What Recent NZ Employment Disputes Teach You About Fair Process

What Recent NZ Employment Disputes Teach You About Fair Process

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You might think employment disputes all sound the same. Yet this past week of June 2025, three very different cases landed in the ERA’s (Employment Relations Authority) lap. Each one highlights a gap in how employers and employees understand their rights.

You may see some practical lessons for your own business or career.

20-Day Hire: Abandonment or Unfair Dismissal?

A worker joins a company. Spends just 20 days on the job. Then he’s told he “Abandoned” his role. The employer didn’t go through any formal process. No warning. No discussion. In the ERA, the employer argued that the worker walked off. The worker said he was never asked to leave. Guess what? The Authority sided with the worker. They found zero proof of abandonment. Instead, they said the employer effectively sacked him without telling him. Compensation was awarded.

  • Lesson for you: Even for short-term hires, you must follow a fair process.
  • Ask questions: Did you document performance issues? Did you invite a response? If you want someone to leave, you need to discuss it.

Source: https://www.hcamag.com/nz/specialisation/employment-law/dismissed-worker-succeeds-against-employers-abandoned-job-allegations/538148

Subsidiary vs Parent Company: Who’s Liable?

A worker is made redundant. He sues the subsidiary for unjustified dismissal. But he also wants the parent company on the hook. Why? He says the parent called the shots and decided who worked where. The ERA agreed to let the parent in on the claim. They found enough control from above. Now both companies face scrutiny. The case hasn’t finished yet. But it’s a warning: hiding behind a subsidiary won’t always protect a parent.

  • Lesson for you: If you’re part of a group structure, check who makes decisions.
  • Ask yourself: Could a court find your parent company controlled the hire-and-fire process? Consider clarifying roles.

Source: https://www.hcamag.com/nz/specialisation/employment-law/worker-wins-right-to-pursue-parent-company-alongside-employer-in-dismissal-dispute/538011

AEWV Scam: Migrant Worker Left High and Dry

Imagine you’re in China, desperate for work. You pay about NZ$18,000 to an agent who promises a legitimate Accredited Employer Work Visa (AEWV). You arrive in Auckland. You live in a dorm paying NZ$130 per week, waiting for a job that never comes. Two months later, someone simply says, “you’re not needed.” No contract. No pay. You file for penalties under the Wages Protection Act and Fair Trading Act. In June 2025, the ERA said there wasn’t enough proof of wrongdoing by the employer or agent. No penalties awarded.

  • Lesson for you (as an employer or agent): If you recruit overseas, don’t invite trouble. Check that any agent you use is licensed. Do your due diligence on the AEWV documents.
  • Lesson for you (as a migrant or applicant): Always verify an AEWV direct with Immigration New Zealand. Keep every email. Insist on a signed contract before you book your flights.

Source:  https://www.hcamag.com/nz/specialisation/employment-law/crackdown-on-exploitation-of-migrant-workers/537878

What This Means for New Zealand Workplaces – Employment Equity

  1. Fair Process Can’t Be Skipped. You need to show records. You need to discuss performance. You need to be transparent about the reasons for ending a hire. Even if someone only worked a few weeks, they still have rights.
  2. Corporate Structures Don’t Grant Immunity. If a parent company calls the shots, it can get pulled into a claim. You might think a subsidiary is the face of any dispute. Think again. Demonstrate clear lines of authority.
  3. Migrant Protection Needs More Than Good Intentions. Scams happen. They prey on hope. A bad agent can ruin someone’s life. It also risks your reputation if you’re the “employer” on paper. Take steps today to verify every agent and job offer.

Perhaps you’re nodding along. Or maybe you’re thinking, “Could that happen here?”

Ask yourself:

  • Are your hiring processes watertight and documented from start to finish?
  • Have you checked every agent or recruitment partner you work with?
  • Could any part of your business structure leave you exposed to claims?

If you’re not sure, now might be the time to talk to someone who is. Don’t wait until an email arrives from the ERA.

Common Employment Law and Related Questions You Might Have

Q: How quickly do I need to act if I suspect an employee has abandoned their role?

You should arrange to meet or call the employee immediately. Give them a chance to explain. Put any concerns in writing, and give them an opportunity to respond. If you skip this, you risk a finding of unjustified dismissal.

Q: My parent company doesn’t handle day-to-day operations. Could they still be liable?

Yes. If they set policy, approve hiring budgets, decide redundancies or direct transfers, the ERA may find they exercised “complete control.” That’s enough to bring them into a claim.

Q: I’m a migrant worker—how do I know if my AEWV is real?

Go to the Immigration New Zealand website. Use their verification tool. Ask for your employer’s accreditation number. If you feel pressured into paying high fees, step back and seek free advice from an accredited immigration adviser.

You don’t want to be the person who thought “it won’t happen to me.” Every story we’ve covered happened to someone. Their lives changed, and sometimes permanently.

Take a moment to review your own employment processes and employment contracts.

Be honest about weak spots. Then fix them.

If you need a hand, you know where to find me.

Mike Harrison

Employment Equity Limited

New Zealand

0800 Dismissed – No Win No Fee

This blog or news item is for informational purposes only and does not constitute employment law  or professional advice. For guidance on your specific employment situation or employment law dispute, please call 0800 DISMISSED.

personal grievance payout nz

Need advice about a personal grievance payout (NZ)?

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When is a personal grievance payout (NZ) applicable?

What is a personal grievance claim?

A personal grievance is a formal complaint that is made by an employee against their employer – or former employer – when the matter has not been resolved internally or through direct consultation with the employer.

What is covered by the term ‘personal grievance?’

An employee can raise a personal grievance if they believe that their employer has acted unfairly or unreasonably towards them. This is covered by the Employment Relations Act 2000.

The Employment Relations Act 2000 sets out to build productive employment relationships. The act sets out expectations of good faith for employment relations including but not limited to employment agreements, union membership, bargaining, employee leave, disputes and penalties.

Personal grievance claims can refer to poor treatment, humiliation, loss of dignity, or if an employee feels that they have been unjustifiably dismissed, harassed or discriminated against.

The below definitions are brief and not exhaustive, talk to someone today for a fuller discussion of the following grievances.

Unjustified Dismissal: if you believe that your employer has not followed the correct procedure when you have been fired, made redundant, or otherwise dismissed.

Unjustified Disadvantage: if you believed that your employer has taken actions which are unjustified and have caused you disadvantage – for example, if your employer has failed to address bullying or harassment in the workplace, or not issuing benefits that you are entitled to.

Discrimination: if you feel that you are being treated differently or unfairly due to your age, gender, sexuality, race, religion, ethical belief, marital status or any of the factors prohibited by the Human Rights act 1993.

Racial Harassment: if you have been targeted, mocked, or otherwise made to feel uncomfortable for your race, or had racially motivated comments made about you.

Sexual Harassment: if you have been subjected to unwelcome requests for sex or sexually suggestive comments from employers, colleagues, or customers.

Duress: if you have been pressured over your membership or non-membership of a union.

How much is a personal grievance payout (NZ)?

A personal grievance payout (NZ) is variable. The level of compensation awarded can vary on the severity of the breach by the employer as well as the type of breach. The payout amount can often be related to the sum of wages lost, and for cases of humiliation and distress payouts awarded have typically been lower lump sums.

What are the Employment Relations Authority and the Employment Court?

The Employment Relations Authority (ERA) is an independent organization below the Employment Court. The ERA is more formal than mediation and makes a binding decision but not as formal as the Employment Court.

What happens when starting a personal grievance claim?

The first step you can take is to raise a personal grievance with your employer and attempt to resolve the problem while maintaining a positive employment relationship. Keep copies of all communication regarding the grievance, making sure that your complaint is clearly stated and backed up with evidence.

If this is unsuccessful or unsatisfactory, mediation is the next step. Mediation refers to a third party that assists the resolution in an informal and confidential way. This can be done independently of the employer if you feel unable to go through the employer due to the type of grievance being raised.

The next step is to file a personal grievance claim with the Employment Relations Authority.

Get Advice.

We suggest getting advice before starting the official process in order to ensure that your case is as strong as possible before embarking on a claim. We can represent you during the mediation stages as well as help prepare you for the settlement process and negotiate a Full and Final Settlement Agreement with an employer.

Contact our team of employment law experts for more information and to discuss making a claim.

Unfair Dismissal nz

What Is the Average Payout for Unfair Dismissal (NZ)?

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How to calculate the average payout for unfair dismissal (NZ)

 

When calculating the average payout for unfair dismissal (NZ), it should be noted that previous compensation awards bands are a matter of public record, but each actual payout will vary according to the specific factors of the individual case which remain confidential if at mediation but public if in the ERA.

Employment New Zealand is the government agency which stores the data regarding the compensation payouts for personal grievance claims. Using the data provided by Employment New Zealand, we have come up with the following guidance.

When looking at the levels of compensation awarded to employees by the Employment Relations Authority (ERA) and Employment Court under section 123(1)(c)(i) of the Employment Relations Act 2000 it is important to note that the data only takes into consideration those cases where compensation was actually awarded. In addition, it must be noted that precedent of payouts does not indicate potential future payouts as each case is assessed individually and on factors discussed briefly below.

In 2020 there were 7 cases awarded between $1 and $5,000, 24 cases awarded between $5,000 and $10,000, 58 cases awarded between $10,000 and $20,000, 11 cases awarded between $20,000 and $25,000, and 11 cases awarded more than $25,000.

From this we can see that the largest number of cases (the mode average) were awarded between $10,000 and $20,000. However, with the data provided and without case-by-case specific payout numbers we are not able to give a mean average payout for unfair dismissal (NZ). It should also be noted that the number of cases with a high level of compensation are only given as ‘over $25,000’ and so the average cannot take into account the highest compensation levels.

What are the factors of calculating a personal grievance payout?

Contractual Entitlements

If an employer has not paid employees for time that they have already worked, then the amount, in line with employee’s employment agreements, is likely to be awarded – including any bonuses previously agreed upon by employers and employees.

Note: Depending on the employment agreement specifics there may be a 90-day trial period under which an employee may be dismissed without the possibility of raising a personal grievance – unless that dismissal is deemed to be discriminatory.

Statutory Entitlements

If the employer has not paid out accrued holiday pay or leave, sick leave, or other statutory entitlements then these should be awarded.

Lost Wages

Lost wages can be awarded as the lesser of 13 weeks’ pay, or the actual time the employee was out of work or between jobs.

Note on Entitlement and Lost Wages Payouts

Where entitlements are concerned you must remember that you are required to pay income tax on these as normal. Additionally, when seeking lost wages, you are under obligation to try and mitigate your losses in this situation but trying to find new gainful employment.  Any lost wages that are awarded are also subject to income tax.

Compensation for Humiliation, Loss of Dignity and Injury to Feelings

Where your case involves personal damages over loss of dignity or injury to feelings the payout, if it happens, can vary significantly depending on the impact being unjustifiably dismissed has had.

Contribution to Costs

There may be a contribution to costs ordered by the ERA, this is calculated on a daily tariff and is only a contribution and does not cover the total costs. If the matter is conducted over a day the cost awarded to the successful party is normally $4500.00

Where more complex offers are made, or there is an unusual procedure, or the case is particularly severe then the payout may be significantly above or below the average payout for unfair dismissal – NZ employment law is multifaceted and there may be an alternate approach than filing a personal grievance claim.

There is a Time Limit on Raising a Personal Grievance

You only have 90 days to bring a personal grievance against your employer, it is best to gather the required information and evidence to support your claim and seek advice from employment specialists to discuss whether or not you have a case to bring against your employer.

If it has been more than 90 days since your dismissal, you may be able to raise a personal grievance but you would require the employer to agree to it, if this is not possible then you can apply to the Employment Relations Authority to be allowed to raise a personal grievance outside of the 90-day period, but this is only awarded when there are exceptional circumstances.

Contact our team of experienced employment specialists today.