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The government has confirmed that it will increase the minimum wage to $ 20 an hour starting April 1 of next year.
The Minister for Safety and Workplace Relations Michael Wood said that as New Zealand recovered and rebuilt from Covid-19, the government pledged to support New Zealanders by increasing wages.
“There are many Kiwis earning minimum wage who have gone the extra mile in our fight against Covid. I think everyone agrees with those who served us so well during the lockdown, including supermarket workers, cleaners, and security guards, they deserve a raise.
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The measure will give people who work 40 hours a week on the minimum wage $ 44 more each week before taxes.
“This increase in the minimum wage will raise the income of around 175,500 New Zealanders, which means $ 44 more each week before taxes for Kiwis who work 40 hours a week at minimum wage.”
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In recent weeks there has been a debate between those who think that the minimum wage should rise to the level of a living wage, by just over $ 22 an hour, and those who think that this year’s increase to $ 18.90 should be undone in the light of the pandemic. .
The Ministry of Business, Innovation and Employment had estimated that a minimum wage of $ 18.90 would result in a “restriction on employment” of 6,500, although it later said that the impact of Covid-19 would have likely increased the effect.
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Labor Relations and Safety Minister Michael Wood said the increase would increase the income of 175,500 people.
“Increasing the minimum wage is estimated to increase wages across the economy by $ 216 million, giving New Zealanders more money to spend on local businesses. Minimum wage increases can also boost productivity, which is good for businesses too, ”Wood said.
“We are taking a balanced approach and supporting both employees and employers during the pandemic.
“We will provide access to short-term absence pay to help employers ensure their employees can follow public health guidelines while they await a Covid-19 test.
“In the event of a Covid-19 resurgence, we have implemented a new resurgence support payment to help companies cover their fixed costs and committed to the wage subsidy scheme for alert level 3 and above.
“Pointing out minimum wage increases for three years has helped give companies much-needed certainty. Next year I will outline the changes we intend to make in the coming years so that companies have time to plan for the future, ”Wood said.
Minimum starting and training wages will also go up to $ 16 an hour, to stay at 80 percent of the minimum wage for adults.
