ESCT Rate – Set and forget on 1 April

Setting the ESCT rate for the next tax year is a 1 April activity that Payroll are responsible for.  As part of your payroll checks and balances, you must check your payroll system is doing as expected. If you are processing payroll manually, you will need to set the ESCT yourself.  Understanding how ESCT is essential to getting this right for anyone involved in payroll. What is ESCT? ESCT (Employer…  Read more

Why are you paying overtime for salaried staff?

Paying overtime to salaried staff has many consequences that a lot of employers are not aware of. The purpose of a salary is to pay an all-inclusive rate that is a fixed, regular payment to an employee for the work they perform. It allows a business to plan and forecast labour costs on an annual basis and can also provide concise data for business planning over the coming years, as…  Read more

Completing Holidays Act 2003 Remediation Calcuations

Remediation of your payroll system can seem extremely intimidating.  There is a lot involved in the process of checking payroll for Holidays Act 2003 compliance.  This information comes from the FAQ section of the Labour Inspectorate website so we thought we would share some of this here. How far back should re-calculations go? Once non-compliance with the Holidays Act 2003 is identified, the expectation of the Labour Inspectorate is that…  Read more

Parental leave and annual holidays – what you need to know

An employee’s time on parental leave is included as continuous service and taking parental leave does not affect entitlement to annual holidays. Employees who take parental leave will still become entitled to a minimum of four weeks of annual holidays on the anniversary of their employment start date. However payment for annual holidays that an employee becomes entitled to: during parental leave, or during a period of preference after parental…  Read more

Payment for Leave and Holidays in a Final Pay

When you leave your employment for any reason, you may be entitled to get paid for annual holidays, alternative holidays and/or public holidays in your final pay. Public holidays Employees are sometimes entitled to be paid for public holidays that fall after their employment has ended (i.e. after their termination date). This can happen if the employee has unused annual holidays they are entitled to at the time their employment…  Read more

What do I pay my employee if they go home sick on a public holiday?

This is a question that has come up in our Payroll Essentials Training Course that is currently running. Scenario: An employee comes to work for 2 hours on a public holiday, then has to go home early due to being ill.  This is what they would receive for the day 2 hrs at time and half 1 x alternative day IF the day is a otherwise working day for the…  Read more

MBIE have 5 Fair Pay Agreements to bargain

MBIE have approved 5 applications from unions to start bargaining for Fair Pay Agreements (FPAs).   If a company employs people in an occupation or industry you are in which is covered by a Fair Pay Agreement where bargaining has started, there are specific actions you need to take – and now. More details are below. The industries and occupations include the following: Early childhood education industry — Public notice…  Read more

Late Opt Out Requests from Kiwisaver

Your employees who choose to opt into KiwiSaver cannot opt out. Only new employees you are automatically enrolled in KiwiSaver can opt out. Requests to be opted out after 8 weeks (57 days) are LATE OPT OUT REQUESTS. How your employee requests a late opt-out Employees will need to send their KiwiSaver late opt-out request to Inland Revenue. Approving a late opt-out request Inland Revenue must approve the late opt-out…  Read more

Pay and leave during natural disasters and emergencies

During and after a disaster or emergency, employers and employees main concern is consideration of issues such as health and safety, emotional wellbeing and payment options for employees.  This comes before thinking about the interests of the business or organisation. Employers and employees should remember to keep in regular contact and deal with each other in good faith. If the workplace cannot be accessed, is closed, or is open but…  Read more

Employee vs contractor – what you need to know

Depending on the nature of your business, you may have workers who are employees or contractors, or you may have both. Each has their merits, but it’s important to review which are which in order to meet your tax obligations. When you have an employee, you must withhold income tax as well as report on additional benefits. Contractors generally look after their own tax obligations. It’s against the law to…  Read more

Payroll – Christmas and Public Holidays

Christmas is a time of sun, sand, lots of food and family time here in the Southern Hemisphere.  Ensuring employees get paid right for the public holidays however can be a challenge for those employing staff.   We thought we would put together some examples to help you on with navigating the challenges of the Christmas payroll this year. PUBLIC HOLIDAYS THAT FALL ON A WEEKEND  How to work out pay…  Read more

Fair Pay Agreements came into effect 1 December 2022

The Fair Pay Agreements Act 2022 (FPA Act) has been passed, and will come into effect quickly, on 1 December 2022. The new Act is the biggest change to employment law since the Employment Relations Act 2000. What is a fair pay agreement? A fair pay agreement is an agreement that applies to all workers across entire industries or occupations. It will provide minimum terms and conditions of employment for…  Read more

Legislation Involved in Payroll

Did you know there are over 27 Legislative Acts involved in payroll – insane right? So, isn’t it interesting to know that most small businesses have an untrained staff member processing payroll for their team? Payroll is not the back-office data entry job that a lot of people think it is.  In fact, when you start to understand the rules and regulations around payroll, you may be right in thinking…  Read more

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