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Increase In Minimum Wage – The Largest In A Decade.

Increase in Minimum Wage – The Largest in a Decade.

As an employer you need to be prepared for the minimum wage to increase by .75 cents to $16.50 an hour from April 1, 2018. The largest minimum wage increase since 2008 will impact all businesses, across all industries, who pay the minimum wage. Minimum wage increases are a topical public debate because this will affect everyone, employees, customers, employers.

Effective 1 April 2018, the minimum wage is mandatory to be paid to an employee irrespective of the hours worked or job responsibilities are as follows:

Adult Minimum Wage – $16.50 Per Hour. An increase of .75 cents per hour.

Currently this is $15.75 and will increase to $16.50 per hour.  The adult minimum wage applies to all employees aged 16 years and over who are:

  • not starting-out workers or trainees, or
  • involved in supervising or training other workers.

Starting-Out Wage – $13.20 Per Hour. An increase of .60 cents per hour.

Currently this is $12.60 and will increase to $13.20 per hour.  The starting-out minimum wage applies to workers who are:

  • 16- and 17-year-old employees who haven’t done six months of continuous employment service with their current employer. After six months with one employer they are not starting-out workers and must be paid the adult minimum wage
  • 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.

Training Minimum Wage – $13.20 Per Hour. An increase of .60 cents per hour.

Currently this is $12.60 and will increase to $13.20 per hour. The training minimum wage:

  • applies to 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. Many of these employees will be apprentices.
  • doesn’t apply to employees who are being trained at work, for example, by their employer at the start of their employment; it only applies to employees doing an approved industry training programme
  • doesn’t apply to an employee who is supervising or training other workers. These employees must be paid at least the adult minimum wage.

Paying employees under 16

There is no minimum wage for employees under 16 but all the other minimum standards and employment rights and obligations apply. When an employee turns 16, they must be paid the relevant minimum wage (even if they were paid less than the minimum wage when they were 15).

Being fully aware of the wage increases is something that is vitally important to running a business. Employees have to be paid at least the minimum hourly wage rate for every hour worked.

If you require assistance with this or any other payroll concerns, including outsourcing, contact me today. on 027 337 6029

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