Workers face wage cuts to pay for Kiwisaver changes

Workers look set to carry the full cost of changes to Kiwisaver after the Government removed rules requiring employers to share the costs fairly, said Green Party Co-leader Dr Russel Norman today.

“John Key has said that the reduction in Government contributions to Kiwisaver will be covered by both employees and employers. But what’s to stop the increased cost coming straight out of the pay of employees?” said Dr Norman.

Early in their term, the National Government repealed section 110A of the Employment Relations Act which protected employees from employers using Kiwisaver contributions to justify withholding pay raises or other benefits.

“The National Government should reinstate protective measures to make sure both employers and employees fairly share the additional costs of their Kiwisaver changes,” said Dr Norman.

The Employers and Manufacturers Association said yesterday that employers will treat planned changes to Kiwisaver as ‘part of employees' total salary and wages’.

“The EMA suggests that some employers will simply push their costs onto workers,” said Dr Norman.

“Employees in low-wage jobs with little bargaining power will be worst affected because they will have the least power to make the employer pay their share.

“Without additional protective measures for employees, this Government cannot say that they are protecting the most vulnerable from the worst effects of Government’s cutbacks.

“Most New Zealanders will be uncomfortable knowing the most vulnerable will shoulder a disproportionate cost of their Government’s poor fiscal management this coming Budget day.”