March 2013


This month:

Three questions

All NARGON members should know the answer to these three questions:

  1. Who is the new Labour party spokesperson on Labour?
  2. What unwelcome ingredient has been found in some beef dishes in Europe?
  3. Did cheese prices increase or decrease in the year to February 2013?

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Food prices down again, card spending up

Food prices fell 0.3 percent in February 2013 according to official figures from Statistics New Zealand. The decline was led by cheaper prices for the meat, poultry and chicken category, and the fruit and vegetable category. The price of fresh milk (up 2.1 percent)showed the largest monthly rise since July 2010 and is now at its highest level since May 2012. The price of boxed chocolates (down 21 percent)falls every February because of Valentine's Day.

For the year to February 2013, food pricesdecreased 0.1 percent overall. Decreases included grocery food (down 2.1 percent), and meat, poultry, and fish (down 1.2 percent). Fruit and vegetable prices increased 6.3 percent over the year. Prices for fresh milk (down 6.0 percent), butter (down 20 percent) andcheese (down 5.4percent) all dropped.

Figures from Statistics New Zealand show shoppers in New Zealand spent more using debit and credit cards in February 2013. After being adjusted for seasonal effects, the value of electronic card spending in the retail industries increased0.8 percentin February 2013. This was the fifth consecutive monthly increase and the largest since August 2012. The consumables sector, which includes supermarkets and retail grocery stores, was the second largest increase, up 0.6 percent ($9 million).

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Political profile Darien Fenton (Labour)

Darien Fenton is a third-term Labour List MP who became the partys new spokesperson for Labour and Employment Relations earlier this year. A former Vice President of the Council of Trade Unions (CTU), she has written a column for the NARGON News on minimum and living wages:

The Government has announced that the Minimum Wage will increase by 25 cents to $13.75 an hour from 1 April this year

The Minimum Wage is just that: the legislated minimum below which no worker can be paid. It should not be confused with the Living Wage, which has had a lot of publicity recently.

The Minimum Wage is decided by the government, after consultation with employers and unions, and advice from government agencies.

A Living Wage enables workers to survive and participate in society and has been calculated at $18.40 an hour by the community campaign behind the growing movement. It is based on a family who work 60 hours a week and have two children, and takes into account government transfers, housing costs and other necessities.

A Living Wage doesnt require a legislative commitment because it is essentially a voluntary process. However, governments can lead by example by ensuring publicly funded organisations can pay a living wage. Employers who can pay lead the private sector by paying a living wage and become exemplars for others.

The benefits to business and the community of a Living Wage are well established: retention of staff and lower turnover costs, lower rates of absenteeism and sick leave, enhanced productivity and better morale and motivation.

Low-income households spend a larger share of their income on a weekly basis than high income earners. When workers can afford to buy goods and services, businesses, large and small, benefit.

Labours approach is to lift the Minimum Wage to $15 an hour and to champion the Living Wage in both the public and private sectors.

The Governments approach is different. For example, the Minimum Wage (Starting Out) Wage Bill is due for its second reading and needs to be passed in time for commencement on 1 May 2013.

The bill reintroduces youth rages for 16 and 17 year olds, and allows 18 and 19 year olds who have been on any social security benefit to be employed on 20 percent less than other workers. We havent seen youth rates for 18 and 19 year olds since the 1990s.

As you would expect, Labour doesnt support this bill. And nor, from what we heard at Select Committee, do most submitters more than 500 of them. Some employers told us that they dont believe youth rates are a magic bullet, and there needs to be a range of interventions to tackle our burgeoning youth unemployment. We agree.

The bill is unlikely to succeed in its aim of reducing youth unemployment. There are more effective and equitable means to improve outcomes for 15-19 year olds by way of investment in education and active labour market policies.

Apart from that, we dont believe young workers should be paid lower wages because of their age, especially when they are doing the same work as an older worker. Its not fair that 16 and 17 year olds, who gain experience in one job can be returned to youth rates in their next job.

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NARGONs position on minimum and living wages

NARGON has long supported the concept of a minimum wage for all employees. However, we have often disagreed with the Government regarding the level at which it should be set each year. While the Government says the minimum wage is a careful balance between protecting low-paid workers and ensuring jobs are not lost as the economic recovery gains pace, we believe the constant increases have priced a large number of young and/or inexperienced workers out of jobs.

Despite the criticism from opposition parties, unions and segments of the media, the National-led Government has actually increased the minimum wage every year it has been in office.

NARGON is not prepared to advocate for the so-called living wage of $18.40 an hour though we respect that what Government departments, councils, universities or companies choose to pay their workers is completely up to them. We believe an effective 35% increase in the minimum wage would have a huge impact on companies in the retail grocery sector which employ a large number of first time employees and operates on very thin margins. Job losses and stores closures would be the likely results of a living wage economy.

The OECD database shows that New Zealands minimum wage ($13.75 an hour) is around half the average New Zealand hourly wage of $27. According to the OECD, that proportion is the highest in the developed world. In all other countries, the minimum wage is under half the average wage. That includes Canada (40 percent), Britain (38 percent) and America (28 percent). NARGON believes the minimum wage as a percentage of the average wage is a more important figure than the face dollar value of the minimum wage rate.

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Minimum wage up again and Starting Out Wage passed

Starting Out Wage

Yesterday the Starting out wage for young people, narrowly passed its third and final reading in parliament.

From May 1st 2013, 16- and 17-year-olds will be paid 80% of the minimum wage, or $11 an hour, in their first six months of work with a new employer.

Three groups will be eligible unless they are training or supervising others:

  • 16 and 17-year-olds in their first six months of work with a new employer
  • 18 and 19-year-olds who have been paid a benefit for six months or longer, and who have not completed six months of continuous work with any employer since starting on benefit
  • 16-to-19-year-old workers in a recognised industry training course involving at least 40 credits a year.

Under the starting-out wage, eligible 16-to-19-year-olds can be paid 80 per cent of the minimum wage for six months or for as long as they are undertaking recognised industry training of at least 40 credits per year.

Minimum Wage

New Minister of Labour Hon Simon Bridges has confirmed that the minimum wage is to rise on 1 April 2013 to $13.75 an hour, up from the current rate of $13.50, and the training and new entrants minimum wage will increase from $10.80 an hour to $11. This is 80 per cent of the adult minimum wage. Members should ensure their payroll system reflects these changes. Employees should also be reminded that they may be able to access additional support such as Working for Families, accommodation supplements, emergency benefits and the Community Services Card.

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Government expected to introduce significant employment law changes

The National-led Government is expected to introduce a large Employment Relations reform bill as early as April 2013. It is predicted to include a number of previously signaled changes. The key provisions for the retail grocery sector are likely to be:

  • Extending the right to ask for flexible working arrangements to a wider range of employees (not just those with caregiving responsibilities) and possibly allowing flexible working arrangements to be negotiated without invoking a formal process.
  • Removing the current requirement for unions and employers to conclude collective bargaining, as well as providing an ability to have the Employment Relations Authority declare bargaining to be concluded.
  • Removing the requirement for non-union members to be employed under an identical collective agreement for their first 30 days of employment.
  • Allowing employers to opt out of negotiations for a multi-employer agreement.
  • Allowing partial pay reductions for partial strikes or low-level industrial action.
  • Reviewing how constructive dismissal allegations can be better challenged.
  • Updating the existing legislation on rest and meal breaks to make it more flexible and more suited to the needs of a diverse range of industries.
The Monday-isation of ANZAC and Waitangi Day when those holidays fall in the weekend. Anzac Day next falls on a Saturday in 2015 and the same will happen for Waitangi Day in 2016.

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Useful guide to the responsible display of lads magazines

There are a growing number of lads magazines which have covers containing imagery that many people would regard as inappropriate for children to see. These mens interest magazine are often raunchy but not pornographic. Members who sell them need to be careful to display the magazines responsibly and appropriately.

The British Association of Convenience Stores (ACS) has published a guide for retailers on how to display lads magazines. The document provides common sense, practical and simple suggestions on best practice and responsible display. NARGON endorses this guide and suggests that all members who sell magazines with raunchy covers study it to ensure their shelving and display policies are the best they can be.

The guide can be accessed on-line by clicking here.

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UK: Mixed signals on plain packaging

The UK government is poised to introduce legislation to bring in plain tobacco packaging, according to areport on The Guardian website. Quoting a senior Whitehall source, The Guardian said the legislation will be announced in the Queens Speech in May, along with an expected ban on smoking in cars carrying anyone who is under 16 years of age.

However, tobacco company JTI and smokers lobby group Forest say the Coalition government has made no decisions about plain tobacco packaging. They quoted recent comments from the Prime Minister David Cameron and Health officials that the Government had an open mind on the issue and was considering all the submissions. JTI suggested the story had been planted by supporters of plain packaging to put pressure on the Government. Their statement said those who wish to close down the debate on plain packaging appear to be using the media to pressure the government into making a decision on a policy despite there being no credible evidence that it will have any public health benefit.

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UK: Horse meat scandal hits supermarket sales

What has now become known as Europe'shorsemeatscandal erupted in January 2013 when routine testing in Ireland revealed that some beef products also contained horse and pig DNA. Horse meat was being used as a cheap substitute for beef somewhere in the supply chain. Although horse meat is not medically harmful it is a delicacy in some countries customers were understandably disappointed and horrified that it was secretly in their beef.

The scandal quickly spread across Europe, involving a number of well-known brands and high-profile supermarkets. In response, there have been product withdrawals, increased testing and government investigations into the region's complex food-processing chains. However, as recently as 15 March supermarket giant Tesco was forced to withdraw a meatloaf product after it tested positive for between 2% and 5% horse meat.

Despite the vast majority of tests coming back clear, customers are clearly still concerned and sales of supermarket frozen meals - the main culprits in the scandal - have plummeted. Instead of customers buying something different in the supermarket, independent butchers and fishmongers are reporting dramatically increased trade. Fish shop owners say recent sales have increased by up to 20 percent as families reject processed foods after horse DNA was discovered in ready-made meals, burgers and meatballs.

This means that even supermarkets which never stocked adulterated products are likely to be affected by the scandal. Events in Europe stress the need for stores to have confidence in their suppliers and the integrity of the food chain which brings products to their shelves.

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Reminder about written employment agreements

NARGON reminds all members that full written employment agreements are required for every single employee. This is a strict legal requirement. The member's section of the NARGON website contains draft agreements and advice on employment agreements www.nargon.co.nz.

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On a lighter note This cheese tastes slippery

The following exchange happened at a grocery store in Oklahoma, USA at least according to www.notalwaysright.com:

(I work as the HR manager at a grocery store. We often have various specialty items on display near the registers. One day, an angry customer storms in and confronts me.)

Customer:Excuse me! Your cheese samples made me very sick!

Me:Im very sorry to hear that maam, but I was unaware that we had cheese samples in the store today.

Customer:You sure do! I took a sample and my mouth was foaming before I even left the store!

Me:Do you mind showing me where you found the cheese sample?

(The customer leads me to a table filled with samples.)

Customer:It was these! See, a whole table filled with them. Theyre not even being attended by anyone! Theyre all rotten. I demand compensation!

Me:Maam, the reason you got sick is because these are not cheese. These are bars of soap.

(The customer stares at wide-eyed at the table: its filled with unwrapped bars of specialty bath soaps which are clearly labelled as Organic Soaps. Realising her mistake, she covers her mouth with her hand and runs out of the store.)

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Answers to 3 Questions

1. Darien Fenton (Labour MP - List).

2. Horse meat (Horse DNA).

3. Decreased 5.4%.

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