State servants5 wage rise staggering

Press, 22 April 1980, Page 25

State servants 5 wage rise staggering

The general manager of a chain of employment agencies has reacted sharplv to the recent news that public servants are to receive a 10.4 per cent wage increase, to be backdated to November 1979. The general manager of the Key Personnel agencies, (Mr B. T. Knight) said the announcement was “staggering” and the backdating was even more amazing.

"To say that the object of this increase is to keep up with the wage rates of the private sector is more than just a joke among those in industry and commerce,” said Mr Knight. But the pay-out has been defended by the Public Service Association, the director of the Gov-ernment-appointed Pay Research Unit (Mr J. Latimer), and the State Services Commission.

Mr Knight produced 15 examples in which public servants were being paid more than workers in private employment. “In six separate cities we encounter without exception examples where employers are unable to compete with the wages or salaries being paid to State servants.

"This wage rise means that State servants maintain their enormous lead •n remuneration over the private sector and will have a nice little capital sum to add to it,” he said.

Mr Knight said that there was something “grossly wrong” with the method of calculation of parity between private sector and State sector remuneration. “Until someone straightens out this, business of the State sector ostensibly trying to keep up with the private sector it will remain what it is, a sick joke,” said Mr Knight. Examples given by Mr Knight included the fol-

lowing: a tvpist-tele-phonist, aged 17, with more than two years’ secondary education and Post Office junior and senior typing examination passes was paid $5600 as a public servant, but would receive the equivalent of only $4lOl in the private sector.

A clerk, aged 38, with no previous experience had taken on a Government job on a salary of $8893, but the most she would have got in a private sector job was $3200.

A senior systems analyst in his mid-30s, with 10 years experience, was receiving $21,000 in a Wellington. State job, but the most he would be able to get in the private sector in Wellington was $15,700, said Mr Knight. He said only about 10 per cent of the occupations were not comparable, such as teaching positions. . The Canterbury section secretary of the P.S.A. (Mr J. E. Cornhill) said he thought Mr Knight was not comparing like with like.

“For example, the senior shorthand typist in a State job may be a supervisor of a large pool of typists, and her salary would reflect that extra responsibility, though it may not have been included in her description of her occupation,” Mr Cornhill said.

“I would not accept,that people in the public sector get paid higher, and the Labour Department surveys show otherwise,” said Mr Cornhill.

The procedures for comparing the public and private' sector rates are set down in the State Services Conditions of Employment Act,' 1977, and according to Mr R. A. Kelly, of the State Services Commission in Wellington, the procedures are both sound and fair.

In the past the private sector rates were measured by the Department of Labour’s half-yearly surveys and by ruling rates surveys. The ruling rates survey was exclusively for tradesmen’s rates, while the half-yearly surveys (April and October) measured movements in the wages of white-collar workers. Now the survey is done quarterly. Once the Labour Department establishes the gap between public sector and private sector rates, the Combined State Unions and the State Services Commission then agree on a percentage adjustment. Sometimes the Government refuses to

agree to the passing on of the full percentage. Mr Kelly said if it was accepted that fair relativity was the proper basis of State pay fixing, then some back-dating could be justified. It was the passage of time required in the analysis of the figures and the negotiation of the final percentage adjustment that necessitated backdating. Mr Latimer, director of the Pay Research Unit, which operates under the auspices of the Department of Statistics,' said that comparisons such as those provided by Mr Knight were unsophisticated and unreliable. In one occupation, such as a clerk, there was a big range of types of job, and it was hard to judge what a person actually did. The senior systems analyst quoted by Mr Knight was receiving a high salary for a state servant and would have had to be “a king-pin in a large Government centre.” The job-was'probably not able to be matched in the private sector and the position would probably best be equated with that of a manager. Until a detailed survey was done there was no way that one could generalise about the discrepancies, Mr Latimer said: “My belief is that the rates are not all that different because it tends to be reflected in recruitment. The Government has just as much difficulty to recruit skilled staff as the private employers.” He said there was also a problem in that the Labour Department surveys were averages across the country, which disguised variations from place to place. For example, a shorthand typist in the private sector

would be earning more in Wellington than in Christchurch because of the greater demand, but. the State typist would be . getting the same in both cen* tres for similar work. Consequently, a shorthand typist in Christchurch might well be receiving less in the private sector than in a Government department, but the situation would probably be reversed in Wellington? Government workers earned higher salaries on an average than private sector employees because there was a higher composition of scientists and technical workers, working for the Government, said Mr Latimer.

Mr Knight’s complaints about public sector rates are not the first. The Employers Federation has been critical of the Labour Department’s surveys in the past, and is still not satisfied. The Federation made submissions to the Royal Commission of Inquiry on salary and wage fixing procedures in 1972, and submitted its own findings on pay rates for clerks, computer programmers, and engineers. But the findings were rejected by the commission on similar grounds to the arguments put forward by Mr Latimer. The commission reported that whether broad categories of State servants were being paid more than was warranted by external relativity could only be known with certainty through pay research. The Pay Research Unit was actually provided for in legislation of 1969, did not become operative until 1972, but operated only a short time because wage stabilisation policies prevented the 'information from being useful. After the return to free wage bargaining in 1977, the Combined State. Unions agreed to resume pay research council meetings., But until recently there have been . differences of opinion between the C.S.U. and the Employers Federation, mainly over the extent to which information should be disseminated to the interested parties. Now these differences appear to have been settled, and if the Unit survives it should be able to achieve a degree of statistical competency which will finally settle the ar* gument of wage and salary relativity between private and public sector employees.