News

Fly-in workers to be paid 3/4 of NZ wage

A Chinese development company planning to fly in 200 overseas tradies for an Auckland hotel build are prepared to pay only three-quarters of the normal hourly rate - with further deductions to workers' pay for travel and accommodation.

The news is the latest development in the Fu Wah Auckland Park Hyatt Hotel build, which hit headlines earlier this month after the company said it needed 198 temporary workers from China to complete the fit-out stages of the project by deadline.

Fu Wah, which formally submitted its application to Immigration New Zealand two weeks ago, pointed to the labour shortage in local trades as justification.

At the time, fears regarding equitable pay and working conditions for the overseas workers - an ongoing, and cross-sector problem associated with imported labour in New Zealand - were raised.

Since then, Fu Wah has communicated with the Council of Trade Unions, and a meeting has taken place between the company’s lawyer, former Alliance MP Matt Robson, and E Tū - the union which represents between 1200 and 1500 construction workers. As part of the application process, Immigration New Zealand consults with the CTU, Worksafe and the Labour Inspectorate.

In the meeting between E-Tū and Robson last week, Fu Wah laid out a proposed hourly pay rate of $25 for workers. Deductions for the workers’ travel and accommodation arrangements would also come out of their wage, said Joe Gallagher, the national industry coordinator who attended the meeting on behalf of E-Tū.

“Depending on what the role is, the average pay for someone like a tiler or a commercial painter [for the fit-out stages of a job] would be about $32 per hour - and you’d charge more if you were a qualified builder. It could be up to $55 depending on what you were doing.

“This is really where the rubber hits the road with migration, with firms saying they cant find local workers, yet aren’t paying anywhere near the going rate." - CTU national secretary Sam Huggard

“Those guys with the top-line finishing skills, which I assume you’d want in a luxury hotel build like this, would be pricier.”

The “$25 rate”, and the outlined plan to deduct for travel and accommodation is a “huge red flag”, Gallagher said.

“In recent years, there hasn’t been the openness to engage with us around these types of things,” he said in reference to projects involving large numbers of overseas workers.

“We thought … it was good that Fu Wah’s lawyer wanted to meet, but by the end of the meeting, when we saw the proposed contract with that rate, it was clear there wasn’t going to be a positive outcome - particularly because he [Robson] didn’t appear to have any room to negotiate on it.”

And while New Zealand’s lack of skilled trades workers was a significant problem for the wider economy, the current situation with Fu Wah needed to be put in perspective.

“We’re in a crisis where we’ve got to build 100,000 homes in 10 years, and we haven’t got enough people, so you’re going to have to blend that with bringing some people in from overseas - but we should be maintaining some proper standards around that,” Gallagher said.

“When you bring people in on temporary work permits, they’re much more open to exploitation because they want to make some money and they tend to come from low-wage economies. If there aren’t proper standards in place, managing pay and living conditions, then the quality of the work suffers - which we’ve seen before.”

Gallagher pointed to compliance problems with numerous development sites in Auckland that epitomised issues around regulation of overseas developers and workers - including a site where raw sewage was being discharged into a stream. Building compliance problems have also emerged out of the Christchurch rebuild, which has relied heavily on overseas workers. Currently, the rail and maritime transport union is also embroiled in a legal challenge with KiwiRail over its use of Chinese workers to repair asbestos-ridden locomotives in 2015. While the case is based on a potential breach of the collective contract, the union has also claimed the overseas workers were paid below minimum rate and forced to live in substandard conditions while in the country.

Both Gallagher and Sam Huggard, the CTU national secretary, said the proposed contract from Fu Wah was “unacceptable”.

“This is really where the rubber hits the road with migration, with firms saying they cant find local workers, yet aren’t paying anywhere near the going rate," Huggard said.

"Fu Wah’s application shouldn’t be supported if they are sticking to a $25 rate with deductions for travel and housing tacked on."

Robson, who acknowledged last week’s meeting when contacted by Newsroom, would not confirm or deny whether an hourly rate was discussed.

“I’m not at liberty to say exactly what figures [were] or weren’t done, but there have been negotiations with the union,” he said.

“Fu Wah and the people that they are employing, and everyone they’re working with [are] setting various conditions, but I’m not at liberty to say what the negotiations they’ve had or what they haven’t had.

Read more: A more durable alternative to fly-in workers