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What changes to employment law can employers expect following the New Zealand election?

New Zealand
Written by
Kiely Thompson Caisley, New Zealand’s leading boutique employment law firm.
Following the general election result, Labour received enough votes to govern alone and can implement its manifesto policies. Labour’s proposed policies could result in significant changes for workplace relations in New Zealand.

New appointment 

The Prime Minister has appointed a new Minister for Workplace Relations and Safety, Hon Michael Wood. 

Sick leave 

Within the first 100 days, Labour has promised to legislate to double minimum sick leave entitlements, from five days to ten days a year. 

Labour noted it would work with business and unions on implementation timeframes for this change.  

Minimum wage  

During its first term, Labour promised to increase the minimum wage each year. Labour has promised to raise the minimum wage from the current NZ18.90 to NZ20 in 2021. 

Beyond 2021, Labour has stated that it will continue to have a balanced approach to minimum wage increases.  

Pay equity 

The Equal Pay Amendment Act 2020 came into force on 7 November. The Amendment Act sets out a new process for employees and unions to make pay equity claims and to bargain for increases in pay rates where it is arguable that the work is, or has been, undervalued and the work is, or was, predominantly performed by female employees.  

Fair Pay Agreements 

Labour has promised to introduce Fair Pay Agreements in line with the recommendations of the Fair Pay Working Group. Legislation would set the minimum content that must be included in each Fair Pay Agreement.  

The key features of Fair Pay Agreements are:  

  • Agreements would cover both employees and dependent contractors. 
  • Workers would be represented by registered unions during bargaining. 
  • Only unions would be able to initiate bargaining for the first agreement. 
  • Concluding agreements would need over 50% support from workers and over 50% support from employers. 


Once agreed, the agreements would cover all employers in the sector but there could be regional variations and exemptions of up to 12 months for employers facing severe financial hardship.  

Holidays Act 

Labour has announced that it will implement the so far unpublished recommendations of the Holidays Act Taskforce to reform the Holidays Act. This would include introducing legislation that simplifies the employer’s leave calculation as well as legislating to have sick and annual leave accrue over time, rather than becoming available in a block at six or 12 months. 

Labour also intends to allow employees to take bereavement and family violence leave as needed. 

Dependent contractors 

The term dependent contractor is used to describe workers who operate their own business and may use their own equipment but have little control over their daily work and depend heavily on one firm for most of their income. 

Labour has stated that it will extend basic employment rights to dependent contractors. This will include allowing contractors to bargain collectively, introducing a duty of good faith between contracting parties and requiring written contracts. 

Scott Worthy
Scott Worthy
Partner - New Zealand
Kiely Thompson Caisley
Layla Darwazeh
Solicitor - New Zealand
Kiely Thompson Caisley