Pay Review Budget Calculator NZ 2026
This calculator plans a pay round and tells you what it really costs. You set the bands you are reviewing against, how many people sit in each, their combined salaries and the increase you intend to give each band, and it returns the total wage increase, the on-costs that ride on it, the effect on your annual leave provision and the blended percentage across the whole team. Three things make the real number bigger than the percentage you announce. Employer KiwiSaver of at least 3.5 percent and the ACC work levy both apply to every extra dollar, so the cash cost runs several percent above the headline. Banked annual leave is revalued, because leave is paid at the rate in force when it is taken rather than when it was earned, which means a business carrying several weeks per person takes a one off hit to the provision on top of the ongoing salary cost. And the blended percentage across a team almost never matches the number you had in mind, because the people getting the larger increases are rarely the ones on the smaller salaries. How to distribute the pool is a judgement rather than a calculation. An even spread is simple and protects relativities; a differentiated one recognises performance but leaves the lowest band flat, and over a few rounds that band drifts away from the market. What this tool does is make sure the total lands where the budget is before you commit to anything in a conversation.
| Band | People | Combined salaries | Increase | Cost of the rise |
|---|---|---|---|---|
| Exceeding | $12,750 | |||
| Meeting | $20,250 | |||
| Developing | $3,900 | |||
| On a plan | $0 |
The blended figure is the increase across the whole payroll, which is the number to compare against your budget. Banked leave is revalued because annual leave is paid at the rate in force when it is taken, so that part is a one off rather than an ongoing cost.
How it works
Each band's cost is its combined salaries multiplied by the increase you have set for it. The wage increase is the sum across the bands. On-costs apply employer KiwiSaver and the ACC work levy to that increase, because both ride on every extra dollar of gross pay. The leave provision line takes the banked weeks per person across the whole team, values them at the average weekly salary, and applies the blended increase to that balance, since leave is paid at whatever rate applies when it is taken. The blended increase divides the total wage increase by the combined salaries of everyone in the review, which is the percentage your payroll actually rises by and is usually lower than the number people remember announcing.
Worked example
A team of 17 has combined salaries of $1,250,000. Three people exceeding expectations share $255,000 and get 5 percent, which is $12,750. Nine people meeting expectations share $675,000 and get 3 percent, which is $20,250. Four developing people share $260,000 and get 1.5 percent, which is $3,900. One person on a performance plan gets nothing. The wage increase is $36,900, which blends to 2.95 percent across the payroll, shown as 3.0 percent. Employer KiwiSaver at 3.5 percent and an ACC work levy of 0.67 percent add about $1,539. With 2.5 weeks of banked leave each, the leave provision is revalued by roughly $1,774. The round therefore costs about $40,213 in the first year.
Related calculators
- Annual Leave Liability: the provision this revalues.
- Gender Pay Gap: what the round does to your gap.
- Pay Rise: one person's increase, after tax.
- Minimum Wage Increase: the rise you do not choose.