Understanding Living Wage vs Minimum Wage in New Zealand
What we do
We can easily adapt to your environment and coach you every step of the way, either on your site, off-site, on the phone or online. You will get a dedicated Consultant to support you with all your people and culture requirements.
Processes & Guidelines
We will tailor your HR processes and policies to perfectly fit your company's unique needs and goals. We conduct a thorough evaluation of your current HR documents, policies & frameworks to identify gaps & improvement areas.
We will then work with you to create bespoke documentation, templates, guides, policies and toolkits that suit your internal culture. We also work with our employment lawyer to ensure your documents comply with current legislation so that your HR department has the fundamentals in place to operate smoothly (without going overboard with paperwork)!
People & Culture Strategy
In the initial phase of our collaboration, we engage with clients through either an employee engagement survey or a client discovery session. This step allows us to gather essential insights into the current HR dynamics and employee perspectives. The outcomes from these discovery phases allows us to craft a bespoke HR strategy that aligns with business goals and prioritise key focus areas.
Our partnership approach ensures the HR strategy we develop addresses both the immediate and long-term needs of the organisation.
Remuneration & benefits
We collaborate with you to refine your remuneration and benefits approach, ensuring they're competitive and reflect your company's mission. By leveraging market insights, we craft strategies that attract and retain talent while maintaining financial viability.
Our role extends to effectively communicating these benefits to your employees, emphasising their value in supporting both professional and personal growth. This approach boosts employee satisfaction and positions your company as a preferred employer.
Talent management and planning
We help you align your talent strategy with your business goals, identifying skill needs and talent gaps to ensure your workforce is future-ready. Our services include succession planning and talent development, aimed at creating a flexible and growth-oriented organisation.
Our proactive talent management approach focuses on nurturing high-potential employees and fostering a culture of continuous improvement. This keeps your team competitive and engaged, preparing your company for both current and future success with enhanced employee retention.
Organisational design
We partner with our clients to identify key talent needs and develop strategies to attract, retain, and develop the right people. Our approach includes performance management, leadership development, and succession planning, all tailored to enhance your team's capabilities and readiness for future challenges.
Our support extends beyond strategy development; we also provide practical tools and guidance for implementing effective talent management practices. This includes creating engaging employee development programs and establishing clear career paths that motivate and retain high performers.
Diversity and Inclusion
We collaborate with you to develop strategies that foster an inclusive workplace, where diversity is not just recognised but celebrated. Through targeted training programs, policy development, and awareness campaigns, we help create an environment that encourages open dialogue, mutual respect, and equal opportunities for all employees.
Our goal is to ensure that every team member feels valued and empowered to contribute their best, driving innovation and enhancing company performance.
Wellbeing initiatives
We assist our clients in crafting and implementing comprehensive wellbeing initiatives that address the physical, mental, and emotional health of their workforce. By conducting thorough needs assessments, we identify specific areas where support is most needed, creating tailored programs that promote a healthy work-life balance, stress management, and overall employee wellness.
Our services range from developing wellness workshops and fitness challenges to offering resources for mental health support. We aim to foster a supportive environment where employees feel valued and have access to the tools they need to maintain their wellbeing.
Recruitment support
Our recruitment support services are designed to streamline the hiring process for our clients, ensuring they attract and retain the best talent for their needs. We offer a comprehensive suite of services, including job description development, writing & placing job adverts, screening candidates, conducting initial interviews, and facilitating the final hiring steps and onboarding.
Second to last example
Lorem ipsum dolor sit amet, consectetur adipiscing elit. Suspendisse varius enim in eros elementum tristique. Duis cursus, mi quis viverra ornare, eros dolor interdum nulla, ut commodo diam libero vitae erat.
Lorem ipsum dolor sit amet, consectetur adipiscing elit. Suspendisse varius enim in eros elementum tristique. Duis cursus, mi quis viverra ornare, eros dolor interdum nulla, ut commodo diam libero vitae erat. Lorem ipsum dolor sit amet, consectetur adipiscing elit.
Last example
Lorem ipsum dolor sit amet, consectetur adipiscing elit. Suspendisse varius enim in eros elementum tristique. Duis cursus, mi quis viverra ornare, eros dolor interdum nulla, ut commodo diam libero vitae erat.
Lorem ipsum dolor sit amet, consectetur adipiscing elit. Suspendisse varius enim in eros elementum tristique. Duis cursus, mi quis viverra ornare, eros dolor interdum nulla, ut commodo diam libero vitae erat. Lorem ipsum dolor sit amet, consectetur adipiscing elit.
What we do
We can easily adapt to your environment and coach you every step of the way, either on your site, off-site, on the phone or online. You will get a dedicated Consultant to support you with all your people and culture requirements.
Processes & Guidelines
We will tailor your HR processes and policies to perfectly fit your company's unique needs and goals. We conduct a thorough evaluation of your current HR documents, policies & frameworks to identify gaps & improvement areas.
We will then work with you to create bespoke documentation, templates, guides, policies and toolkits that suit your internal culture. We also work with our employment lawyer to ensure your documents comply with current legislation so that your HR department has the fundamentals in place to operate smoothly (without going overboard with paperwork)!
People & Culture Strategy
In the initial phase of our collaboration, we engage with clients through either an employee engagement survey or a client discovery session. This step allows us to gather essential insights into the current HR dynamics and employee perspectives. The outcomes from these discovery phases allows us to craft a bespoke HR strategy that aligns with business goals and prioritise key focus areas.
Our partnership approach ensures the HR strategy we develop addresses both the immediate and long-term needs of the organisation.
Remuneration & benefits
We collaborate with you to refine your remuneration and benefits approach, ensuring they're competitive and reflect your company's mission. By leveraging market insights, we craft strategies that attract and retain talent while maintaining financial viability.
Our role extends to effectively communicating these benefits to your employees, emphasising their value in supporting both professional and personal growth. This approach boosts employee satisfaction and positions your company as a preferred employer.
Talent management and planning
We help you align your talent strategy with your business goals, identifying skill needs and talent gaps to ensure your workforce is future-ready. Our services include succession planning and talent development, aimed at creating a flexible and growth-oriented organisation.
Our proactive talent management approach focuses on nurturing high-potential employees and fostering a culture of continuous improvement. This keeps your team competitive and engaged, preparing your company for both current and future success with enhanced employee retention.
Organisational design
We partner with our clients to identify key talent needs and develop strategies to attract, retain, and develop the right people. Our approach includes performance management, leadership development, and succession planning, all tailored to enhance your team's capabilities and readiness for future challenges.
Our support extends beyond strategy development; we also provide practical tools and guidance for implementing effective talent management practices. This includes creating engaging employee development programs and establishing clear career paths that motivate and retain high performers.
Diversity and Inclusion
We collaborate with you to develop strategies that foster an inclusive workplace, where diversity is not just recognised but celebrated. Through targeted training programs, policy development, and awareness campaigns, we help create an environment that encourages open dialogue, mutual respect, and equal opportunities for all employees.
Our goal is to ensure that every team member feels valued and empowered to contribute their best, driving innovation and enhancing company performance.
Wellbeing initiatives
We assist our clients in crafting and implementing comprehensive wellbeing initiatives that address the physical, mental, and emotional health of their workforce. By conducting thorough needs assessments, we identify specific areas where support is most needed, creating tailored programs that promote a healthy work-life balance, stress management, and overall employee wellness.
Our services range from developing wellness workshops and fitness challenges to offering resources for mental health support. We aim to foster a supportive environment where employees feel valued and have access to the tools they need to maintain their wellbeing.
Recruitment support
Our recruitment support services are designed to streamline the hiring process for our clients, ensuring they attract and retain the best talent for their needs. We offer a comprehensive suite of services, including job description development, writing & placing job adverts, screening candidates, conducting initial interviews, and facilitating the final hiring steps and onboarding.
Second to last example
Lorem ipsum dolor sit amet, consectetur adipiscing elit. Suspendisse varius enim in eros elementum tristique. Duis cursus, mi quis viverra ornare, eros dolor interdum nulla, ut commodo diam libero vitae erat.
Lorem ipsum dolor sit amet, consectetur adipiscing elit. Suspendisse varius enim in eros elementum tristique. Duis cursus, mi quis viverra ornare, eros dolor interdum nulla, ut commodo diam libero vitae erat. Lorem ipsum dolor sit amet, consectetur adipiscing elit.
Last example
Lorem ipsum dolor sit amet, consectetur adipiscing elit. Suspendisse varius enim in eros elementum tristique. Duis cursus, mi quis viverra ornare, eros dolor interdum nulla, ut commodo diam libero vitae erat.
Lorem ipsum dolor sit amet, consectetur adipiscing elit. Suspendisse varius enim in eros elementum tristique. Duis cursus, mi quis viverra ornare, eros dolor interdum nulla, ut commodo diam libero vitae erat. Lorem ipsum dolor sit amet, consectetur adipiscing elit.
What Employers Need to Know
Pay is more than a number. It shapes how your people feel about work and their purpose within the business. At the heart of our HR compliance support is a commitment to helping businesses across Auckland and New Zealand navigate their people challenges with practical, people-first advice. One common question we’re asked by employers is, ‘Do we need to pay above the legal minimum?” and we love helping them explore the answer in today’s evolving workforce landscape.
Understanding the difference between the minimum wage and the living wage can help you make better decisions for your team and your business. So, to help you get better insights on this, let’s dive deeper into understanding minimum wage and living wage.
What is the Minimum Wage in New Zealand?
In simple terms, minimum wage is the lowest legal hourly rate that an employer can pay most workers aged 16 and over. As of April 2025, the New Zealand minimum wage is $23.15 per hour, as set by the New Zealand Government.
This rate is reviewed annually by the New Zealand Government. It is designed to help workers meet basic living costs, but many find that it is no longer enough to keep up, particularly in areas like Auckland, where housing, food, and transport costs are higher.
For businesses that rely on minimum wage roles, this often leads to high turnover, inconsistent performance, and difficulty attracting candidates.
What is the Living Wage?
On the other hand, the living wage represents the income necessary for a worker to afford the essentials of life: food, housing, transport, and participation in the community. It is not mandated by law but is calculated by independent researchers based on real household expenses.
As of 1 September 2024, the nominal New Zealand Living Wage is $27.80 per hour. This figure is independently calculated each year by the New Zealand Family Centre Social Policy Research Unit and published by Living Wage Aotearoa New Zealand. Employers who choose to pay the living wage often do so to reflect their values, strengthen employee engagement, and create a more sustainable work environment.
Why Understanding the Difference Matters for New Zealand Employers
Knowing the difference between the minimum wage and the living wage is more than a compliance issue. It helps New Zealand employers make better decisions about pay, retention, and team support. As costs rise and expectations change, People & Culture can help you review your approach and build a strategy that works for your business and your people.
Cost of Living in Auckland is Higher
Auckland remains one of the most expensive places to live in New Zealand. Rent, utilities, transport, and groceries are more costly than in other regions. For workers on the minimum wage, these costs often stretch income thin, affecting not just financial stability but overall well-being. Employers who understand this local context are better positioned to support their teams meaningfully.
Low Pay Often Leads to Higher Turnover
Pay levels are a major factor in employee turnover. When workers feel their wages do not reflect the cost of living or their contributions, they are more likely to leave. High turnover can lead to service disruption, low morale or employee burnout, and additional recruitment costs. If your business is not in a position to pay more than the minimum wage, there are still effective ways to keep your employees happy and engaged. Read our guide on how to turn burnt-out employees into thriving employees.
Understanding the Gap Supports Better Decisions
Awareness creates options. By understanding the gap between the minimum wage and the living wage, businesses can make more deliberate choices about pay structures, benefits, and future planning. In our work with clients, we’ve seen how practical adjustments, such as pay increases or targeted incentives, can improve retention and job satisfaction without placing undue strain on budgets.
It’s About More Than Compliance
Meeting the legal minimum is not the same as building a great place to work. Employees increasingly assess employers based on fairness, transparency, and long-term opportunity. Gaining a clear understanding of how wages impact employees helps businesses align their values with everyday practices, and strengthens their reputation as an employer of choice that attracts great talent.
What More Employers Across New Zealand Are Doing
More employers are moving toward the living wage, either fully or for selected roles. As of 2025, over 350 organisations are accredited by Living Wage Aotearoa New Zealand. This includes local councils, national brands, and small to mid-sized businesses.
Auckland City Council has committed to paying the living wage to all contracted security staff, demonstrating how public sector leadership can influence employment standards nationwide.
Major employers such as Westpac have implemented Living Wage practices, including extending it to cleaners, security staff, catering and maintenance contractors, showing that wage decisions are becoming a core part of employer branding.
How to Decide What’s Right for Your Organisation
Not every business can move straight to paying the living wage. But that does not mean the conversation should be avoided.
Many of our clients start by reviewing where their biggest turnover or engagement gaps are. From there, they consider:
- Whether to apply the living wage to specific high-impact roles
- Phasing wage increases over 12 to 24 months
- Adding non-monetary benefits such as transport subsidies or paid training
- Improving communication around pay decisions and future goals
These steps show your team that their value is recognised, even if full implementation is not yet possible.
Get HR Support from People & Culture
At People & Culture, we help businesses across New Zealand design fair, realistic, and people-first HR strategies. Whether you are reviewing your wage structure, updating your employment policies, or exploring better ways to retain your staff, we are here to support you.
If you are considering a shift toward the living wage or want to make sure your pay practices support your wider business goals, our team can guide you through the process. We offer support that fits your size, sector, and growth stage. Contact us today to find out how we can help you build a workplace that values and retains its people.
Not sure where to start?
Let’s have a chat.
