New Zealand Minimum Wage Increasing April 1 2019
On April 1 2019, the New Zealand minimum wage is increasing by $1.20 to $17.70 an hour.
This is New Zealand’s biggest wage increase in history, with plans to increase it to $20 by 2021.
By 2020, the minimum wage will sit just below the living wage, which currently sits at $20.55.
What does the wage increase mean for employees?
Workplace Relations and Safety Minister, Iain Lees-Galloway said the rise would result in employees being paid the minimum wage taking home an extra $48 each week before tax.
“The Government is determined to improve the wellbeing and living standards of all New Zealanders as we build a productive, sustainable and inclusive economy,” said Lees-Galloway.
What does the wage increase mean for employers?
Employers must adjust the hourly rate for any employee being paid the minimum wage from April 1 onwards, updating pay slips and Payday Filing.
Small businesses have expressed concerns that this will squeeze margins even tighter.
What can you do to prepare?
- Make sure any profit/loss forecasting takes into account your increase in labour costs.
- Make sure you are ready for Payday Filing which also comes into play on April 1 2019. Payday Filing means you will need to report your employee payments to the Inland Revenue Department on the day of your pay run. You can read more about this here.
- Review your current systems and explore new technology that could help streamline/automate processes such as payroll and rostering.
- Review your current recruitment processes–With labour costs going up, business must ensure their recruitment methods are as efficient and effective as possible.
How will this affect Sidekicker clients?
We’ll be updating the Sidekicker platform to reflect the minimum wage changes, so you don’t need to worry about compliance, payroll and employment admin.
All shifts completed from April 1 onwards will be automatically updated to the new rates.
Any work already being paid above the new minimum rate will not be impacted.