New Zealand: A Guideline to Payroll and Employer of Record

Establish your presence globally with Neeyamo as we help you go beyond borders to manage your international payroll and hire new talent in New Zealand.

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Despite its landmass being comparable to that of the United Kingdom, New Zealand has a significantly smaller population, constituting only about 10% of the UK's populace. Surprisingly, most of New Zealand's territory is not occupied by humans but teeming with wildlife. Humans make up just 5% of the population, leaving the remaining 95% to be inhabited by animals. This disparity is so pronounced that a study revealed that for every one person in New Zealand, there are nearly five sheep in the country.

Though the population is considerably small, the concentration of talent within the workforce is high. Do your organization's expansion plans require hiring employees in a country concentrated with talent and skill? Do you lack a physical entity in the country – a key requisite to hire local talent? Neeyamo – one of the top Global payroll providers, assists organizations worldwide with onboarding and managing employees in New Zealand- processing payroll, managing local compliance requirements, benefits, and more.

Tools And Instances

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Global Payroll

Neeyamo’s global payroll solution covering 180+ countries

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Global Work

A tech-based EOR solution to manage your extended workforce

Facts And Stats




New Zealand Dollars (NZD)

Official Language

English, Maori

Fiscal Year

1st April- 31 March

Date Format


Country Calling Code


Time Zone

UTC +12:00 (NZST) 

Summer DST UTC +13:00(NZST) 

Global Payroll


What is Global Payroll?

Handling payroll for a widespread workforce can pose a significant challenge for any organization, and the added complication of compliance can make things worse. If companies spend more time processing payroll, it directly impacts day-to-day operations and their overall productivity. The solution to this is global payroll outsourcing.

What is a global payroll system? 

Over the years, Neeyamo – a Global Payroll Services provider,  has observed these complexities and strived to provide global payroll solutions through a single technology platform – Neeyamo Payroll. Neeyamos global payroll system eases the process for companies looking to outsource their global payroll requirements and aids them in maneuvering the tricky payroll system in New Zealand. Neeyamos payroll software provides the perfect solution for all your global payroll needs – for employees working in primary geographies, the long-tail region, remote or internationally located.

How is payroll calculated?

Neeyamo acts as your personalized Payroll Calculator. Ensuring adherence to local regulatory requirements using multi-level controls. Providing timely and accurate payroll, courtesy of our experts worldwide and using a tech-based integrated smart helpdesk solution with seamless support experience manned by payroll experts - Neeyamo’s Global Payroll Software has all your payroll needs covered.

Payroll Associations

The Global Payroll Association (GPA) is instrumental in supporting individuals and organizations engaged in payroll and its related functions. These associations offer many advantages that foster professional growth, facilitate networking prospects, encourage knowledge exchange, and promote industry advocacy.

Payroll Taxes

Payroll tax is the percentage amount retained from an employee's salary and paid to the government to invest in the general population's welfare. These are statutory in nature and are levied from both the employer and employee. Additional statutory contributions are made by employers towards aiding both short-term and long-term benefits for their employees.

Employee Taxes

The employer taxes in New Zealand are computed as follows: 

Employee Contribution 

Accident Compensation Corporation - 1.39% 

Optional Contribution - Kiwi Saver (Pension) 

Employee Personal Income Tax 

Taxable Income 

Tax on Column 1 (NXD)  

Tax on excess (%) 

0 – 14,000


14,000 – 48,000



48,000 – 70,000



70,000 – 180,000



180,000 and above



Employer Taxes

The employer taxes in New Zealand are computed as follows: 

Employer Contribution 

KiwiSaver (Pension) - 3.00%

Accident Compensation Corporation - 1.00% of gross salary + KiwiSaver Contribution

Payroll Cycle


Undoubtedly, payroll is a critical aspect of any organization. The Pay cycle is a notable feature that provides a sense of accountability for an employee to be paid consistently for their work.


The payroll frequency in New Zealand is bi-monthly/monthly. 

13th Month Cycle

There is no requirement for a 13th-month payment in New Zealand.

Global Work


An Employer of Record services (EOR) provider helps you eliminate the hassle of handling complexities while onboarding a new employee in an international location. They help bridge the gap that otherwise mandates organizations to have a local registered entity and a local bank account, prior to making a job offer to an international hire. 

An international employer of record services (EOR) provider acts as a legal employer, facilitates salary payments, and manages other statutory requirements such as health insurance, payroll taxes, and employee benefits ensuring compliance with local tax laws and regulations.  

This allows organizations to focus on collaborating with the employee in New Zealand for operational tasks, with the knowledge that they have a cost-effective solution to support their global HR and payroll software requirements, as they continue their global expansion.  

HR Mandates and Practices

Minimum Wage

The minimum wages have been revised in New Zealand, with effect from 1 April 2023. The adult minimum wage increases from NZ$21.20 to NZ$22.70 per hour. The starting-out and training minimum wage rates are increased from NZ$16.96 to NZ$18.16 per hour. Similarly, the minimum wage rate for workers who work for eight hours a day, forty hours a week, and eighty-hour fortnight has also been revised. 


All working hours over the standard working hours per week are to be paid as overtime and are regulated by employment contracts or collective agreements. Before commencing, overtime must be mutually agreed upon between the employee and the employer. 

The payment of overtime hours is not a legal requirement; however, they are usually paid at a rate of 150% of the regular salary rate of pay. 

Data Retention Policy

In New Zealand, personnel files must be kept for at least six years. Pay records are kept for seven years.

Tax agency increased rate for FBT 

With effect from April 1, 2023, FBT prescribed interest rate increased to 7.89 percent from 6.71 percent

Hiring and Onboarding Requirements


The stage of the hiring process in New Zealand is as follows:

  • Describing the job
  • Attracting suitable applicants
  • Interviewing
  • Choosing the best applicant
  • Making the offer and finalizing the employment agreement
  • induction and settling the employee into their job


Good induction sets the tone and expectations for the employee’s relationship with their manager and the organization, and helps an employee understand the purpose, functions, and tasks of their job so they can perform at their best.

The employee should feel that they are supported and valued during the induction rather than it being just about the manager ticking off a checklist.

The induction does not have to be completed by one person and doesn’t all have to be done on the first day.

Sometimes, too much information all at once can be hard to take in and retain. The induction can provide information on aspects such as the organisation’s history, values, culture, services offered, customers, staff, policies, practices and expected behaviour.


  • The statutory probation period in New Zealand begins on the first day at work and can be for up to 90 days.  

  • The actual timeframe will be stipulated in the employment contract and only applies to employees who have not worked for the employer before. 


Public Holidays

There are 10 national public holidays in New Zealand:

  • January 1 - 3: New Year’s Day 
  • Febraury 6: Waitangi Day 
  • April 7: Good Friday 
  • April 10: Easter Monday 
  • April 25: ANZAC Day 
  • June 5: Queen’s Birthday
  • September 26: Queen Elizabeth II Memorial Day 
  • October 23: Labour Day 
  • December 25: Christmas Day 
  • December 26: Boxing Day

Sick Leave

The New Zealand Parliament passed the Holidays Amendment Bill to increase the minimum employee sick leave entitlement from 5 days to 10 days per annum, after six months of continuous employment with their employer.

If an employee already receives ten or more sick days a year, they will not be affected. Under the new law, employees can only carry over ten unused sick days each year to add to their annual entitlement, up to a maximum of 20 days of current entitlement in any year. This applies to full-time, part-time, and fixed-term employees, where that fixed term is longer than six months.

Maternity Leave

Maternity leave is called Primary Caregiver Leave in New Zealand, and it is accessible to: 

  • Female employees who are expecting a child, her partner or spouse, and employees who will permanently be in charge of providing the majority of the care, development, and upbringing for a child under the age of six; this includes adoption but excludes foster care or other temporary care arrangements. If the employee is married or living with a partner, they can decide who will be the main caregiver. 
  • Pregnant employees are eligible for 26 weeks of primary care leave and are compensated by the government between 177.00 NZD and 585.80 NZD per week before tax. 
  • When it is due for childbirth or when the employee has a child, primary caregiving leave begins on the due date. In any other scenario, primary caregiver leave begins when the employee is named the child's primary caregiver. Up to six weeks (or sooner with the employer's permission) before the baby's due date or the time the employee will take on the role of primary caregiver for the child, the employee may begin their primary carer leave. 

Paternity Leave

In New Zealand, paternity leave is referred to as partners leave. Partners are entitled to leave beginning 21 days before the baby's due date or the day the employee's partner or spouse assumes primary responsibility for a child under the age of six. This ends 21 days after the baby is born (unless the child is discharged from the hospital more than 21 days after the birth, in which case the partner's leave timeframe ends on the day the child is discharged).

Other Leave

Special Leave: 10 days of unpaid leave, which employees receive for pregnancy-related appointments.

Extended Leave: This is extended unpaid leave given to parents and depends on the amount of time an employee has worked. An employee may be entitled to 52 extra weeks of leave if they have been employed for at least 12 months, and 26 weeks is given to a parent who has been employed for at least six months. 


Notice Period

The term of notice period is given in the employment contract and typically it is between two and four weeks.

Severance Pay

Severance payments include the hours worked until the final day and any unused annual leave or days in lieu payments. All details of the payment entitlement are stipulated with the employment agreement and/or negotiated as a part of the leaving package. 



A foreign national may apply for a work visa for the following reasons: 

  • a country that has a specific work program,
  • a job offer from a New Zealand firm,
  • a particular work-related purpose or event, or
  • someone who has been studying there

Some work visas can also result in residence, which is the unrestricted right to live, study, and work. 

The New Zealand workforce needs certain skills, experience, and qualifications to apply. 

Categories of work visa

Temporary work visa for essential talents that allows working for 1 to 5 years. 

From home to office Visas - Temporary visa possibilities that grant residency status after two years of continuous full-time employment. 

Working holiday visas - 12 to 23 months of work and travel are permitted. These visa policies vary depending on where you are from. 

Employee visas with a specific purpose are designed to accomplish a certain goal. These visas normally have a validity of three to twelve months, while multinational personnel occasionally receive three-year visas. 

Relocating business visas are utilized when an employer or corporation moves to New Zealand. 

Additionally, beginning on November 1, 2021, all New Zealand employers who employ foreign workers will need to be certified.

Employee Background Checks

Legal and Background Checks 

The following legal and background checks are done in New Zealand: 

  • Criminal records
  • Drug screening- If required for employment
  • Credit checks- Depends, on if there is a significant financial risk, such as dealing with accounts or financial administration, the short-listed employee has consented. 

Last updated on October 5, 2023

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