Allowances stripped after minimum wage raised, Greens say

Sue Bradford

Some businesses are stripping employees of allowances so they don't have to pay last month's minimum wage increase, Green MP Sue Bradford says.

Ms Bradford has been told of three lower North Island clothing manufacturers which had taken away staff allowances to avoid increasing their wage bill when the minimum wage increased from $9.50 to $10.25 on March 27.

The Clothing, Laundry and Allied Workers' Union had intervened in one case and the company had backed down.

Another is considering the issue but the third was continuing to withhold allowances.

"In the case of one of the companies, individual workers were forced to sign an agreement agreeing to the employer's actions," Ms Bradford said.

"At the other two companies, the workers were expecting their wage rise but when they opened their pay packets found these had been circumvented."

She said it was disturbing that two of the employers said the Department of Labour Employment Relations service had said their plan was acceptable.

"I believe this is illegal and any employers that buy into this kind of thing should be dealt with swiftly," Ms Bradford said.

"This kind of underhanded activity undermines our employment laws and efforts to improve conditions for low paid workers."

Ms Bradford has written to Labour Minister Ruth Dyson about it.

- NZPA