If you are anything like us, you will be shocked to realise that we are halfway into 2025. As time has been marching on, so too have employment law developments – and there have certainly been quite a few developments! Read on for a summary of both recent as well as potential upcoming changes.

What’s new so far in 2025?

 The changes we have seen so far this year include:

• Hot off the press are the controversial changes to the Equal Pay Act 1972, which have amended the pay equity scheme by increasing the threshold and changing the requirements for raising and pursuing claims. The changes are extensive, and include for example that a workforce must be historically and currently made up of at least 70% female workers (as opposed to the previous threshold of 60%);
• An added requirement under the Employment Relations Act 2000 for employers to ensure that an employee does not hold the only copy of their individual employment agreement, and that the employer’s copy is readily accessible;
• An increase in the adult minimum wage from $23.15 to $23.50, and an increase in the starting-out and training minimum wage from $18.52 to $18.80;
• Some minor tweaks in the health and safety space including expanding the meaning of a notifiable incident;
• An amendment to the Crimes Act 1961 which makes it a crime for an employer to intentionally, and without reasonable excuse, fail to pay money that it owes to an employee (both under the employment agreement and legislation); and
• Tweaks to the Parental Leave and Employment Protection Act 1987, including clarification that any week where a preterm baby payment is made, is in addition to (rather than part of) the duration of both primary carer leave and extended leave. Primary carers will also remain entitled to a parental leave payment even where the person stops working as an eligible employee or self-employed person (provided that is within a ‘reasonable period’ after becoming the primary carer).

 Employment-related bills

There are a number of bills (proposed laws) currently progressing through Parliament which would affect the employment space should they become law. For those of you who are not familiar with this process, there are a number of steps involved before a bill becomes law:

There is of course never any guarantee that a bill will become law, but some of the employment-related bills which are currently in the parliamentary process are more likely to progress than others because they are supported by the Act, National and/or New Zealand First parties. In summary, these include:

Exit negotiations

Currently, employers and employees are able to have without prejudice negotiations only where there is a live dispute between the parties. This means that a discussion can take place off the record (i.e. it is confidential and cannot be referred to in any proceedings should they eventuate), which allows parties to an employment relationship to negotiate an agreed settlement, to resolve the dispute.

The Employment Relations (Termination of Employment by Agreement) Amendment Bill would broaden the status quo, as it would take away the requirement for there to be an existing dispute before negotiations can be initiated. Consequently, employees would not be able to raise a personal grievance in respect of an offer made by an employer to an employee, and evidence of pre-termination negotiations could not be submitted should litigation eventuate.

The National, NZ First and Act parties indicated their support of the Bill at its First Reading, so we consider it highly likely that the Bill progresses on to become law. This Bill is currently at the Select Committee stage, and its report is due in October 2025 – so keep an eye out!

Privacy

The Privacy Amendment Bill is at the Third Reading stage and looks set to become law soon as it has had the support of the whole House. If enacted, the key change this Bill would introduce is additional notification requirements for agencies where personal information is collected from a source other than from the individual concerned.

Partial strikes

The Employment Relations (Pay Deductions for Partial Strikes) Amendment Bill would allow employers to make pay deductions in response to partial strikes i.e., where an employee is mostly performing their work as usual, but has refused or failed to perform part of their work, or has reduced their normal performance, output or rate of work.

This Bill is at the Committee of the whole House stage. At its Second Reading, it had the support of the Act, National and NZ First parties – so it will likely continue on to eventually become law.

Pay secrecy

The Employment Relations (Employee Remuneration Disclosure) Amendment Bill, which has recently reached the Second Reading stage, would allow employees to freely discuss and disclose their remuneration (which would cover salary, wages, allowances, productivity-based payments, bonuses, incentive payments, employer superannuation contributions and any other payment for work). Contractual pay secrecy clauses could still be agreed, but employers would not be able to take adverse steps in respect of that employee’s employment for disclosing or discussing their remuneration.

The Bill is a Labour MP Member’s Bill but was supported by the National Party at its First Reading. It is one to watch given that it has been recommended by the Select Committee and appears likely to become law.

Gender identity or expression discrimination

The Human Rights (Prohibition of Discrimination on Grounds of Gender Identity or Expression, and Variations of Sex Characteristics) Amendment Bill seeks to add two new grounds of prohibited discrimination – gender identity or expression and variation of sex characteristics. This Bill has a while to go in the process as it is only at the First Reading stage and has been postponed until further notice.

Restraint of trade

This is another Labour MP’s Member’s Bill which seeks to prohibit the use of restraints of trade in employment agreements for lower and middle income employees, which it defines as employees who earn less than three times the minimum wage (approximately $146,640 gross per annum for fulltime workers). It would also introduce specific compensation requirements when restraints of trade are included in the terms of employment for higher income employees.

This Bill is at the Second Reading stage, but it does not have the support of the National and Act parties and has also been postponed until further notice.

Other changes on the horizon?

Hon. Brooke van Velden, the Minister for Workplace Relations and Safety, has made a number of comments around other changes she plans to make to employment law. The Minister intends for many of these changes to be rolled out this year in an Employment Relations Amendment Bill. While this Bill and others are yet to be drafted, and so we are yet to see these potential changes set out in detail, the possible changes include:

• New test for contractor vs employee status. The Minister has long signalled her intention to introduce a new test for determining employment status. This has been a contentious issue, and if introduced would cut through the body of developing and high-profile case law on this issue. Watch this space!
• Income threshold for unjustified dismissal personal grievances. If this change is implemented, it would mean that employees earning over $180,000 could not challenge their dismissal (unless otherwise agreed between the employee and employer).
• Change to remedies. The Minister would also like to remove all remedies for employees who have engaged in serious misconduct, and remove eligibility for both reinstatement and compensation for hurt and humiliation when an employee has contributed to the issue.
• Health and safety reform. Following a period of public consultation, the Minister has announced a raft of intended changes to the Health and Safety at Work Act 2015 and the WorkSafe New Zealand Act 2013. While bills are yet to be drafted, the Minister is seeking to amend WorkSafe’s main objective to the management of critical risks, and place greater emphasis on its role of providing guidance and information. Among other things, the Minister has said she wants “to see a shift from a regulator that has a safety at all cost mentality, to a regulator that focusses on helping duty-holders do what is proportionate to the risks, including rooting out over-compliance”.
• Removal of the 30-day rule. The current rule is that a new employee who is not a union member can be employed on the terms of the collective agreement (if applicable) for the first 30 days of employment.
• Holidays Act reform. Both the previous and current government have sought to reform the Holidays Act 2003 for simplicity and workability. The Minister engaged in targeted consultation on a draft Bill at the end of last year. This Bill ultimately did not go ahead, and instead work is now being done on a new system which would include, among other things, an hours-based accrual model for annual leave. It seems that any changes are still a long way off.

Finally, the recent budget announcement has heralded a change for KiwiSaver. From April next year, minimum employee and employer contributions will increase from 3% to 3.5%. Then in April 2028, that rate will increase again from 3.5% to 4%.

If you have any questions about any recent or potential upcoming employment law changes or our upcoming webinar topics, please get in touch with the Helpline Team.

Disclaimer:  The information contained in this article is current at the date of publishing and is of a general nature.  It should be used as a guide only and not as a substitute for obtaining legal advice.  Specific legal advice should be sought where required.