Soaring cost of sickies hits meat industry

Meat workers have been abusing the Holidays Act, forcing absenteeism rates to new highs and contributing to a $17 million wage-bill blowout, employers claim.

In one southern plant, stunned management uncovered an unofficial "sick day roster", as workers apparently capitalised on the act's new provisions.

The Otago Daily Times has also learned some meat plants have reduced production by up to 30 per cent on some days, due to high levels of sickness and bereavement leave.

Companies say there is a noticeable increase in sick leave six months into the season - the point at which workers do not need to produce a medical certificate as proof of up to three days of illness.

According to a Meat Industry Association report, sick leave among the industry's 22,000 workers rose 39 per cent (from 58,600 sick days to 81,400) in the year to March last year, compared with the previous 12 months.

"This is itself largely a result of the Holidays Act, due to the relevant daily pay concept meaning that workers are financially no worse off for taking sick leave," a just-released association survey of members has found.

Business New Zealand chief executive Phil O'Reilly said other industries had noticed similar trends since the act was introduced, but the meat industry was the first to quantify the impact.

The act introduced relevant daily pay, which entitled sick workers to be paid what they would have earned had they worked that day, rather than a previously agreed rate.

In the 2003-2004 financial year, the meat industry's average sick day payment was $92.50.

That had blown out to $148 - an increase of 60% - by last year.

New Zealand Meat Workers Union Otago-Southland branch organiser Gary Davis said companies had only themselves to blame by classifying staff as seasonal workers rather than permanent seasonal workers - as the union had suggested.

That would have allowed workers to carry sick and bereavement leave over each year to a maximum of 20 days, meaning workers would not lose their sick leave entitlement.

"I don't blame some of these people for taking a couple of days off," he said, adding that shift work made the job stressful.

The association's report said the act had increased the industry's total payroll for the year ended March 2005 by 2.65 per cent.

In that same 12-month period the cost of bereavement leave rose $700,000 or 182 per cent with workers claiming 7400 days compared with 4500 days a year earlier. The average daily cost rose from $84 to $145.

The act introduced changes to the way people were paid for working on holidays.

A senior southern manager said he had uncovered an unofficial "sick day roster" among staff in a department at his plant.

Staff were organising among themselves when to take their sick leave, the manager said.

PPCS chief operating officer Keith Cooper said companies were hit twice by the legislation, through having to pay a higher relevant daily pay and loss of throughput.

He would not say if workers were abusing the legislation but added: "The opportunity is being taken."

Affco chief executive Tony Egan said the level of absenteeism meant some plants had to reduce production which affected the wages of those who turned up for work.

Affco was trying to negotiate a Christmas incentive payment to reward staff who did not use their sick leave.

A spokeswoman for Labour Minister Ruth Dyson said the minister had not seen the industry association's report, but the Government had no plans to revisit the Holidays Act.

- OTAGO DAILY TIMES