City council rejects living wage

03:04, Dec 13 2013

Up to 136 Palmerston North City Council workers are earning less than the living wage, and city leaders have rebuffed calls to improve their pay to $18.40 an hour.

Both Mayor Jono Naylor and chief executive Paddy Clifford have rejected the idea that ratepayers should have to find another $353,000 a year to adopt the living wage as the minimum for council staff.

Mr Clifford said the move would cost $4.3 million a year if other staff received increases to maintain pay differentials.

The Wellington City Council decided this week to phase in the living wage for its staff from January 1, at a cost of about $750,000 a year.

Mr Naylor said the move would shift the burden of addressing social inequity from taxpayers to ratepayers.

Mr Clifford said it did not seem fair to expect ratepayers on the minimum wage or receiving superannuation to foot the bill.


PSA union organiser John Shennan, who represents some of the council staff earning below $18.40 an hour, said the response was disappointing.

"It's not that the council is a bad employer. But this is about setting an aspirational goal - that Palmerston North is not a low wage community.

"For them to be saying the council will not be a leader is not good enough. They should show some guts."

The figures produced by the council show 104 waged staff earning below $18.40 an hour work in parks and civil maintenance, refuse and recycling, cleaning, stores, gardening, or working as casuals.

Performance bonuses allowed 75 of them to earn more.

Salaried staff below the threshold work in the library, call centre or at Arena Manawatu, in administration support, or as cadets or library service guides. Two thirds of those 32 staff affected can earn more through performance pay.

Mr Clifford said the council's management team generally supported increasing low incomes.

He said the issue should be addressed through the minimum wage, working for families tax credits and tax thresholds.

If the council brought in the living wage, but contractors did not, it could cost council jobs, Mr Clifford said.

"Requiring contractors to pay the living wage is fraught with many problems," he said.

Mr Naylor said the principle of a living wage was something he could support, but there were ramifications for ratepayers that could not be taken lightly.

Recent changes to the Local Government Act had given councils the power to set remuneration policy, which was previously the domain of the chief executive alone.

Mr Naylor said he had no intention to use that power to advance the living wage issue and prompt a council debate.

It was ironic, he said, that the Government had brought in the new power so councils could act to control high salaries in local government, rather than to raise the minimum.

Mr Shennan said the unions would continue to push for the council to take action.

The co-ordinator of the living wage campaign, Annie Newman, would be the guest speaker at a public meeting in Palmerston North next month.

"We want to set up a broad-based coalition in the city to lead and co-ordinate dialogue in the community."

He said it was vital to address the growing gap between rich and poor in New Zealand, and Palmerston North should aim to be a high-skill, high-earning community.

"We are not going to grow on the back of poverty level wages."

Mr Shennan said he understood the risks to jobs if the council raised pay rates while competing contractors did not. However, that was not a reason to do nothing, and he said many of the concerns were excuses.

The cost of passing increases up through the council to retain relativity, for example, was not something workers were demanding, Mr Shennan said.

"This campaign is about setting a safety net, not some sort of leverage or bargaining tool."

Manawatu Standard