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New Zealand’s showing in a Unicef survey of national childcare policies isn’t flattering. (Getty Images)
New Zealand’s showing in a Unicef survey of national childcare policies isn’t flattering. (Getty Images)

The BulletinApril 8, 2022

Paying for parental leave

Contributing writer
New Zealand’s showing in a Unicef survey of national childcare policies isn’t flattering. (Getty Images)
New Zealand’s showing in a Unicef survey of national childcare policies isn’t flattering. (Getty Images)

Businesses are providing increasingly generous leave, going above some of the rich world’s stingiest childcare laws, Justin Giovannetti writes in The Bulletin.

Leading the change on parental leave in New Zealand.

Dean Wharewera’s employer extended its offering of paid parental leave to 12 weeks last year, regardless of gender or parenting role. He told Stuff that he jumped at the opportunity to be a stay-at-home dad for three months. His partner was keen on getting back to work and he wanted to spend time with his kids. Dads taking parental leave in Aotearoa remains a rarity. As Wharewera explains, he felt guilty taking 12 weeks off, despite giving his manager six months to prepare. The stereotypes are starting to change and some big companies are coming forward with gender-neutral, and more generous, parental leave policies.

Aotearoa has some of the world’s most meagre childcare policies.

New Zealand’s parental leave policies have improved over the past two decades, but they remain some of the least generous among rich countries. The Economist put out a striking graphic last year that ranks Aotearoa in 33rd place out of 41 OECD countries for childcare. The finding can be confounding to some New Zealanders, especially those who don’t have infants. It’s based on a Unicef study released last year that looked across national childcare policies. Specifically on parental leave, the UN agency ranked Aotearoa the third worst, beating only Switzerland and the US. Infamously, the US has no paid parental leave policies.

Didn’t the government fix this?

Labour increased New Zealand’s paid parental leave to 26 weeks in 2020. That’s captured in the data above. However, there’s a payment cap of $621 per week (which is significantly less than a full time worker on minimum wage). The OECD average is 51 weeks of full pay. Romania offers the most generous scheme at 92 weeks, while Aotearoa’s offering is calculated by Unicef to be around nine weeks of full pay for the average worker. Stuff reports that while New Zealand has some of the best quality childcare in the world, it’s also some of the least affordable. Despite 20 hours of free weekly ECE for children aged three to five, childcare consumes up to 37% of the average wage of a couple, with children under three. Unicef has called on the government to extend free ECE to one-year-olds and to introduce national targets to increase the affordability and accessibility of childcare.

The future direction of parental leave in New Zealand.

At a time when many families are struggling, expensive childcare costs have received almost no attention in the Beehive. Without direction from the government, telecommunications company 2degrees increased its parental leave payments to 100% of an employee’s salary last year. The company said the more generous policy was a way to attract and retain talent in a competitive labour market. The government’s scheme has been recently going in the other direction. The NZ Herald reported on Inland Revenue fighting two new mothers to deny leave payments for their second children. The women hadn’t waited long enough between births, the IRD argued. The Employment Relations Authority ruled on appeal that IRD was right and both women shouldn’t have access to parental leave.

The government says the bill has the potential to improve the lives of working New Zealanders. (Image RNZ/123F)
The government says the bill has the potential to improve the lives of working New Zealanders. (Image RNZ/123F)

The BulletinApril 7, 2022

A radical overhaul of labour laws

Contributing writer
The government says the bill has the potential to improve the lives of working New Zealanders. (Image RNZ/123F)
The government says the bill has the potential to improve the lives of working New Zealanders. (Image RNZ/123F)

The government says its fair pay agreements will stop a 30 year race to the bottom for workers, Justin Giovannetti writes in The Bulletin.

The biggest change to workplaces in a generation.

Nearly a year ago the government unveiled its plan for fair pay agreements. As I wrote at the time, it’s an economy-shaking move that could raise wages, empower trade unions and end precarious work. The agreements will create mandatory, sector-wide collective bargaining. They will likely be one of the most significant and lasting changes by the Ardern government. A bill is now sailing through the Labour-controlled parliament to make the agreements law. With the final shape of what’s to come set, Stuff looks at whether the agreements are fundamentally a good idea.

The impacts of fair pay agreements will be widely felt.

We won’t know what impact the agreements will have on workers, but it’s possible most New Zealanders will eventually be covered by one. There’s nothing in the law that limits it to cleaners, security guards and others in precarious occupations. Once 10% of employees in a proposed sector sign up, an agreement setting minimum pay and conditions becomes mandatory. If employers and unions can’t agree on a deal, the Employment Relations Authority will impose one. Newshub sets up the debate, with some workers enthusiastic for the change, while employers are worried. The Employment and Manufacturers Association has warned it could lead to the return of meal breaks and triple time, both “problematic” perks dropped in the 1990s, it said.

The arguments for and against the agreements.

Business NZ represents over 70,000 businesses across the country. It refused the government’s offer to be the representative for businesses during negotiations in the future. Business NZ’s Kirk Hope told RNZ that he views the agreements as “fundamentally flawed”. The main argument against the agreements is that they are inflexible and a throwback to the last century. Business NZ is also arguing to the International Labour Organization, a UN agency, that the mandatory nature of the agreements makes them unlawful. An alternative system, the group argues, would be setting new minimum standards in jobs with well-documented labour problems. The government’s argument is that the last 30 years of light regulations has been bad for many workers and Labour campaigned vigorously in the last election to introduce the agreements.

Support could be all a question of timing.

It’s difficult in my mind to disentangle fair pay agreements from the government’s other significant labour change, the proposed income insurance scheme. There was a Bulletin about it in February. The two are vastly different ideas, but the players are the same and the point is to make work fairer. Both also suffer from a similar problem: the timing couldn’t be worse. Both will increase costs on employers at a time when inflation is running rampant and consumers can’t handle more expensive shops. The House reported earlier this week that businesses are on edge, with all of that in front of parliament, as well as the Matariki public holiday bill. There’s little support across the aisle for the government’s business agenda. Newshub reports that Act has promised to cancel all of it, while National isn’t too keen.