NZ 2025 Employment Law Rulings on Unjustified Dismissal
Recent Employment Relations Authority (ERA) and Employment Court decisions have shed light on how personal grievance claims are being handled in workplaces across Aotearoa. From trial-period dismissals to Covid-19 vaccination disputes, these rulings remind both employers and employees that fair process and good faith remain at the heart of New Zealand employment law.
Unjustified Dismissal After Improper Use of a 90-Day Trial Period
A recent case confirmed that dismissing an employee after a 90-day trial period had expired can amount to an unjustified dismissal. The worker was terminated 121 days into the job without consultation or warning, and the ERA ruled that the employer couldn’t rely on an expired trial clause.
Read more about the decision in the 90-day trial dismissal case.
Procedural Fairness in Covid-19 Vaccine Mandate Dismissals
In Idea Services Ltd v Wills, the Employment Court found that while requiring vaccination was substantively justified, the dismissal process lacked procedural fairness. The employer hadn’t properly consulted, shared all relevant information, or explored alternative work options. The employee was awarded compensation for lost income and humiliation.
See the Employment New Zealand case summary for full details.
Migrant Worker Wins Personal Grievance for Unjustified Disadvantage
In Cuc v Huynh, a migrant nail technician succeeded in a claim for unjustified disadvantage and dismissal. She’d been paid in cash, asked to perform unsafe work, and dismissed after seeking advice about her rights. The ERA ordered the employer to pay compensation and penalties for serious breaches.
More information is available in the Employment New Zealand ruling summary.
Upcoming 2025 Changes to Employment Law In Unjustified Dismissal
1. High-Income Threshold for Unjustified Dismissal Claims
Proposed amendments to the Employment Relations Act would prevent employees earning over NZ $180,000 per year from lodging unjustified dismissal claims. They’d still be able to bring grievances for discrimination or harassment, with a 12-month transition period for existing agreements.
Read more in the NZIM summary of high-income employment law changes.
2. Stricter Remedy Rules for Employee Misconduct
The Employment Relations Amendment Bill 2025 proposes allowing the ERA or Court to reduce or deny remedies if an employee’s own behaviour contributed to their dismissal. In cases of serious misconduct, employees could be barred from compensation or reinstatement.
3. Clarifying Employer Obligations Around Procedural Errors
Under the proposed reforms, minor procedural errors by employers would no longer automatically make a dismissal unjustified, provided the employee was treated fairly overall. While the duty to act in good faith remains, the change is intended to reduce penalties for purely technical breaches.
What These Changes Mean for Employers and Employees
For employers, these developments highlight the need to maintain clear processes, proper consultation, and detailed documentation around performance and disciplinary matters. Even with new flexibility proposed for procedural errors, fairness and good faith remain non-negotiable.
Employees should be aware of how the proposed high-income threshold and misconduct provisions could affect their rights to bring a personal grievance. Understanding employment agreements and keeping written records of workplace concerns will be more important than ever.
Timeline of Key Dates and Legislative Changes
| Date | Change or Milestone | What It Means |
|---|---|---|
| February 2025 | Recent Employment Court and ERA rulings released | Clarified standards for fair process and dismissal grounds. |
| June 2025 | Employment Relations Amendment Bill 2025 introduced | Outlined proposed changes to remedies and procedural fairness requirements. |
| Late 2025 (expected) | Bill progresses through Parliament | Employers should begin reviewing agreements and disciplinary policies. |
| 2026 (anticipated) | High-income threshold provisions come into force | Employees earning over $180k p.a. may lose unjustified dismissal protection. |
Employer Compliance Checklist
✅ Review employment agreements – confirm trial period wording, expiry, and termination clauses comply with current law.
✅ Update disciplinary and consultation procedures – ensure processes align with ERA expectations for procedural fairness.
✅ Check pay thresholds – identify employees who may be affected by the proposed $180 k limit.
✅ Train managers and HR staff – on consultation, documentation, and fair process requirements.
✅ Monitor legislation updates – stay informed about final Bill wording and commencement dates.
Need Expert Help? Speak to NZ Employment Law Specialists
If you’re facing a dismissal, personal grievance or disciplinary issue and want to get it handled properly from the start, it’s best to work with experienced employment lawyers. At Resolve Legal, we specialise in employment law across New Zealand and provide tailored advice and support every step of the way.
Contact us at info@employmentlaw.co.nz or call +64 21 242 3200, Monday to Friday 8:30am–5:00pm, or visit us at 350 Jackson Street, Petone, Wellington.
