It's The Margins That Matter
OPINION: It appears to be difficult for people who haven’t tried to run a business to understand the difference between assets and cash.
The subject of low wages in the dairy industry got media attention last week when Council of Trade Unions president Helen Kelly tweeted links to job postings on the Farm Source site which she claimed proved gross underpayment of workers.
Kelly tweeted links to job descriptions which she claimed were for jobs paying $12.80-$15.55 per hour. She arrived at this rate by dividing the offered base salary by the average number of working hours – which Muir says does not fairly represent overall market offers.
While farmers may offer workers accommodation, its cost is often calculated at discounted rates which, Muir says, can reflect a poor, unwarranted image of the industry.
While it was common for employers to offer accommodation this was often done so at discounted rates, reducing the overall value of the package. For example, rents in the regions listed in the ads mentioned by Kelly were $240-360 a week – as much as $18,000 a year in some cases.
This is no good for an industry reputedly a poor employer, says Muir. “The dairy industry is struggling for employees and when stories like this hit the media people in towns say ‘there’s no way I’d let my child enter the dairy industry for pay like that’.”
Muir recommends increasing rents, then increasing salaries in line with the rent increase to paint a truer picture of the actual industry. “We calculate that 10% of the operators reported to be paying below the minimum wage through calving would [not be unjustly accused] if they were to [charge] a market rent.”
