KiwiSaver increases and minimums

From 1 April 2013, compulsory employer contributions will rise from the current 2 % to 3 %, and the default rate and minimum employee contribution rate will also increase from 2 % to 3 %. This applies to existing and new members.

A recent court case has clarified that where employers include their KiwiSaver contribution in an employee’s wage, the employee’s wage excluding the KiwiSaver contribution must not fall below the minimum wage (currently $13.50 an hour).  i.e. staff on minimum wage, who are members of KiwiSaver, must as a minimum receive $13.50 plus $0.27 = $13.77 per hour. This confirms that contributions to KiwiSaver are not wages – check to make sure that you are complying with the law and adjust your employee’s wages as required. Note that the minimum wage looks likely to increase in April this year, by slightly less than 50c an hour.

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