The starting-out wage gives employers a real incentive to give young people a foothold on the employment ladder. The starting-out wage sits alongside other government initiatives aimed at helping more young New Zealanders into work or training, including Work and Income’s Job Streams.

The starting-out wage replaces the new entrants wage and training minimum wage for under-20s.

Employers paying their employees the new entrants’ wage rate before 1 May 2013 can continue to do so until their employees have completed the lesser of 200 hours or 3 months continuous employment. After this time their employees will be eligible for at least the adult minimum wage.

Sixteen to 19-year-old trainees who were on the training minimum wage before today continue on the same wage rate.

Three groups are eligible for the starting-out wage. These are:

• 16- and 17-year-old employees who have not yet completed six months of continuous employment with their current employer (or until they are training or supervising others).
• 18- and 19-year-old employees who have been paid a specified social security benefit for six months or more, and who have not yet completed six months continuous employment with any employer since they started being paid a benefit (or until they are training or supervising others).
  After completing six months continuous employment with a single employer, they will no longer be a starting-out worker,  and must be paid at least the adult minimum wage rate.
• 16- to 19-year-old employees who are required by their employment agreement to undertake industry training for at least 40 credits a year in order to become qualified for the occupation to which their employment agreement relates (or until they are training or supervising others).

Under the starting-out wage, eligible 16to 19-year-olds can be paid 80 per cent of the adult minimum wage for six months OR for as long as they are undertaking recognised industry training of at least 40 credits per year. However, employers and employees may agree to any wage rate as long as it is not less than the starting-out minimum wage rate.

For more information on the new starting-out wage, go to the Ministry of Business, Innovation and Employment’s website or call 0800 20 90 20.