Minimum wage
As an employer, you must pay your employees at least the current minimum wage rate for every hour they work, no matter what responsibilities they have.
There are three rates:
- adult minimum wage
- starting-out wage
- training minimum wage.
All rates are before tax and any lawful deductions – for example PAYE tax, student loan repayment, or child support.
Current minimum wage rates
Adult minimum wage
The adult minimum wage applies to all employees who are:
- aged 16 years and over, who aren’t starting-out workers or trainees
- involved in supervising or training other employees.
This is the minimum wage most widely used by Kiwi businesses of all shapes and sizes.
Starting-out minimum wage
The starting-out minimum wage applies solely to workers aged between 16 to 19 and who are entering the workforce for the first time.
Starting-out workers are any of the following:
- People aged 16 to 17 who have worked for you for less than six months.
- People aged 18 to 19, who have been paid a specified social security benefit for six months or more, and haven’t completed six months continuous employment with any employer since they started being paid a benefit. After six months continuous employment with a single employer, they must be paid the adult minimum wage rate.
- People aged 16 to 19 and with an employment agreement that says they must undertake industry training for at least 40 credits a year, to become qualified in the area they are working in.
Training minimum wage
The training minimum wage applies to employees aged 20 years or over who are completing at least 60 credits a year of an industry training programme, to become qualified in an area they are working in.
The training minimum wage usually applies to apprentices. An apprentice has the same minimum rights and protections as any other employee but can be paid the training wage.
Employing school-age workers
There is no minimum wage for employees under 16 years of age. If you employ anyone under the age of 16, their work hours must be outside of school hours and must not get in the way of doing schoolwork.
Exemptions
A small number of people hold an exemption from the minimum wage – for example, prison inmates and some apprentices.
Paying fairly
Beside paying minimum wage, you must ensure your pay policies and practices are as fair as possible.
Paying employees fairly means:
- paying your employees for actual hours worked – this means paying employees at least the minimum hourly wage for any extra time worked
- women and men must receive the same pay rates for doing the same or substantially similar work
- you can’t discriminate based on an employee’s race, ethnic or national origins, gender, pregnancy or childbirth status, marital or family status, age, disability, religious or ethical beliefs, political opinion, sexual orientation or union activity.
The gender pay gap toolkit
The gender pay gap is the percentage difference between women’s and men’s earnings in the workforce. This could be at a job, organisation, industry or national level.
Currently, the national gender pay gap in New Zealand is 8.2% (as at 30 June 2024).
The gender pay gap is significantly higher for wāhine Māori, Pacific, ethnic, and disabled women, compared to the national gender pay gap. The causes behind this are difficult to measure, like conscious and unconscious bias.
To help you calculate if there’s a gender pay gap at your business, use the Ministry for Women’s toolkit. The toolkit includes:
- an online calculator for calculating gender pay gap
- a self-assessment questionnaire to identify opportunities for improvement in your business
- a downloadable workbook and templates to support you.
Understanding, measuring and reporting on your gender pay gap is a great way to create a more equal workplace, and fairer hiring and pay processes. it can also improve employee productivity and retention.
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