Do I Have Any Rights As An Employee If I Am Paid 'Under The Table' In New Zealand?

Being paid “under the table” might sound simple.  Cash in hand.  No tax deducted. No paperwork. Sometimes it even feels convenient.  But if you’re working this way, you might be wondering do I actually have any rights and can I complain if I’m treated unfairly?  You may also be worried what will happen if my employer hasn’t paid tax and am I going to get in trouble?  

Even if you are being paid ‘off the books’ or ‘under the table,’ you do still have rights as an employee in New Zealand. 

What Does 'Under the Table' Mean?

'Under the table' usually means you’re being paid in cash, no PAYE tax is deducted, generally no payslips are provided, you have no employment agreement and your employer may not be keeping proper records.  In most cases, this is illegal. Employers in New Zealand must:

• Deduct PAYE tax,

• Keep wage and time records,

• Provide written employment agreements,

• Pay at least minimum wage, and 

• Provide holiday pay.  

  
  

Failing to do these things breaches employment and tax law.  But, just because your employer arrangement is unlawful, does not mean you lose your employment rights.

Am I Still Legally an Employee If I Am Paid 'Off The Books'?

In most cases, yes.  New Zealand law looks at the real nature of the relationship, not just what the employer calls it.  Even if there’s no written agreement, you’re paid in cash, the employer says you’re just 'helping out', or you are told you’re a contractor, you may still legally be an employee. 

Under the Employment Relations Act 2000, the test is about what actually happens in practice. For example:

• Do you work set hours?

• Do you work under someone’s direction?

• Do you use the employer’s tools?

• Are you part of the business?

If the answer is yes to most of those, you are probably an employee and you have legal protections.

What Rights Do I Have If I Am Being Paid 'Under The Table'?

If you are legally an employee, you are entitled to the same minimum rights as everyone else. This includes minimum wage, four weeks annual leave, public holidays, sick leave and bereavement leave.  If you were paid cash without holiday pay, you may be owed back pay.  

You are also entitled to protection from unfair dismissal.  Your employer cannot fire you without good reason or a fair process, or threaten you for asking about your rights. Even in a cash arrangement, dismissal must be justified.  

Finally, under health and safety law, your employer must provide a safe workplace.  This applies whether you are paid properly or not.

Can I Make a Complaint About My Employer If I Am Paid 'Under The Table'?

Yes, you can still bring a claim under New Zealand employment law.  The fact the arrangement was unlawful does not stop you from:

• Raising a personal grievance,

• Claiming unpaid wages,

• Seeking holiday pay, or

• Challenging an unjustified dismissal.  

The Employment Relations Authority (ERA) focuses on fairness and the real working relationship.  In fact, employers who pay under the table often face serious penalties when claims are made.

In a 2024 Mathews Walker case, a young employee was unfairly dismissed while working 'off the books'.  The ERA found the following in relation to her unlawful employment relationship.  

The employee chose to engage our client without an employment agreement and paid her in cash. They also withheld 20% of her pay but did not remit this to the IRD and placed it in the business account instead even though she had completed a new employee form with her IRD details.  Our client was the only employee paid in cash and she said she felt trapped into accepting cash payments as she had given up her previous permanent job and was struggling financially.  

The ERA found that the employer had made the mistake of luring our client from secure employment elsewhere, without properly recording her agreed hours of work in an employment agreement (in itself a breach of s 63A of the Act). The employer also initially operated the employment engagement in an informal manner by imposing cash payments. Our client was thus placed in an unenviable and vulnerable position.  

The unlawful nature of the employment relationship contributed to the overall remedies awarded to our client for her unfair dismissal.  

Will I Get in Trouble For The Employment Arrangement Being Unlawful?

Employees sometimes worry whether IRD will come after them, or if they will be fined or charged.   In most cases the employer carries the primary responsibility for deducting PAYE, IRD usually focuses on employers who deliberately avoid tax, and if you come forward early, you can often sort out tax issues safely. If you are concerned about tax exposure, it’s wise to get legal advice before taking action.

What If I Am Being Mistreated By My Employer?

Being paid under the table often goes hand in hand with underpayment, long hours, unsafe conditions, verbal abuse and threats of retaliation.  If you are being mistreated you should gather evidence of the employment arrangement and the mistreatment.  The ERA will look at real-world evidence, not just paperwork.  Record and summarise your hours worked, what you were paid, what and when problems occurred, and any threats or unfair treatment.  

Then seek legal advice.  An employment advocate can help you assess your risk, communicate safely with your employer, protect you from retaliation and help you raise a formal claim or personal grievance.  Often, employees in these situations recover significant unpaid wages.

What If I’m An Undocumented Migrant?

This can be a very sensitive situation.  Even if your visa status is unclear, you may still be entitled to unpaid wages for work performed.  The courts have recognised that employers should not profit from such unlawful arrangements.  However, immigration consequences can be serious. Specialist immigration legal advice is essential before taking action.

FAQs

If I was paid 'under the table', can I still claim unpaid wages?

Yes. If you were legally an employee, you can claim unpaid wages and holiday pay, even if payment was in cash.

Will IRD automatically investigate me if I complain?

Not automatically. IRD usually focuses on employers. But if tax was not paid, you may need advice on how to regularise your position.

Can my employer threaten to report me?

Threats may amount to unlawful disadvantage or even blackmail. An employer cannot lawfully intimidate you for asserting employment rights.

What if I don’t have any written proof?

The ERA can rely on:

• Witness evidence

• Text messages

• Work patterns

• Credibility

Many cases succeed without formal contracts.

How long do I have to make a claim?

For personal grievances, generally 90 days from the issue. Wage arrears claims may have longer limitation periods, but early advice is critical.

What if I was partly paid properly and partly in cash?

You still have rights. The Authority can examine the full reality of the arrangement.

Cash in hand work can feel risky and it generally is.  But the law in New Zealand is clear.  Minimum employment rights exist to protect vulnerable workers, especially those in informal arrangements.  If you are being mistreated, underpaid, or dismissed unfairly, there are options available.  The key is getting the right advice early, protecting yourself properly, and taking action strategically.  If you are concerned about your employment agreement, or your employer is taking advantage of an unlawful arrangement to treat you unfairly, get in touch today for a free consultation. MathewsWalker.co.nz | 0800 612 355

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