Teachers aren’t getting $1500 lump sum they expected
Teachers are angry they won’t be getting the full $1500 lump sum they were promised as part of the latest pay deal.
The one-off payment for union members was seen as compensation for wages lost while striking, but the amount being paid into teachers’ bank accounts is less than some were expecting.
That’s because the payouts are subject to tax, Kiwisaver and student loan deductions. For some teachers, the extra money pushed them into a higher tax bracket.
On social media, many teachers have expressed their shock and disappointment on receiving their payslips on Tuesday.
One from the Bay of Plenty who did not want to be named said almost half her lump sum was gone before she saw it.
After tax and other payments she was left with about $800 of the $1500 payout – “significantly less” than she expected.
She said while it “wasn’t a secret” the payment would be taxed, she had estimated the deductions would be much less.
She said the lump sum should have been paid separately instead of included with normal wages, to avoid the higher tax bracket.
While a lot of teachers weren’t happy with the reality of the payout, others didn’t think the additional Kiwisaver and student loan payments were such a bad thing, saying they were “enforced saving” and paid off loans faster.
Teachers also made the point that automatic tax refunds would apply to those who had been pushed into the higher tax bracket for one pay round because of the lump sum.
This isn’t the first upset over teachers’ pay increases.
Earlier this month, primary and secondary unions filed legal action against Novopay over the delay to pay increases. While teachers will receive the lump sum on 31 July, salary increases won’t be processed until September.
Last week, principals found out they would have to foot the bill for the lump-sum payment to teachers and support staff paid out of schools’ operational budgets.