Photo Source: Edmond Dantès
Workplace Relations and Safety Minister Brooke van Velden has revealed a new set of reforms to New Zealand’s employment grievance procedures.
The Employment Relations Amendment Bill, which focuses on limiting remedies for employees guilty of serious misconduct, is designed to address what the government perceives as an imbalance in the current framework.
Reforms Target Serious Misconduct and Reduce Remedies
The proposed legislation includes a focus on employees engaged in serious misconduct, such as bullying, sexual harassment, dishonesty, or fraud. Under the new rules, these individuals would no longer be eligible for remedies like reinstatement or compensation for hurt and humiliation.
Additionally, remedy reductions could be as high as 100% if the employee’s actions are found to have contributed to the grievance.
Another key aspect of the reforms involves changes to the procedures of the Employment Relations Authority and Employment Court. Judges would be required to assess whether an employee obstructed the employer’s ability to act fairly. In cases of procedural errors by employers, the impact on the outcome would only be considered if deemed substantial.
“These changes will strike a better balance and increase certainty for employers so they can focus on their business,” Van Velden said in a statement.
Government Defends Reform Objectives
The rationale for the proposed reforms stems from rising costs and what the government terms as “increasing uncertainty” for employers. Compensation for hurt and humiliation has been steadily increasing, while reductions in remedies for employee misconduct have become less frequent.
Van Velden cited an example of an employee dismissed for falsifying timesheets who received $10,500 in compensation along with 13 weeks of lost wages.
“This is not the balance personal grievances are meant to strike,” she stated. The minister also argued that the current framework encourages frivolous claims, noting,
“The status quo has led to increasing uncertainty and potential costs for employers and has incentivised employees to try their luck at raising a personal grievance in the hope that they will get a financial payout.”
Employers Voice Support for Reforms
The proposed legislation has found strong support among employers’ groups, including the Employers and Manufacturers Association (EMA). Alan McDonald, Head of Advocacy at the EMA, welcomed the reforms, describing them as an effort to restore fairness to the employment relations system.
“It’s important that the system no longer rewards employees for poor behaviour or performance. Employers should not be left footing the bill when an employee has clearly acted improperly,” McDonald said.
He also argued that minor administrative errors should not outweigh significant employee misconduct when legal outcomes are determined. The EMA hopes the reforms will ease the financial and legal challenges employers face in grievance cases.
Potential Effects of the Reforms
The proposed reforms are set to create a more predictable legal environment for employers, potentially lowering the costs of personal grievance claims. The increased focus on employee behaviour may discourage frivolous claims. On the other hand, employees may face stricter criteria for lodging grievances, particularly in cases of serious misconduct.
Critics of similar reforms in other areas have expressed concern that they may limit employees’ ability to hold employers accountable, particularly in cases involving procedural errors. It remains uncertain whether the bill will face significant opposition as it progresses through the legislative process.
Working Toward Improved Workplaces
The Employment Relations Amendment Bill is now under consideration in the legislative process, with the government framing the reforms as a crucial recalibration of workplace dispute laws. Van Velden is hopeful the changes will realign the system with the intended purpose of personal grievance protections.
“These changes will strike a better balance,” she asserted, emphasising the importance of fairness for both employers and employees.