Youth rates bill struggling for support

A 2007 protest against youth rates in Auckland. Photo / Herald on Sunday.

The issue of youth rates is again in the headlines after a bill to re-introduce them was drawn from a parliamentary ballot this week.

Youth rates were abolished in 2008 under the Labour Government.
Employers could pay those staff aged 16 to 17 nine dollars an hour, while the minimum wage was $11.25 for those employees over 18.

ACT MP Roger Douglas, who is sponsoring the bill, says the minimum wage stops employers taking on young workers, while those who support it argue it is unfair to differentiate pay rates based on age and say there is little evidence of a link between youth rates and unemployment.

His proposed bill would allow for the reintroduction of youth rates.

Unite director Mike Treen says he campaigned robustly to remove the rates and had the support of many high school students who went on strike.

Treen says if the government were to adopt youth rates again employees could then start to discriminate against workers young and old, by not paying them equal rates.

"They do the same work, and work side by side. Certainly it's an abuse of workers rights. The Human Rights Commission said it was discrimination. By allowing employers to employ young workers at a lesser rate, it's taking advantage of younger workers.

Business NZ chief executive Phil O'Reilly says other measures have now replaced youth rates for those sectors who previously paid them.

Under the government's 'Job Ops' scheme, which began in August last year workplaces can be subsidised $5000 for each young person they employ. Employers hiring staff aged 16 to 17, or between 18-24 with little skills or experience qualify.

Treen says those industries seeking to employ young people will keep doing so because of their suitability - regardless of the pay rate.

"That's because of the time the workers are available - weekends and after school. That would suit the fast-food industry, supermarkets and the cinemas."

Treen argues if a lesser wage was introduced it would further disadvantage those families relying on multiple incomes.

"During the 90s there was an increase in unemployment. As a consequence families depend on working longer hours and more people working.

"It's often not pocket money but it's necessary for the families survival in difficult times."

O'Reilly says it is the joint responsibility of the community and the government to support young people in need of work.

"New Zealand is a welfare state. I think it would be a hard call to say to a young person first entering a job that they are to provide for their family. And that's a big ask to say to an employer you should be paying more because this person is supporting their family."

He says youth are over-represented in the ranks of the unemployed - currently at 7.3 per cent - but the renewed debate was unlikely to result in youth rates being reinstated.

O'Reilly said he'd "be very surprised" if the bill to reintroduce them got much support.