What is the Minimum Wage?
The Minimum Wage is the minimum hourly rate that must be paid to employees by law. In NZ there are three types of minimum wage: adult, starting-out and training. The current adult minimum wage is $22.70 an hour before tax.
Adult Minimum Wage
The adult minimum wage is:
$22.70 per hour (as of 1 April 2023)
The adult minimum wage must be paid to all employees aged 16 and over who are not classified as starting-out or trainees.
Minimum Wage Calculations
- How much Cash-in-Hand do you get on the Minimum Wage?
- How much Tax do you pay on the the Minimum Wage?
Starting-out Minimum Wage
The starting-out minimum wage is:
$18.16 per hour (as of 1 April 2023)
The starting-out minimum wage is for:
- 16 and 17 year old employees who haven’t done six months of continuous employment service with their current employer.
- 18 and 19 year old employees who have been paid one or more social security benefits for six months or more, and who haven’t completed six months continuous employment with an employer since they started being paid a benefit.
- 16- to 19-year-old employees whose employment agreement states they have to undertake industry training for at least 40 credits a year in order to become qualified in the area they are working in.
- Where those employees are supervising or training other workers they are required to be paid the adult minimum wage instead.
Training Minimum Wage
The training minimum wage is:
$18.16 per hour (as of 1 April 2023)
The training minimum wage is for employees employees aged 20 years or over whose employment agreement states that they have to do at least 60 credits a year of an industry training programme to become qualified in the area they are working in (with some exclusions).
Historical Minimum Wage Rates
| As of | Adult | Starting out | Training |
|---|---|---|---|
| 1 April 2024 | $23.15 | $18.52 | $18.52 |
| 1 April 2023 | $22.70 | $18.16 | $18.16 |
| 1 April 2022 | $21.20 | $16.96 | $16.96 |
| 1 April 2021 | $20.00 | $16.00 | $16.00 |
| 1 April 2020 | $18.90 | $15.12 | $15.12 |
| 1 April 2019 | $17.70 | $14.16 | $14.16 |
| 1 April 2018 | $16.50 | $13.20 | $13.20 |
| 1 April 2017 | $15.75 | $12.60 | $12.60 |
| 1 April 2016 | $15.25 | $12.20 | $12.20 |
| 1 April 2015 | $14.75 | $11.80 | $11.80 |
| 1 April 2014 | $14.25 | $11.40 | $11.40 |
| 1 April 2013 (*) | $13.75 | $11.00 | $11.00 |
| 1 April 2012 | $13.50 | $10.80 | $10.80 |
| 1 April 2011 | $13.00 | $10.40 | $10.40 |
| 1 April 2010 | $12.75 | $10.20 | $10.20 |
| 1 April 2009 | $12.50 | $10.00 | $10.00 |
| 1 April 2008 (*) | $12.00 | $9.60 | $9.60 |
| 1 April 2007 | $11.25 | $9.00 | $9.00 |
| 27 March 2006 | $10.25 | $8.20 | $8.20 |
| 21 March 2005 | $9.50 | $7.60 | $7.60 |
| 1 April 2004 | $9.00 | $7.20 | $7.20 |
| 24 March 2003 | $8.50 | $6.80 | $6.80 |
| (*) Definitions for starting-out / new entrant / youth were different prior to May 2013 | |||
Minimum Wage FAQ
How is the minimum wage adjusted for part-time or casual workers?
In New Zealand, the minimum wage applies equally to full-time, part-time, and casual workers. Employers are required to pay at least the minimum wage for every hour worked, regardless of the employment type.
Is the minimum wage different for salaried employees?
For salaried employees, the minimum wage calculation is based on the total hours worked. Their salary must not fall below the equivalent of the minimum hourly wage for the total hours worked in the pay period.
What are the penalties for employers who fail to comply with minimum wage regulations?
Employers who fail to comply with minimum wage regulations may face penalties, including fines and orders to pay arrears to affected employees. The Labour Inspectorate can enforce compliance and take legal action against non-compliant employers.
How can minimum wage violations be reported?
Minimum wage violations can be reported to the Labour Inspectorate, part of New Zealand's Ministry of Business, Innovation and Employment (MBIE). Employees can file a complaint if they believe their employer is not paying the correct minimum wage.
How does New Zealand's minimum wage compare to other countries?
Although it might not feel like it for minimum wage workers, New Zealand's minimum wage is relatively high compared to many other countries.
Why is New Zealand's minimum wage higher than most other countries?
New Zealand's minimum wage is higher than most other countries due to a combination of factors, including the country's relatively high cost of living, economic conditions, and a labor market that demands competitive wages.
Additionally, there is a societal and political emphasis on reducing income inequality and ensuring that workers can afford a decent standard of living. These factors contribute to setting a minimum wage that is higher than in many other countries.
Why is New Zealand's minimum wage lower than Australia?
The lower minimum wage in New Zealand compared to Australia is influenced by differences in the cost of living, economic conditions, and government policies. Labour market dynamics and the overall economic structure of each country play a deciding role in setting minimum wage levels.
Are there higher minimum wages for certain industries or jobs?
The 2022 Fair Pay Agreements Bill was setting the stage for higher minimum wages in certain industries but that legislation was repealed on 20 December 2023.
Are minimum wage workers net tax payers?
Minimum wage workers in NZ may still be net taxpayers, depending on their total annual income and personal circumstances. Income tax is calculated based on total earnings, and individuals may also be eligible for various tax credits or government assistance.
What would happen if the minimum wage was the same as the living wage?
If the minimum wage were set at the same level as the living wage, it could lead to increased earnings for low-income workers, potentially improving their standard of living. However, it would likely also impact employment levels, business costs, and increase inflation in the economy.
Minimum Wage Articles
NZ Minimum Wage to Increase to $23.15 in April 2024
In a move to balance economic stability with worker support, New Zealand announces a modest minimum wage increase to $23.15 by April 2024. This strategy aims to alleviate financial strains without overburdening businesses, benefiting an estimated 80,000 to 145,000 workers. But with the backdrop of a softening labour market and BusinessNZ's call for depoliticising wage decisions, this policy navigates complex terrain. How does the government plan to maintain this delicate balance?
NZ Minimum Wage Increase Set to Impact Workers Nationwide
New Zealand is set to increase its minimum wage from April 2023, aiming to enhance fair pay and living conditions for low-income workers. The adjustment will raise the adult minimum wage by $1.50 to $22.70 per hour, in line with a 7.2% inflation rate. Additionally, the training minimum wage will increase by $1.20 to $18.16 per hour. Employers are urged to prepare for the change, ensuring compliance with the law. Industries like retail, with a high number of minimum wage earners, will be significantly impacted.
Minimum Wage Hits the $20 mark
The Adult Minimum Wage was increased $20.00 from 1 April 2021, and the Starting wage is up to $16.00
How equal has wage growth been over the last 10 years?
How does growth in the minimum wage and living wage stack up against growth in the median wage and average wage in New Zealand over the last 10 years?
Minimum Wage Boosted 7.3% in 2019
The Adult Minimum Wage was increased $1.20 to $17.70 as of 1 April 2019. This represents an increase of 7.3% over the previous level - the largest yearly percentage increase within the last 12 years
Minimum wage rises to $13.50/hour on 1 April 2012
New Zealand's minimum wage increases 3.85% to $13.50 per hour from the 1st of April 2012. That's an extra $17.93 per week cash-in-hand for someone working a standard 40 hour week.
Minimum wage to increase $0.25c
After much speculation and debate the Government has announced a small increase in the minimum wage, to come into effect as of 1 April 2010.