Wilkinson Kate: Minimum Wage (New Entrants) Amendment Bill — In Committee 
Wilkinson Kate: Minimum Wage (New Entrants) Amendment Bill — In Committee 
[Volume:641;Page:11170] 
KATE WILKINSON (National) 
: 
 I rise to speak on clause 4 of the Minimum Wage (New Entrants) Amendment Bill. I understand there is a Supplementary Order Paper in relation to this clause. Can I say from the outset and repeat that the National Party thinks this is a well-intentioned bill and an attempt to avoid the exploitation and discrimination of young workers but it is not the right instrument in which to do that. 
I will pick up on one of the scenarios that the honourable member Sue Moroney mentioned in respect of the young women in the supermarket on $5 an hour. That seems somewhat incredible to me because if those women were aged between 16 and 17 then under the current law they should have been in receipt of 80 percent of the adult minimum wage. If they are earning less than the adult minimum wage then that is contrary to the law. That may indeed be—[ 
Interruption 
] 
The CHAIRPERSON (H V Ross Robertson) 
: I just say to members that it is not permitted for those who do not have the call to interject on each other. Interjections are only for the member who is speaking. 
KATE WILKINSON 
: I would also like to repeat the quote that I used earlier because I think it is a good quote to use to preface the debate on clause 4: “What good does it do a young person to know that an employer must pay him or her”— 
Simon Power 
: I raise a point of order Mr Chairperson. Although your ruling at the last break in proceedings was that people who were speaking could be interjected upon—and I have absolutely no difficulty with that and I am not disputing it—I would ask you to remind members on the Government benches that those who have shifted their seats to gain advantage should not use that advantage to interject on others. 
The CHAIRPERSON (H V Ross Robertson) 
: I thank the member for his contribution and say that a number of members on both sides of the Chamber have shifted their seats. I will take into account what the member has said. 
KATE WILKINSON 
: I will paraphrase the quote that ended my previous speech because I think it is a good quote to preface what I want to say in relation to clause 4. What good does it do a young person to know that an employer must pay him or her the adult minimum wage if the fact that he must be paid that amount is what keeps him or her from getting a job? We really need to focus our minds on that because if the bill even though it might be well intentioned becomes a barrier to young people obtaining work and if it prevents them from getting work then the bill will have the opposite effect of what is intended and it will not be good effective law. 
Clause 4 relates to what the Governor-General by Order in Council may prescribe as the minimum wage and this provision is in relation to 16 or 17-year-olds who basically meet the criterion. The criterion was specified in the commentary on the bill as being 200 hours of employment. We recognise the introduction of the new entrants’ requirement of 200 hours. I appreciate that Supplementary Order Paper 137 proposes to replace that period with 90 days but I will speak to that later. The requirement is designed to provide young workers with time to acquire the skills and experience necessary to hopefully lift their productivity which is what we all want to achieve and to justify a higher minimum wage. The difficulty with this 200 hours’ training requirement is that the formula provided for it is not clear. The 200 hours could be with one employer in which case those skills could be cumulative. It could be with two or even more employers. In that situation one cannot assume for example if a young person worked for four employers at 50 hours each that that experience gained is actually transferable to the latest employment. One cannot assume that the skills and experience of the different jobs are transferable and that the young person is valuable enough to the employers to justify the adult rate. 
The interesting thing about the Supplementary Order Paper is that it abolishes the youth rate—to use the colloquial term—but then it proposes to insert a provision in respect of workers who are new entrants “being workers who are 16 or 17 years of age except workers (i) who have completed 3 months or 200 hours of employment whichever is the shorter;”. I want to focus on that criterion for a moment. I wonder whether the member Sue Bradford might take a call and explain what she understands by the amendment—although of course the amendment has been introduced by the Minister Ruth Dyson. 
There are two issues in respect of this amendment. One issue is that the definition of employment includes employment undertaken with more than one employer. So this provision basically includes a young person who has worked for a couple of employers. But what happens if the young person is employed with only one employer? That is not included in this clause. I am not sure what the rationale would be for this. It seems to me that if it is a training rate a provisional period or something like that then employment with one employer would translate into an employee acquiring more cumulative and better skills training and experience rather than working for more than one employer and doing the same job but not learning. Maybe there is a very good reason why the provision relates to employment undertaken with more than one employer. I would have thought the correct drafting—not that I am here to help the Government draft its Supplementary Order Papers—would be that it should be one employer or more than one employer. If that were an error of drafting it would not surprise me. 
The second point I will make in respect of the Supplementary Order Paper is in relation to the provision that the new entrant has completed 3 months of employment. There is nothing in the definition of employment to say how many hours that 3-month period of employment is. Is it 3 months? I know that Supplementary Order Paper 137 states that it is 3 months or 200 hours whichever is the shorter but 3 months could be 1 hour per week or it could be 1 hour per month. There is no qualitative criterion for that 3 months of employment. I think that this leads to some uncertainty and we all know that uncertain law is bad law. 
I will talk further in relation to the wider ramifications but those are the two issues that I raise in relation to the technicalities if you like of the Supplementary Order Paper. I understand and appreciate what the author of that Supplementary Order Paper is trying to achieve but I am not actually sure that that will be achieved through this amendment. 
I also say at this stage that many employers at the moment—and we understand through submissions that the figure is about 85 percent—already pay above the minimum youth rate to their staff. That is because they recognise that the value their staff are providing warrants a higher level of pay. I was interested to listen to the submission of the Engineering Printing and Manufacturing Union. In its submission it advised that none of its members receive the youth rate at all; in fact they all received above the youth rate. 
We have to wonder what the point is of having a prescriptive bill like this that could be the very barrier that stops young people from getting a job. 
Paula Bennett 
: More compliance costs. 
KATE WILKINSON 
: Yes it is a case of more compliance costs because employers have to keep a record of not only the hours worked with them but the hours worked with other employers. They may not even necessarily know what other employers the young person is working for in terms of the 200 hours or the 3 months. When does the 200 hours actually kick in? It is not the responsibility of employer A to know exactly what employer B is doing. Keeping a record of the hours per se is not a problem because wage records are kept. But one does not keep records of the hours worked in respect of other employment matters or issues or for other employers. I think that it is somewhat unwieldy. Again unwieldy and uncertain law is bad law. It is good for the lawyers but it is bad law. 
In any employment relationship the last thing people want to have to do is resort to the tribunal the authority or the court procedures to try to work out exactly what this law is supposed to say. I believe that the bill is not particularly workable. The intent of the bill is fine. Let us avoid the exploitation of young people. If young people deserve a fair wage then they should get a fair wage.