Payroll Remediation
Worried your past payroll might be wrong? You're not alone - and it's fixable.
If you’ve started to wonder whether your historical leave or pay calculations are right, that feeling is worth acting on. Payroll errors rarely announce themselves – they sit quietly in the background, compounding pay by pay, until a Labour Inspectorate notice, an employee query, or a system migration brings them to light.
The good news: this is a solvable problem. Payroll remediation is the process of finding the errors, working out exactly what they’ve cost, putting them right, and making sure they don’t happen again. And it can be done discreetly, by people who do this for a living.
Talk to us first.
New Zealand has a payroll compliance problem
It isn’t a small one, and it isn’t going away. The Holidays Act 2003 is widely regarded as one of the most complex pieces of employment legislation in the country, and miscalculated holiday pay has caught out some of New Zealand’s largest and best-resourced employers. If organisations with whole payroll teams can get it wrong, the average employer running a legacy system has every reason to check.
What’s changed recently is the cost of being wrong:
- Back-pay liability can stretch back six years for miscalculated leave and entitlements.
- Labour Inspectorate penalties can reach $50,000 per breach for serious violations, alongside arrears and 50% penalty payments to affected employees.
- Wage theft is now a criminal offence. Since 14 March 2025, an employer who intentionally fails to pay money owed to an employee can be charged under the Crimes Act 1961 – so unintentional underpayments now carry far sharper consequences if left unaddressed.
- The Employment Leave Bill, set to replace the Holidays Act, even includes a formal remediation process for past underpayments – a clear signal that historical liabilities are expected to be cleared, not ignored.
In short: the exposure is real, the clock has been running for years, and the safest time to deal with it is before someone else finds it.
When you need a payroll remediation
Most remediation work starts with one of these triggers. If any sounds familiar, it’s worth a conversation:
- You’ve received a Labour Inspectorate compliance notice or audit request.
- An employee has queried their holiday pay, final pay, or leave balance – and you’re not certain of the answer.
- You’re buying or selling a business, and payroll liabilities need to be quantified for due diligence.
- You’re migrating off a legacy payroll system and errors are surfacing as the data comes across.
- A new payroll provider or adviser has flagged that something doesn’t look right.
- You simply have a nagging doubt about how leave has been calculated for staff with variable hours, multiple rates, or irregular patterns.
How we put it right
Our remediation process is built to reduce fear, not add to it. You’ll know what we’re doing and why at every step.
1. Confidential review
We examine your payroll data, employment agreements and pay history to identify where calculations have gone wrong - and how far back they go. Nothing is disclosed anywhere on your behalf.
2. Quantify the exposure
We calculate what is actually owed, to whom, and over what period, so you have a clear, defensible number rather than an anxious guess.
3. Remediate
We correct the calculations, prepare the back-pay figures, and help you manage the process with employees and the Labour Inspectorate accurately and sensitively.
4. Prevent recurrence
We explain the root cause - the system settings, the agreement wording, or the process - so the same error can't quietly start again.
Why employers trust The Paymasters with this
Remediation is detailed, sensitive work, and the detail is exactly where most providers fall short.
NZPPA-certified specialists
who understand the nuances generic software misses – when ordinary weekly pay applies versus average weekly earnings, how gross earnings are defined, how to handle public holidays for fluctuating hours.
More than 30 years
navigating New Zealand employment legislation, through multiple major law reforms.
Labour Inspectorate experience
we’ve guided multiple businesses through compliance notices and audits, with zero penalties assessed.
Complete confidentiality
this is a discreet, advisory engagement, handled by a small expert team, with Privacy Act 2020 compliance throughout.
If you’d like to read more on what’s involved, our article Payroll Remediation in New Zealand: What Employers Must Know is a good starting point. You may also find our NZ Payroll Compliance and Labour Inspectorate pages useful.
The cost of waiting
Every pay run that passes repeats the error and extends the liability. A problem found and fixed on your own terms is a fraction of the cost – financial and reputational – of one found by the Labour Inspectorate or aired in an employment claim.
You don't need to have all the answers before you call. That's our job.