Minimum wage increase: ‘Govt created the mess and business owners have to clean it up’

Approximately 1.4 million New Zealanders will receive an increase in the minimum wage and financial benefits they are entitled to from the state.

In summary government changes effective today include:

• 880,000 pensioners to get a boost to Super, including 5000 veterans
• 52,000 students to see a bump in allowance or loan living costs
• Approximately 223,000 workers to receive a wage rise as a result of the minimum wage increasing to $22.70
• 8,000 community nurses to receive pay increase of up to 15%
• 345,000 families including 646,000 children better off through Working for Families Tax Credits
• 10,000 more children eligible for subsidised childcare

‘Across the world inflation is causing costs to rise and New Zealand has not been immune. That’s why the Government is focused on helping kiwi families with extra cost of living support,’ Prime Minister Chris Hipkins said.

‘We will continue to make the cost of living and bread and butter issues our priority as we navigate tough economic times. Today demonstrates our commitment to that.’

The announcement brought mixed reactions, as nurses working in GP practices were excluded from the 15% pay increase.

‘It’s a real kick in the guts for the work that they’re doing. For many this is the last straw and they’re looking to go overseas,’ Kerri Nuku of the New Zealand Nurses Organisation told RNZ.

‘If we want to invest in the workforce then we have to sincerely listen to what they’re wanting. And it’s not just about the pay parity, it’s about safe working conditions and having the resources so that when we go to work, we can do it really well.’

One small business owner DTNZ spoke to who employs 20 staff was scathing of recent minimum wage and 2021 sick leave changes.

The minimum wage increases were going to cost an additional $60,000 a year, which his business would have to absorb as it was already running at capacity and operated with a fixed revenue.

‘The government created the financial mess, cost of living crisis but small business owners are expected to pick up the pieces,’ the man told DTNZ.

The increase in annual sick leave from 5 to 10 days meant he had to cover the cost of an additional 100 days of no work and lost productivity.

The COVID support relief payment of $600 per week was not enough to cover the costs of an employee being off work for the mandatory 7 days isolation.

‘It’s a rort. Even just to get the payment you have to jump through so many hoops and delays, while I have to fork out the money immediately. My staff are all quadruple jabbed because of the mandates, yet they’re still getting sick. The vaccine has been the biggest rip off. Most of those who test positive aren’t even sick and show no symptoms, and they’re told to stay home when they can easily still come to work. The government is creating a sick workforce which isn’t even sick. Meanwhile they expect me to pay 7 days full wages, even if that staff member has used up their sick leave. What can you do?’

‘These changes and increased costs mean I cannot reward the good employees and pay more to those who deserve more. As budgets are stretched I have to equalise wages just to keep my head above water and prepare for unexpected future events.’

Image credit: Skitterphoto