Feds: Inflexible FPAs are ‘a solution looking for a problem’

7 May 2022

Federated Farmers is joining the fight against yet another case of politicians intruding with unnecessary, inflexible, one-size-fits-all legislation - this time over workers’ wages and conditions.

"There’s nothing fair about so-called Fair Pay Agreements," Federated Farmers national board member and employment spokesperson Chris Lewis says.

"They’re just a straightjacket that lock employers and employees into a national set of pay and conditions rules that might suit a minority but remove all ability of businesses and staff to agree on terms that suit their own needs and local conditions."

The threshold for initiating an FPA is 10% of workers or 1000 workers in the identified group, whichever is less. Once an FPA is agreed, all employers and employees across an entire industry or occupation are locked into the conditions of that FPA.

There’s little or no collective bargaining in the agriculture sector, yet workers’ pay is well above the minimum wage, above the living wage and in most areas, above the median wage, Chris said.

The 2022 Federated Farmers-Rabobank Farm Remuneration report shows 13 percent average growth in pay packages for farm workers over the last two years. Average reported hours worked fall below the International Labour Organisation recommended maximum standard working time of 48 hours per week (for full-timers - dairy 47.2 hours, sheep/beef 44.8, arable 46.2.

"This is off the back of farm and business owners negotiating with their staff what will work to retain those workers in a competitive marketplace and keep the business profitable.

"Our industry isn’t perfect on this front. But we’re working hard to get it right with programmes such as Good Boss, the Sustainable Dairying Workplace Action Plan and a mountain of other resources for farmers," Chris said.

"Ag staff can get free employment, legal and other advice through RESH (the Rural Employment Support Hub). I think the fact RESH only gets a dozen or so calls a month, when there are tens of thousands of employees in the sector, shows that we’re getting a lot right."

However, farmers are concerned that other sectors they rely on - such as transport - will get bogged down by Fair Pay Agreements, reducing flexibility, raising costs and destroying productivity.

"It will be a powerful message if all food sectors from farm gate to plate step up and state they don’t want a bar of this. Feds agrees with Business NZ - and more than 20 other major sector organisations - that compulsory FPAs are a step backwards, a solution looking for a problem," Chris said.

"As the open letter to Workplace Relations and Safety Minister Michael Wood states: A far better option is to identify sectors facing wage challenges through a market test and if there is an issue in a particular sector, then let’s fix that. We don’t need a one-size-fits-all sledgehammer of a solution across all sectors.

"Feds recommended all employers and employees take a look at the website yourworkyourway.co.nz and make up their own minds. You might also consider signing the letter to Minister Wood yourself."


For more information contact:
Chris Lewis, Federated Farmers national board member and employment spokesperson, 027 289 8942
Simon Edwards | Communications Advisor, Federated Farmers
Email: [email protected], Mobile: +64 (0)27 484 8892