Minimum Wage Increases from 1st April 2020
Today, New Zealand's adult minimum wage increases from $17.70 to $18.90 per hour.
This is an extra $1.20 per hour and an additional $48 per week (before tax) for full-time employees.
This is some good news for minimum wage workers, many of whom continue to work in essential services during the nationwide Level 4 lockdown. We thank YOU!
This minimum wage increase is another step towards the Government's plan for a $20 minimum wage by 2021.
Figure 1. Current minimum wage rates as of 1st April 2020. Info taken from Employment NZ
For more information on the minimum wage increase and other employment information, visit the Employment NZ website.
The Minimum Wage Increase and Covid-19 Level 4 Lockdown
As the Level 4 lockdown continues to impact many businesses across New Zealand, employers may be wondering just how to manage the minimum wage increase such as with challenges updating payroll systems, or whom are facing financial difficulties and using the Government’s Wage Subsidy scheme.
During the lockdown, businesses must still pay workers for the work they do. This means employees—regardless of whether they are working from home, or from premises to do essential work—must be paid at least the new minimum wage for each hour they work.
However, employers may be affected by the lockdown requirements and other impacts of COVID-19 and some may not be able to action the increase immediately, while also complying with lockdown requirements.
Here is what you can do if you are an employer in this situation:
If Employers cannot process the change immediately due to Level 4 lockdown restriction, they can backdate the wage increase for the hours works as soon as possible. Ensure you are open and honest with your employees about this.
Employers can also access the Government Wage Subsidy for income affected employees due to Covid-19, even if the employee is unable to work during this period. There is certain criteria and obligations that must be followed to receive this subsidy. For more information visit the Work and Income website
For more information on how to manage the minimum wage increase during the Level 4 lockdown and how to access the wage subsidy, visit the Employment NZ website.