Sharemilking agreement gets a major makeover

Sharemilking agreement gets a major makeover

With about 40 percent of New Zealand dairy farms operating sharemilking contracts, Federated Farmers has released its Variable Order Sharemilking Agreement 2012. This follows the Sharemilking Agreements Order 2011 being passed into legislation on 22 August.

"We are pleased the Variable Order Sharemilking Agreement 2012 is now available from Federated Farmers," says Ciarán Tully, the Federation's Sharemilkers chairperson.

"The Variable Order Sharemilking Agreement is one area where Federated Farmers has a statutory role under the Sharemilking Agreements Act 1937.

"Our Variable Order Sharemilking Agreement 2001 has been a valuable document, protecting both the rights of sharemilkers and those of their farm owners, but there have been issues that needed clarification.

"The order's review was spear-headed by representatives from Federated Farmers Sharemilkers' and the Sharemilker Employers' Section who considered feedback from our members on the existing 2001 Agreement.

"The resulting Variable Order Sharemilking Agreement 2012 is a product of good faith bargaining which will stand up in the courts. Most importantly, it is written in plain-English that makes it easier for farmers to understand.

"Aside from making it more user friendly, current obligations relating to farm practices, such as the Resource Management Act, have been incorporated. These have the potential to cost farmers money if things are not done correctly.

"Critically, the Variable Order Sharemilking Agreement 2012 acknowledges the need to keep children safe from farm hazards.

"The farm house will be required to have stock proof fences and there must be provision of a safe place for children to be in, if they are at the milking shed while their parents work.

"For Fonterra suppliers, the new method of payment has been taken into account.

"For those with herds of not more than 300 cows and who agree not to share dividend revenue from the Dividend Related Payment Adjustment, the minimum percentage of income derived from milk supplied to Fonterra will be 22 percent.

"The arbitration and conciliation clauses have also been updated. While it is disappointing every time a relationship breaks down, these things do happen. Our role is to speed things through to as amicable an outcome as possible.

"As with any commercial agreement, Federated Farmers asks the parties involved to FIRST sit down and talk over issues. All the clauses in the agreement need to be read and discussed, as the outcomes will affect you if things go wrong. Fill in all of the tables and blank spaces where you need to and of course, sign on the dotted line. An unsigned agreement is not worth the paper it is printed on.

"Finally, since the Variable Order Sharemilking Agreement 2012 is a Federated Farmers document, members can call us at 0800 327 646 for a copy or advice today," Mr Tully concluded.

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