Mind the gap
Bosses versus worker pay
Councillors should consider low-paid staffers if they’re dishing out sizeable CEO salary increases, a union head says.
But a mayor says elected members decide based on the one staff member they employ - the chief executive.
There’s certainly a gap between those at the top and bottom of the earning tree.
You could pay about 16 living wage workers for a year using the $690,000 salary of Auckland Council chief executive Stephen Town.
In Hamilton, the majority of councillors recently approved a $60,000 pay rise for chief executive Richard Briggs - more than the average Waikato person earns in a year.
While there are reported cases of council bosses getting 10 to 15 per cent raises, Public Service Association national secretary Glenn Barclay said staffers get around 2 per cent a year.
‘‘If you’re not prepared to pay the living wage but you’re prepared to give the chief executive a significant wage increase, then what does that look like?’’ he said.
The living wage is $20.20 an hour, while the legal adult minimum wage is $15.75.
But the chief executive is the only person councillors employ, Hamilton Mayor Andrew King said.
‘‘We don’t take into account at all where other general managers in our organisation are sitting or where other people who work for council sit on the scale... Our job is just to consider where Richard [Briggs] should be, as our chief executive.’’
A committee gets internal and external feedback to give Briggs a performance rating, he said. An external company takes it, looks his responsibilities - such as staff,
The whole organisation suffers if the chief executive doesn't perform. LGNZ chief executive Malcolm Alexander
money handled - and recommends a pay rate.
That sounds like councillors washing their hands of it, Barclay said, and they shouldn’t.
Chief executive salaries - not just in local government - have lost connection with the people who work in their organisations, he said.
But they’re separate arguments in the eyes of Local Government New Zealand chief executive Malcolm Alexander.
‘‘The chief executive is the most important person in an organisation, so you have to pay what you have to pay.’’
The whole organisation suffers if the chief executive doesn’t perform, he said.
‘‘They are responsible for the organisational performance, for making sure that everything achieves the plan that their respective boards or governors put in place.’’
Those in the public sector are generally paid significantly less than their commercial counterparts, he said.
The living wage is about lifting people’s pay above the market rate, he said, and that’s a political decision for councillors.
In Hamilton, Briggs has asked for - and been granted - $750,000 for staff salaries, King said, some of which will be used to push low wages up.
‘‘This is the one way that Richard’s got to use because when the living wage has been brought up, it’s been voted down.’’
PSA wants all councils to become accredited living wage employers and so far, Wellington City Council is furthest along the track. Auckland Council has voted in a living wage for core staff and CCOs.
Christchurch City Council has recently adopted the living wage for core staff, which it said will cost about $775,000 a year.
Ratepayers had plenty to say in the comments section, ranging from ‘‘Lead by example. Great decision’’ to ‘‘I hope they are taking it out of their fat pay cheques and not putting our rates up again‘‘.