Author: WILLIAM BUCKLEY LLB, BSc
Published: 09 July 2026
Legislation: Employment Relations Amendment Act 2026
A recent Employment Relations Authority decision has highlighted one of the most significant changes introduced by the Employment Relations Amendment Act 2026.
The case involved an employee who was dismissed immediately after allegations of serious sexual harassment came to light. The Employment Relations Authority ultimately found that the dismissal was unjustified because the employer had not followed a fair disciplinary process.
However, despite succeeding in his claim, the employee received no compensation.
The case highlights an issue many employers grapple with in practice: what happens when there are serious concerns about an employee’s conduct, but taking the time to follow a formal disciplinary process may expose others to harm?
Following the decision, the employer told NZME:
Those comments reflect a dilemma many employers will recognise.
The Employment Relations Authority accepted there was sufficient evidence of serious misconduct. However, it also found the employee was not given adequate notice of the allegations or a reasonable opportunity to respond before the dismissal decision was made.
Historically, employers in this situation faced the risk that a procedurally flawed dismissal could result in significant compensation, even where serious misconduct had occurred.
That is where the Employment Relations Amendment Act 2026 becomes important.
One of the Act’s key changes is that where an employee’s conduct amounts to serious misconduct and materially contributed to the personal grievance, the usual remedies may be reduced or unavailable altogether.
Speaking to the New Zealand Herald about the decision, our Tauranga-based employment lawyer, William Buckley, noted that a 100% reduction in compensation is “rare”. However, he said the recent amendments to the Employment Relations Act 2000 will have a direct impact on this area of law.
As William explained:
Under the Employment Relations Amendment Act 2026, where an employee’s actions contribute to the situation giving rise to their personal grievance and those actions amount to serious misconduct, the Authority’s ability to award remedies is significantly restricted.
The case serves as an important reminder that employers should continue to follow a fair and reasonable process wherever possible. However, it also demonstrates Parliament’s intention that employees who engage in serious misconduct should not automatically receive compensation simply because a procedural error occurred.
For employers, the lesson is clear: procedural fairness remains important, but under the new law, serious misconduct will play a much greater role in determining the outcome of personal grievance claims.
As William Buckley recently told the New Zealand Herald:
