THE PRESS THURSDAY, SEPTEMBER 16, 1976. Defining the wage ‘exceptions’

Press, 16 September 1976, Page 20

THE PRESS THURSDAY, SEPTEMBER 16, 1976. Defining the wage ‘exceptions’

The Government’s wage regulations are at last being given an opportunity to work as they were intended. The Drivers' Federation has won agreement from road transport employers that a claim for a 3 per cent wage increase Is justified because of “ exceptional circumstances ”, But the drivers will not automatically receive their increase. Their federation and the employers must now demonstrate to the satisfaction of the Industrial Commission that circumstances are sufficiently “exceptional ” to justify breaking the limits on wage increases.

The Industrial Commission, established by the Industrial Relations Act in 1973. is composed of five members appointed by the Governor-General on the recommendation of the Minister of Labour. One member represents the employers, one the trade unionists, and the other three are deemed not to represent any sectional interests. The commission has before it several applications from unions and employers for wage increases because of “ exceptional circumstances ”. Its decisions will begin to define what that phrase means in New Zealand’s present difficult economic circumstances.

The drivers’ case is particularly important because of the number of people involved and because of the industrial unrest which preceded an agreement with the employers. The drivers’ representatives have settled for a much smaller wage increase than that contained in their original demands. In this they have shown a responsible

awareness that these are not normal times, but the public must wonder whether agreement on a modest 3 per cent increase could not have been reached without the disruptive strike by drivers in Christchurch for more than a week.

If the Industrial Commission accepts the application from the drivers and their employers, that is still not the end of the matter for the community. Road transport operators already have an urgent application for exemption from the price freeze before the Ministry of Transport. Even before the agreement to pay more to drivers, transport operators were claiming “ exceptional circumstances ” for themselves and were maintaining that their margin of profit was uneconomic. The drivers’ wage increase would add about 1 per cent to road transport costs; this will be added on to the present application for higher freight rates.

If the applications for higher w’ages and higher freight rates are both granted, in the end it will be the community which pays out. Another inflationary increase will have been added to costs in industry and its effects will be felt throughout the economy. This was exactly the situation which the latest wage and price regulations were designed to avoid. Modest increases in wages, and costs, where these can be shown to be justified- by genuinely “ exceptional circumstances ”, may be deemed less harmful than prolonged industrial unrest. But that is not an argument to be weighed by the Industrial Commission.