Pay Equity update for employers of Care and Support workers

Employers of mental health and addiction workers will need to ensure that the new minimum wage rates are being applied after an agreement to increase the wages of mental health and addiction support workers took effect on August 1, 2018.  

This is the latest group of support workers to be included in the Care and Support Workers (Pay Equity) Settlement Act which was passed in July 2017. 

The Care and Support Workers (Pay Equity) Settlement Act increased the pay rates of care and support workers in aged and disability residential care, and home and community support services. Mental health and addiction workers will now also be included. 

What does this mean for employers? 

Employers will need to ensure that they are complying with the new pay rates. The settlement applies to all those who have an hourly rate lower than what has been agreed in the settlement act. 

The new pay scale reflects workers’ qualifications and experience. Workers’ wages will increase to between $19 and $27 per hour over five years. The new wage rates will also be back-dated to 1st July 2017, when the Act came into effect. 

New wage rates for workers employed before July 1, 2017 

The agreement means an employees service will be considered continuous if the employee was employed on 1st July 2017. This means that if they left the organisation after 1st July 2017 but are now working with you again, there is no break in service. The initial date they started before the 1st July 2017 is the date you apply to the pay scale. 

Payscale One 

Level 

Qualification or length of service  

1 July 2017 
Year 1  

1 July 2018 
Year 2  

1 July 2019 
Year 3/4  

1 July 2021 
Year 5  

1 

L0 or <3 years' service  

$19.00  

$19.80  

$20.50  

$21.50  

2 

L2 or 3+ years' service  

$20.00  

$21.00  

$21.50  

$23.00  

3 

L3 or 8+ years' service  

$21.00  

$22.50  

$23.00  

$25.00  

4 

L4 or 12+ years' service  

$23.50  

$24.50  

$25.50  

$27.00 

 The key to applying the correct hourly rate to existing employees is to look at both qualifications and length of service.  

Payscale TwoWorkers with greater than 12 years’ service without a Level 4 qualification 

After 1st July 2017  

On or after 1st July 2019 

On or after 1st July 2018  

On or after 1st July 2019  

On or after 1st July 2021  

Level 4  

12+ without Level 4 qualification 

$23.50  

$24.50  

$26.00  

This payment will supersede any allowances based on current qualifications or length or service but you will need to work this through with each employee as you offer them their variation of employment. 

New rates for workers employed on or after 1st July 2017 

The minimum rates and progression for mental health and addiction support workers employed on or after 1st July 2017 are: 
 

Level 

Qualification or length of service  

1 July 2017 
Year 1 

1 July 2018 
Year 2 

1 July 2019 
Years 3/4 

1 July 2021 
Year 5 

1 

L0 or <3 years' service  

$19.00 

$19.80 

$20.50 

$21.50 

2 

L2 or 3+ years' service  

$20.00 

$21.00 

$21.50 

$23.00 

3 

L3 or 8+ years' service  

$21.00 

$22.50 

$23.00 

$25.00 

4 

L4 or 12+ years' service  

$23.50 

$24.50 

$25.50 

$27.00 

Next steps for employers  

  • Ensure that all employees have had a variation of employment letter reflecting the new pay rate. 
     

  • Back pay is to be calculated back to 1st July 2017. It applies to all staff (including those who are not currently working) that have been employees since 1st July 2017.  The back pay will be made in September 2018. 
     

  • Start new employees on the new rates (based on service and training). Ensure that the salary scales are referenced in the remuneration section of the individual employment agreement. 
     

Support for Training 

Employers will be required to provide the necessary support to enable workers covered by the settlement to reach the following NZ Qualifications Authority Health and Wellbeing Certificate (or their relevant equivalent) qualifications within the following maximum time periods:   

  • Level 2 NZ Certificate – within 12 months of commencement of employment  
     

  • Level 3 NZ Certificate – within three years of commencement of employment  
     

  • Level 4 NZ Certificate – within six years of commencement of employment  
     

Note: In the mental health and addiction sector the minimum qualification is acknowledged to be level 4. The intent of the sector is to train support workers to Level 4 within 2 years of employment.  

Employees will have the opportunity to take a personal grievance if the employer has not created the opportunity for them to train and therefore be unable move up the pay scale. 

This blog is not intended as legal advice but is intended to alert you to current topics of interest. For further advice about responding to the Employment Relations changes please call Viv Patterson on 021 223 2128 or email v.patterson@eqconsultants.co.nz.