Contract Milking – as an industry we need to do it better

In the last few weeks I have been privileged to have been invited to speak at a couple of Dairy Training’s Contract Milking courses to the next generation of contract milkers coming through. I have also unfortunately seen some poor PR from another organisation that placed the burden of good contracts and agreements squarely on these keen sharefarmers – many who are incredibly trusting.

If you as a farm owner are going to have contract milkers this season, you are currently contract milking, you are thinking about going contract milking, or you know someone who is – the following is for you.

We have found keeping contract milking simple has the best outcomes for everyone.

Stop messing around with fancy bonus structures, calf rearing payments, rates that increase as the milk price increases (there is something called Sharemilking that does that already) – set the rate based on the actual costs, a conservative milk production estimate and a fair (ahem, generous) managers salary as a comparison using the DairyNZ contract milking calculator. Also, be prepared to provide (and as a contract milker, ask) for information and evidence regarding milk production, feed budgets, inputs, and costs.

When it comes to the co-operative bonus or similar – be generous and share it with the contract milker. They are responsible for the SCC, the records and going through the inspection – reward them for a hard job done well.

As a farm owner, ensure you are meeting the expectations of the agreement when it comes to farm maintenance. The wording in the market leading agreement specifically says “The Owner warrants that all Structures on the Land are in order and in a condition that will enable the Contractor to efficiently manage the Farm and Herd for the purposes of this Agreement and comply with all regulations required by central and local government”. The contract milker should not be chasing faults, leaks and repairing issues across the farm in their first months after they arrive. They should be getting orientated, getting cows fed and getting geared up for an excellent calving season. Contract milkers, if this is you, you need to do a notice of repair in the first 28 days of the term so get in the habit of doing an initial inspection along with a farm walk and count up of feed. Farm owners, you should join your contract milker in doing this or bring on a consultant who can help.

Healthy homes is officially 5 years old – becoming law on 1 July 2019. From 1 July 2025 (1 month into next season) all private rentals must comply and landlords (a contract milker would be considered a landlord when they have staff in a house on farm) could be liable for a financial penalty of up to $7,200. If you haven’t already, you need to be getting your homes up to scratch, getting them inspected and certified ahead of 1 June. Contract milkers, be aware of your responsibilities if you have staff and make sure you do an initial inspection of all the houses.

Finally, get some farm policies in place. These cover everything that isn’t in the agreement and are tailored to how you farm. No two farms are the same and if there is something specific you like done a certain way, get it written down. We can help you with that if that isn’t your strong suit but you should have policies for feed and pasture, animal health, buildings and maintenance, housing and general policies around spending, decision making and communication. You should also have a comprehensive health and safety policy that is tailored to the farm and outlines the shared duties correctly, including a drug and alcohol policy.

If any of the above resonated with you, please get in touch either on 0211335607 or louiseg@thesharefarmingconsultants.com