Minimum wage when farming

18 May 2023

It is relatively straightforward to ensure you’re paying your workers at least minimum wage when your employees’ hours of work are regular and are usually an 8-hour day, a 40-hour week or an 80-hour fortnight.

 

It can be more complicated if your business is seasonal, which is common for many farming businesses, as peak seasons require longer hours than usual, or irregular hours. You need to check you have systems in place to check your business is fully compliant with minimum wage requirements. Even if you pay above minimum wage, you need to check.

 

From 1 April 2023 the minimum wage rates have increased. The rates for adult workers are:

  • Hourly: $22.70 ($18.16 for Starting-out workers/Trainees)
  • Daily (based on an 8-hour day): $181.60 ($145.28 for Starting-out workers/Trainees)
  • Weekly (based on a 40-hour week): $908 ($726.40 for Starting-out workers/Trainees)
  • Fortnightly (based on an 80-hour fortnight): $1,816 ($1,452.80 for Starting-out workers/Trainees)

 

In the past, some employers averaged wages out over busy and quiet times. However, under the current law, the maximum period wages can be averaged over is a fortnight (and there are conditions that must be met). Averaging over a season, or longer periods of time, is NOT permitted.

 

If you provide accommodation or other benefits to your employees, when you’re calculating wages, the Minimum Wage Act allows you to count some of these benefits as ‘wages’, but not all. You can mutually agree in advance that you will deduct an agreed amount from their wages as reimbursement. The Wages Protection Act means this MUST be in writing.

 

It's a legal requirement to keep records of hours worked, wages paid, and all holiday and sick leave for all employees. Your records must be detailed enough to show that you’re complying with minimum employment requirements including minimum wage requirements. Your agreements with employees about accommodation and other benefits should be documented and should be separate from employment agreements.

 

If you need help checking that you’re complying with the new minimum wage requirements, give us a call. We can check your systems to ensure you’re minimum wage compliant.

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