The recent modifications to the Recognised Seasonal Employer (RSE) policy by the New Zealand coalition government sparked significant discussions at this year’s annual RSE conference. Attendees included RSE employers, industry organizations, government representatives, and delegates from Pacific nations.
Employers expressed optimism about the policy changes, which are expected to lower their participation costs – an outcome that has been a priority for both employers and industry advocates. Despite 17 years of the RSE scheme’s operation, a significant portion of small producers continues to dominate; in 2024, 62 percent of the 179 active employers brought in fewer than 50 workers, with about half recruiting fewer than 20.
For many smaller producers, escalating employment costs and reduced profit margins, particularly following the pandemic, have led to concerns about the sustainability of RSE participation. However, Pacific nations view three specific policy changes that impact workers’ take-home pay less favorably: eliminating the requirement for employers to pay RSE workers 10 percent above the minimum wage, removing the guaranteed payment for 30 hours of work each week, and lifting the freeze on worker accommodation fees.
Effective September, the 10 percent wage increase will now only apply to workers in their third and subsequent seasons, intended to acknowledge the skills of returning workers, a demand from Pacific nations. Nevertheless, this shift has raised concerns, particularly because data in the past 17 years show that many workers from Pacific nations do not reach an average of three seasons. For instance, while Vanuatu workers average three seasons, those from Samoa and Tonga average 2.9 and 2.8 seasons, respectively.
The policy to tie wage rates to the number of seasons worked may encourage workers to return to New Zealand for financial reasons, which might not align with the best interests of their families at home. Additionally, solely basing higher wages on tenure does not necessarily correlate with skill or productivity, which could lead to less capable workers being paid more than their more skilled counterparts in their second season.
Employers traditionally make decisions regarding wage rewards based on skill and experience. Currently, under the new policies, RSE employers must guarantee payment for 30 hours of work averaged over four weeks, a shift from the previous requirement, which was particularly protective during the pandemic.
National MP Catherine Wedd commented on this averaging approach, suggesting it would help New Zealand compete better with Australia. Critics argue that reducing worker financial protections in this way could undermine competitiveness. Historically, New Zealand attempted to distinguish its RSE scheme from Australia’s Pacific Australia Labour Mobility (PALM) scheme by emphasizing strong employer-employee relations and worker protections, but this may no longer hold true as Australia now offers both higher wages and better protections.
PALM approved employers must guarantee a minimum pay threshold and cover expenses like accommodation during weeks without sufficient work for their employees, protections not mirrored in the RSE scheme. Workers are likely to face increased housing costs following the removal of the accommodation charge freeze.
Despite some necessary adjustments to the RSE settings, concerns persist regarding the lack of consultation with the Pacific nations that supply labor. Pacific stakeholders await meaningful outcomes from the ongoing RSE policy review that began before the pandemic, completed in 2023, but has yet to yield substantial results.
Vanuatu’s High Commissioner to New Zealand, Jimmy Nipo, emphasized the importance of maintaining a balance of benefits between New Zealand and Pacific nations through consistent, open dialogue to foster strong bilateral and regional relationships.