Living Wage is the income necessary to provide workers and their families with the basic necessities of life. It is determined independently by the Family Centre Social Policy Research Unit, which updates it on the basis of average wage movements annually and reviews the rate every five years to ensure its foundation research is sound.

This has now become a benchmark for 80 businesses which are accredited Living Wage Employers and provides union advocates with a legitimate, if bold, wage claim in bargaining. While not yet meeting the four criteria for accreditation, King Salmon and Hubbards Foods have both given significant, above market, wage rises to their staff in collective bargaining as a result of the aspirational goal of creating a Living Wage workforce. 

Detractors have been few (the Treasury being one) and tend to rely on the arguments that it doesn’t target the poorest; and results in benefit abatement impacting on its real value. Anna, who recently moved close to a Living Wage at a council says:

“We are now working 40 hours a week and spending more time with our baby. We managed to move into a two-bedroom place with more space for our baby to play in. Thanks to the Living Wage we are saving some money to go to Samoa to visit our families who we’ve never seen since moving to New Zealand. We are not living a life of luxury but it just got better”.

Winning large-scale transformation ironically begins with a single conversation. But that becomes a million conversations between people and organisations that, for all their differences, share the same sense of justice and desire to do something about suffering and exploitation. The Living Wage Movement is affiliated to the US-based Industrial Areas Foundation that advocates a broad-based community organising model of building power across civil society so our voices can be heard by the decision-makers that matter. With more than 90 member groups, the Movement has proven leverage and in 2017 will organise toward general election forums to secure the commitment of future politicians so, should they be in power, workers will win on a massive scale.

We Are Asking All Candidates:

  1. That the candidate/party support and promote the Living Wage being implemented for all those employed in the core public service within 12 months of the new Government being formed.
  2. That the candidate/party support and promote changing Government procurement policies to ensure that all contracted workers, who are delivering a regular and ongoing service to the core public service, move to the Living Wage within the next term of Government.
  3. That the candidate/party support and promote the new Government developing an ongoing relationship with Living Wage Movement Aotearoa/New Zealand through an Advisory Group in order to champion the Living Wage throughout the NZ economy and oversee implementation.

Catriona MacLennan has recently completed some research about the affordability of a Living Wage by central government (www.livingwage.org.nz) and, just as with her research on Auckland Council, this will provide the Movement with a valuable tool in the debates over the next few months. Catriona makes a set of recommendations any Government that forms after the election on 23 September should:

  1. Immediately begin paying all staff and contracted workers at Parliament and in MPs’ electorate offices the Living Wage. The Scottish government in 2010 committed to paying a Living Wage for employees in the public sector, and implemented this in 2011. The Westminster Houses of Parliament became a London Living Wage accredited employer in 2014.
  2. Commit to paying a Living Wage for employees in the public sector and prepare a detailed budget for implementing this. The Prime Minister and Minister of Finance have repeatedly said in speeches that the economy is healthy and large surpluses are predicted in the coming years. The Living Wage is not a cost: it is an investment in workers and the future of the country. It also returns dividends. The Government will save large sums on Working for Families and on benefits and will receive a higher tax take. In addition, there will be a stimulus effect for the economy as those on low incomes spend almost all their incomes. This will increase consumer spending and, in turn, create additional jobs and result in a higher GST take. There is considerable information about this stimulus effect from Scotland and the rest of the United Kingdom. The United Kingdom Government at present subsidises employers who pay low wages to the tune of £11 billion a year through in-work tax credits and other benefits. The New Zealand government is committed to improving the economic position of Māori and paying a Living Wage would benefit many Māori as they are disproportionately represented among low income earners. Paying the Living Wage also means that employers save on recruitment and training. Auckland Mayor Phil Goff told a Council meeting on 9 February 2017 that it was calculated that the Council would save $1 million a year on recruitment and training by implementing a Living Wage. The Scottish Living Wage covers 180,000 people in Scotland who work for the central Government. Scotland has a population of 5.3 million, while the population of Aotearoa New Zealand is 4.7 million. Implementation of the Living Wage in Scotland for both employees and contracted workers in the public sector has been complicated by the facts that Scotland does not have control of all of its governmental activities, and that it is subject to European Union law. This country does not have those complications.
  3. Prepare a timetable and budget for implementing a Living Wage for public sector contracted workers once it has been put in place for employees.
  4. The Government and all Ministers and MPs should play a proactive role in encouraging employers in local government and the private sector to implement the Living Wage. Politicians in Scotland and the rest of the United Kingdom publicly support the Living Wage and are involved in many actions to support and promote it.
  5. Funding should be allocated to monitor the implementation of the Living Wage and to check that it is paid.
  6. If the Government in future gives funding to sports events, such as the Rugby World Cup and the America’s Cup, it should be a condition of the grant that employees and contracted workers working on the projects are paid a Living Wage.
  7. The Government should adopt the brand of Aotearoa New Zealand as the first Living Wage country in the world. This would complement the country’s clean, green brand and be an important selling point for goods, services and tourism.

These Are Aspirational Yet Realistic

If the interests of Labour and the Greens are aligned with the interests of workers, and they would say they are, then this is achievable. We would never have dreamed in 2013 that the capital city would have a Living Wage Council in so short a time but organising has achieved that – from small conversations to large deputations, peoples’ assemblies and rallies, we had hope. The Guardian’s Rebecca Solnit said it well:

“Hope is the belief that what we do might matter, an understanding that the future is not yet written. It’s informed, astute open-mindedness about what can happen and what role we may play in it. Hope looks forward, but it draws its energies from the past, from knowing histories, including our victories, and their complexities and imperfections. It means not being the perfect that is the enemy of the good, not snatching defeat from the jaws of victory, not assuming you know what will happen when the future is unwritten, and part of what happens is up to us”.


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