Disability sector consulted on minimum wage

  • Hon Carmel Sepuloni
Social Development

Minister for Disability Issues, Carmel Sepuloni, and Workplace Relations Minister Iain Lees-Galloway today announced a plan to ensure all disabled New Zealanders’ are paid at least the minimum wage.

 From mid-February, the Ministry for Social Development (MSD) and Ministry for Business, Innovation and Employment (MBIE) will undertake targeted consultation with the disability sector on a proposal to replace the Minimum Wage Exemption (MWE) scheme with a wage supplement.

“This Government is committed to building an economy that is growing and working for all of us – and that includes working New Zealanders with disabilities,” Carmel Sepuloni said.

“Currently around 900 disabled New Zealanders have a MWE permit. Many of them are on extremely low wages - 70 per cent receive under $5 per hour for their work.

“The disability sector has called on the Government to end discrimination against disabled people at work, while protecting job opportunities.

“We’re proposing a wage supplement approach that continues to provide disabled workers with job security and rewarding work, while ensuring every working age New Zealander receives at least the minimum wage.

“Disabled people have long told us ‘nothing about us without us’. They need to know that we have heard that loud and clear,” Carmel Sepuloni said.

Minister for Workplace Relations, Iain Lees-Galloway says the consultation process will contribute to greater understanding of the rights of disabled people amongst the public, government and non-government sector.

“This is a government that recognises the value of every New Zealander and backs all of our people.

“This consultation is about looking at ways the Government can support employers to take on workers with disabilities, rather than a system that penalises people with disabilities because they want to work,” Iain Lees-Galloway said.

Targeted consultation with the disability sector will take place from mid-February until mid-April 2019.

Further information: The Cabinet Paper associated with this announcement can be found here

Note to editors:

How does a wage supplement work?

Key components of the proposed wage supplement approach include that:

  • it would be accessible by the same group that is currently accessing the Minimum Wage Exemption, and those who would be eligible for it in the future
  • the government will meet the cost of paying the wage supplement
  • it would be paid to employers with respect to eligible employees, and employers would then pay their disabled staff minimum wage
  • the application process would include a criteria check to ensure it is not being used to subsidise wage costs for a broader group than intended
  • unlike other employment supports, a wage supplement would not be for a set period of time, but would continue for as long as the disabled person is assessed as eligible
  • MSD and MBIE will seek feedback from targeted disability sector stakeholders on the design of the wage supplement approach, including the methods of calculating and paying the wage supplement. Consultation will help identify the level of support for change to the MWE and a wage supplement approach. Assuming a wage supplement approach is supported, the feedback we receive on the design will be used to further refine the proposed approach and ensure it is fit for purpose.

Contact: Shalleen Hern – 021 871 496