HR Practice For Payroll Practitioners

HR Practice for Payroll Practitioners

• Negotiations in regard to a collective agreement or individual agreement

Legislation

New Zealand has a heavy reliance on legislation in regard to what, how and when an employee is to be paid. Principal acts in this area are:

Wages Protection Act Minimum Wage Act

• • • •

Employment Relations Act

Equal Pay Act

Different ways to pay the individual or group

In the previous section we discussed what makes up base pay. In this section we discuss what can enhance base pay for the purpose of motivating employees to perform better.

The common name for this type of pay method is “ Variable Pay ”.

Variable pay can be defined as:

“A way to influence employee behaviour and performance by the promise to provide or the threat to withhold financial benefits.”

Typical types of variable pay include methods such as:

Bonuses

• • • •

Piece work

Commission only Profit-sharing plans

Bonus

The employee or group receives a bonus directly related to their own or the group’s performance. The bonus is based on the criteria developed by management linked to performance levels.

Piece work

The employee receives payment for each agreed unit produced. The level of payment to the employee is totally dependent on performance and the production of goods.

© New Zealand Payroll Practitioners Association, Sep 2024, Ver 12

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