Employer of Record in New Zealand

What is an Employer of Record in New Zealand?

An Employer of Record (EOR) in New Zealand is an entity legally employing workers on a client’s behalf, handling all local HR tasks - including payroll, tax withholding, statutory benefits and general compliance with New Zealand employment laws. This arrangement allows foreign companies to manage their New Zealand-based team’s tasks and responsibilities without establishing a local entity.

Using an EOR, like Rivermate, streamlines operations and provides a compliant, agile entry into New Zealand. The foreign company recruits and selects candidates while the legal employer issues a compliant contract and fully manages the employment relationship.

New Zealand labor market: At a glance

The hiring market
Greatest hiring activity:	The primary commercial center is in Auckland (North Island) while Christchurch (South Island) typically offers a lower employment cost structure.
Hiring timelines:	Locals: about one week Foreign nationals: Work permits 8-12 weeks
In-demand sectors:	IT, technology and renewable energy infrastructure
Sector shortages & immigration patterns:	Public administration, healthcare, engineering & infrastructure.

The salary market
Employer tax contributions:	KiwiSaver (savings scheme): at least 3.5% on gross earnings Accident Compensation Corporation (ACC): variable, average 0.69% on payroll cost
Minimum hourly wage:	NZ$23.95 / hour (adult minimum wage) NZ$19.16 / hour (starting-out wage) NZ$19.16 / hour (training wage)
Average hourly wage:	NZ$44.62 / hour across whole population
Income tax brackets:	Taxes on annual income in New Zealand are progressive, with annual income up to NZ$ 15,600 taxed at 10.5%; NZ$ 15,601 - 53,500 at 17.5%; NZ$ 53,501 - 78,100 at 30%; NZ$ 78,101 - 180,000 at 33% and all income in excess of NZ$ 180,000 at a rate of 39%.

What will it cost to hire employees in New Zealand?

Payroll in New Zealand is typically processed weekly, fortnightly or monthly, with the fortnightly schedule being the most common one.

Base salary

While New Zealand’s general average hourly earnings have been estimated at NZ$44.62/hour according to latest data, some sectors note distinctly different averages. For example, employees in the electricity, gas, water and waste services have average earnings of NZ$53.69/hour, IT and media employees of NZ$55.43/hour and Financial services an average of NZ$64.29/hour.

Employer taxes and contributions

New Zealand maintains the KiwiSaver retirement savings scheme. Participation in it is mandatory for employers who must contribute at least 3,5% (3% prior to April 2026) of gross earnings for eligible employees. Contributing more than 3.5% of the gross earning to the KiwiSaver scheme is commonly used as an additional non-mandatory benefit. Employees contribute to KiwiSaver as well (based on one of the following deduction levels: 3.5%, 4%, 6%, 8% or 10%, free to choose), unless they choose to opt out within a certain timeframe.

Additionally, an Accident Compensation Corporation (ACC) levy is applicable to employers based on the accident risk assessment for the appropriate industry. Levies vary by industry and classification but; the average levy rate for 2026/27 is 0.69% of liable earnings.

In addition to withheld PAYE tax and employee contributions, employers must pay the above charges to the authorities no later than the 20th day of the following month.

Statutory benefits

Working hours in New Zealand average 40 hours per week, distributed across five workdays. Statutory premiums and benefits in New Zealand include:

• Overtime: while pay rates are not mandated by law, the payable premiums are regulated via individual or collective employment agreements. Market practices include payments of 1.5x or 2x of regular rates. Offering time off in lieu is also acceptable.
• Work on public holidays: payable at 1.5x of regular rate. Additionally, an alternative paid day in lieu must be granted.
• Sick leave: Employees working in New Zealand with at least 6 months of continuous employment are eligible for 10 days of paid sick leave which are accrued up to a maximum balance of 20 days.
• Annual leave: a minimum of four weeks of paid annual leave per year is granted to employees who have at least 12 months of continuous service.
• Bereavement leave: 3 days for immediate family members, 1 day for other relations.
• Parental leave: government-paid primary carer leave of up to 26 weeks.
• Family violence leave: employees with at least 6 months of continuous service are entitled to 10 days of paid family violence leave per year and can request flexible working arrangements for up to 2 months.

Additional benefits

While not mandatory, recent Rivermate practices have shown that a work-from-home stipend (usually ranging between NZ$50 and NZ$200 per month) is increasingly popular.

Calculate employment costs

Hiring in New Zealand in practice

Market condition	Current reality	Comments
Hiring momentum	🟡 Moderate	Cautious overall, strong demand in renewable energy, infrastructure and ICT
Talent availability	🟡 Moderate	Unemployment around 5.6%, tighter competition for top candidates
Specialist talent	🔴 Acute shortage	Localized in healthcare, engineering, niche technology.
Immigration process	🟡 Moderate	Moderate overall but easier to navigate in shortage sectors, supported by Green List
Employment & contractor legislation	🔴 Highly regulated	Strict laws on contractor classification, stringent termination process

Although it's a generally low-volume market, New Zealand’s major hiring hub is Auckland in the North Island, and it generally has higher salaries. The South Island (and particularly Christchurch) can offer more competitive costs as well as increased interest in certain sectors such as renewable energy, including the construction of wind turbines and their servicing. Because these projects are temporary, many foreign companies hire workers on a Working Holiday Visa and use contractors. However, both using the WHV outside of its intended scope as well as contractor misclassification is a real risk in New Zealand and must be approached carefully.

Contractor misclassification risk in New Zealand

Due to the reasons discussed above, many foreign employers choose to use a contractor model over regular employment. While this is achievable through the Contractor of Record (COR) model via Rivermate, great care should be taken to use this approach and only establish a contractor relationship when it is genuine. Under the Employment Relations Act 2000, a strict “substance-over-form” principle applies to determine the real nature of the relationship rather than a written contract. To establish whether an individual is indeed a contractor or an employee, four core tests are performed: the Intention Test, the Control Test (mostly focused on supervision and control), the Integration Test (whether work performed is core or auxiliary to the company’s operations) and the Economic Reality Test (which assesses ownership, commercial risk and profitability). Exclusive work for a single client and high degree of control typically create exposure.

Misclassification and disguised employment carry a risk of reclassification including back-pay for annual leave entitlement, public holiday premiums, unpaid withholdings, employer contributions and ACC levies. Foreign clients should work with Rivermate to assess and classify workers under the appropriate category in New Zealand.

Hiring foreign nationals in New Zealand

New Zealand’s framework includes tight immigration controls and the possibility of hiring a foreign national should be carefully explored prior to taking any onboarding steps. Some of the routes available to foreign nationals include:

• Accredited Employer Work Visa (AEWV): most commonly used route for employer-sponsored work visa, a formal Job Check and a minimum threshold (equal to the industry market rate or minimum national wage) is required. Typically the complexity of this procedure heavily depends on the occupation/job role; highly skilled roles are usually approved easier while some blue-collar roles have proven very difficult to obtain approval for. Additionally, some specialized or licensed professions (eg. pilots, doctors etc) generally cannot be supported.
• Working Holiday Visa (WHV): an easier option for younger citizens of countries with a working holiday agreement with New Zealand.
• Post-Study Work Visa (PSWV): a visa granted for a period of one to three years to graduates of eligible local institutions.

Processing times take approximately 8-12 weeks and employment can only start when visa approval is secured.

Compliance risks employers must know about

Probationary periods

Probationary periods are allowed in New Zealand if agreed upon in writing. Typically, they can last up to 90 days. It should be noted that probationary periods cannot be used for foreign workers hired under the Accredited Employer Work Visa (AEWV) program discussed above.

Terminations and notice periods

Regarding termination notice periods, a general market baseline of 30 days applies; however, a different notice period may be defined in the individual employment contract.

New Zealand has a generally employee-centric approach to terminations and dismissals requiring substantial grounds and adherence to procedures. Dismissals are frequently challenged via Personal Grievance Claims. However, the Employment Relations Amendment Act 2026 in force since 21 February 2026 removes the possibility for high-earning employees (total annual remuneration above NZ$ 200,000) to file a Personal Grievance for unjustified dismissal unless it has previously been agreed in writing to maintain that protection available. The above bar applies to new contracts concluded after 21 February 2026 while existing contracts have until 21 February 2027 to renegotiate and mutually agree to contract back into unjustified dismissal protections. Otherwise, the bar will apply by default after that date.

As redundancy procedures are not available via an EOR model in New Zealand, international employers should be aware of the fact that most employment relationships terminate with a Mutual Termination Agreement which includes an agreed incentive.

Benefits of hiring through an EOR in New Zealand

Hiring an employee in a foreign country can be both risky and tiring. Compliance risks need detailed understanding and that takes time and effort. Partnering with Rivermate can benefit your business as you can hire compliantly without a legal entity, onboard faster, and scale as needed.

Ready to hire in New Zealand?

Hiring in New Zealand involves much more than finding the right candidate. Trust Rivermate to handle the complexities so that you can grow your business with confidence. Talk to a New Zealand Hiring Expert.

Sources:
Labor Market Statistics Snapshot June 2026
KiwiSaver changes
New Zealand Inland Revenue: Tax rates for individuals
New Zealand Green List
Opting out of KiwiSaver
Employment Relations Amendment Act 2026