Q: I would feel more comfortable asking this question as it is not a regular occurrence for a payroll arrangement. An employee has joined the company (NZ based) and the HR team have confirmed a $10k relocation allowance to be paid to the employee on their commencement. The letter also includes a repayment period should the employee resign. A copy of the letter (see wording attached) has been signed by the employee and manager

The employee has now resigned after 7.5 months and prior to this deduction being taken from their final pay please can you confirm that the employee should be advised in writing of the deduction and request for their approval for this deduction to be made. If the employee doesn’t agree how would we initiate claw-back of monies?

A: The Wages Protection Act would apply to this situation and the employee can redraw from having this deduction from their pay even when agreeing in a letter (as the act allows the employee to withdraw consent).

If they withdraw their consent you could try debt collection but there is no mention of this in the letter provided.