Employer obligations in NZ: a checklist for small businesses with staff

Before day one

Most of the legal work of employing someone happens before their first shift. In the order you will meet it:

1. Employee or contractor. Employment New Zealand says to decide this first, because it changes your obligations for tax, leave and ACC. The legal tests look at how the work actually runs, not what the arrangement is called, and getting it wrong can bring extra costs and penalties.
2. Permanent, fixed-term or casual. Each type changes how leave works. A fixed term needs a genuine reason, written into the agreement.
3. The right to work. Check that the person is entitled to work in New Zealand before they start.
4. Register as an employer. Inland Revenue says to register as soon as you start employing staff, in myIR, and Employment New Zealand says to do it as soon as you know you will. You need the IRD number to register, your contact details, your business industry classification code and the date you start employing.
5. A written employment agreement. Section 63A of the Employment Relations Act 2000 requires you to give the person a copy of the intended agreement, tell them they can seek independent advice, give them a reasonable opportunity to get it, and respond to any issues they raise. Under section 65 it must be in writing and include the names of both parties, a description of the work, where it is done, the agreed hours or the arrangements for when they work, the pay, and a plain explanation of how employment problems are resolved, including the 90-day limit to raise a personal grievance, or 12 months for sexual harassment. You should both sign it before they start, and you must keep a signed copy (section 64). The government's Employment Agreement Builder is a free starting point.
6. A trial period, if you want one. Section 67A allows a written trial provision of up to 90 days, but only for someone you have not employed before.
7. Tax code and KiwiSaver forms. The employee gives you a completed Tax code declaration (IR330). Without one, you must deduct PAYE at the non-notified rate of 45% plus the ACC earners' levy. You send Inland Revenue a New employee and KiwiSaver details form (IR346K) before their first payday, or with the employment information that includes their first pay.
8. KiwiSaver enrolment. You must automatically enrol eligible new employees aged 18 to 65 who are not already members. Some, such as casual or temporary employees, do not have to be automatically enrolled and can choose to opt in. A new employee who is already a member gives you a KiwiSaver deduction form (KS2) with their contribution rate.

Every pay

Once people are on the payroll, the same obligations come round every payday:

• The minimum wage for every hour. From 1 April 2026 it is $23.95 an hour for adults, and $19.16 for the starting-out and training rates. It applies to all hours worked, including extra hours worked by salaried staff, so check pay divided by hours whenever the hours run long.
• PAYE and the other deductions. Deduct PAYE, which includes the ACC earners' levy, using the employee's tax code, plus student loan repayments, child support if Inland Revenue asks, and KiwiSaver at the rate the employee chose: 3.5%, 4%, 6%, 8% or 10%.
• Your KiwiSaver contribution. Pay a compulsory employer contribution of at least 3.5% of gross pay for KiwiSaver members aged 16 and over and under 65 whose contributions you deduct. You also pay employer superannuation contribution tax (ESCT) on it, at a rate that depends on what the employee earns with you.
• Payday filing. File employment information every time you pay, with the payday and the pay period worked. Filed electronically, it is due within 2 working days of each payday; on paper, within 10 working days. New employers can use paper for their first 6 months, after which electronic filing is required if your PAYE and ESCT total $50,000 a year or more.
• Paying the deductions over. If your total PAYE and ESCT is under $500,000 a year, pay by the 20th of the following month. Above that, you pay twice a month: by the 20th for paydays from the 1st to the 15th, and by the 5th of the next month for the rest of the month (15 January for late December).
• ACC work levies. ACC invoices employers for the work levy under section 168 of the Accident Compensation Act 2001, payable by the date on the invoice.

Late filing can bring penalties and interest, and Inland Revenue says to file on time even if you cannot pay. Payslips are not required by law unless the agreement provides for them, but they are the easiest way to show what was paid and why.

Records: wage and time, holiday and leave

Two sets of records are required for every employee, kept for six years, including after they leave:

• The wages and time record under section 130 of the Employment Relations Act: the hours worked each day in each pay period and the pay for those hours, among other details.
• The holiday and leave record under section 81 of the Holidays Act 2003: the start date, current annual holiday and sick leave entitlements, the dates and pay for every holiday and leave taken, and any public holidays worked.

Keep KiwiSaver records for 7 years. Missing a wages and time record or a holiday and leave record, or not having a written agreement, is an infringement offence with a $1,000 fee each time, up to $20,000 in any 3 months. Our article on wage and time records for employers sets out every field, and the free wage and time records checklist turns them into a printable page to check against each quarter. What a Labour Inspector can ask to see, and how quickly, is covered in our article on a Labour Inspectorate visit.

Hours are the part of the record that changes every week. Team timesheets from jobtracker.co.nz shows the hours your people choose to share, by person, project and task, with start, finish and breaks on each day, who has not logged this week, and every change after a week is marked sent, with its date. It downloads as a CSV ready for your payroll, and approvals are there if you turn them on. It does not run payroll, hold anyone's pay or leave balances, or build rosters, and because sharing is each person's choice, it sits beside your wages and time record rather than replacing it. It costs $6.99 a seat a month, GST included, for at least three seats.

Leave, public holidays and breaks

The Holidays Act 2003 sets the minimums, and an agreement can give more but never less:

• Annual holidays: at least four weeks' paid annual holidays after each 12 months of continuous employment (section 16). Paying 8% instead is allowed only in narrow cases, set out in our article on 8% holiday pay for casual staff.
• Sick leave: 10 days a year after six months' continuous employment, or after six months averaging at least 10 hours a week, with at least an hour every week or 40 hours every month (sections 63 and 65).
• Bereavement leave: 3 days for the death of close family, and 1 day for others (section 70).
• Family violence leave: up to 10 days a year once entitled (section 72H).
• Public holidays: the 11 national days in section 44 and the regional anniversary day. Someone who works on one is paid at least time and a half, and gets an alternative holiday if it would otherwise be a working day for them (sections 50 and 56).

Rest and meal breaks come from section 69ZD of the Employment Relations Act. A work period of 2 to 4 hours earns one 10-minute paid rest break; over 4 and up to 6 hours, a rest break and a 30-minute meal break; over 6 and up to 8 hours, two rest breaks and a meal break, with more for longer days. Rest breaks are paid at the rate the person would earn working. Agree when breaks are taken, and record them: they affect the hours worked, and so the minimum wage check.

From 6 August 2028, the Employment Leave Act 2026 replaces the Holidays Act, and annual and sick leave will build up by the hour. Until then, the rules above apply.

Health and safety, and privacy

Under the Health and Safety at Work Act 2015, your business is a person conducting a business or undertaking (PCBU), and its primary duty of care in section 36 is to ensure, so far as is reasonably practicable, the health and safety of your workers, and that your work does not put other people at risk. In practice, for a small business:

• identify the risks in your work and what you do about each;
• engage with your workers on health and safety matters that affect them (section 58);
• notify WorkSafe of a notifiable event, such as a death, a notifiable injury or illness, or a notifiable incident, as soon as possible and by the fastest means (section 56), and keep a record of it for at least 5 years (section 57).

WorkSafe's guidance on writing health and safety documents is a good place to begin.

Employing people also means holding their personal information: IRD numbers, bank details, contact details, timesheets and sometimes health information. Under the Privacy Act 2020 you must:

• appoint at least one privacy officer, who can be you (section 201);
• keep personal information secure with reasonable safeguards, let people see what you hold about them, and not keep it longer than you need it (information privacy principles 5, 6 and 9);
• notify the Privacy Commissioner, and the people affected, of a notifiable privacy breach as soon as practicable (sections 114 and 115). Failing to notify the Commissioner can bring a fine of up to $10,000.

Records the law requires you to keep are a reason to hold that information for the required period; after that, delete what you no longer need. If something on this list is unclear for your business, Employment New Zealand on 0800 20 90 20, Inland Revenue and WorkSafe can help, or talk to an employment lawyer.

The hours part, kept as you go