New Zealand Employment Agreements: ERA Complete Guide 2026 (with 90-Day Trial)

Last verified: 2026-05-02 Author: MmowW Scrib🐮 — Document Preparation Service operated by a Gyoseishoshi (行政書士) office in Japan Primary sources: employment.govt.nz · legislation.govt.nz · era.govt.nz · mbie.govt.nz · business.govt.nz

Hiring your first NZ employee in 2026 sits at the intersection of three statutes that genuinely matter: the Employment Relations Act 2000 (governing the agreement, the trial period, and personal grievances), the Holidays Act 2003 (annual leave, public holidays, sick leave), and the Minimum Wage Order 2026 (effective 1 April 2026 — adult NZ$23.95/hour, starting-out and training NZ$19.16/hour). On top of those, the Health and Safety at Work Act 2015 imposes day-one PCBU duties, the KiwiSaver Act 2006 mandates a default 3% employer contribution, and the Privacy Act 2020 governs every piece of personal information you collect during recruitment and onboarding. NZ employment law is built on a foundation of good faith under ERA s.4 — both employer and employee must deal with each other openly, honestly, and with their cards on the table — which sounds simple until you realise that a single missed step in the section 63A “reasonable opportunity for advice” process can invalidate an otherwise perfect 90-day trial period clause. This pillar guide walks through the complete onboarding pathway: what must be in the Individual Employment Agreement under s.65, how the December 2023 amendment opened 90-day trial periods to all employers regardless of size, what the 2026 minimum wage numbers are, how leave entitlements vest at 6 and 12 months, and how to navigate the personal grievance window (90 days for most claims; 12 months for sexual harassment under s.103(1)(d)) so that what you build in week one stays compliant in year three.

Quick Answer (TL;DR)

Every NZ employment agreement must be in writing under ERA s.65, signed by both parties before the employee starts work, and contain the eight mandatory clauses in s.65(2) (parties, work description, location, hours, wages, dispute resolution explanation including the 90-day and 12-month grievance windows, public holiday treatment, and an employee protection provision for restructuring). A valid 90-day trial period under s.67A requires (i) clause in the IEA, (ii) signing before commencement, (iii) employee not previously employed by the employer, (iv) ≤90 day period, and (v) section 63A reasonable opportunity to take independent advice — since the December 2023 amendment, all employers (regardless of size) may use it. The Minimum Wage Order 2026 sets the adult minimum at NZ$23.95/hour (starting-out and training NZ$19.16/hour) from 1 April 2026. Annual leave under Holidays Act 2003 s.16 vests at 4 weeks after 12 months’ continuous employment; sick leave under s.65 vests at 10 days after 6 months; bereavement leave under s.69 is 3 days for spouse/parent/child/sibling/grandparent/grandchild/spouse’s parent. The personal grievance window under ERA s.114 is 90 days for most claims and 12 months for sexual harassment. KiwiSaver default employer contribution is 3%.

Table of Contents

1. Overview — the NZ employment law architecture
2. Legal foundation — ERA, Holidays Act, Minimum Wage Order
3. Key decisions — trial period, hours, KiwiSaver
4. Required documents and information
5. Step-by-step process — from offer to day one
6. Costs and timeline
7. Common mistakes (Gyoseishoshi perspective)
8. After hire — ongoing obligations
9. FAQ
10. Conclusion

1. Overview

Four bodies sit at the centre of NZ employment law:

Operational hubs:

• Employment New Zealand: https://www.employment.govt.nz/
• Employment Relations Authority: https://www.era.govt.nz/
• MBIE: https://www.mbie.govt.nz/

1.1 What “employee” means under s.6

A person is an employee under the ERA if they are employed by an employer to do any work for hire or reward under a contract of service. Section 6 sets out the real nature of the relationship test — courts look at intention of the parties and the actual conduct, including: degree of control by the employer; integration into the employer’s business; whether the worker is in business on their own account.

This test was reinforced by the Supreme Court in Uber New Zealand v E Tū Inc (2024). Mislabelling an employee as a “contractor” does not defeat employee status if the substance is employment — and the cost of getting this wrong is back-payment of holiday pay, KiwiSaver, minimum wage, and exposure to personal grievances.

1.2 Te reo Māori — workplace tikanga

NZ workplaces increasingly recognise tikanga Māori — including pōwhiri (welcome ceremonies), karakia (prayer/blessing), and tangihanga (bereavement) leave practice. The Holidays Act 2003 s.69 guarantees 3 days’ paid bereavement leave per qualifying death and recognises the deceased’s culturally significant relationships. Whānau, hapū, and iwi connections may qualify under s.69(1)(a) (“a person who, in the employer’s opinion, the employee has a significant connection with”).

1.3 The Employment Leave Bill 2026 — pending

The Employment Leave Bill 2026 was introduced on 9 March 2026 to replace the Holidays Act 2003. Royal Assent is pending; the Bill is tracked at https://www.legislation.govt.nz/bill/government/2026/259/en/latest/. Until Royal Assent and the relevant commencement order, the Holidays Act 2003 continues to apply in full. This pillar reflects current law. Operators should monitor MBIE updates at https://www.mbie.govt.nz/business-and-employment/employment-and-skills/employment-legislation-reviews/holidays-act-reform.

2. Legal Foundation

Full ERA text: https://www.legislation.govt.nz/act/public/2000/24/en/latest/. Full Holidays Act 2003: https://www.legislation.govt.nz/act/public/2003/0129/latest/whole.html.

3. Key Decisions to Make

3.1 Trial period — yes or no, and on what conditions

A 90-day trial period clause under ERA s.67A is valid only if all of the following apply:

Effect of valid trial period (s.67B): the employee cannot bring a personal grievance for unjustified dismissal. They retain other grievance rights — discrimination, sexual harassment, racial harassment, duress on union membership.

The December 2023 amendment removed the previous restriction that limited 90-day trial periods to employers with fewer than 20 employees. All employers may now use 90-day trial periods, regardless of size.

A probationary period under s.67 is not the same. It does not block personal grievances — the employer must still meet the s.103A “fair and reasonable employer” test if dismissing during probation. Probation is essentially a label that signals heightened scrutiny of fit; trial is a statutory safe harbour.

Primary source: https://www.legislation.govt.nz/act/public/2000/0024/latest/DLM1867204.html

3.2 Hours — agreed, variable, or availability provision

NZ “zero-hour contracts” were prohibited by the 2016 amendments. Three valid hour structures remain under ERA ss.67C–67E:

For a 40-hour-a-week permanent role, document hours plainly. For a casual role with genuinely variable shifts, use s.67C “an indication of the arrangements relating to the times the employee is to work” and avoid s.67D unless the role genuinely requires availability beyond agreed hours and you are willing to pay reasonable compensation for that availability.

3.3 KiwiSaver — default enrolment, 3% employer contribution

Employer contribution is in addition to wages — not deducted from the employee’s pay. Reference: https://www.kiwisaver.govt.nz/.

4. Required Documents and Information

4.1 Written Individual Employment Agreement — ERA s.65

Every employment agreement must be in writing. The employer must provide the employee with a copy of the proposed agreement and a reasonable opportunity to seek independent advice (s.63A) before the agreement is signed.

4.2 Mandatory content — ERA s.65(2)

Every individual employment agreement must contain:

4.3 Optional but recommended content

• 90-day trial period clause (only valid if compliant with s.67A)
• Probationary period clause (s.67)
• Notice of termination (in addition to the implied “reasonable notice”)
• Restraint of trade / confidentiality / IP assignment
• Drug and alcohol testing
• Suspension and disciplinary procedure
• KiwiSaver opt-in/contribution details

4.4 Document checklist (employer)

5. Step-by-Step Process — From Offer to Day One

Step 1 — Job advertisement (Human Rights Act 1993 compliance)

Advertisements must not discriminate on prohibited grounds (s.22 HRA 1993): sex, marital status, religious belief, ethical belief, colour, race, ethnic or national origins, disability, age (16+), political opinion, employment status, family status, sexual orientation. Genuine occupational qualification exceptions are narrow.

Step 2 — Pre-employment checks

• Right to work in NZ — visa or NZ citizenship (Immigration Act 2009)
• Reference checks
• Privacy Act 2020 — collect only information necessary for the role; obtain consent where appropriate

Step 3 — Issue written offer with draft IEA — s.63A

The employer must:

1. Provide a copy of the intended agreement in writing
2. Inform the employee they are entitled to seek independent advice
3. Allow a reasonable opportunity to seek that advice (typical industry standard: 3–5 working days for ordinary roles; longer for senior roles)
4. Consider any issues the employee raises and respond before signing

Skipping s.63A is one of the most common grounds for personal grievances. A 90-day trial period clause is invalid if s.63A is not complied with.

Step 4 — Sign the IEA before employment starts

Both employee and employer must sign before the first day of work. For a 90-day trial period to be valid (s.67A), the agreement must be signed before commencement of employment.

Step 5 — Tax and KiwiSaver setup

1. Employee completes IR330 (tax code declaration)
2. Employee completes KS2 (KiwiSaver deduction form) — opt out within first 8 weeks if eligible
3. Employer registers with Inland Revenue as PAYE employer if first hire — https://www.ird.govt.nz/employing-staff
4. Employer enrols employee in KiwiSaver if eligible (employer default contribution 3%)

Step 6 — Health & Safety induction (HSWA 2015 s.36)

The PCBU (employer) must, so far as is reasonably practicable, ensure the health and safety of workers. On day one:

• Site induction (hazards, emergency procedures, reporting incidents)
• Training appropriate to the role
• PPE provision
• Worker engagement and participation arrangements

Reference: https://www.worksafe.govt.nz/

Step 7 — Provide mandatory day-one information

6. Costs and Timeline

6.1 Government / service fees (effective 2026)

References:

• ERA — Who can apply: https://www.era.govt.nz/resolution-process/who-can-apply-to-the-authority
• Mediation: https://www.employment.govt.nz/resolving-problems/steps-to-resolve/mediation/

6.2 Indicative timeline — hire

6.3 Indicative timeline — personal grievance

6.4 Minimum Wage Order 2026 — effective 1 April 2026

Starting-out and training rates are 80% of the adult rate. There is no youth minimum wage in NZ for 16+ year-olds outside the starting-out criteria. After 6 months continuous employment with one employer, a starting-out worker must move to the adult rate.

Primary sources:

• https://www.employment.govt.nz/pay-and-hours/pay-and-wages/minimum-wage/minimum-wage-rates-and-types
• https://www.legislation.govt.nz/secondary-legislation/pco-drafted/2026/16/en/latest/
• https://www.employment.govt.nz/news-and-updates/minimum-wage-is-increasing-on-1-april-2026

6.5 Leave entitlements at a glance

6.6 Public holidays — Holidays Act 2003 s.44

The 12 NZ public holidays:

1. New Year’s Day (1 January)
2. Day after New Year’s Day (2 January)
3. Waitangi Day (6 February)
4. Good Friday (variable)
5. Easter Monday (variable)
6. ANZAC Day (25 April)
7. Sovereign’s Birthday (1st Monday of June)
8. Matariki (variable — first observed 24 June 2022; date set by Matariki Public Holiday Act 2022)
9. Labour Day (4th Monday of October)
10. Christmas Day (25 December)
11. Boxing Day (26 December)
12. The province’s Anniversary Day (regional)

If the employee works on a public holiday that they would otherwise have worked, they must be paid time-and-a-half for time worked and receive an alternative holiday (“day in lieu”) under s.56. Mondayisation (s.45A): if New Year’s Day, 2 January, Waitangi Day, ANZAC Day, Christmas Day, or Boxing Day falls on a Saturday or Sunday and is not otherwise a working day for the employee, the holiday is observed on the following Monday or Tuesday.

7. Common Mistakes (Gyoseishoshi Perspective)

8. After Hire — Ongoing Obligations

8.1 Daily / weekly

• Pay wages on agreed pay day; provide pay slip with breakdown
• Record hours worked (s.130 ERA — records must be available for Labour Inspector)
• Comply with H&S obligations daily

8.2 Periodic

8.3 Triggered events

8.4 Personal grievances — ERA ss.103, 103A, 114

Section 103(1) lists the grounds: unjustifiable dismissal; unjustifiable disadvantage; discrimination; sexual harassment; racial harassment; duress in relation to membership of a union; unfair conduct; failure to comply with Part 6A on transfer of business.

Section 114 time limit:

• Sexual harassment grievances (s.103(1)(d)): 12 months
• All other grievances: 90 days from the date of the act giving rise to the grievance (or the date the employee became aware of it)

Section 103A — test of justification: the dismissal or action was justifiable if a “fair and reasonable employer” could have done what the employer did in all the circumstances at the time. This includes: properly investigating the issue; raising concerns with the employee before action; giving the employee a reasonable opportunity to respond; genuinely considering the employee’s explanation.

8.5 Record-keeping (s.130 ERA, s.81 Holidays Act 2003)

Wage and time records must be kept for 7 years and produced on demand to a Labour Inspector. Records include hours worked each pay period; wages paid each pay period; annual leave taken and remaining; public holidays worked and alternative holidays accrued / taken; sick and bereavement leave taken.

9. FAQ

Q1. Can I really use a 90-day trial period clause now? Yes — since the December 2023 amendment, all employers may use s.67A trial periods regardless of size. But the clause is invalid unless all of the conditions are met: (i) in the IEA, (ii) signed before the employee starts work, (iii) employee not previously employed by you, (iv) trial period ≤90 days, (v) s.63A advice opportunity given. Sign-on-day-1 invalidates the clause, no matter how perfectly drafted.

Q2. Is a 90-day trial the same as a probationary period? No. A trial period under s.67A blocks personal grievances for unjustified dismissal during the period. A probationary period under s.67 does not — the employer must still meet the s.103A “fair and reasonable employer” test if dismissing during probation. Probation is essentially a label that signals heightened scrutiny of fit; trial is a statutory safe harbour.

Q3. What’s the actual minimum I have to pay in 2026? From 1 April 2026, the adult minimum is NZ$23.95/hour. Starting-out and training are NZ$19.16/hour — both 80% of the adult rate. There is no separate youth minimum for 16+ year-olds outside the starting-out criteria (16–17 new to workforce; 18–19 on benefit ≥6 months and not yet 6 months continuously employed). After 6 months continuous employment with one employer, a starting-out worker must move to the adult rate.

Q4. What’s the difference between annual leave pay (s.21) and 8% holiday pay? Annual leave pay is the greater of ordinary weekly pay or average weekly earnings — calculated at the time leave is taken, for the leave being taken. The “8%” rule applies in two specific contexts: (i) final pay for accrued but untaken annual leave (s.27), and (ii) holiday pay for genuinely casual work that doesn’t accrue 4 weeks (s.28 — pay-as-you-go is permitted only for short fixed-term and genuine intermittent work). Misapplying 8% to ongoing employees is one of the most common Holidays Act 2003 compliance errors.

Q5. What if I make a mistake and underpay holiday pay? Step one: calculate the actual entitlement under ss.16 and 21 of the Holidays Act 2003, including average weekly earnings. Step two: pay the shortfall (this is a statutory debt — Wages Protection Act 1983 s.4). Step three: communicate openly with affected employees — good faith under ERA s.4 requires it. Step four: consider whether a wider remediation is needed across all employees. Many large NZ employers have undertaken multi-year remediation programmes for historic Holidays Act 2003 errors — the Employment Leave Bill 2026 was triggered partly by the volume of these mis-calculations.

Q6. What’s the personal grievance time limit again? 90 days from the date the action complained of occurred, or the date the employee became aware (or could reasonably have become aware) of it — whichever is later. Exception: sexual harassment grievances under s.103(1)(d) have a 12-month window. The ERA may grant leave to file out of time only in exceptional circumstances (s.114(3)) — operators should not assume extension is available.

Q7. Can I deduct money from wages for a till shortage? Only with written consent plus specific consultation before each deduction (s.5A Wages Protection Act 1983). A general “any reasonable deduction” clause in the IEA is not sufficient on its own. Many NZ Employment Court decisions have struck down till-shortage deductions where the employer did not consult before the specific deduction, or where the deduction left the employee below the minimum wage (which is itself a separate Minimum Wage Act 1983 breach).

Q8. What about restraint of trade — can I stop someone competing after they leave? Restraints of trade are enforceable in NZ only to the extent reasonably necessary to protect a legitimate business interest — typically confidential information or customer connections. Courts have power to modify or strike out unreasonable restraints under the Contract and Commercial Law Act 2017. Geographic scope, duration, and breadth of activity restricted are all scrutinised. A 12-month NZ-wide ban on a senior salesperson with established customer relationships may be enforceable; the same clause for a junior administrator probably is not.

Q9. What is “good faith” in practice? Section 4 of the ERA defines good faith with three core elements: (i) active and constructive maintenance of a productive employment relationship, (ii) responsive and communicative behaviour, (iii) not misleading or deceptive, including providing access to relevant information before significant decisions (s.4(1A)). In practice this translates to: consult before restructure decisions, share relevant information when requested, give employees the chance to respond before adverse decisions, and don’t bury bad news in fine print. It’s enforceable — breaches can ground personal grievances and penalties.

Q10. Does Scrib🐮 actually prepare these agreements end-to-end? Scrib🐮 prepares your Individual Employment Agreement under s.65 — including all eight mandatory clauses, optional 90-day trial provisions (compliantly drafted), restraint of trade where appropriate, KiwiSaver references, employee protection provision for restructuring, and the s.65(2)(f) plain-language dispute resolution explanation including both the 12-month and 90-day grievance windows. We also prepare the offer letter, privacy collection notice, and H&S induction template. The PAYE registration with IRD and KiwiSaver enrolment are operator-completed via myIR — a personal authentication step.

10. Conclusion

NZ employment law in 2026 is more accessible to small and medium employers than at any point in the last decade. The December 2023 amendment opened 90-day trial periods to all employers; the 1 April 2026 Minimum Wage Order sets clear, predictable rates; and the Employment New Zealand and ERA infrastructure provides free mediation, low-cost first-instance investigation, and a published, plain-English code of practice for almost every situation a first-time employer is likely to face.

What that openness rewards is process discipline. The trial period only works if the IEA is signed before day one. The s.63A advice opportunity must be real, not a 30-minute window between offer and onboarding. The s.65(2)(f) dispute resolution explanation must include both grievance windows — 90 days for most claims, 12 months for sexual harassment. The Holidays Act 2003 entitlements vest at predictable thresholds (10 days’ sick leave at 6 months; 4 weeks’ annual leave at 12 months; 3 days’ bereavement leave from day one) and the Wages Protection Act 1983 prohibits deductions without written consent and specific consultation. None of this is hidden; all of it is published; all of it is enforceable.

Get the IEA right at the start. Document the s.63A process. Pay correctly under the Minimum Wage Order 2026 and the Holidays Act 2003. Consult genuinely on changes. The workplace that follows tends to take care of itself, and the personal grievance window — often described as a sword over employers — becomes a non-event because the employer’s practice is already aligned with the s.103A “fair and reasonable employer” test.

Create your NZ employment agreement with Scrib🐮

Skip the paperwork. Generate your ERA-compliant Individual Employment Agreement — including a s.67A-compliant 90-day trial clause, s.65(2)(f) dispute resolution explanation with both grievance windows, KiwiSaver references, and employee protection provision for restructuring — in minutes with MmowW Scrib🐮. ¥22,000/month pass for unlimited access to all 18 document types across 7 countries. Start Free Preview →

Disclaimer

This article provides legal information, not legal advice. MmowW Scrib🐮 is a document preparation service operated by a licensed Gyoseishoshi (行政書士) office in Japan. We are not New Zealand solicitors, barristers, attorneys, or licensed immigration advisers. Employers and employees are personally responsible for compliance with the Employment Relations Act 2000, the Holidays Act 2003, the Minimum Wage Act 1983 and Minimum Wage Order 2026, the Wages Protection Act 1983, the Health and Safety at Work Act 2015, the KiwiSaver Act 2006, the Privacy Act 2020, and all other applicable New Zealand law. Where the legal effect of a particular set of facts is uncertain, obtain advice from a New Zealand-qualified lawyer.

Sources

1. Employment New Zealand — https://www.employment.govt.nz/
2. Employment Relations Authority — https://www.era.govt.nz/
3. ERA — Who can apply — https://www.era.govt.nz/resolution-process/who-can-apply-to-the-authority
4. Mediation Services — https://www.employment.govt.nz/resolving-problems/steps-to-resolve/mediation/
5. Employment Relations Act 2000 (consolidated) — https://www.legislation.govt.nz/act/public/2000/24/en/latest/
6. ERA s.65 (Form and content of IEA) — https://www.legislation.govt.nz/act/public/2000/0024/latest/DLM59157.html
7. ERA s.67A (90-day trial period) — https://www.legislation.govt.nz/act/public/2000/0024/latest/DLM1867204.html
8. Holidays Act 2003 — https://www.legislation.govt.nz/act/public/2003/0129/latest/whole.html
9. Holidays Act 2003 guidance (Employment NZ) — https://www.employment.govt.nz/assets/uploads/documents/leave-and-holidays/holidays-act-2003-guidance.pdf
10. Minimum Wage Order 2026 — https://www.legislation.govt.nz/secondary-legislation/pco-drafted/2026/16/en/latest/
11. Minimum wage rates and types — https://www.employment.govt.nz/pay-and-hours/pay-and-wages/minimum-wage/minimum-wage-rates-and-types
12. Minimum wage 1 April 2026 update — https://www.employment.govt.nz/news-and-updates/minimum-wage-is-increasing-on-1-april-2026
13. Leave and holidays overview — https://www.employment.govt.nz/leave-and-holidays/
14. Parental leave — https://www.employment.govt.nz/leave-and-holidays/parental-leave/
15. WorkSafe (HSWA 2015) — https://www.worksafe.govt.nz/
16. KiwiSaver (Inland Revenue) — https://www.kiwisaver.govt.nz/
17. Inland Revenue — Employing staff — https://www.ird.govt.nz/employing-staff
18. MBIE — Holidays Act reform / Employment Leave Bill — https://www.mbie.govt.nz/business-and-employment/employment-and-skills/employment-legislation-reviews/holidays-act-reform

Last verified: 2026-05-02 · MmowW Scrib🐮 · Gyoseishoshi document preparation service