Minimum wage pay boost tomorrow
The minimum wage rises to $16.50 an hour on April 1 – and no, it’s not a bad April Fool’s joke from the Government.
About 164,000 workers and their families would be better off after the 75 cent increase, said Workplace Relations and Safety Minister Iain Lees-Galloway.
The increase would also boost collective wages across the country by $129 million a year, he said.
The 75c increase was part of the new Government’s 100-day plan, while the Government’s long-term target is to increase the minimum wage to $20 by 2021.
Kirk Hope, chief executive of BusinessNZ, said in October that New Zealand already had one of the highest minimum wages in the OECD, and the plan would put pressure on small businesses.
‘‘$15.75 to $16.50 is a 5 per cent increase so we need to ensure small business has sufficient access to capital so they can fund the increase if they aren’t able to increase prices to cover the additional costs,’’ he said.
So how would the minimum wage increase roll out over the next four years?
Incremental rises
Starting this April, the minimum wage would increase in annual stages.
Each year, the Government will review the minimum wage, taking economic conditions into account when setting the new rate.
Lees-Galloway announced in December that in the Government’s first year in power, it would abolish starting-out rates and consider changes to the training wage in addition to the hike to $20 within four years.
‘‘The Government is committed to a high-performing economy that delivers good jobs, decent work conditions and fair wages,’’ he said.
‘‘These changes are a part of this Government’s wider workplace relations policy platform, which is about backing fair pay and conditions, and ensuring those on lower incomes get to share in our economic prosperity.’’
Until changes are made to the starting-out rates, Lees-Galloway said they would remain at 80 per cent of the minimum wage – meaning they will rise to $13.20 per hour in April.