Wages, a big cost. Employees a bigger asset - Small Business E-guide - employsure.co.nz
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Chapter 1 | MINIMUM WAGE INCREASE
Employsure e-guide
Small Business E-guide
Wages, a
big cost.
Employees
a bigger
asset.
employsure.co.nz | 1
Chapter 1 | MINIMUM WAGE INCREASE
Employsure e-guide
Wages, a big cost.
Employees, a bigger asset.
New Zealand already has one of the highest minimum wages in Contents
the world; and from next year, more than 200,000 Kiwi workers
will benefit from an extra $48 a week in the biggest boost to the
minimum wage in its history. 1 Minimum Wage Increase
The cost of doing business becomes more challenging as wage
increases are introduced. Small business owners will be pressured
into reconsidering their staffing needs. 2 Retaining and motivating staff
under financial pressure
Employsure understands the importance of employees and how
a great team, or lack of one, can make or break your business.
So we’ve carefully put together this e-guide to help you save on
costs without compromising on your biggest asset:
3 Inexpensive investments to
grow your business
your employees.
employsure.co.nz | 2
Chapter 1 | MINIMUM WAGE INCREASE
Employsure e-guide
Chapter 1
Minimum wage increase.
employsure.co.nz | 3
Chapter 1 | MINIMUM WAGE INCREASE
Employsure e-guide
Minimum wage increase. If employers pay at the
current minimum wage rates,
Effective 1 April 2019, the minimum wage is mandatory to be paid to an employee they should start forecasting
irrespective of the hours worked or job responsibilities. the increase to their wages
bill, and increase in pay only
Adult Minimum Wage – Starting-Out Wage – Training Minimum Wage –
from 1 April 2019.
$17.70 Per Hour. $14.16 Per Hour. $14.16 Per Hour.
This wage is the most commonly used Workers aged 16-19 who are entering the This category of wage applies to
by Kiwi businesses and applies to all the workforce for the first time. employees aged 20 years or over who are
employees who are 16 years of age or completing recognised/accepted industry
older, provided they do not qualify for the • this only applies to 16 and 17 year training involving at least 60 credits in
starting out or training wages. olds during the first 6 months of order to become qualified.
their employment. Or 18 or 19 year
olds who have been on a benefit
for 6 months or more prior to their
employment – and only for their first
6 months of continuous employment
following them being on a benefit
• it also applies to 16 – 19 year olds if
they are doing at least 40 credits in
a training programme just like the
training minimum wage
Why have a minimum wage?
New Zealand was the first country in the world to establish a Minimum Wage Policy in
1894, although the idea of a minimum wage has been around a lot longer. Minimum
wage laws have been modified over time to provide equal pay and fairness in the
workplace, while aiming to increase the standard of living and reduce poverty.
The argument for and against the minimum wage, and what rate it should be set at is
still heavily debated to this day.
employsure.co.nz | 4Chapter 1 | MINIMUM WAGE INCREASE
Employsure e-guide
How often does the minimum wage change?
Each year the Minister for Workplace Relations and Safety fulfils their obligation under the Minimum Wage Act 1983 to submit an
annual review of the minimum wage by 31 December. Since 2000, the New Zealand minimum wage has increased on a yearly basis
for each type of minimum pay including adults, new entrants and trainees.
Who does the minimum wage apply to?
Minimum wage rates apply to all employees aged 16 years and older who are full-time, part-time, fixed-term, casual, and work from
home. The minimum wage standard applies to employees who are paid an hourly wage and salary, and most employees who earn a
commission or piece rates.
There are employees who are exempt from the standards of the Minimum Wage Act 1983. They include:
• employees under 16 years (but they are still entitled to other minimum employment rights)
• some disabled employees who hold an exemption permit from the minimum wage
• inmates of a charitable institution
• prisoners working in custody under the Corrections
• apprentices who are under: the Maori Housing Amendment Act 1938, the New Zealand Railways Corporation Act 1981, the Defence
Act 1971, the Post Office Act 1959, the State Services Act 1962, or under any other Act.
employsure.co.nz | 5Chapter 2 | RETAINING AND MOTIVATING STAFF UNDER FINANCIAL PRESSURE
Employsure e-guide
Chapter 2
Retaining and motivating
staff under financial pressure.
employsure.co.nz | 6Chapter 2 | RETAINING AND MOTIVATING STAFF UNDER FINANCIAL PRESSURE
Employsure e-guide
Retaining your best staff under
financial pressure.
The recent increase in minimum wage from $16.50 an hour to $17.70 is the biggest
boost to New Zealand’s minimum wage in its history. Small business owners who employ
staff on minimum wage will have to increase wages accordingly. This may prove to be a
Providing flexible working
bit of a dilemma for employers as they may have less financial resources to reward their arrangements is almost
best staff. twice as popular in retaining
This places additional strain on the budgets of many employers, making it near staff than a salary increase.
impossible to promote their best staff. With promotions out of the equation, how can
employers retain their best staff?
Pocket-friendly methods.
Employee reward and recognition is a powerful tool in retaining employees. It moves
employees from being pay check motivated, to finding purpose and drive in becoming
active contributors to the growth of your business.
In a recent survey, Employsure clients were invited to share their views on the best
methods to retain employees. Below are the most common and successful methods
of retaining employees according to Employsure clients:
• Flexible working arrangements 38% • Social events 2%
• Pay increases and bonuses 20% • Promotions 2%
• Training 16% • Improving health and safety 1%
employsure.co.nz | 7Chapter 2 | RETAINING AND MOTIVATING STAFF UNDER FINANCIAL PRESSURE
Employsure e-guide
Almost 40% of employers surveyed suggested that providing flexible working arrangements was the best approach to retain staff. In
fact, flexible working arrangements was surveyed to be nearly twice as successful in retaining staff when compared to offering
pay increases and bonuses.
Employers can also choose to combine the methods above to create a wholesome work environment, which will lead to an increase
in staff retention. They could perhaps provide flexible working arrangements, as well as occasional training and organise social
events.
Other methods to explore.
According to recruiting experts Hays, voluntary staff turnover has risen in 23% of organisations in New Zealand within a year. The
evidence suggests that it is getting increasingly challenging for employers to retain staff.
If you’re looking to retain and engage staff beyond the typical retention rates, these 5 handy tips can help.
1. Ensure work is challenging: Set goals for employees — when people know that they have a purpose at work and goals to achieve,
they not only tend to stay longer, they also try their hardest at work.
2. Invest in professional development: Keep your staff engaged and motivate them to achieve personal development goals. Guide
them and learn about their journey and make sure that they know that there is a path and direction for them.
3. Promote internally: Internal promotions will maintain a high performer’s desire and need to succeed continually, which ultimately
benefits the business.
4. Progress and performance reviews: Regular catch ups are a helpful tool in letting your employees know that they are cared for
and appreciated. It also provides a chance for employers to provide feedback and learn about the challenges that your employees
are facing.
5. Rewarding a job well done: A basic human need. Everyone likes to feel appreciated and have their hard work acknowledged. So a
simple thank you, for a job well done, can go a long way.
employsure.co.nz | 8Chapter 2 | RETAINING AND MOTIVATING STAFF UNDER FINANCIAL PRESSURE
Employsure e-guide
Engaging the disengaged. What exactly
motivates staff?
Dan Ariel’s study tested
Employee engagement is key to a successful business. But how do you achieve
which incentive would boost
employee engagement? The first step would be to assess your current work
environment and culture to identify any areas for improvement.
productivity the most:
A great way to start improving employee engagement is to speak with your employees • Voucher for a free pizza
themselves. Have an honest conversation to understand their needs.
• Cash bonus
Some fundamental questions to consider asking:
• Compliments from
• Are you challenged by your current role and the work performed? their boss
• What are your career plans?
• Are you aware of how your work contributes to the business? The results?
In the course of two weeks,
• What do you most enjoy about working for the company?
the group receiving
• If you could identify one major area you would like to improve, what would it be? compliments from their
• What can I do to assist you in your role? boss saw over 6.6% increase
Once you know what you need to improve and have gained insights into the desires in productivity – while the
of your employees, you can begin implementing changes to help engage your staff group promised the cash
members. bonus became 6.5% less
productive.
employsure.co.nz | 9Chapter 3 | INEXPENSIVE INVESTMENTS TO GROW YOUR BUSINESS
Employsure e-guide
Chapter 3
Inexpensive investments to
grow your business.
employsure.co.nz | 10Chapter 3 | INEXPENSIVE INVESTMENTS TO GROW YOUR BUSINESS
Employsure e-guide
Penny wise, pound foolish.
At times, it is necessary to spend money to make money. As a business owner,
expenses are unavoidable — the assumed costs are regular bills, salary, and logistical
expenses. However, the investments that tend to be evaded are actually the ones that
can grow your business, and those are exactly the investments that this chapter will be
looking into.
A happy team will be
Staff happiness.
motivated to play their
part in pushing a business
This element cannot be reiterated enough. It is absolutely essential that employers forward.
value their staff and realise that the business cannot grow with an unhappy team.
There are many ways to ensure staff happiness.
For starters, ensure that your staff is comfortable in their place of work. This includes
both tangible and intangible comfort. From peace of mind (knowing that they have the
right support) to physical comfort (like a conducive, safe and comfortable
work environment).
Even little gestures can go a long way towards boosting staff morale, such as providing
occasional food and drinks. Most importantly, employers should keep in mind that a
happy team will be motivated to play their part in pushing a business forward.
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Below is a more thorough checklist that employers can use to ensure that their staff is Employees who are not
happy and content. constantly developing and
• Does your staff feel challenged? • Are you aware of your improving have a far greater
employees’ aspirations? likelihood of becoming jaded
• Do your employees feel like they have
and disengaged.
a purpose? • Do you promote internally?
• Are there achievable goals that you • Do you conduct regular
have set for your employees? performance reviews?
• Do you invest in employees’ • Do you reward a job well done?
professional development?
Training and development.
There have been many instances where employers are disinterested or reluctant
to upskill their employees. This is usually brought on by their apprehension of the
employee leaving the company. If the employee does leave, it would result in an extra
and unnecessary cost for the employer.
However, having a team of employees who are not developing and growing with the
industry is a much greater risk. This will not only hold the business back and make it
less competitive in its field, but employees who are not constantly developing and
improving have a far greater likelihood of becoming jaded and disengaged.
employsure.co.nz | 12Chapter 3 | INEXPENSIVE INVESTMENTS TO GROW YOUR BUSINESS
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Resource library.
There are many ways of building a low-cost resource library. Below are two easy and effective ways to go about this:
1) Circulate amongst employees 2) Reach out to local colleges
Speak to your employees and ask them Educational institutions tend to have
what is and has been on their reading list. collections of textbooks and other
Chances are that quite a few of them may resources that they are either willing to give
have self-help and training books that away at a reduced cost, and at times at
they are reading. Encourage them to bring no cost at all. You may even enter a
these books in and share it amongst their community arrangement to borrow these
colleagues. Before you know it, you will have books from them.
a pool of employee-sourced books and
materials.
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Seminar Sponge
Signing up all of your employees for external seminars may be heavy on the wallet. Missing
out on important seminars, however, could also be detrimental for your business. A
simple solution would be to pick a representative to attend the seminar on behalf of your
business. After the seminar, schedule a formal meeting where the representative can
share the information acquired amongst the team.
Alternatively, there are several organisations that provide free and industry-specific
seminars. This is an excellent and cost-efficient avenue to explore for both business
owners and employees to attend.
Employsure understands
Have a look at the free seminars provided by Employsure:
https://employsure.co.nz/seminars/ New Zealand employment
law inside out.
Online Training
An obvious benefit of online training is its cost-effectiveness. It significantly reduces
expenses such as meals, accommodation, and travel. Also, online courses in general
tend to have a lower fee per person than in-person training. Yet another benefit of online
courses is that they save on time. Getting your employees to do an online course rather
than an actual one shortens the amount of time spent outside the office, minimising
time wastage.
External advisors.
To be a business owner requires a host of skills. You are regularly required to wear different
hats and slip into different roles. From business development, employee management,
cash flow monitoring and complying with strict employment law. It’s incredibly demanding
and with your attention stretched over various areas, it makes it all the more challenging to
focus on what you do best – developing your business.
Employsure understands New Zealand employment law inside out, and are a leading expert
in the field. We ensure that businesses are compliant, we provide 24 hour advice, legal
representation and insurance in the event of a claim.
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Employsure e-guide
Navigating workplace relations can
be confusing.
Employsure works directly with employers to ensure they stay on top of rapidly
changing legislation and provide a fair and safe workplace for their staff.
Whether it be dealing with a difficult employee, facing a tribunal claim or
reviewing work health and safety, our clients can rest assured we have
them covered.
Get in touch with us today to find out how we can help your
business grow.
0800 675 700
employsure.co.nz
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