May 5, 2005
Memo EMA – 5 is more than 4
The Employers and Manufacturers’ Association needs to do a course in remedial maths if it thinks that a five per cent pay rise is the same as a four per cent pay rise, says the country’s largest union.
“A five per cent pay rise is a five per cent pay rise, and that’s what workers will have in their pay packets next week” said national secretary Andrew Little.
“If the EMA can’t work that out, then we should all be worried,” he said.
The EPMU yesterday announced the settlement of the country’s largest private-sector industrial agreement, the Metals and Manufacturing Industries Collective Agreement, with a five per cent pay rise and a 15-month term. The EMA has claimed that the settlement is the same as a four per cent pay rise over 12 months.
Mr Little said that the EMA’s maths did not stack up.
“Take, for example, a worker earning $35,000 a year,” he said. “With a four per cent pay rise, that person would be $1400 better off at the end of a year. Under our deal, with a five per cent pay rise, that person has $1750 extra in his or her pocket.”
Taken over 15 months, the figures continued to favour the EPMU deal, Mr Little said.
“In the four per cent scenario, using the EMA’s assumption that there is another four per cent deal done at the end of 12 months, the cumulative effect over 15 months is $2114. But the person who got a five per cent pay rise at the start of the 15 months is still better off, with an extra $2187.50 in the hand.
“Of course, you can’t predict what settlement will be done in the future, and the time elapsed since the last pay rise will be one of the things workers take into account in their next pay claim.”
Mr Little said that the EMA’s spin was wrong in two other key areas.
“Firstly, the EMA did not offer four per cent at the start of negotiations,” he said. “It went into negotiations back in February offering a 2.2 per cent rise. Talks broke down when the EMA made a final offer of 3.2 per cent. The four per cent offer didn’t come until March 30, when workers had held mass stop-work meetings all over the country and were threatening to strike.
“Secondly, the suggestion that ‘only’ 73 employers had signed into the Metals, proving that hundreds of others had rejected it, is just plain mischievous. The Metals is always negotiated with a small group of employers, known as the original parties, and then offered to others, known as the subsequent parties. The EMA knows this because it has been done this way for 14 years. The fact that 73 employers have already signed in when there were only 33 original parties is a sign that most employers accept the deal.”
Mr Little said that the union’s organisers were now taking the settlement out to other companies.