Setting pay, pay reviews and pay rises

An employee’s pay is set by agreement between the employee and the employer – as long as it's at least the relevant minimum wage and meets the requirements of the employment agreement.

Your duties when setting pay

You must:

  • negotiate with your employee in good faith to agree on the rate of pay, and include the agreed rate in their employment agreement
  • pay employees whatever rate has been agreed to, and this rate must be at least the current minimum wage rate if they are aged 16 years or over
  • pay wages in money, not through other non cash benefits (except for deductions from wages agreed by an employee for accommodation or other goods or services)


  • keep accurate records of hours worked, wages payable (and paid), and leave taken.

Keeping records

You cannot pay an employee a different amount based on their: 

  • gender
  • skin colour, race, ethnic or national origins
  • marital or family status (including pregnancy or childbirth status)
  • age
  • disability
  • religious or ethical beliefs
  • political opinion
  • sexual orientation
  • union membership or activity.

Pay and gender equity



CareersNZ has information about the pay range for many jobs.

CareersNZ(external link)

Pay reviews

There is no legal obligation to review an employee's pay.

If you do review pay, you can link it to specific performance criteria. You can also review pay and decide not to increase it, if it is at least the relevant minimum wage rate.

If an employee is unhappy about their current wage rate, they can ask you for a pay rise. You must consider and respond to the request in .

Performance management, training and development

Pay rises

You do not have a legal obligation to provide a pay rise or conduct a performance review unless it is in an employment agreement or workplace policy. However, it is best practice to regularly review employees' performance and pay. You and your employee should negotiate:

  • rates of pay
  • salaries
  • bonuses
  • review periods 
  • pay rises.

Workplace policies and procedures

Collective and individual agreements

Get advice

If you are unsure about your rights or responsibilities or need advice, call us on 0800 20 90 20 or email us.

Contact us

Pay and the minimum wage [PDF, 540 KB]

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