Minimum Wage Increases from 1 April 2025 – What You Need to Know

sarah34943
Mar 27
3 min read

The Government has confirmed an increase in the minimum wage, effective 1 April 2025, which will impact thousands of businesses and employees across New Zealand. Whether you’re a small business owner or managing a larger team, it’s time to ensure your business is ready for the change.

📈New Minimum Wage Rates

From 1 April 2025, the following changes will take place:

Adult Minimum Wage: Increasing from $23.15 to $23.50 per hour
Starting-Out and Training Wage: Increasing from $18.52 to $18.80 per hour

These rates are before tax and any lawful deductions such as PAYE, student loan repayments or child support.

✅What You Should Do Now

🤝Let Your Team Know: If you have employees on the minimum wage, notify them in writing of the upcoming change. This could be a formal letter or email updating their employment agreement.
💻Check Your Payroll Systems: Whether you're using manual systems or payroll software, make sure everything is set up to apply the new wage rates from 1 April. Engage with your accountant, payroll provider, or HR team to ensure all processes are in place.
📝Review Employment Agreements: Now is a great time to ensure all employment agreements are up to date and reflect current terms. If an employee doesn’t yet have a formal agreement, or it hasn’t been updated in a while, use this opportunity to align with legal requirements.
📊Pay Relativity and Industry Benchmarking: A rise in the minimum wage may have a knock-on effect for other employees. Staff earning slightly more than minimum wage may expect a wage adjustment to maintain relativity. It’s also worth checking your wage rates against industry standards.
📚Understand Your Obligations: Minimum wage applies to all hours worked, regardless of whether an employee is paid hourly, on a salary, or by commission/piece rates. It’s also important to note the few exemptions, such as workers under 16 or those with a Labour Inspector-approved exemption.

💰Update Your Business Budget

This change isn’t just about wages—it can affect your cashflow, ACC levies, KiwiSaver contributions, annual leave balances, and pricing models.

If you haven’t already, now is the time to revisit your business budget and cashflow forecasts. Even small wage changes can have a larger ripple effect on business expenses.

🧠Need Help Creating Your Budget With Certainty?

At Clear Mind Accounting, we offer a comprehensive Business Budgeting and Planning Service designed to give you clarity and confidence in your numbers.