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Employers damned if they do and if they don't

Media statement Tuesday, April 15th, 2008

Employers damned if they do and damned if they don't

TV3's failure to provide balance in its reporting of KiwiSaver employer contributions has prompted the Employers & Manufacturers Association (Northern), or EMA, to complain to the Broadcasting Standards Authority.

The complaint relates specifically to the Campbell Live programme at 7pm on Monday, April 14, 2008.

The programme presenter interviewed the Minister of Labour, Trevor Mallard, about employers allegedly paying their employees' KiwiSaver contributions out of those employees' pay, which had the effect of reducing their net pay. Mr Mallard said thousands of employees were treated this way.

EMA chief executive Alasdair Thompson says, "Not only was there a lack of balance, but this kind of reporting deliberately undermines workplace relations. I say 'deliberately' because the show's producers talked to me on the phone - and in fact briefly quoted me on the show in question - so I was able to brief them in detail about what was behind the Minister's comments.

"Of the seven employers Mr Mallard said were acting either illegally or unethically, only one small employer had actually unilaterally reduced its employees' cash remuneration by the amount of the employer's 1 per cent KiwiSaver contribution.

"There are remedies available to employees if their employers act unilaterally.

"Yet when the presenter John Campbell (doing his best to be fair to employers but failing due to his lack of information) asked Mr Mallard how many employees were affected, Mr Mallard got away with the answer of 'thousands'.

"With regard to the matter of employer contributions raised on the TV show, we believe employers are being condemned for complying with the recently passed KiwiSaver legislation, while at the same time receiving 'please explain' letters from IRD if they do not comply.

"We're damned if we do comply and damned if we don't.

"The law provides a tax credit for employees as well as a separate tax credit for employers.

"The law also allows employers to maintain equity of workplace pay and benefits between those who join KiwiSaver and those who do not. The law specifically spells how: by agreeing that employer contributions be part of an employee's wages and salary.

"The law is so clear they even named a date of 13 December 2007 from which that can be agreed between employer and employee.

"We understand that 6 of the 7 employers the Minister of Labour Trevor Mallard has used as examples, are using this provision in conjunction with an overall pay increase.

"Many employers support the concept of KiwiSaver. Some are paying more than the minimum 1% employer contribution based on the employer tax credit being available.

"Comments from the Minister have caused unnecessary tensions in the workplace and are a knee jerk reaction to pressure from unions that have been opposed all along to these particular provisions in the KiwiSaver law.

"Mr Mallard in his inexperience in this portfolio has allowed himself to be drawn into a case of wage bargaining. He is out of order," Mr Thompson says.


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