Guest Post: Sue Kedgley on the Living Wage

A guest post by :

For the last few decades wages for low paid workers have been stagnating to the point where many low wage employees live in poverty and can’t afford decent housing, healthcare or food or other basic necessities of life. 

At the same time the salaries of staff in senior management positions have been skyrocketing.

So we have a situation in New Zealand now where the salaries of central government chief executives are among the highest in the world, and chief executives of some of our large institutions earn in excess of $4 million a year. But at the other end of the scale many workers earn so little they cant even afford the basic necessities of life, and have to work two or three jobs just to make ends meet.

This extreme gap in the incomes of people working at the top and the bottom of the workforce has been fueling inequality and the growing gap between the rich and the poor in New Zealand.

The Auckland Council exemplifies this growing wage gap. Around 1800 staff earn more than $100.000 a year, while the Chief Executive earns around a million dollars a year. But 1800 workers earn less than the .

The Living Wage movement to pay workers a minimum of a Living Wage of $19.80c an hour is part of a campaign to redress this growing gap.

It’s interesting that have never heard the government, or councils for that matter, object to paying wage increases for staff at the top of an organization. But many object to paying meagre wage increases to low income staff.

My argument is that if we can afford to give wage increases to people at the top of an organization, we must also be able to afford to wage increases to staff at the bottom of an organization, so that they can afford the basic necessities of life.

So I’m delighted that the agreed unanimously to my resolution to become a Living Wage employer last week, and pay our directly employed and contract staff a Living Wage.

All of our directly employed permanent staff are already paid more than the living wage, so it will only cost around $5000 to pay the remaining part time staff a living wage.

But it will be more challenging to pay our contract staff —cleaners and security staff for example —a living wage.

But that’s the beauty of the Living Wage process. It is a process, and a journey, and no one expects us to do it overnight. And that’s why the resolution asks officers to develop a framework for implementing it, and a timeline for its phased implementation. 

I would note that most of the other Councils in the Wellington region are also at different stages of the Living wage journey, including the Wellington city council, Porirua Council and the Hutt City Council. I think it’s great that Wellington is leading the way in the living wage campaign, and that the Wellington Regional Council is the first regional council to do so.

Employers should see becoming a living wage employer as an investment, however, not as a cost, because the evidence is overwhelming that staff who are paid a decent wage are more productive, and there is less turnover, less absenteeism and higher morale. So paying staff a decent wage should be a normal requirement of a modern, progressive workforce, and I hope that employer organisations such as the Chamber of Commerce will come to see it that way.

I recall the extreme opposition that my Flexible Working hours private members bill attracted when it was first introduced into parliament. The Chamber of Commerce and most employer organizations said it would be an unmitigated disaster if they had to allow their staff to work flexible working hours, and some threatened to move their businesses off-shore if the bill was passed. Yet a few years after my bill became law, most employers began to embrace it, and see it  as part of a modern organization, which not only helped them to attract staff but increased productivity and staff morale. And now the National government (which was implacably opposed to my bill) has extended its provisions to cover all employees in the workforce.

I hope that the same thing will happen with the living wage, and that paying staff decent wages to all staff, at the bottom as well as the top, will be simply seen as an investment in a modern, productive workforce.

Comments (56)

Login to comment or vote