Your employer is legally required to pay you correctly for your time and work under the Employment Relations Act 2000 and the Minimum Wage Act 1983. If you believe you have been underpaid or denied fair compensation, this guide will help you understand your rights, and what steps you should be taking.   

What is Wage Theft?  

Wage theft occurs when an employer fails to pay employees their full, legally owed wages. This can include:  

• Not paying for all hours worked 

• Not paying the legal minimum wage 

• Failing to pay holiday or sick leave entitlements 

• Misclassifying employees as independent contractors to avoid paying entitlements 

• Illegal deductions from wages without consent 

Unpaid overtime is also a form of wage theft if an employee is not compensated correctly for extra hours worked, particularly if they are entitled to overtime pay or time off in lieu.  

Your Rights  

New Zealand’s employment laws protect workers from wage theft:  

Minimum Wage Protection: Employees must be paid at least the legal minimum wage ($23.50 per hour as of April 2025, with exceptions for trainees and apprentices).  

Holiday and Sick Leave Entitlements: After at least 12 months of continuous employment, employees are entitled to 4 weeks of paid annual leave, public holiday pay, and sick leave under the Holidays Act 2003.  

Overtime Payment: If your employment contract states that you should be paid for overtime, your employer must honour it.  

Wages Cannot Be Withheld: Employers cannot withhold wages as punishment, or deduct pay without written consent.  

Steps to take if you Experience Wage Theft 

1. Check Your Employment Agreement

Review your employment contract and any workplace policies regarding pay, overtime, and leave entitlements. These clauses should be the basis for whatever action you take moving forward. If you don’t have a written contract, the default minimum employment standards and laws will apply. 

2. Keep Detailed Records

Document your hours worked, pay slips, and any missing wages. Keep records of:  

• Work schedules and actual hours worked 

• Pay slips and bank account deposits 

• Emails or messages regarding payment discussions  
• Any (dis)agreements made regarding overtime.

3. Raise the Issue with Your Employer

Sometimes, wage theft occurs due to payroll errors or misunderstandings. Talk to your employer or HR department in writing, clearly stating:  

• The missing wages or unpaid overtime  

• The relevant time period  

• The steps you expect them to take to resolve the issue  

At times, an in-depth discussion can go a long way and reach a mutual understanding or resolution. 

4. Seek External Advice

If your employer does not resolve the issue, you can seek mediation or further support from an employment relations specialist. Mediation is a confidential process in which a mediator helps disputing parties reach a fair outcome – especially if internal resolution is unsuccessful.  

5. Proceed to the Employment Relations Authority (ERA)

If your employer refuses to pay what is owed, and mediation is unsuccessful, you can proceed to the Employment Relations Authority (ERA). An employment relations specialist can also represent you to the ERA. The ERA can order:  

• Back pay for unpaid wages  

• Penalties against the employer  

• Compensation for stress and financial hardship  

Preventing Wage Theft in the Future  

There are some steps you can take to protect yourself in the future, ensuring that you have evidence to back up any potential claims if something goes wrong.   

• Always keep copies of your employment agreement and pay slips.  

• Track your hours independently using a work diary or time-tracking app.  

• Join a union for workplace advocacy and support.  

• Know your rights by visiting Employment New Zealand or seeking advice from employment relations specialists. 

Final Thoughts  

Wage theft and unpaid overtime are illegal in New Zealand, and employees have several options to recover their money. If you suspect your employer is withholding wages, act quickly, keep records and evidence, and seek external support if necessary. By understanding your rights and taking the correct steps, you can ensure that you get paid fairly and adequately for your hard work!   

Don’t go through it Alone!  

If you’re experiencing wage theft, our expert team will help you understand your employment rights and pursue resolution (including compensation) through various channels, such as: Without prejudice negotiations, mediation, the Employment Relations Authority, or Employment Court if required.   

We also work on a no-win, no-fee basis – if we win your case, your employer covers the costs. 

Get in touch for a free consultation. 

You can fill out this form – or contact us at admin@mahilaw.nz, or 0800 450 032. 

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