Fair Pay Agreements (FPAs) were Labour's landmark 2022 policy to lift pay floors across entire industries through binding sector-wide collective bargaining — the most significant shift in New Zealand employment law in decades. They were designed to break a 30-year cycle of wage stagnation in low-paid work tracing back to the deregulatory 1991 Employment Contracts Act. Six sectors covering an estimated 200,000–250,000 workers had entered or been approved for bargaining when the incoming National-NZ First-ACT coalition repealed the legislation in December 2023 — one of its very first acts — before a single agreement had been signed.

What's happening:

• The Fair Pay Agreements Act 2022 came into force on 1 December 2022 and was repealed exactly one year and 19 days later, on 20 December 2023, after receiving Royal assent on 19 December — passed under urgency with no select committee review of the repeal bill.
• Six sectors had received formal approval to begin bargaining under the regime: bus drivers (the furthest along, having reached the bargaining table with employers); early childhood education (with 6,000+ workers signed up and an application submitted by May 2023); commercial cleaners; security guards; supermarket workers; and hospitality workers.
• Treasury's own analysis found FPAs would disproportionately benefit Māori, Pasifika, women, and young people — groups overrepresented in low-wage industries — making the repeal's equity impact particularly acute.
• FIRST Union general secretary Dennis Maga warned after the repeal that NZ supermarket workers start on the $22.70 minimum wage with little progression, while Australian grocery workers earn AU$24.73 minimum with overtime and weekend penalty rates — driving brain-drain to Australia from the very sectors FPAs were meant to protect.

Where the parties stand:

Labour introduced FPAs as an election promise and passed the legislation in 2022. Opposition leader Chris Hipkins has committed to reinstating FPAs "quickly" if Labour wins in 2026, alongside restoring the 30-day rule (automatic collective agreement coverage for new workers) and delivering a costed pay equity commitment before the election. Hipkins frames reinstatement as fundamental to a fair economy, saying a Labour government would put Fair Pay Agreements, pay equity, and stronger worker protections at the top of its list.

The National-led government, with ACT's Brooke van Velden serving as Workplace Relations and Safety Minister, led the repeal. Van Velden argued FPAs were "a one-size-fits-all model" that could be triggered by a union and a small number of workers yet bind entire industries, undermining the flexibility that she characterised as a pillar of NZ's economic success for three decades. The government's Beehive statement claimed the repeal "will have no impact on the current employment terms for workers because no Fair Pay Agreements have been finalised." BusinessNZ chief executive Kirk Hope backed the repeal, having earlier said the FPA process was "significantly wasting people's time" and that Treasury's own advice showed costs would outweigh benefits.

NZ First voted with National and ACT for the repeal, completing the coalition bloc needed for passage. NZ First had not campaigned publicly on FPAs but the coalition agreement committed all three parties to repeal before Christmas 2023.

The Greens support restoring FPAs and would go further — their workforce policy includes default union membership, the right to solidarity strikes, pay gap reporting, and extending collective bargaining rights to contractors. CTU president Richard Wagstaff said industry-wide standards are "incredibly important" and that the repeal removed a mechanism that had brought workers together across the country for the first time in a generation. Te Pāti Māori also opposed the repeal, citing the disproportionate impact on Māori workers.

What to watch:

• Whether Labour releases a detailed, costed FPA reinstatement plan before the 2026 election — Hipkins has promised this but specifics remain outstanding as of mid-2026.
• Pay and conditions data in the six sectors that were in bargaining: bus drivers, security guards, cleaners, early childhood educators, supermarket workers, and hospitality — union tracking of these wages versus Australia will be a key battleground argument.
• Whether unions pursue multi-employer collective agreements (MECAs) as a partial substitute, given these require employer consent and typically involve significant industrial action.
• Any Treasury or Productivity Commission analysis commissioned by the current government on low-wage sector outcomes since the repeal — or absence thereof.
• The political salience of the Australia wage-gap narrative: with trans-Tasman migration accelerating, sectors that FPAs were meant to address are losing experienced workers, which could harden public opinion ahead of 2026.