Retirement home operator Metlifecare is increasing staff pay by an average of 7.7 percent, saying it is investing in the future of both residents and staff.
Metlifecare operates 25 retirement villages and nine care facilities nationwide and employs more than 1000 staff.
The agreement, signed this month between Metlifecare and the Service and Food Workers Union and NZ Nurses Organisation, delivers an average pay rise of 7.7 percent to the workforce.
The increase will raise top level carers pay by a couple of dollars per hour, but will not significantly affect level one carers, who currently earn just over the minimum wage.
Level four carers earn about $17 an hour.
Metlifecare chief executive Alan Edwards said the pay increase was a good investment in the future for both staff and those in the homes.
Staff would have the opportunity to learn and develop, and to have a more meaningful career path.
"The company has decided that investing in our staff is an investment in our future. We believe that these initiatives will lift skill levels, they'll enhance the quality of care in our care homes which will impact positively on our clients."
The increases had been prompted by a company review of its business and the way in which it valued its healthcare assistants, and would charge some residents more to cover the increase, Mr Edwards said.
"We've put in place pay scales and pay rates which we believe are appropriate for those roles and the work that those people do."
Service and Food Workers Union spokesman Alastair Duncan said the deal was a ground-breaking agreement which truly valued the workforce and set a new and impressive benchmark.
Most carers' pay would increase 12-14 percent, with nursing and other occupational groups also receiving significant increases, he said.
Also today, Metlifecare lifted its half-year profit by 78 percent to $122.7 million, due to strong sales and rising property values.
Stripping out revaluation gains, the company's profit for the six months ended 30 June rose 14 percent to $52.4 million.
Revenue rose 39 percent to $224 million, due to building 133 more units, selling those units at higher prices, and a focus on more lucrative regions such as Auckland.
The company lifted its dividend by 20 percent to 4.5 cents a share.