Impact of Median Wage change on businesses and migrants17 March 2023
From 27 February 2023, a new median wage of $29.66/hr was applied across multiple immigration polices where the wage threshold is indexed to median wage. This includes Accredited Employer Work Visa, occupations covered by sector agreements, green list, and residence categories. In this article, we explain how the new median wage affects your business and your employees, and answer some frequently asked questions.
What has changed?
The median wage increased from $27.76/hr to $29.66/hr on 27 February 2023.
From this year onwards, there’s a new standard process where the updated median wage will be adopted in immigration instructions every February. The new median wage will be based on the June rate published by Stats NZ the previous year.
How does it affect my organisation?
Wage thresholds impact across a large number visa categories and services within Immigration NZ. The median wage thershold must be met at the Job Check and Visa application stages of the Accredited Employer Work Visa process. In addition to this, wage threshold also impacts these areas:
- Sector agreements
- Green List
- Highly paid work to residence pathway
- Skilled Migrant Category
- Parent Resident Category
My job check at $27.76/hr was approved before 27 Feb 2023, do I need to readvertise or submit a new one?
No, the job check can still be used to support a visa application. All job checks submitted from 27 February must meet the new threshold of $29.66/hr.
However, if your candidate applies for an AEWV on or after 27 Feb 2023. You must pay them at least NZD $29.66/hr, even though your job check was approved for $27.76/hr.
I have advertised a role at $27.76/hr for 2 weeks and I am submitting a job check after 27 Feb 2023. Will my job check application be affected?
Any advertising submitted for new job checks will need to reflect the new wage threshold, even if advertising was completed before the median wage increased. This means that you may need to advertise again to meet the increased median wage before submitting the job check.
How does the new wage threshold affect roles covered by sector agreements?
Thresholds applied in most sector agreements are calculated off the median wage. So with the change in the median wage, those thresholds have also been affected, listed as below:
Some of the occupations I am hiring for, are on the Green List. Will the new wage threshold affect Green List residence pathway for my employees?
Yes. Occupations in green list that have a minimum rate specification have been impacted. The new minimum rates are listed below.
For example, a software developer prior to 27 Feb needed to earn $57.69/hr ie $119,995.20 p.a for a 40 hour week. From 27 Feb, the same role now needs to earn $61.69/hr ie $128,315.20 p.a. for a 40 hour week.
My employee is going to apply for a Skilled Migrant Category visa application. How will the new wage threshold impact their application?
Since SMC is skilled residence category, it is largely impacted by the median wage change. The increased threshold has not just affected what the role must earn depending on its skill level, but also the threshold for bonus points that can be achieved in this category, has also increased.
Your employee must be paid at least $29.66/hr if their occupation matches with ANZSCO 1, 2 or 3 or $44.49/hr if their role matches ANZSCO 4 or 5.
They can now gain bonus points for working in role paying 200% median wage, ie $59.32/hr
My employee’s partners is based overseas and will be applying for a partnership-based work visa. How will the increased median wage impact the partner’s application?
AEWV holders earning at or above the new median wage $29.66/hr can support their partner on a partnership-based work visa with conditions imposed. If AEWV holders are paid under the new median wage, they can only support a visitor visa for their partner. Read this summary article on partner work rights from 31 May 2023 onwards.
I am hiring an employee who will need a VOC to an existing AEWV. Do we need to pay them the new median wage?
Yes, the AEWV applicant must meet the new median wage threshold at the time of applying for a VOC
My employee is renewing their existing visa or moving to AEWV from another visa. Do I need to increase their pay to meet median wage?
Yes unless the role is exempt
If you or your organization need assistance in navigating the complex world of immigration, please do not hesitate to get in touch with our team. We can help you tackle the present and prepare for the future.