Contractors minimum wage bill passes hurdle

27 May, 2008

Contractors are likely to have minimum wage protections extended to them after Labour MP Darien Fenton's Minimum Wage and Remuneration Amendment Bill passed its second reading on Wednesday.

It will now go back to Select Committee and then to the house for one more reading before becoming law.

The bill seeks to provide protection for contractors by fixing an anomaly in our law that allows contractors to be paid below the minimum wage for their services, as was seen recently in a Fair Go exposé on pamphlet deliverers.

Council of Trade Unions secretary Carol Beaumont says people doing contract work for less than the minimum wage deserve the full wage protections afforded to other workers.

"As those who saw the recent Fair Go story on pamphlet deliverers will attest, there are people doing contract work right now who are paid poverty wages, and these people need the full protections of minimum wage laws.

"Most contractors in New Zealand would be remunerated at well above the minimum wage.  For those that aren't, this Bill would provide protection against them being exploited by companies wanting to unreasonably drive down costs."

"Pamphlet delivery is one area of work that is relevant to this Bill, but contracting practices are certainly widespread in other industries such as acting, cleaning and forestry."

The bill has the support of Labour, the Greens and the Maori Party, with opposition from NZ First and National, which argued there was no need for minimum wage protections for contractors and said the bill created too many "compliance costs."