Cash for wages: keeping the team paid when money runs late

Nothing quite matches the knot in the stomach when Thursday is payday and the account is short. Your team have rent, mortgages and families. They did the work. And the customer who’d fix everything by paying has gone quiet.

Why pay is untouchable

Three reasons make payroll the last place to cut:

• It’s a legal duty. Employment agreements and the Employment Relations Act set when staff must be paid. The adult minimum wage sits at $23.95 an hour from 1 April 2026.
• The deductions aren’t yours. PAYE and employee KiwiSaver come out of pay for Inland Revenue, and employers add their own KiwiSaver contribution, at least 3.5% of gross from 1 April 2026.
• People remember. A late pay run can lose good staff, and replacing them costs far more than bridging a few days.

The bills that can wait, and the ones that can’t

Bill	Can it move?	Approach
Wages	No	Bridge the shortfall
PAYE and KiwiSaver	Hardly	Park the money each pay run; due by the 20th for most
GST	Hardly	Due on the 28th after the period; talk to Inland Revenue early if short
Rent	Sometimes	Ring the landlord before the due date
Suppliers	Often	Ask for a short, agreed extension
Subscriptions, non-urgent spend	Usually	Pause or reschedule
Equipment finance	Sometimes	Ask for a new date

Spreading regular bills across the month stops payday colliding with everything else; see bills due at once.

Payday close and the account short? Start the 60-second enquiry.

Sizing the payroll gap

Go through one pay run at a time:

1. Gross wages for the run.
2. Add the employer’s KiwiSaver contribution, at least 3.5% of gross.
3. Add the PAYE and other deductions that will fall due on the 20th.
4. Set the total against cash in the account and receipts genuinely due before payday.

You can enter each payday as a bill in the cash gap calculator to see how deep the dip goes and for how long.

Ways to bridge a pay run

• Business cash line: draw before payday and repay as invoices are settled. Good where the dip returns each cycle. See business cash line.
• Short-term loan: suits a one-off, such as a late customer or a large leave payout. See quick business cash.
• Property-backed cash: where wages, tax and suppliers have all piled up together.

A calm pay week

For a fortnightly Thursday payday:

When	What to do
The Friday before	Check the forecast: wages and deductions covered?
Monday	Phone the customers who owe you for firm dates
Monday	Ask suppliers to move anything due this week
Tuesday	Arrange a bridge if a gap remains
Wednesday	Run payroll in Xero, MYOB or your payroll tool
Thursday	Staff paid
Within two working days	Payday filing sent to Inland Revenue

The earlier you spot the hole, the more choices remain. Finding it Wednesday night leaves almost none.

Leave payouts and bonuses

Large one-offs, like a departing worker’s accrued leave, a year-end bonus or a heavy overtime fortnight, can double a normal pay run. The Holidays Act also affects how holiday and public holiday pay are worked out, which can lift payroll around Christmas and Matariki. Add them to your forecast as soon as you know.

Fixing the cause

If payroll is tight every cycle, ask why:

• Customers on long terms while you pay weekly? See slow-paying invoices.
• Rosters that don’t track demand?
• Prices that haven’t kept pace with wage rises and KiwiSaver?
• Tax money mixed with operating cash? The PAYE and KiwiSaver page shows how to ring-fence it.

Talking to your team

If a pay run is genuinely at risk, silence helps nobody. Staff usually respond better to an early, honest conversation than to a surprise. But the aim is to avoid ever needing that conversation, which is why bridging a pay run matters. If you can see a problem two weeks out, you can ask a customer to pay sooner, move supplier bills and arrange funding without anyone noticing. Teams that know the business pays on time stay longer, work harder and recommend you to friends, and that loyalty is worth far more than the cost of a short bridge.

An illustrative example

Illustrative only. A landscaping firm in Tauranga with 14 staff pays weekly. A developer owes $48k and has pushed payment back a fortnight. Two pay runs including KiwiSaver total about $46k. The owner asks the nursery for two weeks’ grace and covers wages with a short-term unsecured loan, repaid the day the developer settles.

Look after your people

Paying on time is non-negotiable, and you shouldn’t need to scramble to manage it. Tell us what’s due and when money is coming. It takes about a minute, asking involves no credit check, and a real person calls, often the same business day.

Tell us the payroll amount, how often you pay and when customers pay, so we can match the cover to your cycle.

Cover my payroll →