Pay equity settlement - implementation information for providers

Providers have been integral to the successful implementation of the pay equity settlement, which came into effect on 1 July 2017 and covers 55,000 workers in aged and disability residential care and home and community support services around New Zealand.

For pay equity implementation information, see the dedicated sections for each sector:

Frequently asked questions

Have a look at our Employer factsheet for answers to your pay equity questions.

Settlement funding

The increased costs for employers of care and support workers are funded in three ways:

  1. The Government is providing $2.048 billion over five years by increasing funding of District Health Boards (DHBs) and the Ministry of Health: Disability Support Services (DSS).  In turn DHBs and DSS are increasing their payments to providers that employ care and support workers.
  2. Aged care residents with assets over the threshold for the government subsidy are paying an increased ‘maximum contribution’ as a result of the increase in the rest home price.
  3. ACC is funding providers of services to its clients. 

The additional $2.048 billion the Government is providing over five years is being funded primarily through additional funding to the health sector and will not impact health funding or the provision of frontline health services in other areas. 

Providers have received additional funding towards offsetting the additional costs imposed by the legislation as well as a cash advance to help manage their cash flows immediately following enactment of the settlement.

Providers will also receive the benefits of lower turnover due to increased wages and a more capable and skilled workforce through access to training and qualifications.

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