Hon Ruth Dyson
Minister of Labour

28 March 2007 Media Statement

Largest increase to minimum wage since 1999

Workers earning the minimum wage will receive a 9.8 per cent pay rise on Sunday as the Labour-led government delivers on its promise to deliver more help to the families that need it most, Labour Minister Ruth Dyson said today.

The minimum adult wage, which applies to people 18 years and over, will increase from $10.25 to $11.25 an hour ($450 for a 40 hour week) from 1 April - the largest increase since the Labour-led government came into office in 1999.

The minimum youth rate – for workers aged 16 and 17 years – will increase from $8.20 an hour to $9.00 an hour, to stay at 80% of the adult minimum wage. The minimum training wage will increase to the same rate.

“The boost in the minimum wage will ensure that lower paid workers share the benefits of economic growth, encourage people to join the workforce and provide protection for some of New Zealand’s most vulnerable workers,” Ruth Dyson said.

“ An increase to $11.25/$9.00 will benefit around 110,000 adult workers, most of whom are women, and around 9,200 youth workers. It can be made with confidence in the current economic and labour market conditions, without being at the expense of jobs.

The Minister of Labour reviews minimum wage rates annually for adults, youth and trainees, seeking submissions from a wide range of organisations, including employer, union, Pacific, Maori and women’s groups.

Ruth Dyson said the Labour-led government’s goal is for the adult minimum wage to reach $12 an hour by the end of 2008, if economic conditions permit.

1 April will also see a range other policies for working families come into force, including a $10 per child, per week boost to Working for Families tax credits, the delivery of a minimum four week's annual leave entitlement, and a substantial increase in the rate of New Zealand Superannuation.

Employers and employees can contact the Department of Labour for more information about the minimum wage through free phone 0800 20 90 20 or by visiting www.ers.dol.govt.nz

ENDS

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