Overview

Capital
Wellington
Currency
New Zealand Dollar (NZD)
Date Format
dd/mm/yyyy

Taxes

Employer

Employer Payroll Tax

3.0%
KiwiSaver (minimum employer contribution)
3.0% Total Employment Cost
Employee

Employee Payroll Taxes

2.0%-10.0%
KiwiSaver
up to 10.0%
Employee

Employee Income Tax

10.5%
0.00 - 14,000 NZD
17.5%
14,001 NZD - 48,000 NZD
30.0%
48,001 NZD - 70,000 NZD
33.0%
70,001 NZD - 180,000 NZD
39.0%
180,000 NZD +
Employer Taxes
3 HIGHEST
3 LOWEST
Brazil
China
Slovakia
New Zealand
South Africa
Georgia
Macedonia
82.39%
41.12%
37.2%
3%
2%
2%
0%
Employee taxes
3 HIGHEST
3 LOWEST
Romania
Macedonia
Netherlands
New Zealand
Georgia
Belarus
Ukraine
45%
28%
27.65%
10%
2%
1%
0%

Minimum Wage

General

New Zealand’s minimum wage is 20.oo NZD per hour.

Minimum wage (per month)
$4000
$2663
$2491
$2425
$47
$36.80
$2.33
Geneva
Luxembourg
Australia
New Zealand
Malawi
Angola
Venezuela
3 HIGHEST
3 LOWEST

Payroll

Payroll Cycle

Payroll frequency is the Employers choice; however, common frequencies are monthly or bi-weekly (every two weeks).

13th Salary

Not required.

Working Hours

General

New Zealand does not have a minimum requirement. Common full-time hours are 7.5 hours to 8.0 hours per day.

Overtime

The hours that are agreed to in an employment agreement are generally the only hours that an employee needs to be present at work. Overtime hours and pay should be included in the employment agreement.

Many employees receive a payment if their employer asks them to work more than their normal hours. However, there is no legal requirement to pay more than the regular salary for overtime.

Leave

Paid Time Off

Almost all employees are entitled to at least 4 weeks’ paid annual leave a year. Casual employees however get 8% holiday pay each pay instead of 4 weeks annual leave.

Unused leave is cashed out in cases of termination.

Vacation days
Public holidays
3 HIGHEST
3 LOWEST
Brazil
Peru
Albania
New Zealand
Michigan
China
Federal
30
13
43
30
12
42
28
14
42
20
10
30
2
11
13
5
7
12
10
10
Public Holidays

10 public holidays.

Sick Days

Employees are entitled to a minimum of five days paid sick leave a year after the first six months of continuous employment and an additional five days paid sick leave after each subsequent 12-month period. This is paid by the employer.

Sick leave entitlements are not pro-rated in any way. Any employee including part-time employees is entitled to five days’ sick leave a year.

Any sick leave owed at employment termination is not paid out.

Maternity Leave

Known as primary care leave, mothers are entitled to 26 weeks of maternity leave and are paid between $177.00 to $585.80 by the government per week before tax.

Mothers who suffer from a miscarriage or a stillbirth are also entitled to three days of paid leave.

PAID MATERNITY LEAVE (DAYS)
410
365
365
154
45
30
0
Bulgaria
Serbia
Albania
New Zealand
United Arab Emirates
Tunisia
Federal
3 HIGHEST
3 LOWEST
Paternity Leave

Known as partners leave, a spouse or partner is given one-week unpaid leave after six months of employment and two weeks of unpaid leave after 12 months of employment. Leave can be taken any time within the period of 21 days before or after the birth.

Fathers who suffer from a miscarriage or a stillbirth are also entitled to three days of paid leave.

Parental Leave

Parental leave in New Zealand covers maternity and paternity leave and is comprised of primary care leave, special leave, partners leave, extended leave, and negotiated career leave.

Parents who suffer from a miscarriage or a stillbirth are also entitled to three days of paid leave.

Other Leave
  • Special Leave-10 days of unpaid leave are given 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. 52 extra weeks can be taken for a parent who has been employed for at least 12 months, and 26 weeks is given to a parent who has been employed for at least 6 months.

Termination

Termination Process

An employer must tell their employee in advance when the employer is going to end the employee’s employment (unless the employer is going to dismiss the employee without notice for serious misconduct).

Just because an employment agreement contains a notice period doesn’t mean that the employer can dismiss the employee for any reason as long as they give the appropriate notice. The employer must still have a good reason and must follow a fair process. This also includes fixed-term agreements.

Notice Period

An employee must tell their employer in advance when they want to leave employment (generally outlined in the employment agreement).

Depending on the role 2 to 4 weeks’ notice is often seen as fair.

Notice of redundancy

If there is no specific clause in an employment agreement giving a period of notice in a redundancy situation, ‘reasonable notice’ must be given. The length of ‘reasonable notice’ depends on a variety of factors, such as:

  • the reason for the redundancy
  • the employee’s length of service
  • the employee’s seniority and/or remuneration package
  • custom, practice and industry norms
  • the employee’s ability to find alternative employment

the amount of compensation being paid (if any).

Severance Pay

Severance payments include the hours worked until the final day and any unused annual leave or days in lieu payments. Additional payments are either specified in the employment agreement or negotiated as a part of the leaving package. If employees do not receive all components of their payments, they may file a claim for unpaid salary or other breaches of the employment agreement.

Probation Period

Only an employer with 19 or fewer employees (at the beginning of the day on which the employment agreement is entered into) may employ a new employee on a trial period for the first 90 calendar days of their employment.

A valid trial period must be agreed to in the employment agreement before the employee starts work, or the trial period is invalid.

A trial period must have a valid notice period in the employment contract, can be used in any industry and for any job and must be agreed by the employer and employee in good faith – an employee can’t be forced into being employed on a trial period.

Employers can test the skills of a new employee or a current employee moving to a new position through using a probation period. Probation periods can last for any amount of time (the standard length is around three to six months) but the length of time must be recorded in the employment agreement.

VAT

General

GST is 15% standard rate.

Version History

April 1, 2021
Minimum wage: raised to 20.00 NZD per hour
Income Tax: New bracket of 39% tax on income above NZD 180,000
March 25, 2021
Parents who suffer from a miscarriage or a stillbirth are now entitled to three days of paid leave. 

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