On the Q+A with Corin Dann the other day Prime Minister Jacinda Ardern was asked questions regarding Industrial Relations Reform which included a discussion on fair pay for bus drivers
CORIN What about industrial relations reform? Will there be reform that brings in, effectively, a modern version of national awards? So some industries, there is a minimum wage set, say, bus drivers.
JACINDA And that’s a good example. Let’s draw on that example. At the moment we see contracts coming up across councils for those who offer services for our bus drivers. So one of the ways that those who are pitching for those contracts, offering council a lower bill, is by driving down the conditions that those bus drivers have. That’s not a pathway to prosperity for New Zealand or for the workers.
CORIN So you’ll legislate on that?
JACINDA That’s an example of where, in our view, things like fair pay agreements, which we intend to have a handful of any given year across an industry could have a positive benefit.
CORIN This is very important, though, because the business community is quite worried about this.
JACINDA And we have assured them that they have no need to be.
JACINDA Because in an area like that where we’re talking about with bus drivers, I think that there would be agreement that continually driving down people’s wages and conditions in order to win those contracts actually does not serve our purposes.
CORIN But are you saying it’ll only be one or two industries a year?
JACINDA Yes, we have at least set ourselves the goal of one or two a year. We already have an example of a form of fair pay agreement in the home-care workers.
CORIN But this is different. This is like going back. This is an award system, isn’t it, effectively?
JACINDA No, it’s not different, actually. What we achieved for the home-care workers was essentially exactly the same as what we’ve
CORIN But that took a court case.
JACINDA Well, it’s avoiding the court case. Of course, that was a prohibitive process to go through. We’re talking about a process that’s collaborative, works with employers and employees to drive consensus.
CORIN Would you need to legislate for that?
JACINDA We will create a process, but, for instance, where there has been most concern from the business community has, for instance, been around whether or not you could take strike action as part of those negotiations. We are absolutely ruling that out as part of the process.
CORIN Are you worried you’ll get some sort of winter of discontent that Helen Clark faced when she came in 1999 from business?
JACINDA No. No, no, I’m not. I intend to work in partnership. In fact, I had contact with Business New Zealand over the issue of fair-pay agreements during the campaign, and we’ll continue to engage with them. Ours will be a government of partnership. If we want to deliver the gains for New Zealanders that we intend to, we’ll have to deliver them alongside the business community as well. That’s the kind of government I wish to lead.
This was an interesting point made by the Prime Minister as one of the major criticisms of the Public Transport Operating Model process also known as PTOM by unions and workers especially in Auckland is has the New Network contracting been used as a means to drive down bus drivers wages and conditions as bus companies engage in a race to the bottom to win contracts.
Bus drivers have not been the only ones raising this issue in Auckland. The Train Managers/Ticket Inspectors who will now be replaced over time as part of the SaFE programme by roving Warranted Transport Officers who have new powers under the new act, increased station staff and more ticket gates. Some Train Managers have mentioned to me that the roles that can be transitioned into Station Staff or Transport Officers will have much lower wages than they do currently if that is true is a little concerning.
While lowering OPEX is a good thing as it means we can run more services and we should always look to run a system as efficiently as possible it may be counterintuitive to engage in trying to drive down wages like this. The reason other than of course the obvious ethical concerns is that transit around the world is in a renaissance. Drivers are in high demand and many places will pay top wages to meet the need. Places such as Victoria and Queensland, for example, have massive shortages of drivers and are willing to pay very good wages, with better leave, as well as overtime. If you are a driver here taking up a high paying job with better conditions in a city with much more affordable housing like Brisbane will be very attractive. Having a shortage of drivers will be terrible long run for the future Auckland’s PT network. We will have made all these savings all to not be able to actually run any more services.
A look at PTOM was also signalled by Phil Twyford. However, PTOM while it has a few issues the root of the problem mainly lies elsewhere one of the things the Government should consider if this is a major concern for them is taking a look at the 50% Farebox Ratio Target that was set by the NZTA under Joyce’s ideological thinking. Serious questions have been raised regarding the appropriateness of this target and its effect on PT especially as it makes entities like AT risk adverse to major changes which could lead to long run better growth and farebox. On the other side, a broader conversation may need to be had about the current Funding Assistance Rates and whether the levels are delivering the best outcomes.
Of course many will argue what if operators simply pocket the extra funding. The solution to this might be best addressed through employment law changes changing the law to list public transport drivers as vulnerable workers. This will give them the right to choose to be transferred to the new employer, on the same terms and conditions of employment with continuity of service, including their leave and other entitlements.
I think this is one of those issues that doesn’t need to be either or, we can treat transport workers fairly and still have fully funded services.