How to hire in New Zealand through an EOR

Every employee in New Zealand must have a signed, written individual or collective employment agreement. This isn't optional under the Employment Relations Act 2000. Get it wrong and you're looking at disputes or penalties from the start.

Contract types

Most companies use permanent employment agreements. They work well for ongoing roles, and the vast majority of NZ employees are permanent. Permanent contracts can be full-time or part-time, with no end date unless employment is terminated.

Here's a breakdown of the main types you'll encounter:

For your first hires, stick to permanent unless you have a clear, temporary need. Fixed-term agreements attract scrutiny if they look like a way to avoid permanent employee rights.

What has to be in the contract

The law requires specific details in every written agreement. You'll need to cover work location, hours, pay rate, pay frequency, holidays, and how employment can end. Include employment protection provisions if the business is sold or work is contracted out, and state whether the role is permanent or fixed-term.

There's no language requirement in law, but English is standard given that NZ courts and legislation use it. Probation periods aren't capped, but 90 days is common practice. During probation, you can end employment with notice, but the employee still has full rights including minimum wage and leave accrual. State probation terms clearly in the contract to avoid disputes later.

Contractor vs employee

This is where international companies most often get caught out. Misclassify an employee as a contractor and you could owe back pay, taxes, and face fines. NZ applies a "real nature of the relationship" test, not just whatever label is on the contract. If someone works set hours, uses your tools, follows your instructions on how to work, or is integrated into your business, they're likely an employee regardless of what the agreement says.

The penalties are significant. You could be liable for back wages, holiday pay, sick leave, KiwiSaver contributions, and ACC levies. Fines through the Employment Relations Authority reach $10,000 per breach for individuals or $50,000 for companies. Employees can also raise personal grievances for unjustified dismissal, with damages up to 12 months' pay or reinstatement.

Non-competes are enforceable if they're reasonable in scope: limited duration (under 12 months), geography, and tied to protecting genuine business interests like client lists. Courts will strike down broad ones. On IP, employees own what they create unless the contract says otherwise, so you need to spell this out. With contractors, it's generally easier to enforce strong IP and non-compete clauses since employment law doesn't apply in the same way.

Get the setup reviewed by a NZ employment expert before anyone signs anything. If you're unsure about classification, treat the person as an employee to reduce your risk. Your EOR can draft compliant agreements and help you manage classification exposure from the start.

New Zealand gives employees 4 weeks of paid annual leave after 12 months. That's 20 days for full-timers, which is more generous than many countries, and it builds up as they work.

Time off

Employees get 4 weeks (20 days) of paid annual leave after 12 months of continuous work. It accrues pro-rata over the year at about 1.67 days per month. They generally can't take it until the full year ends, when accrued leave becomes entitled leave.

If someone leaves before 12 months, you pay 8% of gross earnings instead. Leave is paid at whichever is higher: ordinary weekly pay or average weekly earnings over the prior 12 months.

New Zealand has 11 public holidays. Most are paid if they fall on a workday. Here's the list:

All leave types

Here's a breakdown of the key leave types. The law requires job protection for most parental and family leaves. Pay is at 100% unless noted.

Mandatory benefits

You're required to deduct and contribute to KiwiSaver, New Zealand's pension scheme. It applies to employees aged 18-65 earning over $520/week. If an employee contributes, you match between 3% and 10%, with a minimum employer contribution of 3%.

Income tax runs from 10.5% to 39% under PAYE, and ACC levies cover workplace injury insurance. You pay ACC at 1.25-4% of payroll depending on your industry. There's no mandatory health insurance requirement since the public system is free at point of use.

There are no unusual mandates like meal vouchers or transport allowances. Accident cover through ACC is the main employer-funded protection outside of KiwiSaver.

What people actually expect

Most employees see 4 weeks of annual leave as the minimum. In tech and professional roles, 5 weeks is what stronger candidates tend to expect. If you're only offering the legal minimum, you'll likely need to compete harder on other parts of the package.

Private health insurance is common at mid-sized companies and above. It gives employees faster access to specialists, since public wait times can stretch out. Remote work stipends aren't required by law, but $20-50/month for home office costs has become fairly standard for hybrid roles.

Flexible hours and mental health support matter to a lot of candidates here. Gym memberships or wellness allowances can help you stand out. In Auckland and Wellington especially, hiring gets harder when you're sitting at bare minimums.

New Zealand's employment law shifted in 2026, giving employers a bit more room, especially with high earners. But fair process still matters, and skipping it can still land you in trouble.

Firing someone

The Employment Relations Amendment Act 2026 took effect on February 21 and changed the rules around personal grievances. Employees earning over NZD200,000 in total remuneration can no longer claim unjustified dismissal unless you both agree otherwise in writing. That threshold updates yearly and includes bonuses, but not KiwiSaver or superannuation contributions.

For everyone else, valid grounds for dismissal include misconduct, poor performance, redundancy, or incapacity. You still need to act as a fair employer would: investigate properly, give the employee a chance to respond, and consider alternatives before deciding.

Procedural slip-ups won't automatically sink you if they didn't actually disadvantage the employee, or if the employee themselves blocked your process. That said, dismissals without a genuine reason or proper process still expose you to personal grievances. Protected categories like race, sex, disability, union activity, and family status apply regardless of salary, so high earners can still raise grievances on those grounds.

Remedies can now be reduced by up to 100% if the employee's own conduct contributed, such as serious misconduct. Reinstatement is no longer the default outcome. For new hires, 90-day trial periods are worth using since dismissals during that period block grievance claims. For existing staff over the NZD200,000 threshold, there's a 12-month transition period to negotiate protections.

Notice periods

Notice is set by the employment agreement. If there's nothing in writing, statutory minimums apply.

Pay in lieu of notice is an option if working out the notice period isn't practical. Agreements can set longer terms, and high earners often negotiate their own notice arrangements.

Severance

There's no statutory severance requirement in New Zealand. You only pay it if your employment agreement says so, which is most common in redundancy situations.

Calculate based on base pay or total remuneration, depending on what your contract says. There's no statutory cap unless you've set one. For senior staff post-2026, severance can help smooth exits and reduce the risk of disputes.

Work permits and visas

You can hire foreign nationals through an EOR. The EOR acts as the legal employer and handles visa sponsorship, since Immigration New Zealand requires a job offer from an accredited employer.

The main visa categories for most hires are:

• Accredited employer work visa: For skilled roles on the green list or roles that pass a job check. Valid for up to 3 years and can lead to residence.
• Specific purpose work visa: Short-term, suited to project-based roles.
• Post-study work visa: For recent graduates.

There's no digital nomad visa in New Zealand. Standard applications typically take 1-3 weeks if everything is in order. Key requirements include a role that matches ANZSCO skill classifications, pay at or above the median wage (NZD31.61/hour as of 2024), and a genuine position. The EOR manages accreditation, sponsorship, and compliance. You'll cover application fees, which run around NZD700-1,000 per application.

A few other things worth knowing

Following fair process on termination isn't just good practice, it's how you avoid personal grievance claims. On data protection, the Privacy Act 2020 requires you to secure personal information, get consent when collecting it, and report breaches. Fines start at NZD10,000 for minor violations and go higher for serious ones.

Trade unions exist in New Zealand but coverage is low, under 20%. If you hire in roles covered by a collective agreement, that agreement applies. The 2026 Act removed the 30-day rule, so new non-union hires don't automatically fall under collective terms. You do need to let them know a collective agreement exists and provide union contact details.

It's also worth keeping an eye on the Employment Relations (Termination by Agreement) Amendment Bill. If passed, it would protect exit negotiations from constructive dismissal claims, provided you use written offers and give the employee time to get independent advice. Courts will still look for signs of pressure, so the process needs to be genuine. Used alongside the 2026 changes, it could make negotiated exits cleaner for both sides.