The “total remuneration” approach to KiwiSaver has been effectively banned in legislation rushed through Parliament under urgency last week. This change, which represents a substantial policy U-turn, was flagged by the Government in July. In essence, the new law says a KiwiSaver member cannot be offered lesser terms (or be otherwise disadvantaged) in comparison with a "comparable" non-member employee of similar skills, experience and circumstances.
The implications of this change are serious and potentially complex for employers who use a total remuneration approach, or who look to offset any existing superannuation subsidies against KiwiSaver employer contributions.
Chapman Tripp has published an article looking at the implications of the change for employers, and some of the problems with the way in which the new law has been implemented.
Click here to read the article.