There are a number of issues that should be considered before transferring staff between companies or requesting an entire payroll to be transferred or merged from one company to another.
Bulk company data move to another company/IRD number
Transferring all employees to a new company
As a general rule, all employee's in the old company should be paid out their final pay entitlements, and they should start as new employees with the new company.
In fact, Section 27 of the Holidays Act 2003 requires an employer to pay out accrued holiday pay whenever an employment relationship ends.
Under certain circumstances the employee can agree to have leave transferred to the new employer, requiring what we term a "Section 69(B) Restructure" after the clause in the Employment Protection Act.
SmoothPay provides the following options for moving staff or merging companies.
1) Total data merge - this is relatively complex, as it requires combining all unique allowance, deduction etc payroll codes, as well as all the historical data from both companies and can result in a relatively untidy result (multiple codes for the same thing etc). The tax reports will contain the combined data (which isn't usually correct, as the tax data would have been reported by the separate employers under their tax number).
This option is generally used when separate branches for the same company have been processed separately for some reason, and you now wish to merge them together into a single payroll database.
This option should not be selected if the employer ird numbers are different.
2) Merge as new employees - this brings on the employee information with a new start date and default leave settings. Employees will not have any history or standard pay information.
This option is generally used where staff have been terminated and paid out their final pays in the old company and you wish to start them as fresh employees in the new employer's payroll.
3) Section 69(b) Restructure - this option lets you keep employee leave balances and summarises their pay history as "take on" pay values for the purposes of maintaining Holidays Act compliance for calculating Average Weekly Earnings and Relevant Daily Pay (the take-on pay entries do not appear on tax reports, so only the pay runs processed in the new company appear on ir schedules).
Please call when you're ready to prepare your new company and we'll assist with transferring your employee information.
Moving individual staff from one company to another
Staff can be moved with their current leave entitlements intact, or simply copied with existing details to another company and starting a new contract (no leave balances and no supporting pay history).
Moving an employee with their existing leave entitlements from one company to another
This process utilises the clipboard to copy most of the employee's details, leave balances and historical pay totals required to support the correct valuation of leave.
1. right-click the employee's name and choose Export employee (detail) and follow the prompts
2. select the destination company, Staff page, right-click any employee and select Import employee (preserve leave balances) and follow the prompts
3. the original employee record can now be manually terminated (Staff..Contract..Terminated).
Note that the employee's pay history will contain negative numbered pay history entries (effectively take-on history entries) that are needed to correctly calculate Holidays Act averages. These do not affect the tax reporting in the target company - they are just there for compliance.
Copying an employee record to another company
This process utilises the clipboard to copy most of the employee's details, saving you from having to manually recreate them in the target company.
1. right-click the employee's name and choose Export employee (basic) and follow the prompts
2. select the destination company, Staff page, right-click any employee and select Import employee (bring-on) and follow the prompts
3. if the original employee is being terminated, then process a final pay (or if casual and not eligible for any further payments than just manually terminate using Staff..Contract..Terminated).