How to hire workers in New Zealand and pay them without establishing an entity
Expanding your business to include representatives on the ground in New Zealand can be very exciting. However, if you’re like most businesses in today’s world, you need to onboard people and have them working productively sooner rather than later.
If you’re wondering how to recruit and pay new team members in New Zealand, the good news is that you can do so without the need to establish a legal entity.
Why set up an entity?
Having a legal entity in a country where you intend to hire and pay workers can make sense if you’re a large business and want total control.
The strategy does give you longevity in the market but the time and money required to do this may not be worth the investment, particularly if you’re just getting started. You could end up committing considerable funds and resources, only to change directions within a few years.
What’s more, there are a number of steps to set up an entity in New Zealand, including reserving your company’s name, registering each director and shareholder, applying for what’s known as an IRD number, registering as an employer for tax purposes and registering for GST (goods and services tax).
It makes the most sense to start operating in a new market with a dedicated partner that will act as your entity in New Zealand. If things go well, you can progress to establishing an entity without the time pressure.
How to pay staff in New Zealand without an entity
If you need people on the ground in New Zealand sooner rather than later, you can recruit workers and start paying them without the need to establish an entity.
One option for businesses of any size is to use what’s known as a PEO (Professional Employer Organisation). This entity is already established and has the purpose of helping overseas businesses to hire employees, create contracts, comply with local regulations and pay workers.
When you use a PEO, this company is the employer of record. The benefits of this approach include:
– Relatively fast hiring process, with ANZPEO staff ‘on the ground’ in New Zealand
– Lower costs to start operating in New Zealand
– End to end support for the employee onboarding process (it makes a difference to work with someone who knows the culture)
– Local HR representative who understands New Zealand’s specific workplace laws and pay requirements
– Payroll service
Your PEO will work alongside your HR, recruitment and financial teams to create contracts, hire workers in New Zealand and ensure they are paid in accordance with the country’s laws. This includes paying them correctly based on whether they are full-time employees, ‘starting out’ workers or contractors.
Why use a PEO to hire workers in New Zealand?
The cost of establishing an entity in a new country can be hundreds of thousands of dollars, and the process can take several months. As well as establishing the entity, you will need to find someone to help you with the recruitment process and upskill a member of your finance team so they know how to pay people the right way in New Zealand.
When you use a PEO, you have the benefit of an Employer of Record (EOR) and a locally based point of contact. Once you have partnered with this type of business, you can start recruiting immediately. What’s more, your PEO will assume full legal liability for your employees and handle all of the back-end administration, leaving you to focus on supporting your employees to achieve their KPIs.
You will pay a monthly fee based on the services you receive and be able to wrap up your New Zealand presence with minimal fuss.
Hire workers in New Zealand, starting now
New Zealand’s healthy economy and key position in the Oceania market makes it the ideal place to do business in 2022 and beyond.
If you want to install a representative or an entire team here, it makes sense to work with an established ANZPEO. This will allow you to find workers and start paying them sooner rather than later.
Side-step the cost, legal issues and lengthy wait that comes with establishing an entity. Reach out to ANZPEO for an end-to-end service to will help you build your Aotearoa (that means New Zealand) team.
