Fast-food firm to end youth pay rates

One of New Zealand's largest employers of young people has caved in to union pressure and moved to abolish youth pay rates.

Restaurant Brands, which owns the KFC, Pizza Hut and Starbucks brands in New Zealand, has agreed to phase out the rates.

The proposal, put to union members this week, follows an agreement by BP this month to stop paying less to those aged under 18 at its 90 company-owned stations.

The Restaurant Brands proposal will see youth staff paid 90 per cent of the adult minimum wage, up from 80 per cent, with supervisors under 18 paid the same as adult employees.

The company has agreed to phase out youth rates but has not yet set a date for the move.

The new rates, which have yet to be accepted by union members, will see 15- to 17-year-old staff paid at least $9.23 an hour.

The move comes just days before new Government-driven minimum wage rates come into effect.

From Monday, pay for 16- and 17-year-olds increases to a minimum of $8.20 an hour, up from $7.60. Adult rates increase to $10.25, up from $9.50.

Negotiations between Restaurant Brands and the Unite Union have gone on for the past five months and have been highlighted by strikes at a number of the group's North Island stores.

This week youth pay rates again made the headlines when around 1000 young people marched down Queen St in Central Auckland, where they staged an impromptu sit-in and chanted outside fast-food outlets.

Unite Union delegate Nista Singh, 17, was among the organisers of Monday's march.

She said the offer by Restaurant Brands showed good progress but it was up to members to decide whether it would be accepted.

"It is a hugely significant increase, but it is not quite what we demanded."

She said the group wanted youth rates abolished.

But moves to pay youth workers the same as adults have raised concerns among members of the Employers and Manufacturers' Association.

Spokesman Gilbert Peterson said there needed to be an incentive for employers to take on untrained youth workers with little or no work history.

"The unemployment rate for under-18 workers is four times that of the average. I fear for those workers with moves to do away with youth rates."

He said employers would take on an adult over a youth worker if there was no difference in their pay.

The Government has said it wants the minimum wage raised to $12 an hour by the end of 2008 if economic conditions permit.

Last month, Green MP Sue Bradford's Minimum Wage Amendment Bill, which will scrap youth pay rates, passed its first reading in Parliament with Labour's support. It is being considered by a select committee and submissions close on April 21.

Unions have agreed to campaign this year in support of the bill.

Unite says fast food chains are the largest employers of youth, and have thus been one of the main targets of its SuperSizeMyPay.com campaign, calling for a $12 minimum wage for all ages.

In November, staff at Auckland's Balmoral KFC went on strike for two hours to protest against youth rates. The strike followed action at two Starbucks coffee shops.


Youth rates

For 16-and 17-year-olds
* Now: $7.60 an hour
* From Monday: $8.20 an hour.

Restaurant brands' offer
* Proposal includes wage increases ranging from 6.8 per cent to 47 per cent for KFC, Pizza Hut and Starbucks staff.
* Minimum rate for staff up to 18 increased to $9.23 an hour.
* A 17-year-old in sole charge could earn up to $14.68 an hour.