How should an employer respond to a personal grievance in New Zealand?

Last updated: 11 September 2026 | Written by Andy Bell, Partner, Lane Neave

An employer who receives a personal grievance in New Zealand should acknowledge it in writing, preserve every relevant document, take advice, and then respond in writing within a reasonable time setting out its position. The grievance itself is simply the employee telling you that they consider you have unjustifiably dismissed or disadvantaged them, or discriminated against or harassed them, under section 103 of the Employment Relations Act 2000. It does not need to use the words “personal grievance”. It does need to be raised within 90 days of the action complained of (12 months for sexual harassment), unless you consent to it being raised late or the Employment Relations Authority grants leave.

What happens in the first two weeks shapes the outcome more than most employers expect. Employers who respond calmly, gather the evidence, and assess their own process honestly against the section 103A test tend to resolve grievances at mediation on sensible terms. Employers who ignore the grievance, retaliate, or fire off a defensive reply tend to end up in the Employment Relations Authority, where employees succeeded in around two thirds of the unjustified dismissal claims decided in 2024.

The Employment Relations Amendment Act 2026, in force since 21 February 2026, has strengthened the employer’s position. Process errors that caused no real unfairness no longer make a dismissal unjustified, employee obstruction is now a relevant factor, and an employee whose own conduct contributed to the situation can lose some or all of their remedies. This article sets out how to respond, step by step, and what your exposure looks like.

What is a personal grievance?

Section 103 of the Employment Relations Act 2000 lists the grounds. The most common are:

• Unjustified dismissal: the employee says the dismissal was not what a fair and reasonable employer could have done, either because the reason was inadequate or the process was unfair.
• Unjustified disadvantage: the employee says some action by the employer, short of dismissal, disadvantaged them unjustifiably. Suspensions, warnings, demotions, restructures and failures to deal with complaints all fall here.
• Discrimination, sexual harassment, racial harassment and duress: discrimination on a prohibited ground, harassment of either kind, and duress relating to union membership.
• Adverse treatment for raising health and safety concerns or making a protected disclosure, and breaches of the rules on hours, availability and shift cancellation.

A complaint becomes a grievance when it identifies, in substance, one of these grounds and makes clear the employee wants it dealt with. Section 114(2) sets the test: the employee must have made the employer, or a manager, aware that they allege a personal grievance and that they want the employer to address it. The Employment Court applied that test in Chief Executive of Manukau Institute of Technology v Zivaljevic [2019] NZEmpC 132, following Creedy v Commissioner of Police, and confirmed that no formula of words is needed. The employer must simply be able to tell what it is being asked to respond to. A grumble in a corridor, or an email saying the employee is “not happy”, is not a grievance. A written complaint that says what happened and asks for it to be put right will usually meet the test. When a complaint like that arrives, acknowledge it without conceding that a grievance has been raised, and note any objection you have on timing.

Has the grievance been raised in time?

Section 114 requires a grievance to be raised with the employer within the period of 90 days beginning with the date the action occurred, or the date it came to the employee’s notice, whichever is later. The day of the action itself counts. For sexual harassment occurring on or after 13 June 2023, the period is 12 months.

The rule is strict. In Ferguson v Fire and Emergency New Zealand [2026] NZERA 505, a firefighter with more than 30 years’ service lost because his informal complaints did not amount to raising a grievance within 90 days, and no exceptional circumstances were shown. If a grievance arrives late, you can consent to it being raised, or decline. If you decline, the employee must apply to the Authority for leave under section 114(3). Leave is granted only where the delay was caused by exceptional circumstances and the Authority considers it just. Section 115 gives examples: trauma, a representative’s failure to act, an employment agreement that lacks the plain-language explanation of how to resolve employment relationship problems required by section 65 (or section 54 for collective agreements), and an employer’s failure to give written reasons for a dismissal under section 120 when asked. The last two are traps of the employer’s own making. Check your agreements, and answer any request for reasons on time.

Check the dates carefully before you respond to the merits. If the grievance may be late, say so in your acknowledgment and reserve your position. You do not need to consent to a late grievance in order to mediate; mediation is available for any employment relationship problem. If you do decide that consent is the commercially sensible route, give it deliberately, in writing, and limited to the grievance identified.

What should an employer do in the first 14 days?

1. Acknowledge receipt in writing. One paragraph: you have received the grievance, you are considering it, and you will respond by a stated date. Reserve any objection on timing. Do not argue the merits yet.
2. Do not retaliate. Adverse action taken because the employee raised a grievance breaches good faith and can itself be a grievance. You can still manage genuine, unrelated performance or conduct issues that arise, but do it by the book and expect the timing to be scrutinised.
3. Preserve the evidence. Emails, messages, meeting notes, HR files, rosters, payroll records, CCTV and policies. Instruct managers not to delete anything and not to discuss the matter with other staff other than as part of the investigation.
4. Take advice. An employment lawyer can assess your exposure objectively. The cost of early advice is small next to the cost of a determination. Our personal grievance service for employers covers how we run these matters.
5. Review your own process against section 103A. Did you sufficiently investigate? Did you raise your concerns with the employee? Did you give a reasonable opportunity to respond? Did you genuinely consider the response? Be honest about the gaps.
6. Identify any contributory conduct from the record. Under the 2026 amendments, conduct by the employee that contributed to the situation can reduce or remove their remedies. Look for it in the contemporaneous record; it has to be proved, not asserted, and it does not turn an unjustified dismissal into a justified one.
7. Respond in writing. Set out your position on each allegation, factually and without emotion. Say whether you accept any of it. Propose mediation.

There is one hard deadline. If the grievance concerns a dismissal and the employee asks for a written statement of the reasons under section 120, you must provide it within 14 days of the request. Failing to do so is itself a ground for the Authority to accept a late grievance. Otherwise there is no statutory deadline for the employer’s written response, but a reasonable time is measured in days, not months. Silence costs you credibility and undermines any later argument that you acted in good faith.

Should we try to settle, and how do “without prejudice” discussions work?

Most grievances settle, and early settlement is usually cheaper than being right. A settlement discussion should be held on a without prejudice basis so that offers cannot be used later in the Authority.

Labelling an email “without prejudice” does not by itself create privilege. The Court of Appeal’s test in Morgan v Whanganui College Board of Trustees [2014] NZCA 340, which the Authority applies, requires that the parties agreed, expressly or by clear implication, that the discussion was without prejudice, that a dispute already existed, and that it could lead to litigation. In Philpott v Allied Press Ltd and Mainland Distribution Ltd [2023] NZERA 576, an employer’s “without prejudice” meeting was admitted because there was no evidence the employee had agreed to proceed on that basis. Propose the without prejudice basis expressly and get the employee’s agreement before discussing terms.

Do not use a settlement offer as a substitute for process. In Hansen v Shipco Transport Ltd and Anor [2023] NZERA 679, a manager was dismissed on the spot and handed a pre-drafted record of settlement. The employer was ordered to pay six months’ lost remuneration (over $100,000), $25,000 in compensation and a $5,000 penalty for breaching good faith by never considering alternatives.

Any settlement should be recorded in a record of settlement under section 149 and signed by a mediator from Employment Mediation Services, who must explain its effect to both parties. A section 149 record is final, binding and enforceable. It cannot be cancelled for misrepresentation or breach under the Contract and Commercial Law Act 2017, and it can be challenged only on narrow grounds such as duress, incapacity, fraud, or the mediator’s failure to give the required explanation. Breaching it attracts a penalty.

What happens at mediation?

Mediation through the Ministry of Business, Innovation and Employment is free and confidential under section 148. Either party can request it, and it is voluntary at the outset, although the Authority will normally direct the parties to mediation before it investigates a claim. Section 148 protects what is said and produced in the mediation; it does not protect evidence that existed independently of it. MBIE’s Annual Report 2024/25 records a 9.1 percent rise in mediation applications and a 66.2 percent settlement rate. Waiting times have stretched at busy periods, with RNZ reporting waits of seven to eleven weeks during 2025, and many employers now use private mediators to move faster.

Prepare for mediation as you would for a hearing: a chronology, the key documents, a realistic assessment of exposure, and a settlement range approved in advance by the decision makers in your business. Read our article on how to prepare for a mediation meeting and watch our short video on what happens at an MBIE mediation.

What if the matter goes to the Employment Relations Authority?

The employee can file a statement of problem with the Authority at any time after raising the grievance, and within three years of raising it; they do not have to wait for mediation to fail. The filing fee is $71.55. You must file a statement in reply within 14 days of being served. The Authority will usually direct mediation if it has not already occurred, hold a case management conference, and then an investigation meeting at which the Authority member questions witnesses directly. Demand is rising: the Authority’s Annual Report 2025 records 2,745 applications in 2024 and 3,070 in 2025, and 852 determinations in 2025, 98 percent of them within three months of the investigation meeting or the last information being provided.

Costs usually go to the winner, but they are a contribution rather than an indemnity and the Authority adjusts them for conduct, including unreasonable rejection of a Calderbank offer. The starting tariff is $4,500 for the first day and $3,500 for each subsequent day, and the Authority’s annual reports put the average costs award at about $5,200 in 2024 and $4,900 in 2025. Your own legal costs will be higher than any award you recover.

Westlaw’s personal grievance tracker put employee success in 2024 at just under 60 percent of claims overall, and about 69 percent of unjustified dismissal claims, with average compensation for humiliation of about $15,000. Those figures predate the 2026 amendments and are likely to shift in employers’ favour.

What is our exposure if we lose?

Section 123 remedies are reinstatement (the primary remedy under section 125 where it is practicable and reasonable, but ordered only a handful of times a year), reimbursement of lost wages under section 123(1)(b) (section 128 sets a three-month floor that the Authority can exceed), and compensation for humiliation, loss of dignity and injury to feelings under section 123(1)(c). The Employment Court’s bands from GF v Comptroller of the New Zealand Customs Service [2023] NZEmpC 101 are up to $12,000 for low-level harm, $12,000 to $50,000 for moderate harm, and over $50,000 for severe harm. Most Authority awards fall between $15,000 and $19,999. Penalties can be added for breaches of the Act or of the employment agreement.

Five 2026 changes limit that exposure:

• Section 103A(5): a dismissal cannot be found unjustified solely because of defects in the process that did not result in the employee being treated unfairly. The word “minor” has gone. The Authority still weighs the section 103A(3) factors, and a defect that denied the employee a real chance to respond will still be unfair.
• Section 103A(3)(e): the Authority must consider whether the employee obstructed you from taking the steps a fair and reasonable employer would take. It is a factor, not a defence.
• Sections 123B and 123C: if the Authority finds that the employee’s conduct contributed to the situation giving rise to the grievance and amounted to serious misconduct, no remedy is available at all. If it contributed but fell short of serious misconduct, reinstatement and all compensation under section 123(1)(c) (humiliation and lost benefits) are unavailable, and lost wages can be reduced by up to 100 percent under section 124. The conduct has to be connected to what the grievance is about and proved on the evidence.
• The $200,000 threshold: employees whose annualised remuneration (pro-rated from what was paid in the 364 days before the pay period in which notice of dismissal was given, including bonuses, commission and share scheme benefits) is $200,000 or more cannot bring a grievance, or any other legal proceedings, about the dismissal, unless employer and employee have agreed in writing under section 67J that the exclusion does not apply. Employees still in the position they held on 20 February 2026, or moved from it by a restructuring, are protected for dismissals before 21 February 2027. Grievances unrelated to the dismissal, discrimination and harassment claims remain available to them.
• Trial periods and contractors: an employee dismissed under a valid 90-day trial period can no longer bring a disadvantage grievance relating to the dismissal either, and a worker who meets all five limbs of the specified contractor definition in section 6 is excluded from being an employee, so the Authority no longer examines the real nature of the relationship. The worker can still ask the Authority to decide whether the five limbs are actually met. Our article on what changed in the Employment Relations Amendment Act 2026 covers both.

The amendments took effect on 21 February 2026. Parliament gave no express transitional rule for the justification and remedy changes, so dismissals and actions before that date will generally be argued under the old wording, although the Authority has already recited the new wording in at least one case about a 2024 dismissal.

“The 2026 amendments reward employers who got the substance right. If you had a genuine reason and the employee was treated fairly in substance, a missed step in the process is no longer fatal, and where the employee’s own conduct contributed to the problem, their remedies shrink or disappear. But the amendments do nothing for an employer who had no real reason, or who never gave the employee a chance to respond. When I review a grievance for an employer, the first question is still the same: what did they do, and did we give them a fair hearing?” Andy Bell, Partner, Lane Neave (Legal 500 Asia Pacific Recommended Lawyer)

Recent cases that show where employers win and lose

• FVC v Port of Napier Ltd [2026] NZERA 503: dismissal for failing to disclose overseas convictions was justified. Substance and process both held up, and the Authority applied the amended section 103A(5) wording to a 2024 dismissal.
• Martin v SAS Builders Ltd [2026] NZERA 226: the redundancy was genuine, but the employer failed to consult on redeployment. The employee was awarded $4,872 in lost wages and $10,000 in compensation. A good reason does not excuse skipping a step that would have changed the outcome.
• Brennan v Stella 2020 Ltd and Ors [2025] NZERA 449: a trial period dismissal without the required written notice cost the employer $22,000 in compensation plus lost wages. Because the trial provision was not validly invoked, the trial period bar never applied.
• Tighe-Umbers v Jetconnect Ltd [2025] NZEmpC 136: an employer that refused to consider leave without pay as an alternative to dismissal lost in the Employment Court. The Court of Appeal granted leave to appeal in April 2026 and the appeal is pending.

All four turned on facts that predate the amendments, and one is under appeal, but the pattern holds. Employers lose when they skip the step that would have made a difference: redeployment, notice, a genuine alternative, or a genuine opportunity to respond. That is real unfairness, and the new section 103A(5) does not excuse it.

Key takeaways

• Acknowledge, preserve, assess, respond. Do it within days, and answer any request for written reasons within 14 days.
• Never retaliate. Everything you do after the grievance is evidence.
• Assess your own process honestly against section 103A, and identify from the record any conduct by the employee that contributed.
• Settle early where the process was weak. Use a mediator-signed section 149 record.
• Fix the systems. Every grievance points to a policy, a manager, or a template that needs attention. Take our Switched On Employer test to see where your business stands.

Frequently asked questions

How long does an employer have to respond to a personal grievance in NZ?

There is no statutory deadline for the employer’s response, but the employer must act in good faith and respond within a reasonable time, which in practice means acknowledging within days and responding substantively within a couple of weeks. Two deadlines are fixed: a request for written reasons for a dismissal under section 120 must be answered within 14 days, and if a statement of problem is filed in the Authority, the statement in reply is due within 14 days of service.

Can an employee raise a personal grievance after 90 days?

Only with the employer’s consent or leave from the Employment Relations Authority under section 114(3), which requires exceptional circumstances of the kind listed in section 115 and a finding that leave is just. Sexual harassment grievances have a 12-month period. Employers should check the dates and reserve their position before responding to the merits.

What happens if an employer ignores a personal grievance?

The employee can apply directly to the Authority. Ignoring the grievance is a poor good faith look, forfeits the cheapest chance to settle, can found a further disadvantage grievance, and will be relevant when the Authority decides costs.

How much does it cost an employer to go to the Employment Relations Authority?

Filing a reply is free, but in our experience legal representation through to an investigation meeting commonly costs $15,000 to $30,000 or more. If the employer loses, it may also pay the employee’s costs on the Authority’s tariff of $4,500 for the first day, plus lost wages and compensation.

Does the $200,000 threshold mean high earners can’t claim unjustified dismissal?

Since 21 February 2026, employees whose annualised remuneration is $200,000 or more cannot bring an unjustified dismissal grievance, or other legal proceedings about the dismissal, unless employer and employee have agreed in writing that the exclusion does not apply. Employees still in the position they held before the amendments (or moved from it by restructuring) are protected until 21 February 2027. Claims for unjustified disadvantage unrelated to the dismissal, discrimination and harassment remain available.

For employers: defending personal grievances. For employees: personal grievance services.

Andy Bell is a Partner at Lane Neave, an employment lawyer who has practised in New Zealand for over 20 years, defending personal grievances for employers from small businesses to national organisations and acting for employees in the Employment Relations Authority and Employment Court. He is a Recommended Lawyer in the Legal 500 Asia Pacific and a Recommended Employment Lawyer in Doyle’s Guide 2026.

Last updated: 11 September 2026