New Zealand employment law

New Zealand Employment Law

Whether you already have a job offer or you’re just getting started on your search for a job in New Zealand, you may find it handy to have an understanding of New Zealand employer and employee rights, responsibilities and obligations.

New Zealand employers are obliged to offer an employment agreement to each employee, which sets out their respective responsibilities and entitlements. Some industries are more unionised than others – union members can have their agreements decided as a group in a process known as “collective bargaining”.

New Zealand employment law is centred on a concept of “good faith”, which obliges employers, employees and unions to act fairly and be truthful, and encourages them to sort out any issues that arise among themselves.

We’ve set out below answers to some of the questions we’re commonly asked about terms of employment in New Zealand.

New Zealand Holidays and Leave

All New Zealand employees are entitled to four weeks of annual leave every year. Employers can require you to take some or all of this leave over an annual “closedown period” – manufacturers commonly close down for 2-3 weeks over the Christmas/New Year period. Some New Zealand employers offer senior employees an extra week of annual leave or offer an extra week of annual leave as a bonus to long-serving employees. From April 2011, employees will have the option of cashing in up to one week of their annual leave.

New Zealand employees are also entitled to a paid day off on a public holiday if it would otherwise be a working day for them. New Zealand public holidays are:

  • Christmas and New Year: Christmas Day (25 December), Boxing Day (26 December), New Year’s Day and the day after (1 and 2 January)
  • Waitangi Day (6 February), Good Friday and Easter Monday (dates variable), ANZAC Day (25 April), Queen’s Birthday (first Monday in June), Labour Day (fourth Monday in October) and Provincial Anniversary Day (date determined locally).

If you work on a public holiday, you are entitled to extra pay and an extra day off. Waitangi Day and ANZAC Day are not “mondayized”, so if they fall on a weekend you don’t get a long weekend.

New Zealand employees are also entitled to minimum levels of sick leave (5 days paid per year, eligible after 6 months service) and bereavement leave (3 days paid per bereavement, eligible after 6 months service). These are statutory minimums, many employers are more generous either in their contracts or according to individual circumstances.

New Zealand Maternity Leave

New Zealand parents are entitled to up to 22 weeks of statutory government-funded paid parental leave when they give birth or adopt a child. (from 1st July 2018)

To be eligible for paid parental leave you need to have been working for the same employer for at least 6 months for an average of 10 hours per week. Mothers can transfer all or part of their entitlement to their spouse/partner (including same-sex partner) if they are also eligible.

The current parental leave payment (as of March 2018) maximum is currently $538.55 per week gross (before tax), or your average gross weekly pay if this is lower.

Unpaid leave of up to 52 weeks is also available for employees with more than one year with the same employer. This entitlement can also be shared by both parents. Partners are also entitled to one week (if they have been working for the same employer for 6 months) or two weeks (if they have been working for the same employer for one year) of unpaid paternity/partner’s leave.

As in the UK, these are just the statutory minimums, and some employers are more generous.

For more information on maternity and parental leave entitlements in New Zealand check the Department of Labour Parental Leave website. And for information on maternity care, check our article on the New Zealand public health system.

Trial Period for New Zealand Employees

New Zealand employers with fewer than 19 employees can employ new employees for a three month trial period. As in the UK, New Zealand employers usually have to go through a number of steps (meetings, warnings, training etc.) before dismissing an employee – during the 90-day trial period, employers can simply dismiss the employees if they’re not working out. From April 2011 the 90-day trial period will be extended to all New Zealand employers.

The trial period is voluntary, and must be set out in writing and signed by both the employer and employee. Employers and employees can access mediation services during the trial period, and normal rules of “good faith” apply.

For more information, see Probationary Trial Periods

Flexible Working Arrangements

Work-Life balance issues in New Zealand are legislated for in The Employment Relations (Flexible Working Arrangements) Amendment Act 2007, which came into force in July 2008. The act provides a framework for employees who have been working for the same employer for more than 6 months and have care of another person to request flexible hours, and obliges the employer to consider the request.

As in the UK, the employer does not have to agree to the employee’s proposal, but (despite initial reluctance) most employers now agree that it is handy to have a proper procedure in place to handle flexible work requests. For more information, see www.dol.govt.nz/worklife/flexible/act.asp.

New Zealand’s Minimum Wage

As of 1st April 2018, the adult minimum wage in New Zealand is $16.50 an hour. This applies to all workers over 16 years of age, except 16 and 17 year-olds who have not yet completed 200 hours or 3 months of employment – they are eligible for the New Entrants minimum wage of $13.20 an hour.

For more information on the minimum wage in New Zealand, see www.ers.dol.govt.nz/pay/minimum.html

For more information on the National Minumum Wage in the UK, see www.hmrc.gov.uk/nmw/

To find out more, request a free copy of our Financial and Pension guides for New Zealand.