High-earning Auckland Council staff asked to take 5-10 per cent pay cut

Auckland Council chief executive Stephen Town is asking staff to take a 5 to 10 per cent pay cut for six months. Photo / Sarah Ivey

The Auckland Council is asking staff who earn more than $100,000 to take a minimum 5 per cent pay cut as it tries to find savings after a major drop in council revenue due to Covid-19.

The voluntary paycuts will only impact staff earning six figures and will be a tiered approach with the higher earners being asked to take a bigger cut.

There will be a 5 per cent reduction for anyone earning between $100,000 and $175,000, a 7.5 per cent reduction for anyone earning between $175,001 and $275,000 and a 10 per cent reduction for anyone earning above $275,001 for six months.

The move comes as the council tries to find savings after its revenue has dramatically fallen in the past two months, but there have been unexpected and unbudgeted costs as it responds to Covid.

Auckland Council chief executive Stephen Town said the new cost-saving measures would be implemented over the next six months.

Last month Town and the chief executives and board chairmen of the five council-controlled organisations announced they would take a 20 per cent paycut for the next six months because it was the right thing to do in the current environment.

The council is also in talks with the Public Service Association, the union for council workers, about whether the annual remuneration review for staff should be limited or cancelled.

PSA national secretary Glenn Barclay said the union was working closely with the council over the proposals and never welcomed any step backward in pay and conditions.

"PSA members care strongly about serving our communities and maintaining essential services, that's a top priority whether in good times or bad. We want to figure out strategies to move forward which minimise the impact on communities and employees who can't afford cutbacks."

It was up to the employees themselves to decide whether they wanted to take the cut as there was only a small percentage of Auckland Council staff earn over $100,000 a year, he said.

"We strongly oppose any pressure to take a paycut being put on workers earning well below that amount, whether it comes from on high or from colleagues. Auckland is an expensive city to live in, and council staff have bills to pay like everyone else."