As announced last month the Government is making changes to KiwiSaver. Such changes have been talked about and expected to happen for many years now.
From April 1st 2026:
The default employee and employer contribution rates increase from 3% to 3.5%.
An employee can apply for a 'temporary rate reduction' for between 3 and 12 months to keep it at 3%. At this stage there is no limit on how often this reduction can be applied for.
Any employer can subsequently opt to match the lower rate.
16 and 17 year olds will also be able to opt into KiwiSaver (currently 18 yr old eligibility). The employer will be required to match this as normal of course.
16 and 17 year olds will not be automatically enrolled. The auto-enrollment age remains at 18.
From April 1st 2028:
The default employee and employer contribution rates increase from 3.5% to 4%.
Worth noting, the "Total Remuneration" approach is still valid under the Act (KiwiSaver Act 2006) whereby the employer can assert that the employee's salary is inclusive or the employer's KiwiSaver contribution. This is not the default position under law and needs to be specifically communicated (and agreed to) in the Employment Agreement, and the employer needs to be careful that such an approach particularly with the increased rates does not drop an employee's earnings below the minimum wage.
For more information on this see the clause options in our Employment Agreement building in your
Employers Toolbox, or contact us.