Employer of Record in New Zealand

An Employer of Record (EOR) in New Zealand legally employs your workers on your behalf. This means the EOR handles all the local HR tasks. Think payroll, taxes, benefits, and compliance with New Zealand's employment laws. You get to manage your team's day-to-day work without setting up a local entity. An EOR like Rivermate makes hiring in New Zealand simple.

How an Employer of Record (EOR) Works in New Zealand

Using an EOR in New Zealand follows a straightforward process. The EOR becomes the legal employer, while you maintain control over your employee's daily tasks and projects.

Here is how it works:

1. You Find the Candidate: You recruit and select the best person for the job.
2. The EOR Hires Them: The EOR provides a compliant employment contract under New Zealand law. They officially hire the employee onto their local payroll.
3. Onboarding Starts: The EOR manages all the necessary paperwork. This includes gathering tax information and setting up the employee in the local system.
4. Payroll and Benefits are Managed: The EOR handles salary payments, tax deductions, and contributions to programs like the KiwiSaver retirement scheme.
5. Ongoing Compliance is Ensured: The EOR stays up-to-date with New Zealand's employment legislation. This keeps your hiring practices compliant with regulations from authorities like Employment New Zealand (https://www.employment.govt.nz/) and Inland Revenue (https://www.ird.govt.nz/).

Why use an Employer of Record in New Zealand

Using an EOR simplifies your expansion into the New Zealand market. It saves you time and reduces risk. You can build a team quickly without the major cost and complexity of establishing a legal entity in the country. This lets you test the market or start a project with agility.

Here are some key benefits:

• Enter the Market Faster: You can hire employees and begin operations in days, not months.
• Ensure Legal Compliance: EORs are experts in local labor laws. They manage employment contracts, worker protections, and termination rules for you.
• Simplify Payroll and Taxes: The EOR handles all payroll processing, tax withholding, and reporting to New Zealand's Inland Revenue.
• Offer Competitive Benefits: An EOR can provide your employees with access to local benefits packages, including health insurance and retirement plans like KiwiSaver.
• Reduce Administrative Burden: You can focus on your core business activities. The EOR takes care of the complex HR administration.

Rivermate's transparent pricing model eliminates complexity with a single, competitive monthly fee per employee. Unlike traditional PEO providers, our pricing in New Zealand includes comprehensive HR support, benefits administration, compliance management, and access to our proprietary dashboard for real-time workforce analytics. No hidden costs, no setup fees—just straightforward pricing that scales with your business needs while ensuring full legal compliance in New Zealand.

Hiring in New Zealand is a straightforward process when you understand the local employment landscape. The country's job market is diverse, with opportunities across various sectors like technology, agriculture, and tourism. To ensure a smooth and compliant hiring process, it's essential to get the basics right from the start. This means understanding your obligations as an employer under New Zealand law.

Employment contracts & must-have clauses

Every employee in New Zealand must have a written employment agreement. This is a legal requirement. Think of it as the foundation of your relationship with your new hire. A clear, comprehensive contract helps prevent misunderstandings down the road.

Your employment agreements must include:

• Names: The names of your company and the employee.
• Job description: A clear description of the work the employee will perform.
• Place of work: The primary location where the employee will be based.
• Hours of work: The agreed-upon hours, including start and finish times and the days of the week.
• Pay: The wage or salary and how it will be paid.
• Dispute resolution process: An explanation of how you will handle any employment relationship problems.
• Employment protection: A provision that outlines the process if the company is sold or if the employee's work is contracted out.
• Public holiday entitlements: A clause detailing pay for work on public holidays.

Probation periods

You can include a probation period in your employment agreement to assess an employee's suitability for a role. These periods are typically between three and six months long. It's important to note that employees on probation have the same rights as permanent employees.

There's also a 90-day trial period, but this is only available to businesses with 19 or fewer employees. During a trial period, you can dismiss an employee without them being able to bring a personal grievance for the dismissal.

Working hours & overtime

A standard work week in New Zealand is 40 hours, typically worked as 8 hours a day, Monday to Friday. Any hours worked beyond this are generally considered overtime.

Interestingly, there is no legal requirement to pay extra for overtime. However, many employers choose to do so to attract and retain staff. If you do agree to pay overtime, the rates must be included in the employment agreement. Common overtime rates are time-and-a-half for the first three hours and double-time after that.

Public & regional holidays

New Zealand observes a number of national and regional public holidays. Employees are entitled to a paid day off on these days if it's a day they would normally work. If they are required to work, they must be paid at least time-and-a-half and be given an alternative day off.

Here are the national public holidays for 2025:

In addition to these, each region has its own anniversary day holiday.

Hiring contractors in New Zealand

You can also engage independent contractors in New Zealand. This can be a flexible option for project-based work. Contractors are self-employed and run their own businesses. They are responsible for their own taxes and are not entitled to employee benefits like sick leave or holiday pay.

A key risk when hiring contractors is misclassification. This is where a worker is treated as a contractor but is essentially an employee in all but name. If a worker is found to be misclassified, you could be liable for back-dated employee entitlements, such as unpaid taxes, holiday pay, and minimum wage. This is a serious and potentially costly mistake.

An Employer of Record (EOR) can help you mitigate this risk. An EOR can help you correctly classify your workers from the outset. If you choose to hire a contractor, the EOR can manage the relationship, ensuring compliance with local laws and reducing the risk of misclassification. This allows you to focus on your business, knowing that your contractor relationships are being managed correctly.

Paying your team in New Zealand involves understanding a few key rules. The system is straightforward, designed to be clear for both you and your employees. It’s built around a Pay As You Earn (PAYE) tax system, which means you deduct taxes and other contributions directly from your employees' wages. This simplifies the process for everyone. You'll also handle contributions to retirement savings and accident insurance, ensuring your team is well-covered.

Payroll cycles & wage structure

You have flexibility in how often you pay your employees. Pay cycles can be weekly, fortnightly, or monthly, but you must specify the pay frequency in the written employment agreement.

Wages are typically paid per hour, while a salary is a fixed annual amount. Both methods are common in New Zealand. No matter how you pay, you must ensure the employee's pay equals at least the minimum wage for all hours worked.

Overtime & minimums

New Zealand law does not mandate a specific overtime rate. Instead, the details of overtime pay should be outlined in the employment agreement. A common practice is to pay 1.5 times the employee's regular hourly rate for any extra hours worked.

The government sets minimum wage rates that you must follow. There are different rates for adults, for employees who are starting out, and for those in training.

Employer taxes and contributions

As an employer, you are responsible for a few key contributions on top of your employee's gross pay. These contributions fund important national programs.

Employee taxes and deductions

You will deduct taxes and other contributions directly from your employees' pay. This is part of the Pay As You Earn (PAYE) system.

In New Zealand, employee benefits and leave are a mix of government requirements and extra perks offered by companies. The government sets minimum standards for things like vacation time and sick days to make sure everyone gets a fair go. Many businesses, however, choose to offer more than the minimum to attract and keep great people. This means you can expect a solid baseline of support, with the potential for additional benefits depending on your employer.

Statutory leave

The New Zealand government sets out several types of legally required leave for all employees.

• Annual Leave: You are entitled to at least four weeks of paid annual leave after you have worked for your employer for 12 months.
• Sick Leave: After six months on the job, you get 10 days of paid sick leave per year. You can use this time if you are sick, or to care for a sick partner, child, or other dependent. You can carry over up to 10 unused sick days each year, to a maximum of 20.
• Parental Leave: New Zealand provides for parental leave, which includes maternity, paternity, and adoption leave. Primary caregivers can get up to 26 weeks of government-funded parental leave payments.
• Bereavement Leave: You can take unpaid leave for the death of a family member or other loved one. The amount of leave depends on your relationship to the person who has passed away.
• Family Violence Leave: If you are affected by family violence, you are entitled to up to 10 days of paid leave per year. This leave is to help you deal with the effects of the violence, such as attending court or moving house.
• Jury Service Leave: If you are called for jury duty, your employer must let you go. While not required, some employers will top up the modest allowance provided by the court.

Public holidays & regional holidays

You are entitled to 11 paid public holidays a year. If you work on a public holiday, your employer must pay you at least time and a half and give you another day off in lieu. Each region also has its own anniversary day holiday.

New Zealand Public Holidays 2025

Regional Anniversary Days 2025

Typical supplemental benefits

Here is a look at the benefits required by law versus those that companies often provide as extra perks.

How an EOR can help with setting up benefits

Setting up employee benefits in a new country can be tricky. An Employer of Record (EOR) makes it simple.

An EOR already has a legal entity in New Zealand. This means you don't have to set one up yourself. They handle all the legal requirements for you.

Here’s what an EOR does:

• Ensures Compliance: An EOR makes sure you meet all of New Zealand's employment laws. This includes everything from minimum wage to paid leave.
• Administers Benefits: They manage all the statutory benefits for your employees. This includes things like KiwiSaver and ACC contributions.
• Provides Competitive Perks: EORs can also offer attractive supplemental benefits. Because they employ many people, they can often get better rates on things like private health insurance. This helps you attract and keep top talent.
• Simplifies Payroll: An EOR handles all payroll and tax withholding for your New Zealand employees.

Using an EOR lets you focus on your business. You can be confident that your team in New Zealand is taken care of, and that you are following all the local rules.

When an employee leaves your company in New Zealand, you need to follow a process of termination and offboarding. This ensures you meet your legal obligations and part ways on good terms. The process will vary depending on whether the employee resigns, is made redundant, or is dismissed. In every case, the termination must be handled fairly and in good faith, as required by New Zealand's Employment Relations Act 2000.

Offboarding is the formal process of managing an employee's departure. It includes everything from the final payment and exit interview to the return of company property. A clear offboarding process helps you manage the transition smoothly and protect your company's information.

Notice periods

In New Zealand, the law does not set a minimum notice period for termination. The notice period is usually stated in the employment agreement.

If the employment agreement doesn't specify a notice period, you must give a "reasonable" amount of notice. What is considered reasonable depends on factors like the employee's role and length of service. Typically, a notice period of two to four weeks is seen as fair.

Here are some key points about notice periods:

• Written notice: It is best practice for both you and the employee to give notice in writing.
• Payment in lieu: You and your employee can agree to payment in lieu of notice. This means the employee's job ends immediately, and they are paid for their notice period.
• Serious misconduct: In cases of serious misconduct, you may be able to dismiss an employee without notice.

Severance pay

You are not legally required to provide severance pay in New Zealand unless it is included in the employee's employment agreement. If your employment contract includes a provision for severance or redundancy pay, you must follow the terms of the agreement.

The amount of severance pay and how it is calculated should be detailed in the employment contract. Common ways to calculate severance include:

• A set number of weeks' pay for each year of service.
• A fixed lump sum payment.

Even if there is no severance pay, an employee's final pay must include all wages owed, payment for any unused annual holidays, and any other entitlements.

How Rivermate handles compliant exits

When you use an Employer of Record like Rivermate, we handle the complexities of employee exits for you. We make sure that every termination is managed in full compliance with New Zealand's employment laws.

Here is how we help you with offboarding:

• Compliance: We ensure all legal requirements for termination are met, including providing the correct notice period and final pay.
• Final Payroll: We manage the final payment to the employee, ensuring all outstanding wages and entitlements are paid correctly and on time.
• Documentation: We handle the necessary paperwork to formally end the employment relationship.

By managing the entire employee lifecycle, from onboarding to offboarding, we give you peace of mind that you are compliant with local laws. This allows you to focus on running your business.

New Zealand has a range of visa options for people who want to work in the country. The system is set up to bring in skilled workers who can help the economy. To apply for a work visa, you usually need to have a job offer, the right qualifications, and sometimes a health and police check. The main work visa is the Accredited Employer Work Visa (AEWV). For this visa, your employer needs to be accredited by Immigration New Zealand. There are also other visa types, like the Skilled Migrant Category Resident Visa and Working Holiday Visas.

Employment visas & sponsorship realities

An Employer of Record (EOR) can help you hire employees in New Zealand without setting up your own local entity. An EOR can sponsor foreign employees for work visas, but there are some things to keep in mind.

What an EOR can sponsor:

• Accredited Employer Work Visa (AEWV): This is the most common visa for hiring foreign workers. An EOR that is an accredited employer can sponsor employees for this visa.
• Full-time employees: Visa sponsorship is generally for full-time positions.

What an EOR can't sponsor:

• Contractors and freelancers: These individuals usually need to apply for a self-employment visa on their own.
• Visas with probationary periods: For migrant workers on an AEWV, probationary periods are not allowed.

Practical routes for sponsorship:

The most direct way to sponsor an employee through an EOR is with the AEWV. The EOR, as the accredited employer, will guide you through the process. This includes making sure the job offer meets all the requirements and supporting the employee's visa application.

Business travel compliance

If you need to travel to New Zealand for short-term business, you'll need to follow the rules for business visitors. You can't work in New Zealand on a business visitor visa.

Permitted activities:

• Attending meetings and conferences.
• Negotiating and signing business deals.
• Conducting market research.
• Attending trade fairs for promotional purposes, but not to sell goods directly.

Visa options:

• Business Visitor Visa: This visa allows you to stay in New Zealand for up to three months for business purposes.
• Visa waiver countries: If you are from a visa waiver country, you don't need a Business Visitor Visa for short business trips. However, you will need a New Zealand Electronic Travel Authority (NZeTA) before you travel.

Key requirements for business visitors:

• You must have a genuine reason for your business trip.
• You need to have enough money to support yourself during your stay, or have financial support from your employer.
• You must plan to leave New Zealand at the end of your visit.