Employers will soon have greater flexibility when managing high-income employees, as the government introduces changes to the Employment Relations Act.
The new policy, announced by Workplace Relations and Safety Minister Brooke van Velden, will establish a $180,000 annual income threshold above which employees cannot pursue personal grievances for unjustified dismissal.
The change, part of the ACT-National coalition agreement, aims to give businesses more freedom to ensure leadership and specialist roles are filled by the right candidates.
The threshold will apply to around 3.4% of the workforce and will align with the top income tax brackets.
“This policy is about offering workers and employers more choice when negotiating contracts,” said van Velden.
“It allows employers to test high-impact roles without the risk of costly dismissal processes and provides employees the option to opt back into unjustified dismissal protections during contract negotiations if they prefer.”
The policy targets roles such as senior executives or technical specialists, whose performance can significantly influence workplace culture and morale. Van Velden noted the flexibility could encourage businesses to take risks on potential candidates for challenging positions, benefiting both workers and employers.
While employees earning above $180,000 will lose the ability to file unjustified dismissal claims, they will still retain the right to lodge other types of personal grievances. The threshold, covering base salaries and excluding bonuses or benefits, will be adjusted annually to reflect changes in average weekly earnings.
The change will be introduced as part of the Employment Relations Amendment Bill, set to be tabled in 2025.
Image credit: Andrew Neel
There you are, if you are a talented executive who has worked hard to reach the pinnacle of success with the ability to grow business success, either don’t come to tin pot New Zealand and if you are here already, leave.
National offering skilled workers more “choice”.
Well written.
You build up $100 million in commercial revenue and some CEO decides to dump you and employ his mate.
Thing should read: The policy targets roles such as senior politicians and their cronies, whose performance can significantly influence the health and morale of a people.
“Yeah… I don’t like your face. Don’t come into the office tomorrow.”
“What?! You can’t do that!”
“Yes I can, you earn more than the threshold. Checkmate 😏”
(The economy apparently now improves)
The UniParty in action!!!
… more freedom to ensure… roles are filled by the right candidates…
Phone rings at police station..
Hi, hi there, this is Bo Peep. Has anyone seen my sheep, I can’t find them anywhere..
But…but…but…what about the rules affecting the Golden Masonic Handshakes that comes with ‘redundancy’ pay-outs?
Or…if injured on the job and then dismissed, do we get ACC and WINZ benefirs for life like a certain ethnic group does???????????