The cost of Payroll Compliance

Payroll Compliance is possibly the biggest reason why companies choose to outsource their payroll to a company like Ezypay.  In the UK, around 80% of companies outsource their payroll.  This figure will be much less here possibly due to the Kiwi ‘can do’ attitude.  Unfortunately,  companies still get it wrong as per the following examples of breaches of employment law.

  • Dairy Farm – The employer could not demonstrate they had provided payment of T1/2 for working on a public holiday – $7,000 penalty, $1,550.84 in arrears payments
  • Labour Hire Firm – Failed to retain employment agreements or keep time & leave records – $57,000 penalty, $1,818.02 in arrears payments
  • Courier Firm – Failed to pay minimum wage, provide contracts, making unauthorised deductions, withholding wages etc – $40,000 penalty, $23,621.02 in arrears payments
  • Petrol Station Franchise – Failed to record Alternative Leave correctly – $225,000 in arrears payments
  • Car Dealer – Breach of minimum wages, holiday pay and record keeping – $70,000 penalty, $250,000 in arrears payments
  • Labour Hire Firm – Breach of minimum wage (83 staff), holiday pay and not keeping proper records – $40,000 penalty, $33,081 in arrears payments
  • Country Pub – Failed to keep proper records, failed to account for leave correctly $30,000 penalty, had to reinstate Annual leave for six years, even though it had been paid
  • Car Dealer – Claimed employees were contractors and did not pay legal requirements – $65,000 penalty, $17,996 in arrears payments
  • Indian Restaurant – Withheld termination pay, breach of minimum wage – $6,000 penalty, $7,865 in arrears payments.

It is important to understand that even if you negotiate something ‘in good faith’ with an employee, it cannot breach the Holidays Act 2003 as a Labour Inspector will require compliance with all relevant employment legislation first and foremost.  Keeping abreast of all relevant payroll legislation is a full time job and something we do for our clients.

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