Going part time in your current job: what happens to your pay, leave and KiwiSaver

Put the change in a written variation, with a review date

Your hours are a term of your employment agreement. Section 67C of the Employment Relations Act 2000 says agreed hours must be set out in it: the guaranteed hours, the days of the week, start and finish times, and any flexibility in them. Employment New Zealand puts it simply: if either of you wants to change the hours, you should both agree to it in writing. When your employer drafts the change, the Act requires them to give you a copy of it and tell you that you can get independent advice before you sign.

Most people ask through a flexible working request, which our guide to making a flexible working request walks through. One detail matters here. The Act asks the request to say whether the change is permanent or for a period of time, and if it is for a period, the date it ends. A permanent change has no way back built in: returning to full time later is a new request, which your employer can refuse on the usual business grounds. If you might want your hours back, ask for the change for a set period, or for a review date written into the variation.

A good variation letter covers:

• the date the new hours start, and whether they are permanent or end on a set date;
• the hours, the days and the start and finish times;
• the new pay, as a salary or an hourly rate;
• which duties come off your plate, and who picks them up;
• a review date, and what happens at it.

The money side of the choice itself, pro-rata pay and why take-home falls by less than your hours, is in our article on part time or full time. This one is about what happens in the same job, on the day the hours change.

Annual leave you earned while full time

Under the Holidays Act 2003 you are entitled to four weeks' annual holidays after each 12 months, counted in weeks rather than hours. Employment New Zealand says the entitlement should be based on what a week is for you at the time you take the holiday. So four weeks owed is still four weeks off after the change, but a week is now your new working week: at three days a week, a week off uses three days.

What protects you is the pay. Section 21 says each week of annual holidays is paid at the greater of your ordinary weekly pay when the holiday starts and your average weekly earnings over the 12 months before it. For a while after you cut your hours, that average still holds your full-time pay.

A made-up example, assuming no other pay or leave in the year. Mere earns $70,000 full time, $1,346.15 a week, and moves to three days a week at $42,000, $807.69 a week. Thirteen weeks later she takes a week off. Her last 12 months hold 39 weeks at full time and 13 at part time, $52,500 plus $10,500, so her average weekly earnings are $63,000 divided by 52, $1,211.54. That week off is paid at least $1,211.54, not $807.69. A year after the switch, the average has fallen to her part-time pay and the two figures meet.

So leave taken sooner after the change is paid more for each week. When you take it is agreed with your employer, who must not unreasonably refuse a request. If your payslip shows your balance in hours, ask how those hours will be counted once your days change, because the law counts the entitlement in weeks.

Sick leave and public holidays, now and from 6 August 2028

Sick leave is not cut. Employment New Zealand says it is not pro-rated: you keep 10 days a year after six months, carried over to at most 20, and a sick day is a day you would otherwise have worked. Public holidays follow your days. You get a paid day off when a holiday falls on a day you would otherwise work, so if you stop working Mondays, a Monday holiday no longer gives you a day off.

That changes when the Employment Leave Act 2026 replaces the Holidays Act on 6 August 2028. From then, annual leave builds at not less than 0.0769 of an hour, and sick leave at not less than 0.0385 of an hour, for each standard hour you work. Fewer standard hours means leave builds more slowly. Balances are held in hours, and each hour is paid at your rate for one standard hour, with no look back to your average earnings. One rule to know if a baby is coming: if you agree a temporary cut in your standard hours in the three months before parental leave, your leave keeps building during the leave at your hours before the cut. Our guide to leave in New Zealand sets out every rule that applies until then.

KiwiSaver, student loan and parental leave at fewer hours

KiwiSaver. Your deductions and your employer's 3.5% come off your new, lower pay, so both fall in step with it. Watch the government contribution: it adds 25 cents for each dollar you put in from 1 July to 30 June, up to $260.72, which takes $1,042.86 of your own money. At 3.5%, that needs gross pay of about $29,796 a year. Below that, a voluntary payment to Inland Revenue or your provider by 30 June fills the gap.

Student loan. Repayments are 12% of what you earn over $464 a week ($24,128 a year), so they fall faster than your pay. In the example below, they drop from $5,505 to $2,145 a year.

Parental leave payments. To qualify you need an average of at least 10 hours a week for any 26 of the 52 weeks before the due date. The payment is the higher of your ordinary weekly pay and your average weekly income, which Inland Revenue works out from the 26 weeks in that 52 when you earned the most, up to $811.05 a week before tax from 1 July 2026. So cutting your hours less than six months before the due date may not lower the payment. Our guide to parental leave covers the rest.

What you take home on the new hours

Mere's change, at 2026/27 rates, with PAYE, the ACC earners' levy of 1.75% up to $156,641, KiwiSaver at 3.5% and, in the second pair of columns, a student loan at 12% above $24,128. Tax credits are left out.

A 40% cut in pay costs about 37% of take-home, and less with a student loan. At $42,000 Mere may also qualify for the independent earner tax credit, up to $520 a year for income from $24,000 to $66,000, which she did not get at $70,000.

Your Career holds the change as a pay change from the day it applies, so your pay over time shows both the full-time and the part-time years. Its Leave section works from the balances on your latest payslip and the days you work in a week, and your pay review date comes with reminders six weeks and two weeks before, a natural time to look at your hours again.

Keep the change on the record