Income Insurance – What teachers need to know

What is the New Zealand Income Insurance Scheme? 

The New Zealand Income Insurance Scheme (NZIIS) is a proposed form of unemployment insurance. It has been developed by the Council of Trade Unions, Business NZ, and the Ministry for Business, Innovation & Employment.  

When you lose your job because your position is made redundant, or because you have an illness that means you can no longer do your job, you will be covered by the New Zealand Income Insurance Scheme.  

The scheme guarantees that you are given one month’s notice that your employment is ending. You will receive your full salary for this month.  

After this you are eligible to receive 80% of your salary for a further six months.  

During this time you will also have access to retraining opportunities.  

The scheme will be administered by ACC. Similar to ACC, the scheme will be funded by a levy paid by workers and employers. This levy is proposed to be 1.39% of your salary.     

The NZIIS covers casual workers, so relief teachers and teachers on fixed term contracts are eligible.  

Now is the time for you to have your say about this scheme. Full details, and to make a submission, are here:  

Why does PPTA support the NZIIS?  

Our Collective Agreements already have significantly better provisions for redunancy and medical retirement than are guarenteed in general employment law for all workers.  

These provisions will not be affected by the NZIIS. You will still be entitled to all of these provisions.  

There are some instances where the NZIIS provides additional benefits to teachers.  

When teachers face medical retirement or redunancy, the collective agreement entitles teachers to choose from options that provide financial support. These either come as lump sum payments or as a period of paid time to seek new employment or retrain.  

Once teachers have received their lump sum payment, or if they remain without work at the end of their paid supernumerary time, they will then be entitled to the six months of income insurance.  

This gives teachers a further period of financial stability, over and above their collective agreement entitlements, to find a new teaching position or retrain for other work.  

If you want to see the full details of how each relevant collective agreement clause is affected by the NZIIS, please see the PPTA’s submission attached to the top of this page.  

PPTA also believes in worker solidarity. These provisions will provide additional financial and career security to workers who do not have the provisions afforded to teachers through the collective agreement.  

Are there any concerns? 

PPTA supports the income insurance proposal, but there are areas where we think improvements could be made for the benefit of all workers.  

  • The length of payment eligibility 

The collective agreement redundancy provisions cover teachers for either three terms, or a full year. This to give teachers the best possible chance to find new employment, including retraining. For some teachers six months is not enough time for this, and nor is it likely to be so for many other workers who are genuinely seeking alternative work and/or undergoing retraining. With that in mind we would encourage that this scheme is extended for up to a full year.  

  • Payments should not leave affected workers with less than minimum wage  

We believe that the payments should be to guarantee 80% of expected income, or minimum wage, whichever is higher.  

If a worker earns minimum wage, or close to it, their NZIIS payments will not be at the level of minimum wage. While we recognise that other supports will be available to workers who lose jobs it does seem absurd that the payment should be less than the minimum wage, which itself is less than the living wage, if the response has to be a ‘top-up’ by government through its other schemes.   

Last modified on Wednesday, 17 May 2023 09:08