First off, let’s do a little myth-busting. Payslips aren’t actually a legal requirement in New Zealand - crazy, right?!
On the other hand, you still need to leave a serious paper trail. At all times, you have to be able to give all of your employees a copy of their wages, time records, and holiday and leave figures if they ask for one. Plus, you better check your employment agreements - if they say that you’ll issue regular payslips, you need to follow through.
To be specific, for every team member you have to be able to show:
- total hours worked
- days and hours worked each day
- overtime hours
- penal rate hours (eg higher pay on weekends or night shifts)
- hours worked on public holidays
- any annual holidays, sick leave, or bereavement leave they’ve already taken
Payslips are a good place to track and centralise this info. Plus, issuing regular payslips helps with communication and transparency. Your team not only knows what ends up in their accounts, but can also track the amount owing to them as holiday pay, leave balances and what deductions they’re paying, helping them to understand what they’re getting and why.
A typical payslip will include:
- The dates of the pay period
- The employee’s tax code
- The employee’s ordinary pay (or the amount your employee receives under their employment agreement for a standard working week)
- The employee’s bank account number that you pay into
- Details of deductions (ie KiwiSaver, PAYE, child support)
You can show both the Gross Pay – (total income before deductions, tax etc) and Net Pay, the amount after deductions that the employee actually takes home.
It’s helpful to include running totals like their Year To Date total, showing the employee’s total earnings from the start of the year to the present, and their Holiday Pay balance, the built-up amount owing for annual leave, days in lieu etc that haven’t been taken.
You might also need to include:
Taxable allowances for optional benefits like food and clothing allowances
Non taxable allowances for necessary things like uniforms or meals purchased while travelling for work
In some circumstances, you might need unique items like Termination Pay (only paid when an employee leaves the company) or special one off payments like overtime or bonuses.
If you’re using payroll software (like PaySauce!), payslips will usually be generated for you automatically and could include other custom features like GST breakdowns for contractors.
Here’s an example of a pretty nifty payslip:
On a PaySauce payslip, we choose to include full leave balances (these are also available for staff to view separately in the PaySauce mobile app). We can even brand payslips with your company logo! On payday, your team will receive their payslips as an attachment in an email and a notification in the PaySauce mobile app. They can also access their own payslip history in the app, so if they’re ever looking for older records for proof of income, they can retrieve and print these themselves.
Okay, so what’s the upshot? While payslips aren’t required by law, they’re really handy for helping you remain compliant, keeping your staff informed and giving everybody access to important records. You can build your own payslip template by including the items we’ve suggested above, or sign yourself up for a sweet payroll system that will create and send payslips for you, along with automating your payments, calculations, reporting and tax banking and filing.
PaySauce makes smart solutions for employers, so we know a thing or two about being a good boss. Keen to learn more? Check out our other articles on managing KiwiSaver and making sure your people stick around.