The Wellington City Council has voted to pay all of its staff a "living wage" of at least $18.40 an hour.
At a meeting today, councillors voted nine to five for the proposal, which will cost about $750,000 a year.
The new rate, which will mainly affect those in frontline operations, will come into effect on Janaury 1.
It is the first council in the country to adopt a living wage.
