Engineering, Printing and Manufacturing Union (EPMU) members employed at Vector Taranaki's Kapuni gas treatment plant have agreed a 10 per cent pay rise over the next two years.

The agreement was ratified at the weekend, said EPMU national secretary Andrew Little.

The pay rise has been backdated to May 1 and included an increase of six per cent to October 30, 2011, followed by a further increase of four per cent to April 30, 2012.

"A 10 per cent pay rise over the next two years is well above the current national average annual pay rise of 1.6 per cent," Mr Little said.

It was "welcome at a time when prices are rising and the Government is hiking GST, both of which hit workers' pay packets".

Mr Little said increasing pay was a better way to close the wage gap with Australia than fiddling with the tax system.

The settlement also included agreement to establish a joint working party comprising union representatives and production leaders to facilitate collaborative training programmes, best practice initiatives and ensure shift work requirements do not place too great a burden on workers when they cover for colleagues.

- NZPA