Wellington  - The New Zealand government on Wednesday announced a scheme to pay workers to take one day off every two weeks to save them from the threat of losing their jobs in the current recession.

Under the scheme, workers and their bosses in New Zealand's largest companies that are suffering in the economic downturn will negotiate voluntary agreements to cut their hours, Prime Minister John Key told a news conference.

He said that the government would compensate them by paying 12.50 New Zealand dollars (6.25 US dollars) an hour - the adult minimum wage - for each worker, for up to five hours every two weeks.

While workers are in the scheme, they cannot be made redundant.

"This is a practical measure that will give businesses some extra time to ride out the tough conditions and to retain jobs as they do," Key said.

He stressed that it was a temporary measure.

"It's not my ambition to turn New Zealand into France," he said. "We are not going onto a 35-hour week on a permanent basis."

Key said that initially the scheme would be available to 1,600 companies with workforces of more than 100. It will operate from March 27 to the end of 2010, but each company will be limited to six months.

A similar scheme for smaller businesses was being worked out, but was "hideously complex," he said.

Key described it as "a last resort" measure designed to avoid massive job losses in New Zealand where the current unemployment rate of 4.6 per cent is tipped by some analysts to reach double figures next year as the economy, in recession since early last year, worsens.

"It's not going to turn back the recession - it's just one of a number of tools that the government is employing to try and keep New Zealanders employed," he said.

The scheme was welcomed by the president of the Council of Trade Unions, Helen Kelly, who said, "This package and the amount available do provide a real basis for business and unions to work to save jobs." (dpa)