KEY POINTS:
A $329 million pay deal for hospital nurses and midwives has been reached, despite warnings it will hit hospital budgets hard.
The deal between the country's 21 district health boards and the union representing 20,000 nurses and midwives yesterday gives pay rises of around 4 per cent a year over the next three years, along with additional leave days and parental leave top-ups.
It follows the $380 million Government-funded pay jolt in 2004, which awarded public hospital nurses 20 per cent rises after the union's Fair Pay campaign broadly bracketing nurses' pay with teachers and police.
Canterbury DHB chairman Syd Bradley said on Tuesday the latest deal carried "massive implications".
Lead CEO for the health boards Jim Green conceded that the deal would be costly. It had been calculated to cost health boards a total of $329 million over 39 months in additional pay and leave.
"This a very 'stretching' deal for the DHBs," said Mr Green.
But the boards agreed because they too would benefit. Mr Green said the settlement had been designed to better recruit and retain nurses, whotraditionally have high turnoverrates.
"We're expecting to get some good benefits out of this in terms of lowering the amount of turnover that is there within nursing and obviously that will increase the number of FTEs [full-time equivalents] within nursing."
The additional leave meant more staff might need to be hired, but he expected it to be "manageable".
The boards had looked closely at how the deal would affect other ongoing pay negotiations, he said.
When asked if it could lead to a heightening of expectations from other unions, Mr Green said: "We've obviously taken that into account.
"That spirit of looking at issues in partnership is something that we are very keen on sharing with other unions and their members.
"In a time when the health sector has seen a higher-than-usual level of industrial tension, this settlement is proof that working together constructively delivers better outcomes for all parties."
The three-year agreement will see union members receive incremental pay increases of 3 per cent, 4 per cent and 4 per cent over the term of the agreement.
They will also get around six months' backpay, as the agreement expired on March 31.
DHBs have also agreed to make 2 per cent Kiwisaver contributions from March next year, allowing union members to enter the scheme by making 2 per cent employee contributions.
Nurses Organisation lead advocate Glenda Alexander said the agreement provided solutions for all the issues workers took into bargaining.
Ninety-five per cent of members voted to approve the settlement, compared with 81 per cent approval for the historic Fair Pay settlement.
NEW DEAL
For a public hospital nurse with five years' experience:
Now
* Annual salary of $54,000
* Excludes an additional 13 to 15 per cent in penal rates from overtime and shift allowances
* Four weeks' annual leave, plus additional three days (after six years' continuous service)
* Standard parental leave of 14 weeks at the maximum rate of $391.28
By 2009
* Annual salary rises to $60,150
* Excludes an additional 13 to 15 per cent in penal rates from overtime and shift allowances
* Four weeks' annual leave, plus five days (after five years' service)
* Long service leave of five days every five years
* Fully salaried parental leave of 14 weeks, with DHB making up shortfall
-additional reporting NZPA
