Friday, March 29, 2024

Farmers warned of stronger enforcement

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Farmers not complying with employment law can expect a more hard-edged enforcement response, the DairyNZ Farmers Forum was told last month.
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“We are going to be lifting the level of our response where we find non-compliance,” Labour Inspectorate general manager George Mason said.

“So far it's been soft around enforcement undertakings (but) we think that where it’s needed we take a harder line. In some of these cases there has been fair warning.”

The dairy industry and migrant exploitation are two key areas of focus for the Labour Inspectorate, a branch of the Ministry of Business, Innovation and Employment (MBIE), Mason said. His inspectors found 31 out of 44 dairy farms in breach of minimum employment standards when visited last summer. 

The seasonal averaging of salaries and the failure to keep accurate time and wage records were the main problem areas.

Nine days before the two-day farmers’ forum at Mystery Creek, the Labour Inspectorate reported that non-compliance had resulted in 22 enforceable undertakings and one improvement notice being issued, and one farmer having to pay an employee $6000 for breaching the Minimum Wage Act.

Mason said regulatory minimum standards are the foundation for fair workplaces and productive workplaces “and increasingly it's also about the protection of NZ Inc branding and its reputation and hopefully enhancing that branding”.

“There are 2.2 million workers and 140,000 workplaces in New Zealand and it’s not possible to be all things to all people at all places so we are targeting areas where we think workers are most vulnerable and where NZ's reputation is potentially most at risk.”

He said the inspectorate has “gone back to concentrating our efforts on the enforcement approach by statutory officers having statutory functions connected to statutory powers … the kind of thing other people can't do”.

“You can get advice from DairyNZ and the MBIE provides a lot of material through its contact centres and websites so we (inspectors) are focused on enforcement and working alongside others in partnership to enable those other roles to achieve compliance standards.”

Mason told the farmers forum there were four priorities driving the inspectorate, the first being to “take the criminal employers out”.

“We have some employers, and I don’t think it’s an issue in this (dairy) sector, that deliberately exploit and take advantage of their employees to a degree that is unconscionable by any stretch.”

“The second area of focus is non-compliant business models and some of the labour inspectors have come across this in the dairy sector.”

He said the initial investigation of dairy farms showed a level of non-compliance that was “a surprise given what we had seen in the Federated Farmers remuneration survey”.

The Federated Farmers/Rabobank Farm Employee Remuneration Survey 2013 reported remuneration levels for most pastoral farm positions continued to increase and the average farm worker was earning $5500 more than the country’s average annual wage and salary.

Mason said the majority of dairy farmer breaches, about half, were in relation to record keeping.

“But within that were some clearly substantive departures from the minimum wage that was not being met. In half a dozen cases significantly it was not easy to tell whether standards were being met without accurate records.”

“So that's quite a focus for the inspectorate and we are continuing with our audit programme.”

“We are going to be targeting, in phase three, dairy farms that employ migrant workers.”

Speaking on future directions, Mason wanted the dairy sector to take ownership of employment standards “as a foundation point from which you build productive and engaged workplaces”.

“But be quite clear that you won't get to that productivity except through, first of all, compliance with minimum standards.”

“This (dairy industry) is a well-developed sector with a lot of infrastructure. It’s a profitable sector. It’s a sector the inspectorate sees fundamentally as one which can take responsibility for itself and that's what we would like to see.”

“Frankly if I was here in two years’ time seeing the same results from our audit we are seeing now I would be incredibly disappointed.”

A further development would be strong consumer support for employment standards.

“We have the heart foundation tick on various products and we think there's scope for labour standards to be given greater recognition and system support through consumer choice.”

He said customers in discerning markets saw labour standards as a social issue and a quality of the product.

A final development would have employment standards given a balance sheet value “just as cows appear in the balance sheet”.

Mason was asked how NZ could use employment standards as a brand premium when selling to China and other Asian markets where employment and human rights standards were substandard.

He said the European Union has a Good Agricultural Practice certification programme with an addendum that deals with social standards and long-term there was potential value in such standards for product suppliers.

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