- Survey of 2,800+ workers revealed 64% of professionals would consider salary sacrificing if offered
- 23% would sacrifice salary for mortgage repayments, 16% for extra Kiwi Saver contributions
- 63% of workers are currently job searching after no or disappointing pay rises so far this year.
As New Zealand faces a mass talent exodus, this could be the best, most cost-effective retention strategy for employers
With thousands of New Zealand employees heading into mid-year performance and pay reviews, one financial strategy is re-entering the spotlight – not as a perk for senior executives, but as a practical, tax-smart solution for everyday workers: salary sacrificing.
According to insights from global recruitment agency Robert Walters, a staggering 64% of professionals would consider salary sacrificing if it were offered.
“The mid-year review period presents a strategic opportunity for employers to demonstrate progressive thinking. With strong appetite for salary sacrificing, it’s an initiative all employers should be seriously considering,” said Shay Peters, CEO at Robert Walters Australia and New Zealand.
Salary sacrificing can be a mutually beneficial arrangement for both employers and employees. Common salary sacrifice options, such as additional Kiwi Saver contributions or novated leases, are generally cost-neutral for employers. In many cases, the benefits provided through these arrangements are either exempt from Fringe Benefits Tax (FBT) or receive concessional FBT treatment. This includes items primarily used for work (like laptops or phones), and superannuation contributions.
“As professionals reassess their financial priorities, salary packaging stands out not only as a powerful tool for retention and engagement for employers but also a smart financial choice but for employees.” Peters adds.
What Kiwi Workers Want from Their Pay Packet
The Robert Walters research which surveyed over 2,800 people shows:
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23% of professionals would sacrifice part of their salary toward mortgage repayments
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16% would contribute extra to their Kiwi Saver
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Others are keen on salary sacrificing for additional annual leave (11%), health and wellbeing (10%) and childcare (3%).
“Today’s modern workforce is not just chasing bigger salaries they’re looking for smarter compensation structures,” said Peters.
“In a cost-conscious climate, employers that offer flexible, lifestyle-aligned benefits will stand out as true leaders in employee engagement and retention.”
Employers: Act Now or Risk Losing Talent
The threat of attrition is real. Additional Robert Walters data shows that nearly 63% of workers are currently job searching after no or disappointing pay rises so far this year.
With New Zealand experiencing a mass talent exodus, its crucial employers think about what else they can offer employees to help with the cost of living.
“It’s much cheaper to offer an employee a smarter benefits package than to lose them and start over with recruitment costs, onboarding, and lost productivity,” Peters said.
“Salary sacrificing is one of the lowest-cost, highest-impact levers a business can pull, and it needs to be part of every HR manager’s playbook this review season.”
Rethinking Benefits in the New World of Work
As Gen Z increasingly enter the workforce, expectations around employee benefits are shifting. These cohorts place high value on transparency, flexibility, and financial wellbeing. In response, organisations are being challenged to modernise how they communicate and deliver total compensation.
Previously underutilised or misunderstood offerings, such as salary sacrifice schemes, are becoming more widely adopted. This is largely due to improvements in digital tools and clearer communication from employers.
“Managers must go beyond traditional performance reviews and be equipped to educate their teams on the full scope of their remuneration packages,” said Peters.
“This includes providing guidance on salary packaging, mental health resources, flexible work options, and long-term career development.”
Call to Action for Employers
Robert Walters is urging employers to:
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Integrate salary packaging discussions into mid-year reviews
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Provide clear, jargon-free resources for employees
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Highlight how salary sacrificing can support individual goals (e.g. home ownership, retirement, or education)
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Benchmark what competitors in the market are offering
Call to action for employees
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Ask your employer for information on salary sacrificing options.
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Think about which benefits align with your lifestyle and financial goals – whether that’s superannuation, a car, a laptop, or additional leave.
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Do your research on what salary packaging benefits are commonly available in your industry or role.
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Review your current financial situation to assess what you can afford to salary sacrifice without impacting your day-to-day needs.
If you’re considering salary sacrificing, it’s a good idea to talk to a financial adviser or tax professional to make sure it works in your favour when evaluating a salary package or new job opportunity.
