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Small rise in Minimum Wage doesn't address needs of low paid

26 February 2013

Small rise in Minimum Wage doesn't address needs of low paid

"The decision by the Government to raise the minimum wage by just 25 cents from $13.50 an hour to $13.75 - less than 1.9 percent - does nothing to address the increasingly obvious needs of low paid workers", says Peter Conway, CTU Secretary.

The minimum wage is inadequate to keep low income families out of poverty, as the research on the Living Wage has shown. A significant rise is overdue. It would help reverse rising income inequalities as well as help those on or near the minimum wage. "The evidence from New Zealand and internationally is that it would not increase unemployment," Conway said.

He said that "the Government should make much better use of the minimum wage to address the problems of low incomes. The so-called 'Starting Out Wage' which discriminates against young people by allowing employers to pay them 20 percent lower wages is a step backward."

"Instead, the CTU considers that a much more positive step would be a concerted plan to lift pay levels. That includes a higher minimum wage, more firms and organisations adopting the living wage, expanded collective bargaining, and support for workplace collaboration between employers and workers to increase productivity with assurances that the benefits will flow through to higher wages."

ENDS

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