At the Wage Costs stage of a New Zealand pay batch, FastTrack360 calculates the KiwiSaver employer (ER) contribution for each eligible payee by applying the KiwiSaver ER Contribution Rate rule assigned to that payee.

This involves three determinations: the applicable rate rule validity period, the pay codes to which the accrual applies via the associated pay code group, and whether the payee is eligible to receive employer contributions.

Previously, all three determinations were resolved using the pay period end date of the pay batch as the reference date, for both Normal and Adjustment pay batches.

This meant that where a rate change, pay code group membership change, or eligibility change took effect on a date falling between the pay period end date and the payment date, the system applied the conditions as at the pay period end date rather than those in effect on the date of payment.

Now, the reference date used to resolve the KiwiSaver ER rate validity period, pay code group membership, and payee eligibility is determined by the type of pay batch being processed:

The payment date of the pay batch is used as the reference date for all three determinations. This ensures that the rate, applicable pay codes, and eligibility conditions reflect those in effect at the time of payment.

The adjustment period end date is used as the reference date for all three determinations. This ensures that adjustments are assessed against the conditions applicable to the period being corrected.

The eligibility conditions are unchanged. For payees with a KiwiSaver status of Active Member or Auto-Enrolment Eligible, employer contributions are generated where the payee has not opted out before the reference date, or does not have an active Savings Suspension covering the reference date, unless the Continue Employer Contribution flag is enabled.

For payees with a status of Opting In, the payee's Opt-In Date must be on or before the reference date, and no active Savings Suspension may cover the reference date unless the Continue Employer Contribution flag is enabled.

This update ensures that KiwiSaver employer contribution calculations for New Zealand Normal pay batches comply with Inland Revenue Department (IRD) statutory requirements, under which the payment date governs the applicable rate and eligibility conditions.

If a KiwiSaver rate change, pay code membership change, or payee eligibility change takes effect mid-period, the correct conditions are applied automatically based on when the payment is made.

Adjustment batches continue to be assessed against the conditions applicable to the period being adjusted, preserving the correct behaviour for retrospective corrections.