Five points to check with your payroll provider

Throughout 2019 and in to 2020 we have seen the Labour Inspector and the Employment Relations Authority crack down on employer’s who are not keeping compliant wage & time and holiday & leave records, as well as those employer who are inadvertently underpaying employees on their minimum entitlements.

• In a recent Employment Relations Authority case an employer was fined $80,000 for not keeping accurate employee records.
• The New Zealand Police have also recently been banned from hiring overseas employees for six months and fined $7,000 for not keeping accurate employee records.

This is because keeping compliant employee records ensures that there are measures in place to check if an employee is receiving all of their minimum entitlements.

For those employers that use an automated payroll system to assist in keeping their employee records and payment of employees, we would not advise a “set and forget” approach to payroll compliance. This is because the success of your payroll system will largely depend upon the data you put in.

We recommend that you have the following five points checked with your payroll provider or accountant, to ensure that your payroll system is compliant:

• Payment of annual leave in accordance with the Holidays Act 2003;
• Payment of bereavement leave, alternative holidays, public holidays and sick leave (also known as BAPS leave) in accordance with the Holidays Act 2003;
• You are recording all information legally required of you for wage and time records;
• You are recording all information legally required of you for holiday and leave records; and
• Your system is set up to increase all employees on the minimum wage, on 1 April 2020 to $18.90 per hour.

Your obligations to keep wage & time and holiday & leave records, as well as your liability for wage arrears claims (which includes underpayments in employee’s leave) dates back six years and includes all current and previous employees. Therefore, it’s important that you get these points correct from the outset.

Workplace Law team

Employment: Andrew Shaw, Fiona McMillan, Gwen Drewitt, Maria Green,  Hannah Martin, Joseph Harrop, Holly Struckman, Alex Beal, Giuliana Petronelli, Abby Shieh
Immigration: Mark Williams, Rachael Mason, Daniel Kruger, Nicky Robertson, Julia Strickett, Ken Huang, Mary Zhou, Shi Sheng Cai (Shoosh), Sarah Kirkwood, Janeske Schutte, Lingbo Yu
ACC: Andrew Shaw
Health and Safety: Andrew Shaw,  Fiona McMillan