Christchurch City Council moves to extend living wage

Tuesday, 28 August 2018

The Christchurch City Council has resolved to extend the living wage to employees at council-controlled companies.

Low-paid workers at Christchurch City Council-controlled companies will be moved onto the living wage within three years.

The council has asked its commercial arm, Christchurch City Council Holdings Limited (CCHL), to work with its subsidiary companies to achieve the living wage within the period.

Living wage advocates have welcomed the move, though some have questioned the roll-out length. One critic described the wage as a 'blunt instrument' and said there could be a 'range of unintended consequences'.

CCHL, which has previously recommended against extending the living wage, is the majority shareholder in eight trading companies, including Lyttelton Port Company, City Care, Christchurch International Airport and Red Bus.

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All other council-controlled organisations outside the CCHL group have made the same commitment.

It comes after the council voted last August to pay at least $20.20, the-then living wage, to its directly employed staff, a policy which was estimated to benefit 470 people at a cost of $775,000 a year.

A cleaner at council-owned venue management company Vbase said earning the living wage, which was set at $20.55 in April, would make a 'huge difference' to her life.

The woman, who did not want to be named, said she earned just under $17 an hour. The work was physically hard, and she and her husband were 'just making ends meet' by 'juggling' numerous bills.

Deputy Mayor Andrew Turner said while he and other councillors would have liked to see the wage rolled out more quickly, it was important to reach a balance that avoided 'unintended consequences'.

'In order to implement this successfully it needs to be managed in a way that doesn't result in any shocks to subsidiaries or the CCHL business,' he said.

Council acting chief executive Brendan Anstiss said the total cost of the move could not yet be 'accurately determined'. It would impact about 130 employees across the group, and two companies in particular, City Care and EcoCentral.

CCHL chief executive Paul Munro said CCHL supported the council's approach of implementing the wage in a 'measured way so that it doesn't impact on the financial viability and competitiveness of the entities'.

The Living Wage Movement - made up of community groups, unions and faith-based organisations - announces the living wage, determined by an independent research unit, each year.

Movement national convener Annie Newman said the council's move was an 'important step', but to become an accredited employer it also had to extend the wage to contractors.

'We're very happy with what they've done. It puts a stake down and says 'this is where we want to go, and this is a pathway to it'.'

Councillor Yani Johanson said he welcomed the move to extend the living wage. However, it needed to be extended to contractors and the three-year timeframe was 'far too slow', he said.

'You could easily pay the living wage to people in a short period of time by simply not paying those at the top as much and paying those at the bottom more.'

Cr Jamie Gough said he supported people being paid fairly, but described the living wage as a 'blunt instrument' which could have a 'range of unintended consequences'.

Companies might not take on as many people, and ratepayers working similar jobs outside council might question why those working for publicly owned companies were earning more than them, Gough said.

He also questioned whether it was appropriate for the council to be 'dictating business practices and pay-roll operations' given CCHL was set up to provide a buffer between the council and its companies.

The living wage is announced each year. Council staff are working on a process to review and consider living wage adjustments for council employees on an annual basis.

Anstiss said they are expected to report back to the Strategic Capability Committee in October or November.