Starting-out wage available from 1 May

Employers will have a real incentive to give young people a foothold into work with the passage into law of the starting-out wage, says Labour Minister Simon Bridges.

The Minimum Wage (Starting-out Wage) Amendment Bill passed its third and final reading in Parliament today. The Bill enables the starting-out wage to be an option for employers and employees from 1 May this year.

“Employers should consider using the starting-out wage to give our youngest and most inexperienced workers the break they need to get into the job market, and start building their skills and work experience,” says Mr Bridges.

“Young people who don’t successfully move into work or who are unemployed for prolonged amounts of time face a real risk of long-term unemployment if no action is taken.

“It is in all our interests to make sure we give young people a helping hand into work.” Mr Bridges says.

Three groups will be eligible unless they are training or supervising others:

· 16 and 17-year-olds in their first six months of work with a new employer

· 18 and 19-year-olds who have been paid a benefit for six months or longer, and who have not completed six months of continuous work with any employer since starting on benefit

· 16-to-19-year-old workers in a recognised industry training course involving at least 40 credits a year.

Under the starting-out wage, eligible 16-to-19-year-olds can be paid 80 per cent of the minimum wage for six months or for as long as they are undertaking recognised industry training of at least 40 credits per year.

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.

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