The Fair Pay Agreement Working Group released its set of recommendations today, but division remains among individual members over whether the system should be compulsory or not - a decision the Government will have to make.
Fair pay agreements would set minimum standards to lift wages across an industry.
"We’ve said all along that this is about creating the right framework and then leaving it over to workers and employers to determine if their industry is one that should take up fair pay agreements," says Workplace Relations and Safety Minister Iain Lees-Galloway.
The Government will take time to consider the recommendations made by the group, which is comprised of experts in economics, collective bargaining and employment law. The group also includes representatives of workers and business - two sides that are at odds over whether implementation should be mandatory.
The report outlines that New Zealand is out of step with the OECD in terms of income inequality and productivity.
It suggests Kiwis are working longer hours but producing less per hour than most OECD countries.
"Our productivity rate per person is very low and if we are going to have a high wage economy and a fair society we have to improve it," says former Prime Minister Jim Bolger, who led the group.
“This [report] is one step to try and make sure that we have equitable and fair wage conditions for those who are working.”
Mr Lees-Galloway adds: “If we’re going to build a modern and fairer New Zealand, we need a productive and sustainable economy that’s growing and working for all of us.”
He says the next phase of work - involving detailed policy consideration and consultation - will take some time.
At the moment, employers who pay their staff a fair wage are being undercut by competitors paying below a fair rate, Mr Lees-Galloway says.
“The model that the Working Group has proposed would facilitate conversations not only about fair wage rates but about training pathways and opportunities to increase productivity and profit,” he says.
Mr Bolger says we have to prepare ourselves the best we can for a world in which the workplace changes dramatically. He says it is important to keep up with the leading nations.
“We are facing an uncertain future of work," he says. "We are seeing a lot more change than we have in the past and we need a system that is more flexible and more able to respond to that change, and that’s exactly what the working group has recommended to us.”