Termination Essentials

NZPPA Certificate in Payroll Termination Essentials (Level 4)

Skill Check 13 – Deductions (Wages Protection Act)

1. Can an employer deduct money owed to them from an employee’s final pay without the employee's consent?

Yes / No

2. When applying the Wages Protection Act to recover monies owed to the employer, which of the following statements would meet the act's requirements? (a) The employee's employment agreement contains a deduction clause. The employee is provided a letter stating the deduction amount and the date of deduction, and the deduction is taken out of the net. (b) The employer deducts the amount owed from the employee's termination pay and records the deduction on their payslip. If the employee has an issue with this deduction, they have 90 days from their termination date to lodge a PG.

(c) The employee's employment agreement contains a deduction clause, which takes the deduction out of the net.

3. Which of the following statements is a payment that is not covered by the Wages Protection Act (payroll does not need consent from the employee to deduct)? (a) If an employee takes annual holidays in advance and then terminates, the leave in advance can be deducted from their final pay.

(b) The employee was overpaid and has an amount to be deducted from their final pay.

(c) The employee purchased items on a staff account, and the amount needs to be deducted upon termination.

4. If the employee has been overpaid and the employer has asked for repayment, and the employee has consented, does the repayment from:

Gross or Net (Circle the correct response)

© New Zealand Payroll Practitioners Association, Mar 2026, Ver 9

85