F.O.L. backs indexation

Press, 29 August 1979, Page 3

F.O.L. backs indexation

PA Wellington The Federation of Labour will help the Engineers’ Union prepare its Arbitration Court test-case for the indexation of wages against inflation. The hearing next week will precede negotiations for the key metal trades award, which covers more than 30,000 workers and has a widespread flow-on effect to other awards. The president of the: F.O.L. (Mr J. Knox) said that a delegation from the Engineer’s Union met his executive yesterday and asked for assistance, The executive had agreed to give its help and that of the federation’s research unit.

The engineers’ move follows the Government’s deci-i sion to tepeal the General Wage Orders Act and replace it with the Remuneration Act with provisions to restrict wage increases which exceed unspecified guidelines. Unions have received some inflation catch-up in past years through wage orders or cost-of-living adjustments, and the engineers want the Court to rule on the legality of their inflation formula. Linking wages with the consumer price index as unions and employers do in the United States could result in longer-term awards, according to the engineers’ national secretary and feder-

ation vice-president (Mr J. Boomer). The executive director of the Employers Federation (Mr J. M. Rowe) said there was “something to be said’’ for the principal of partial indexation. “I understand union concern, but the real trouble is that if this was negotiated in one award and not the rest you would have a recipe for chaos.” Full indexation was out of the question because of the effect of factors such as oil price rises. But partial indexation could be discussec by unions and employers nationally. If it were accepted, it would be the only ground for wage adjustments, Mr Rowe said.