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Employer of Record New Zealand

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Employer of Record New Zealand

New Zealands’ complex labor regulations often present challenges for businesses. Agility provides a streamlined solution for hiring local talent.

Currency

New Zealand Dollar (NZD)

Population

5.3 Million

Capital City

Wellington

Minimum Wage

NZ$23.15 (hourly wage)

Local Language

English & Māori

Working Hours

40 hours per week

Employer of record in New Zealand

When you hire in New Zealand the Employer of Record in New Zealand assumes the role of the legal employer for your employees, overseeing the complete employment journey. This encompasses managing all the necessary legal processes, including payroll, taxes, obligatory benefits, employment agreements, and guaranteeing adherence to New Zealand’s labor regulations.

  • Oversees all employment-related matters
  • Functions as the lawful employer
  • Streamlines the recruitment process
  • Ensures compliant employment of a worker

How does an Employer of Record New Zealand work?

Agility

The legal responsibilities associated with hiring employees, such as overseeing HR functions, benefits administration, payroll processing, and tax compliance, are expertly managed.

Company

Concentrates on the essential business operations. Monitors and directs the tasks and performance of designated employees.

Employee

Carries out the delegated work duties, functioning as a regular employee would.

Cost Calculator

Use our easy calculator to explore the employment costs in your country. Share a bit more information, and we’ll deliver a detailed salary breakdown straight to your inbox.

Payment Frequency

Typically, it is monthly but can also be fortnightly.

 

Employee Tax – 11.89% to 50.39%

Kiwisaver: Minimum 3% is participating

Accident compensation levy: 1.46%

Income tax: Begin paying when gross income is over NZ$14,000, starting at 10.5%

 

Employer Tax – 3% to 63.93%

Kiwi saver scheme: 3%

Accident compensation levy: (depends on industry)

Fringe benefits tax: 11.73% – 63.93% (only if fringe benefits are offered)

 

Probation Period

Whilst there is no legal limitations, the usual length of probation is 3-6 months. But there must be a record of this in the employee’s employment agreement.

 

Employment Law

Payslip: Pay stub, wage statement

Flexible working: Flexible hours, part-time employment, job sharing

Health & Safety: Workplace safety, occupational health

Protection from discrimination: Anti-discrimination policy, equal opportunity

Pay and employment equity protection: Equal treatment, equal pay

Unemployment funds: Unemployment benefits, unemployment insurance

Personal information protection: Data privacy, data security

Work unions: Labor unions, trade unions

 

Employee Termination

2-4 weeks notice.

Disregarding cases of gross misconduct or redundancy, employers are required to follow a fair grievance procedure. Those who are pregnant, on paternity leave or part of s union are also protected.

There is no requirement under New Zealand employment laws for an employer to pay redundancy compensation. unless agreed in your employment agreement, this will usually includes the amount of compensation.

Employee Benefits

Statutory Benefits

KiwiSaver

KiwiSaver is a voluntary retirement savings scheme available to New Zealand employees aged 18-65. It helps individuals save for retirement. Participation is voluntary, but many employers offer employer contributions.

Accident Compensation Insurance

Employers in New Zealand are required to cover all employees for workplace injuries, regardless of cause. This mandatory accident insurance typically costs between 0.72% and 1% of the employer’s monthly payroll. It provides financial assistance and rehabilitation services for injured employees.

Common Additional Benefits

Flexible working: Flexible hours, part-time employment, job sharing

Employee assistance program: Employee support program, EAP

Career development: Professional development, career advancement

Wellness programs: Health and wellness programs, employee well-being programs

Hardware: Computer equipment, IT equipment

Health insurance: Healthcare coverage, medical insurance

Additional parental leave: Extended parental leave, additional family leave

Charity work leave: Volunteer leave, community service leave

Additional holiday: Extra vacation time, extended leave

Statutory Leave

20 days and bank holidays
10 days sick leave
26 weeks of primary carer (maternity) leave. And 4-26 weeks unpaid
1-2 weeks of unpaid partner’s (paternity) leave. Length is determined by length of employment
3 days bereavement leave upon a close family member’s death

FAQ

Think of it like this: Agility EOR becomes the legal employer of your employees, taking care of all the paperwork and compliance headaches.

Agility EOR
  • We manage the onboarding process and ensure everything’s in order before your employee starts
  • We make sure your employees are treated fairly and compliantly in their relevant territory
  • We take care of all HR matters, and can answer any and all HR queries you may have e.g. maternity/paternity leave, holidays, sick pay, and more
  • We provide compliant contracts, process local payroll, and file taxes
  • We issue payslips and handle payments to the employee and authorities
Your Company
  • You find and manage your employees’ daily tasks
  • You support their development through their work
  • You follow our guidance on employment laws and best practices
  • You ensure payroll bills are paid to Agility EOR on time

 

Benefits of using an Employer of Record (EOR)

  • Faster and easier hiring: No need to set up your own legal entity.
  • Reduced risk and compliance burden: We handle the legal and administrative complexities.
  • More time and resources: Focus on your core business while we manage your employees.

There are various ways to employ people in New Zealand, each with differing levels of costs and compliance:

Employee is employed by you and paid by you from your overseas Company

  • Pros: Appears to be the most cost-effective and convenient choice.
  • Cons: Inability to meet the mandatory social security contributions, subjecting the employee to New Zealand’s employment regulations.

 

Entity Set-up

  • Pros: This choice could be the most economical option for hiring a large number of staff, usually more than 15.
  • Cons: Setting up a legal business entity and adhering to New Zealand employment and tax laws can be a substantial financial and time commitment, particularly for smaller businesses. This method often becomes unfeasible for companies with fewer than 15 employees.

 

Using an Employer of Record
  • Pros: In New Zealand using an Employer of Record service is the most efficient and cost-effective way to handle payroll, HR, and compliance responsibilities, especially for creating employer-employee connections with teams of less than 15 people.
  • Cons: Expensive for hiring a large workforce. It can be challenging to determine the right Employer of Record provider to select.

 

Hire a contractor in New Zealand
  • Pros: This option is budget-friendly if the employee is not tied exclusively to your organization and can arrange for a replacement on days off.
  • Cons: Hiring a full-time employee who is exclusively committed to your company without the appropriate employment status is considered illegal in New Zealand. Consequences for this misclassification can vary from fines to criminal penalties.

Yes, if the worker is working for other companies, has the autonomy to determine their own work methods, and can delegate their work to another contractor when absent, they can be classified as an independent contractor.

However, in New Zealand, a worker who is exclusively dedicated to your company and whose tasks are directed by your organization should be classified as an employee according to New Zealand employment law.

Failure to do so may result in severe penalties, the requirement to settle unpaid holiday pay and social security contributions, the potential necessity to establish a local presence, and potential legal action from the employee for violating their employment rights.

Yes, if the worker is working for other companies, has the autonomy to determine their own work methods, and can delegate their work to another contractor when absent, they can be classified as an independent contractor.

However, in New Zealand, a worker who is exclusively dedicated to your company and whose tasks are directed by your organization should be classified as an employee according to New Zealand employment law.

Failure to do so may result in severe penalties, the requirement to settle unpaid holiday pay and social security contributions, the potential necessity to establish a local presence, and potential legal action from the employee for violating their employment rights.

Hiring people in New Zealand , ensuring compliance with HR regulations in New Zealand is crucial when hiring employees. By following employment laws and work practice regulations, your company can provide fair treatment to your workforce.

This includes aspects such as sick leave, annual leave, minimum wage, and working hours. Compliance not only creates a positive work environment but also reduces the risk of facing financial penalties, legal consequences, and potential lawsuits due to non-compliance. The overall success of your business.

By partnering with Agility EOR as your Employer of Record in New Zealand, you can simplify tax and social security responsibilities. We manage all employee paperwork and payments, ensuring full compliance and allowing you to focus on running your business without any worries.

Agility EOR manages the intricacies of New Zealand employment law and compliance, allowing your company to concentrate on overseeing daily operations and communication with your team.

This includes managing performance concerns, implementing disciplinary measures as needed, and promoting a supportive work environment through transparent communication.

New Zealand employers and employees are both subject to taxation. Employers are responsible for the KiwiSaver scheme, Accident Compensation levy, and fringe benefit taxes, while employees contribute to KiwiSaver contributions, Accident Compensation levy, and income tax.

New Zealand Employer of Record provides employees with legal protections and a standard employment contract, which includes benefits such as maternity leave, annual leave, and sick pay, as well as tax credits. It is crucial to highlight that the public healthcare system in New Zealand offers coverage to all residents, not limited to employees.

Agility EOR handles the administrative burden of HR compliance for you:

Reliable Partners: Agility EOR works closely with top employment lawyers and advisors in New Zealand to ensure that your employment contracts and other crucial documents fully comply with local legal mandates.

Comprehensive Expertise: We possess extensive knowledge of various aspects of <country> employment law, such as payroll, social security, data privacy, notice periods, and regulations on remote work.

Prompt Response: Should any issues arise, our internal team is ready to provide immediate support and assistance.

Wondering if expanding in New Zealand is right for you?

Read on or speak to a member of our team now

New Zealand Employer of Record Benefits

When you choose Agility EOR to expand in New Zealand, we guarantee an EOR Service tailored to the needs of your business

Compliance

We are on top of regulatory changes in New Zealand so you can relax.

Cost reduction

Allow our economies of scale to work in your favour.

High Service Levels

You and your employees have a dedicated account manager.

Fixed Cost Pricing

We will agree our professional fees up front based on your needs – no nasty surprises!

Consolidated Invoicing & Payments

Make one monthly payment to cover all your tax, social and wages costs from one to one thousand employees.

Fast delivery

You can have 'boots on the ground' within days on our infrastructure.

Reduced Risk

All wage taxes are remitted in full to the New Zealand authorities by professionals ensuring liabilities are met, giving you peace of mind.

Supply Chain Transparency

We only pay employees through local full employed solutions meaning New Zealand payroll tax is paid on all funds.

Save Time and Money

Our expertise is at your disposal. The need for you to have internal HR, Payroll and admin staff is eliminated.

Download our full New Zealand Employment Guide

Find out all about employing in New Zealand

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