Thursday, 26 February 2009

Contractors are people too

On the campaign trail John Key clearly stated "we would love to see wages drop" and the National-led government certainly aren't wasting any time in fulfilling that promise.

First we had the 90-day Fire at Will Bill rammed through under urgency and without public scrutiny. National and friends amended the Employment Relations Act to allow sackings within 90 days for pretty much any reason without risk of personal grievance. Which really encourages workers to seek a pay rise, doesn't it?

Then we had all that dithering by the Prime Minister and the Minister of Labour about the new minimum wage rate, and the eventual decision to put it up to $12.50. This rate was probably at the top end of what the National caucus would hold their noses and agree to, and certainly well above what Act would have wanted. But it's still only a 9c an hour pay increase in real terms.

Most recently we've had the Minister for State Services axe the roll-out of pay equity programmes across the state sector, because equal pay for work of equal value is unaffordable in the current recession. One law for all (special conditions apply).

Next week National have a chance to put the boot in yet again. Or they could choose to make a real difference for thousands of NZ workers and their families and vote for Darien Fenton's Member's Bill on contractors' pay comes up for its third and final reading.

Fenton's Bill aims to end the abuse of labour laws by contracting out work, specifically breaches of the minimum wage. Our labour laws around minimum wage, sick leave, annual leave, and many other entitlements only apply if you are classed as an "employee". Yes there are definitely times when someone is genuinely a contractor, but there are also cases of abuse, such as some of those Fenton gave in her second reading speech:
For example, a pizza deliveryman told me he was employed as a "contract driver," not an employee, then his franchise boss assigned him to work 10 hours straight on well below minimum wage.

A home-care worker, on 24-hour shifts looking after a man with Alzheimer's disease, signed a contract with an agency saying she is "self-employed" and therefore not entitled to the minimum wage.

A waitress was told she was not an employee; she was an independent contractor with a waitressing business.

A hotel housekeeper was contracted on a room by room cleaning basis.

A workers’ brief experience as a "subcontractor" hired to mop floors and dust offices later discovered that other workers had also signed an independent contract with the licensee of a commercial cleaning company. She was told where and when to clean and told to buy hundreds of dollars in supplies.

Ten months after signing her contract, after working for what amounted to less than $6 an hour, she has no cleaning business. And the company is still recruiting workers in employment ads to "Be Your Own Boss."

Even in cases of genuine contracting the minimum wage should be honoured. My observation is that often contracting is a family affair; one partner does the contracting work, while the other takes the calls, books the jobs, does the finances, all behind the scenes. The division of this work is often gendered, no surprises there. So paying the minimum wage is really the least that could be done to recognise this work fairly.

How National decides to divide on Fenton's bill is yet to be seen. If they vote it down that'll be further proof that their abiding love of dropping wages overcomes their fickle affection for closing the pay gap with Australia.

In the interests of transparency, this post came about because Darien Fenton commented on a post at The Standard asking for some support around this bill when it came up for its third reading and she and I had a subsequent email conversation. Fenton didn't write this or even suggest it, and she hasn't seen it before you have, although I did ask her advice about the best timing for it to be topical.


anna c said...

A certain large telecommunications provider did this to me - we were clearly employed in every meaningful sense of the word - we worked 40 hour weeks at set times with no say over how or when we did the work. Whilst they did pay us the minimum wage (just) they avoided paying holiday pay, sick leave (which was very interesting when the work started damaging my health), public holidays etc. Of course I should have stood up to it, but it's very hard when you literally have no money for food.

Keely said...

This is also exactly what they do to leaflet deliverers, usually kids, elderly, unemployed or low-waged desperate for extra income. Companies like Reach (formerly Deltarg) and PMP sign up kids as 'independent contractors' and pay per delivery. This equates to about $1.00 per 100 leaflets for the first pamphlet and 50c per 100for each additional pamphlet. To maximise their profits they will book in large numbers of pamphlets per delivery, sometimes up to 14 different pamphlets. Deliverers can spend hours/days delivering all these for a pittance. There is no holiday pay, no sick pay, no rights at all. If a child falls ill and cannot deliver, their family is expected to do so. If the family are unable to, that child can be fired.
For all exploited 'contactors', I hope this bill goes through.

Anna said...

Keely, that's just awful - and what makes it worse is that, as you say, desperate adults are increasingly doing this work (not that exploiting kids is a good thing either).

Presumably, this will also affect home-based childcarers, which is interesting - their awful pay is what makes going to work affordable for many other low-paid women. And, in the case of these childcarers, their homes are the workplace - so costs like heating or fixing any damage done by kids are met by the 'contractors'.

Julie said...

I see that the Outrageous Fortune cast are also treated as independent contractors.

Home-based carers seem to have a variety of different situations Anna, which are not clear to me. Historically home-based care was predominantly provided by charitable organisations and the women who did the work were actually volunteers; they tended to get an annual honorarium in thanks but that was it. That has changed in the last five years or so as the demand for ECE has gone through the roof, Government funding has increased, and 20 Hours Free ECE was introduced.