Check your pay with minimum wage change

Up to 250,000 people will benefit from the upcoming increase in minimum wage, and Employment New Zealand is encouraging employees to make sure they’re being paid correctly.

From Thursday 1 April 2021, the adult minimum wage rises from $18.90 to $20 per hour in New Zealand. The starting-out and training minimum wage rates also increase from $15.12 to $16 per hour.

Employment New Zealand Information and Education Employment Manager Luciane Bryant says this is important information for all budgeting clients who are employed.

Most employers are good, but unfortunately a few are unscrupulous, and vulnerable employees who may have fewer options for employment may end up working for them.

“In the worst case, an employer may not be holding up their end of the bargain and exploiting you as an employee. This can hurt your pay packet, reduce your spending power, lead to big money worries, and also unwanted distress for you and your whānau.

“If you are not sure of your employment rights, talk to someone you trust like your Financial Mentor.”

FinCap Chief Executive Ruth Smithers says the increase in the minimum wage will make a significant difference for some people facing financial hardship.

“An increase in income is one way to help whānau build their financial capability, and I’m sure many hard-working people will welcome this change.”

Important changes

    • The minimum wage increase directly affects an estimated 250,000 employees in New Zealand and their whānau. The increase also impacts many other low-income workers whose pay is set in relation to these rates.
    • Your pay rate should be noted in your employment agreement (contract). If your rate is noted as a figure below the new minimum wage, then it should increase from Thursday 1 April 2021.
    • Your employer should have advised you of the upcoming increase via letter or email (variation of contract). Now is also an ideal time to ensure you have a written contract and if you do have one that it’s up to date.
    • You’re entitled to ask your employer for a payslip or your recent pay records details. By law, they only have to give you a payslip if they want to, but they must provide you details of your wages, time worked and leave when you request it.
    • You must be paid at least the minimum wage for every hour you work. This always applies – even if you don’t have a valid visa and/or contract.

If you or somebody you know might need more support around employment related issues, you can reach out to our MoneyTalks helpline on 0800 345 123 or speak to your Financial Mentor.

If you’re a Financial Mentor and you or your client needs some more guidance around the changes to the minimum wage, you can contact Employment New Zealand by visiting their website or calling their helpline on 0800 20 90 20. The staff can help explain the changes and discuss options, including where you can get further support if this is required.

Note: estimates for the number of people directly affected by the minimum wage range from about 175,500 to 250,000 workers in New Zealand.