Q I am a 20-year-old university student working during the holidays at a cafe in
Napier. I am a member of KiwiSaver but there's no mention of KiwiSaver on my payslip. What are the rules for casual workers?
A Well done on finding work during your holidays. Anyone starting a new job (casual or otherwise) should let their employer know if they are already in KiwiSaver.
Your employer will have his or her hands full running the cafe and your KiwiSaver status is probably fairly low on the list of things to think about. You can make their life easier by downloading a KS2 form from the KiwiSaver website, filling it out and giving it to your employer, or whoever looks after the payroll.
You do not need to tell them which KiwiSaver scheme you are in, as Inland Revenue handles that part of the process. The IRD will allocate the money when they receive it from your employer with their monthly PAYE returns. You do need to indicate on the form what level of contributions you wish to make - currently 3, 4 or 8 per cent. This same form can be used by anyone wishing to change their rate of KiwiSaver contributions.
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Employees employed on a casual basis are not automatically opted into KiwiSaver.
Some other situations where enrolment is not automatic include those workers under 18, casual agricultural workers or anyone on a temporary contract of less than 28 days.
However, anyone who is eligible to join KiwiSaver can do so, and the employer is required if requested to make the appropriate deductions and contribute their 3 per cent as well (except for those under 18, where the employer contribution is optional). This includes part-time, temporary and casual employees. The 3 per cent employer contribution will be on top of your 8 per cent holiday pay, which you will be getting each week if you are employed on a casual basis (check your payslip).
Some workers find it difficult to talk to their employer about KiwiSaver or indeed anything relating to their terms of employment. Every workplace is different. Most large employers have designated payroll staff who are willing and able to answer questions about KiwiSaver. If you are unsure about asking your employer, talk to the other staff first. Good communication is a valuable skill to learn, so treat this as a useful learning experience.
Large companies absorb the cost of KiwiSaver without too much trouble but for a small business it can be a burden they do not welcome. Some readers report negative experiences with employers who do not want to know about KiwiSaver (particularly as the employer contribution has increased from 0 to 3 per cent since 2007). Other employers (I hope the majority) are generally positive about KiwiSaver and realise that one of the outcomes of regular saving is a more positive and motivated workforce.
Shelley Hanna is an Authorised Financial Adviser FSP12241. Her disclosure statement is available on request and free of charge by calling 870 3838. The information contained in this article is of a general nature and is not intended to provide personalised advice. Send your KiwiSaver questions to firstname.lastname@example.org.