#employerhowto The minimum wage is currently $21.20 but will increase by CPI of 7.2% at the end of the financial year. Make sure your business is prepared!
What will the adult minimum wage be?
The minimum wage will rise by $1.50 per hour to $22.70.
Other types of minimum wages
These are paid at 80% of the adult minimum wage but have requirements.
The starting out minimum wage. This can be used for those 16-19 years old the first six months of their employment only. After six months or if they are training or supervising others, they must be paid the adult minimum wage.
The training minimum wage. This can be used for those 20 and over who are doing at least 60 credits of external training in their field per year. This does not apply if they are being trained at work rather than in an approved training programme or if they are no longer completing 60 credits.
When does this increase happen?
The minimum wage goes up at the start of the new financial year on April 1st 2023.
What must employers do?
Before the new financial year, work out how many, if any, of your employees are being paid under $22.70 per hour. They will all need to increase to at least the new minimum wage on April 1st. Good record keeping is important, and we recommend a variation to their employment agreement to reflect this.
What if you don't pay minimum wage?
This would be a breach of employment law and could result in backpay, compensation and penalties which could amount to tens of thousands in the worst case scenario. That's a big risk for for a $1.50 per hour!
What about other employees?
In addition, we recommend reviewing all your employees' pay rates to check that you are
accurately reflecting their current role and duties
paying in line with others in the industry
rewarding those who are contributing the most to your business
Why is this important?
While its not a legal requirement, it is important for morale, low attrition rates and a culture of motivated and engaged employees. Remember, any changes don't just have to be monetary. Bonuses and work perks can be just as well received as a higher pay rate if they are meaningful to your employees.