Kia ora koutou,
We hope you are well. We are pleased to be getting in touch with you to share the unexpected news of an offer to settle collective agreement negotiations for our Health New Zealand members, and optimism that contractors will soon follow with the same deal!
A positive change – the offer for a quick deal for a Health NZ
As you know, this year we set out to negotiate for a multi-employer collective agreement (a MECA) covering our members employed directly by Health NZ and the five contractor employers which employ members in public hospitals: Compass, ISS, Ventia, Ovation and OCS.
We did this for two main reasons:
- So that members would be treated equally and joined together in the fight with greater power
- To avoid our contracted members being left behind by the Government until well after the Health NZ settlement like last time in bargaining
We’re happy to say the strategy has been successful! Based on the approach from the employers, we have decided to move away from the MECA to get fair settlements for all members, but the outcome is very positive.
During the first two days of negotiations one month ago, the employers all told us they did not want a MECA. They made it clear there were barriers that in their view would take many months to work though. These barriers would impede our ability to negotiate and reach an agreement for pay rises in any kind of reasonable timeframe.
BUT, our MECA strategy caused Health NZ to approach us with an offer to discuss a quick deal and much needed pay rise for members.
If the deal is ratified by our members, it will be the fastest ever pay rise out of bargaining for our 3,000 Health NZ members, and we are confident this can be passed on in the coming weeks to contractor members.
Main details of the deal
Our Health NZ directly-employed members are being offered a single-employer (SECA) collective agreement with the following key benefits:
1. A 2.5% pay rise for all members, effective for the term of the agreement, 29 June 2026 to 30 November 2027
This is the same year 1 rate that the nurses fought over and achieved after a painful 24 months of bargaining and long periods of difficult industrial action.
2. A $1,000 lump sum bonus for all staff
Including for staff on approved leave (e.g. parental leave) and adjusted pro-rata for part-time staff. The calculation will be based on the greater of your contracted FTE or the number of ordinary hours paid (including paid leave) in the previous 12 months. This part of the deal was only on the table until the end of July and would not have been part of any future offer if we didn’t take this to you for a vote now.
3. Living wage protection for low paid staff
It is unacceptable that any E tū member working in public hospitals be paid less than the living wage. We’re proud to say that part of the offer we’ve negotiated is to transfer our lowest paid workers to $29.90 an hour from the start of January 2027.
4. A review of job classifications and evaluation of grading changes
This has been a key priority for members, and it was critically important to the bargaining team to secure this review. Many of our members feel they are wrongly graded and the demands of their jobs have changed significantly over the past few years. This gives us a chance to try and get members onto the right pay for the work you actually do. We need members to actively engage in the job classification process to ensure the results capture the breadth and value of your roles. We’ll prepare all of the evidence to start the review with Health NZ in January.
5. Oversight committee
This is a new committee that will bring together representatives from E tū and Health NZ. This committee will oversee the implementation of the settlement and the pass-on to the contractors. This committee will provide a forum for addressing issues arising from the settlement, including matters affecting terms and conditions. This will be a crucial forum for addressing any issues with Health NZ, and one we’ve never had before.
6. Commitments to work on footwear, sick and bereavement leave approach from the employer
And more… these are the main benefits and all of the details will be talked through at ratification meetings.
Confidence for pass on arrangements – contractor deals to follow soon
We have been 100% clear with the employer parties that we will not leave our contracted members behind if we are to agree to single-employer collective agreements with each of them. Our members have been united and steadfast in this goal.
In 2024-25, it took a year after the Health NZ settlement to get pass on confirmed for contractor settlements. This cannot happen again, and we won’t let it.
Last week, we met with each of the contractor employers and received positive reactions to our plan to move quickly. The main influence in this happening quickly is the Health NZ leadership. And we have a different plan this year to ensure it does happen:
- We have secured a letter from the Health NZ Deputy Chief Executive and the Director of Procurement, sharing the improved process they have put in place to avoid the failures of last bargaining round, and to express their commitment to progress pass on as quickly as possible once the contractors have agreed.
- We have been given an indication that funding for pass on won’t be a problem, and all six employers understand we are only agreeing to break away from the MECA to get speedy pay rises and resolutions for all members.
- E tū’s National Secretary, Rachel Mackintosh, will be writing to Chief Executive Dale Bramley next week, calling for a meeting and putting the pressure on Health NZ to put their processes in place for a quick pass-on. Our aim is for the terms of settlement to be ready for all contractors around the time ratification is confirmed, if Health NZ members vote yes to this offer.
Why not keep fighting for the MECA? The risks of taking a different approach
All the six employers at bargaining in Auckland told us that continuing with a MECA would result in many months of difficult bargaining. This could mean we would likely still be bargaining this time next year, and we may end up with a similar or potentially worse offer. With all those extra months of bargaining, and no backpay, it would mean less money in your pockets.
Members working 40 hours per week will be between $2,500-$3,600 better off over the course of a year through the pay rise and lump sum bonus. With the huge challenges caused by the cost of living, we think it’s better to win this financial support for you now, and then get back into bargaining when this agreement expires next November for another go.
Health NZ told us the current offer is a ‘take it or leave it’ situation, and that things would get worse as some of the funding for this settlement comes from the 2025-2026 financial year. Additionally, the election is rapidly approaching, which adds additional constraints and complexities to an already delicate bargaining. Public service departments essentially shut down a month before election time, so making any progress between October and February would have been almost impossible.
We believe our current approach is the best we can get you in a timely manner. Although a MECA will not be the outcome, our goal remains the same: leave no one behind.
Why we met for ‘without prejudice’ discussions
The discussions with Health NZ have been conducted on a “without prejudice” basis. In simple terms, this means that what was discussed could not be shared with members while negotiations were ongoing. As a result, we were unable to provide regular updates throughout the process that’s taken place over the past month.
This definitely isn’t our preferred approach, but confidential conversations were in this case required for us to hear about the money that Health NZ had on the table for a short time, with the financial year coming to an end.
Your bargaining team – made up from delegates from Health NZ and all 5 contractors – has endorsed the offer and E tū is recommending members vote to accept the deal when your ratification vote takes place in the next few weeks.
Next steps
- Organisers are currently scheduling ratification meetings for directly employed members, and you will be hearing from them soon. The aim is to hold the meetings as soon as possible, with most taking place by the end of August.
- We have sent terms of settlement (TOS) to all 5 of the contractors this week so we can try to quickly iron out any minor details before settlement. We are hoping to be moving to ratification meetings with contractor members in September.
- A ballot for bargaining fee payers will also be conducted at the ratification meetings. It was a big success to get a bargaining fee process confirmed again, so non-members won’t get your hard-earned wins for free.
- For Health NZ members, please attend your meetings so you can vote in the ratification ballot. If you are having issues getting released to attend the meetings, please let your organiser know.
We are working hard to keep all parts of the process moving forward. Our members are our strength and we need your engagement and support at the upcoming meetings to help us get a fair outcome for all, and a much needed boost to your pay.