Almost half of employers in a new survey pay employees' KiwiSaver contributions as part of their staff's total wages, rather than on top of their earnings, as the legislation intended.

More than 300 small, medium, and large organisations were surveyed as part of the new Te Ara Ahunga Ora Retirement Commission research, which found a net 45 percent of employers used a total remuneration approach to KiwiSaver for at least some employees.

Under the KiwiSaver act, employers are required to contribute a minimum of 3 percent of an employee's gross pay on top of their wages, if they are a contributing member to the scheme, unless both parties agree otherwise after bargaining in good faith.

The Commission's director of policy Dr Suzy Morrissey said the prevalence of the use of total remuneration packages raised questions.

"The legislation is written with a default position of earnings plus KiwiSaver, so that's the expectation," she said.

"The prevalence of using total remuneration packages really raises that question about, are employers really using a good faith bargaining practices with their employees that they're putting on this packages?"

Te Ara Ahunga Ora Retirement Commission director of policy Dr Suzy Morrissey Photo: Supplied / Te Ara Ahunga Ora Retirement Commission

Of the respondents using a total remuneration approach, 60 percent of the survey respondents said they did so because it was simpler from an accounting perspective, though 21 percent admitted it was the cheaper option.

Meanwhile 25 percent of employers always included employer KiwiSaver contributions as part of total remuneration and a further 20 percent adopted both approaches, paying some employees earnings plus KiwiSaver, and paying other employees earnings that include KiwiSaver.

Morrissey said when workplaces used a mixture of approaches, there were differences among what people received.

"Where they have a mix within their staff, they tend to use a total remuneration approach for non-managerial staff," she said.

"That opens up the question about the extent to which those staff have their opportunities to experience good faith bargaining."

The Commission estimated about 96 percent of the working age population of New Zealand, more than three million people, were part of the KiwiSaver scheme.

However non-contribution rates were also was high, with around 39 percent of members not currently contributing to their KiwiSaver accounts.

-RNZ