New Zealand's minimum wage rises

By Phil Boeyen, ShareChat Business News Editor

Wednesday 30th January 2002

The government has increased the adult minimum wage rate by 3.9% to $8.00 an hour in a move it says is in line with annual wage growth.

Labour Minister, Margaret Wilson, says the increase will provide an income boost for low paid workers, with the rate rising 30 cents from the current $7.70 per hour.

The government reports that the annual average wage growth in the year ended August 2001 was 3.4%, implying a minimum wage rate of $7.96.

"Rounding this up to $8.00 will make it easier for employers by minimizing compliance costs and at the same time help increase recognition of the minimum wage rate. The increase will apply to all workers aged 18 years and over," Ms Wilson says.

The youth minimum wage rate, applying to 16 and 17-year-olds, will increase from $5.40 to $6.40. The larger increase in youth rates reflects an earlier decision to increase the youth minimum wage rate from 70% to 80% of the adult rate.

It's estimated the increase in the adult minimum wage will affect 5,500 adult workers while the increase in youth minimum wage rates is estimated to affect about 6,900 16 and 17-year-olds.

"Since taking office the Labour/Alliance Government has made significant progress in ensuring minimum wages are fair," Ms Wilson says.

"Since the start of 2000 the Government has brought the youth minimum wage into closer relativity with the adult minimum wage, lowered the age of eligibility for the adult minimum wage from 20 to 18 years in line with other policy areas, and restored the value of the adult minimum wage relative to the average wage."

The latest changes will come into effect from on 18 March.

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