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Minister announces further improvements to RSE

Hon Clayton Cosgrove
Minister of Immigration

30 September 2008 Media Statement
Minister announces further improvements to RSE

Immigration Minister Clayton Cosgrove says the government has decided on a number of measures to further improve the successful Recognised Seasonal Employer (RSE) scheme as it enters its second year.

RSE enables employers in the horticulture and viticulture industries to recruit up to 5,000 workers a year from overseas to meet labour shortages, if there are no New Zealanders available.

Mr Cosgrove said 78 percent of the 4,641 of the RSE workers who came to New Zealand this year were from Pacific Forum countries, which are prioritised under the scheme. He said overall RSE has been a great success, filling many labour market gaps caused by the country's record low unemployment.

“The uptake of RSE has exceeded expectations. It has received strong support from employers who have been able to meet labour needs in industries that have previously experienced routine shortages. For example, for the first time in many years there were no public concerns about labour shortages during the busy apple harvests in Nelson and Hawkes Bay," Mr Cosgrove said. "Likewise RSE is providing our Pacific neighbours with new opportunities and income for their people.”

Mr Cosgrove said as expected, there have been lessons learnt from the first year of RSE, and all parties have worked together at a number of forums to identify ways to improve the scheme going forward.

As a result the following changes will be made:
• There will be improvements to pre-departure orientation information for RSE workers so they will know what to expect upon arrival in New Zealand.
• Enhanced pastoral care planning. In addition to existing requirements, employers will need plans to ensure good cross cultural communication, and effective and fair dispute resolution;
• RSE workers will be able to change between RSE employers – this will give employers greater flexibility and provide employees with more work opportunities.
• Employers will be required on request to fully disclose all payments received from workers – this will assist the department when investigating any concerns raised by workers

In addition, the Department of Labour, which oversees the scheme, is:
• investigating ways of ensuring that health costs are manageable for RSE workers – currently most employers have organised health insurance for their workers
• developing a good practice induction guide to assist employers in the delivery of pastoral care
• exploring ways of improving the induction and training provided to workers, and
• looking at the merits of establishing liaison officers to assist with effective communication between workers and employers and pastoral care providers.

"These are practical, commonsense steps to make RSE even better for employers and employees," Mr Cosgrove said. “Next season the majority of workers, employers and pastoral care providers will have also have had one season’s experience of RSE under their belts, so that will also help employers to meet their obligations and workers to adjust and make the most of their time here.”

Mr Cosgrove said anecdotal evidence is coming from both employers and the Pacific states of the benefits flowing through to the workers’ home countries.

One of the larger Hawkes Bay operators reports that up to 80% of workers’ net earnings have been sent home and used to construct buildings, buy village vehicles and contribute to their children’s education. In Vanuatu a number of villagers are using income derived from RSE remittances to progress a range of community projects. RSE is expected to be the country’s second largest source of foreign exchange this year after tourism.

Today's announced changes to the RSE scheme follow a sample audit undertaken by the Department of Labour. It found:
• Pastoral care and work practice issues have been reasonably well managed by the majority of employers
• Workers averaged 17 weeks of work, with average weekly hours ranging from 36 to 57, with an overall average of 43 hours a week
• Workers’ average net earnings over that period (after paying for living expenses; half their airfare, tax, and health insurance) ranged from almost $2900 to over $11800. The overall average was $5700.
• The minimum requirement of 30 hours work per week on average was more than adequately met
• The standard of accommodation provided by employers was generally acceptable, with the average cost being $90 per week

Mr Cosgrove said issues that have come to the Department’s attention have been quickly investigated by inspectors on the ground and employers have generally responded well to put things right when needed.

"Like any new policy, we need to allow time for RSE to bed down. There is already ample evidence that the RSE scheme is a win-win situation for employers and workers and the improvements we are making will make it even better.”

Mr Cosgrove said overall RSE has resulted in standards being lifted within the industry by reducing the use of illegal labour, which has resulted in better conditions for all employees as well as a reliable, returning workforce for employers.

Further information on the RSE Scheme is available at http://www.dol.govt.nz/initiatives/strategy/rse/index.asp

--

Background Questions and Answers

What sort of problems have been reported to the government with RSE?
While the RSE scheme has been very successful overall, there have been some issues as was to be expected in its first year of operation. The on-set of winter, for example brought different working conditions, and both employees and workers needed to adjust to this. Issues have also arisen over factors such as the quality and the cost of accommodation provided by some employers, questions over pay rates and deductions, hours of work and productivity. The Department of Labour (DOL) has taken a facilitative approach and issues that have arisen have been resolved in close co-operation with all parties. Problems can be expected to reduce over time as employers become used to operating under RSE and workers become more familiar with working in New Zealand.

What decisions has the government made to improve RSE going forward?
There will be improvements to pre-departure orientation information for RSE workers so they will know what to expect upon arrival in New Zealand. This includes developing information DVDs, closer liaison between DOL staff and RSE co-ordinators based in the Pacific countries, and updating the “get ready” information pack provided to workers.
• Enhanced pastoral care planning. In addition to existing requirements (e.g. providing accommodation, transportation, reasonably priced food, protective equipment etc), employers will need plans to ensure good cross cultural communication; and effective and fair dispute resolution;
• RSE workers will be able to change between RSE employers – this will give employers greater flexibility and provide employees with more work opportunities.
• Employers will be required on request to fully disclose all payments received from workers – this will assist the department when investigating any concerns raised by workers
• DOL is investigating ways of ensuring that health costs are manageable for RSE workers – currently most employers have organised health insurance for their workers
• DOL is developing a good practice induction guide to assist employers in the delivery of pastoral care
• DOL is exploring ways of improving the induction and training provided to workers, and
• DOL is looking at the merits of establishing liaison officers to assist with effective communication between workers and employers and pastoral care providers.

What about situations of overcrowding?
The Department’s audit found that the standard of accommodation provided is generally acceptable. There was an average of 2.5 workers per room across accommodation types with an average of 7.5 workers per room in backpacker accommodation. There have been cases of overcrowding, and all complaints are investigated by DOL inspectors. Employers who do not meet the standards required under RSE - which include making suitable accommodation available at a reasonable cost - risk losing their RSE status. Shared accommodation for large groups is commonplace and in fact appears to be the preference of at least some of the RSE workers.

Is enough being done to ensure New Zealanders are filling these jobs?
Yes. Like all immigration policy, the RSE scheme is designed to ensure New Zealanders are put first, and that employers have strong incentives to train and upskill a domestic workforce before looking elsewhere. RSE is not a cheap alternative to employing kiwis, as employers must pay RSE workers market rates and half their airfare, plus meet their pastoral care requirements. The Department works closely with Work and Income in each horticulture/ viticulture region to ensure that the RSE scheme gives New Zealanders the first opportunities for employment. Permits are not given where New Zealanders are available for work.

What are you doing to ensure that workers who come over to New Zealand have the work that they are contracted to do?
There have been incidences of employers over estimating the amount of work to be done, which is one of the reasons why a change is being made to the scheme so that RSE workers can temporarily move to the site of another RSE. Care will need to be taken to ensure that workers are aware of any changes to their working conditions that may emerge as a result of moving between RSE employers. Employers have to pay market rates, ensure workers are able to work an average of 30 hours a week and provide a guarantee to pay for at least 240 hours of work.

Why is RSE mainly targeted at Pacific countries?
The scheme is geared towards Pacific states because of New Zealand’s special relationship with the region and commitment to its economic development and stability. Employers can take on workers from elsewhere if they have a pre-established relationship with a particular country outside the Pacific.

What else is being done to help RSE workers?
The government has already announced work is being done to reduce the cost of remittances so people can send more money home to their families; and NZAID is exploring the possibility of supporting targeted training for RSE workers, particularly in the areas of basic literacy, numeracy and financial literacy.


ENDS

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