2023 is shaping up to be a big year for business, as New Zealand navigates tough economic conditions. It’s likely that we can expect a few employment law updates on the horizon too, and it’s critical that businesses are across the changes before it’s too late.
Download our factsheet to find out more about potential employment law updates that could be coming your way in 2023.
We recommend you contact a local law firm for further advice on how these employment law updates apply to your specific business situation, or visit the Ministry of Business, Innovation and Employment for more information.
Disclaimer: The information in this article is current as at 1 February 2023, and has been prepared by Employment Hero Pty Ltd (ABN 11 160 047 709) and its related bodies corporate (Employment Hero). The views expressed in this article are general information only, are provided in good faith to assist employers and their employees, and should not be relied on as professional advice. The Information is based on data supplied by third parties. While such data is believed to be accurate, it has not been independently verified and no warranties are given that it is complete, accurate, up to date or fit for the purpose for which it is required. Employment Hero does not accept responsibility for any inaccuracy in such data and is not liable for any loss or damages arising either directly or indirectly as a result of reliance on, use of or inability to use any information provided in this article. You should undertake your own research and to seek professional advice before making any decisions or relying on the information in this article.
What are the latest employment law updates in 2023?
In this factsheet, we’ll be covering:
- The Holidays Act submissions process
- Modern slavery legislation
- New wage threshold for migrant workers
- Income insurance scheme
- Independent contractors clarification
- An amendment to the Employment Relations Act
What is employment law?
Employment law is the legislation which governs the relationships between employers and employees. Legislation is different in every country, and sometimes varies region to region within countries.
Employment law generally covers (but is not limited to):
- Employment contracts
- Employment types (full-time, part-time, contract, freelance, etc.)
- Hiring and recruitment
- Dismissal and termination of employment
- Occupational health and safety
- Workers’ compensation
- Workers’ rights
- Discrimination in the workplace
- Employee entitlements including annual leave, maternity leave and long service leave, amongst others
Why is it important for businesses to stay on top of employment law updates?
Employment law is always evolving. As society, and consequently the needs of employers and employees, change – so too must employment legislation.
Sometimes these changes will come in the form of amendments or reforms to legislation, sometimes important requirements will be changed to processes that affect businesses, sometimes statutory rates of pay or contributions will be amended, and sometimes new precedents will be set by cases seen in the court.
This can have a range of impacts on businesses. For example, if statutory rates of pay have changed but you have not updated your payroll, you could be at risk of non-compliance. If you’re not up to date with the latest rules around leave entitlements, your employees may be justified in making a complaint.
To make matters more complex, different employment law updates will affect different businesses in different ways. That’s why we always recommend not only keeping track of employment law updates, but seeking professional advice for your personal situation from a qualified employment lawyer.
Looking for more information about payroll in New Zealand? Download our guide to the basics of payroll in New Zealand now!
How often does employment law change?
In a word – constantly. Like the rest of the legal system, employment law is constantly evolving, being amended and being updated.
A country’s law and policy-makers are always looking for ways to improve legislation and employment rules, in line with emerging needs or current events. As stated above, there are many legal changes happening at any one time, for any number of reasons.
We created our Employment Law Updates Factsheets to alert you seasonally to changes both current and upcoming, so feel free to check back on this page each quarter to stay up to date.
We know that it’s especially challenging as an SME leader, who doesn’t have the luxury of an in-house legal team or an expansive HR and administrative team to stay on top of these updates. We want to support you so that you can feel ahead of the curve when it comes to employment law, and future-proof your business in line with emerging legislation.
It’s all part of our commitment to making employment easier and more rewarding for everyone.
Should your business get help from employment law experts?
100%. This Employment Law Updates Factsheet is general in nature and does not speak to your specific situation. The views expressed in this article are general information only, are provided in good faith to assist employers and their employees, and should not be relied on as professional advice.
There are a thousand variables when it comes to the application of business and employment law compliance. This can include the industry your business is in, the number of employees you have, the location of your business – and so much more.
Our factsheets can provide a great point of reference for new or upcoming employment law updates. You might use these to kick-start discussions with your legal expert, or to seek further personalised advice on how these updates will impact your business.
Want a more basic overview of HR compliance? Download our free guide to HR compliance in New Zealand.
How can Employment Hero help you stay compliant with employment law?
Employment Hero’s advanced (but easy-to-use) HR and payroll platforms have been purpose built by employment experts for the needs of SMEs.
Our features are here to help you stay compliant with employment laws. Just a few of the ways in which our best-in-class platform can help include:
- A library of HR policies created by employment experts which you can easily customise, issue for acknowledgement by your team, and update
- Certification management, with cloud-based storage of your team’s certifications and qualifications that are necessary for them to complete their role
- Digital employment contracts which are stored on the cloud and easily accessible from your employees’ mobile app
- Time and attendance tools, helping you and your team keep track of their working hours
- Payroll reporting and contribution calculation; our payroll platform can help you complete payroll correctly
- Automated pay runs and pay slips, to help you with payroll admin and reduce human error
Employment law updates from 2022
Introduction of the Matariki public holiday
On Friday 24 June 2022, Matariki was officially celebrated with a public holiday in New Zealand, to be continued annually. The public holiday will shift each year because it follows the lunar calendar but will most likely always fall between June and July.
Matariki is sometimes referred to as Māori New Year. Matariki is also the Māori name for the group of stars also known as Pleiades or the Seven Sisters, which are visible to the naked eye at a specific time during the year. It is a time for celebration, growth and renewal. It’s also a chance for people to come together to remember those who have passed away, share food, tell stories and sing. Learn more about celebrating Matariki here.
Minimum wage increases
On 1 April 2022, the minimum wage increased in New Zealand. The adult minimum wage increased from $20 per hour to $21.20 per hour. The starting-out and training minimum wage increased from $16.00 per hour to $16.96 per hour.
Temporary collective bargaining changes have been removed
The NZ Government decided to remove the temporary modifications to collective bargaining rules. In response to the pandemic, temporary modifications were made to the Employment Relations Act.
This paused multiple timeframes in collective bargaining that would apply in usual circumstances. It also allowed unions to nominate an alternative agreement if the previous was impracticable due to the pandemic (e.g. in-person meetings).
The existing processes and timeframes for collective bargaining have now been reinstated (effective 6 May 2022). This is under the Epidemic Preparedness (Employment Relations Act 2000 – Collective Bargaining) Immediate Modification Order 2020.
Fair Pay Agreements
On 29 March 2022, the New Zealand Government announced it was planning to introduce a Fair Pay Agreement (FPA) system.
This is one of the biggest changes to NZ employment legislation in modern times and is designed to regulate working conditions and pay for employees. Taking a similar approach to modern awards in Australia, these changes will help standardise employment conditions as the cost of living continues to skyrocket.
Put simply, the Fair Pay Agreements will involve both employers and unions advocating for employees. This will include minimum conditions of employment for each sector by ‘bargaining’ for set minimum rates of pay and conditions.
The Fair Pay Agreement Bill was passed in late 2022. Find out more about the changes here.
Changes to bereavement leave
The government passed new legislation regarding paid leave for employees following a miscarriage or stillbirth. New Zealand became the second country in the world to introduce this kind of law, after it came into effect on 1 April 2021.
Employees are entitled to three days of paid leave in the event of a miscarriage or stillbirth. This applies to the pregnant parent and their partner, plus parents that are planning to adopt, are using a surrogate, or carers that have a whāngai arrangement. Employees become eligible for bereavement leave after six months of employment. They are not required to provide proof of pregnancy, miscarriage or stillbirth to take this leave.
Employment law updates from 2021
Minimum wage increased
As of 1 April 2021, minimum wage increases applied in New Zealand. The adult minimum wage increased from $18.90 to $20.00 an hour. The starting-out and training minimum wage increased from $15.12 to $16.00 an hour.
Minimum wage rates apply to all employees aged 16 and over, who are full-time, part-time, fixed-term, casual or working from home. They apply to all hours worked with no minimum hours requirement.
Get the latest employment law updates
Ready to learn more about the latest updates to employment law? Download our free factsheet now by filling in the form on the right.