• Leah Norman

Minimum Wage Increase

Following the annual wage review, the minimum wage is set to increase from 1 April 2018. This will impact all businesses, across all industries, who pay at the national minimum wage. Employees must be paid at least the minimum hourly wage rate for every hour worked.

With effect from 1 April 2018, the following changes apply:

  • adult minimum wage will increase from $15.75 to $16.50

  • starting-out wage will increase from $12.60 to $13.20

  • training minimum wage will increase from $12.60 to $13.20


How Does This Affect Employers?

If an employer pays staff at the current minimum wage, this must be increased to the minimum rate from 1 April 2018.


However, if an employer already pays above the minimum wage, they may not be required to increase employees’ wages. In addition to paying the minimum wage or higher, employers also need to ensure pay policies are as fair as possible.

It is important to remember that employees who are paid a wage, need to be paid for actual hours worked. This means also paying employees for any extra time worked, and accounting for meal and rest breaks.


If employees are on a salary, it is important to consider if the minimum wage increase will impact their salaried rate. The Minimum Wage Act 1983 set out provisions which require that salaried employees are not paid below minimum wage for any hour of work.  Employsure can assist with assessing if current salaries are compliant with the changes that will take effect on 1 April 2018.


We’ll Keep You Updated.

The Labour Government has tabled further changes to employment relations legislation. We will continue to keep our clients informed of any changes.

Should you require advice about  the new minimum wage rates or any other employment relations matter, please contact us today to discuss further.


Disclaimer

This article, and any information contained on our website is necessarily brief and general in nature, and should not be substituted for professional advice. You should always seek professional advice before taking any action in relation to the matters addressed.