Ensure that the accommodation your new employee and any family will inhabit, is better than appropriate, and able to become a happy and secure home for them.
- Walk through the house/accommodation and consider what needs improving or replacing to ensure the house is warm, safe and dry. Then action those changes. It must be at a likeable standard as per the Residential Tenancy Act and the Health and Safety Act.
- Consider what changes you could make which would positively impact living in the house. This might include paint, a deck, a new oven or a place to put wet weather gear. If your budget allows then action one, or some, of these suggestions.
- Work through a tenancy agreement (this may be in the employment agreement) when your new employee moves in and both of you sign it. This process should include you both detailing and agreeing the condition of each room of the house and the grounds to prevent dispute later.
- Take note of any improvements to the property they suggest and see if you are able to complete them. It is likely you will be repaid by a more motivated employee.
- Ensure your accommodation is in a good state and ready for your new employee.
- Complete regular reviews of state of the house and consider what improvements you could make.
- Clearly outline from the start what maintenance of the property you require, such as lawns mown every two weeks.
- You must give 48 hours notice before entering the property unless there are extenuating circumstances.
Quick Questions & Answers
What value do I put on accommodation?
The IRD requires that a fair market rental is charged for accommodation provided to dairy farm employees. This is often incorporated into the Total Package Value (TPV), or total earnings, that you offer as the terms and conditions for the job.
To fulfil IRD requirements you can either:
a) Take the rent out of the person's wages after tax has been paid. Note: the provision of accommodation is a taxable benefit so it is liable for PAYE.
b) Pay an accommodation allowance, which covers the value of the accommodation, within their wages and then deduct the rent back once tax has been paid on the total wages.
c) Pay Fringe Benefit Tax on the value of the accommodation.
Options a) and b) are essentially the same, there is just more paperwork in option b). Option c) is the only method which can be considered free rental.
The amount of rent paid for accommodation must be clearly written into the employment agreement and the employee must agree in writing to the deduction of rent from their wages. If they do not agree then no deduction can occur.
Find out more about employment agreements and why you must have them. Make sure your agreement includes any accommodation or other wage deductions and that they are specific.
Learn about your other legal responsibilities as an employer.
Can I set rules for those inhabiting my accommodation?
Generally no, you must allow the tenant enjoyment of the premises. Although you own the property it is your tenant's/employee's home and you must allow them peace, comfort and privacy to live in.
In return your tenant/employee must not disturb the peace, comfort and privacy of neighbours (which might include you) and other tenants, or allow anyone visiting the property to do so.
Several “rules” are allowed to be negotiated as part of the tenancy agreement. These include if pets are allowed, the number of people living in the accommodation and the ability to sublet the property. Any terms or conditions specified in the tenancy agreement which are outside the Residential Tenancies Act 1986 are considered invalid (even if signed by both landlord and tenant).
What do I need to know about carrying out a property inspection?
The following rules apply to property inspections:
- You must give your employee / tenant at least 48 hours notice before a property inspection.
- This notice cannot be given more than 14 days ahead of time.
- Only one inspection can be done every four weeks.
- Inspections must be completed between 8 am and 7 pm.
You should complete a thorough property inspection with your employee before they move in, accurately documenting the condition of the property. This helps ensure that you don't wrongly blame your new employee for any existing damage and any new damage, either careless or deliberate, is easily identified.