The COVID-19 crisis has caused an economic slump across countries worldwide. Robust economies have toppled. Several people have lost their jobs. The pandemic has catalyzed the fall of several multinational organizations and has led to a magnitude of global job loss comparable to the great depression.
In the midst of all this, the government of NZ has been continuing its endeavors to safeguard the country’s economy and ensure the financial soundness of its citizens. While it has issued several critical notices and plans of action to be followed during alert levels 3 and 4, it has also taken a step forward to ensure its citizens’ workplace satisfaction.
The government of NZ was long back planning to increase the minimum wage rate of all the adult employees to $20.00 per hour since 2018. If an adult worker is paid less than the minimum wage rate per hour, the employers are supposed to increase their wages to $20.00 per hour from 1 April 2021. All employers are required to provide a variation letter to their employees so that they are aware of the rate changes. The employers can maintain a recorded copy of the same letter if the Labor inspectors ask for records during the audit process. NZ government had categorized standard minimum wage rates in three sections:
The minimum wage change is subjected to both full-time and part employees in NZ. Also, the rate change is applied to employees hired on a commission basis or hourly basis. There is no minimum rate change in employees who are 15 years or younger. But it is compulsorily required for all employers to pay minimum wage rate to individuals who are 16 years or above. The minimum wage rate is not applicable in the case of adult employees if they are liable for the ‘starting-out wage or training wage.
As per the Labor’s pre-Covid commitment, the NZ government is committed to increasing the minimum wage rate by 5.8% from April 2021. The previous Labor government in power already indicated changes in minimum wage three years prior. At the same time, the Minister of Workplace relation confirmed that he could provide details about the following change only after 2022. The amplification in the minimum wage rate will be subjected to 1,75,000 citizens of New Zealand.
This means that an adult employee working on minimum wage for 40 hours a week will earn $44 more every week. The rise in the minimum wage rate in NZ will prove to be beneficial as it will boost the financial system by $216 million. This will provide an opportunity for New Zealanders to increase their expenditure on local companies. Further, this change will also enhance the market productivity needed for the growth and development of businesses.
Several reforms have been introduced regarding the minimum hourly wage rates. The following list gives you a detailed overview.
However, if you are confused regarding your eligibility for a specific wage rate, you can contact us. Our amicable experts will be happy to help you. The following tables seek to provide detailed information regarding the wage rates and respective employment types.
If a company or organization is employing any individual below the age of 16 years, they should ensure that their work does not hamper the school schedules of NZ employees. Moreover, there is no minimum wage provided to workers who are below 16 years of age.
The NZ government has exempted few people from getting minimum wage. These people are generally the ones who are serving jail terms and some individuals serving the probation period.
The NZ government aims to become one of the world’s leading governments that look after their citizens’ well-being and implement reforms proactively that ensure the same. The neutral/impartial payment scheme is one of the best economic and employment reforms that ensure the world’s NZ government’s leading status.
For further information and assistance on employment and minimum wage rate, you can Book a consultation. All employers need to pay at the least minimum wage to their employees. In this way, the country’s job ecosystem will flourish, and financial wellness will be maintained irrespective of the pandemic situation.