Changes to the employment law landscape in 2024

As part of its 100-day plan, the National-led coalition government has passed legislation under urgency this week restoring the availability of 90-day trial periods for all employers, regardless of the size of the business. The extension of 90-day trial periods will take effect the day after the Employment Relations (Trial Periods) Amendment Bill receives Royal Assent.

?Trial periods were first introduced in March 2009, but the legislation has changed several times since then, largely reflecting differences between respective Governments on whether they should be applicable to all employers, employers with fewer than 20 employees, or whether they should be applicable at all. ?Most recently in 2018, the Labour-led coalition government limited the availability of 90-day trial periods to businesses with fewer than 20 employees.

?Trial periods must be agreed in writing and negotiated in good faith as part of the employment agreement. An employee who is dismissed before the end of a trial period can’t raise a personal grievance on the grounds of unjustified dismissal or other proceedings in respect of the dismissal. They can raise a personal grievance on other grounds, such as discrimination or harassment, or unjustified action by the employer.?

Special care must be taken with trial periods and their wording. If the trial period requirements are not met, a dismissal will not be lawful and any termination based on it will be unjustifiable.?An affected employee would then be entitled to the standard range of remedies for an unjustifiable dismissal. ?The use of trial periods can have serious consequences for employees and the Authority and Court have demonstrated that they will be interpreted narrowly and in favour of the employee where there is any ambiguity. We’re more than happy to advise on the use of trial periods in your business, to ensure compliance with legislation and to make sure you can rely on a trial period.

Other upcoming changes

The Fair Pay legislation introduced by the Labour government in 2022, has already been repealed by the coalition government, with effect from 20 December 2023. Other potential changes to watch out for in the New Year, that may impact New Zealand’s employment landscape, are:

• changes to the availability of remedies for personal grievances, where an employee is at fault;
• the introduction of an income threshold above which employees are not able to pursue a personal grievance; and
• amendments to legislation, which could impact a contractor’s ability to challenge their employment status in the Employment Court.

Contact our expert Employment team if you need advice on the changes Erin Davies William Fotherby Georgie Todd Beth Smith