What is unjustified disadvantage in New Zealand, and how do you prove it?

Last updated: 13 November 2026 | Written by Andy Bell, Partner, Lane Neave

Unjustified disadvantage is a personal grievance an employee can bring when their employer does something that harms their employment or their conditions of work, and the employer cannot justify it. To prove it, you show that you were disadvantaged by something your employer did or failed to do. The employer must then show that a fair and reasonable employer could have acted that way in all the circumstances.

The grievance comes from section 103(1)(b) of the Employment Relations Act 2000. The test for whether the employer’s action was justified is in section 103A. You must raise the grievance with your employer within 90 days of the action, or within 90 days of it coming to your notice if that is later (section 114). The period is 12 months for a sexual harassment grievance. If it is not resolved, you have three years from raising it to file a claim in the Employment Relations Authority.

The most useful thing you can do early is write down what changed, when, and how it affected you. A claim is much stronger when you can show a clear effect on your job, pay or wellbeing, backed by documents from the time.

Since 21 February 2026, employees whose annual remuneration is at or above a threshold (currently $200,000) generally cannot bring an unjustified dismissal grievance. There is a transition for existing employees: someone already in the job on 21 February 2026 who is dismissed before 21 February 2027 keeps that right, unless they agreed in writing to give it up. High earners can still bring a disadvantage grievance, as long as it does not relate to a dismissal.

What does the law say?

Section 103(1)(b) covers a situation where an employee’s employment, or one or more conditions of their employment, is “affected to the employee’s disadvantage by some unjustifiable action by the employer”. That includes conditions that survive the end of employment, such as a promised payment after you leave.

A “condition of employment” is wider than the written terms of your employment agreement. It can include the hours you work, your duties, your reporting line, your pay, and the safety and support you are entitled to at work.

“Unjustifiable” is measured against section 103A: the Authority or the Employment Court asks whether the employer’s actions, and how it acted, were what a fair and reasonable employer could have done in all the circumstances at the time.

How do you prove an unjustified disadvantage?

There are three parts.

1. Disadvantage: you show that your employment or a condition of it was affected to your disadvantage. A loss of pay, hours or status is the clearest kind. Stress or damage to your reputation can also count if you can show the effect, and an unfair process counts only if it affected your employment or a condition of it.
2. Employer action: you show that the disadvantage came from something the employer did, or from something it failed to do when it should have acted.
3. Justification: the section 103A test is objective, but in practice it is then for the employer to show that a fair and reasonable employer could have acted the same way.

Under section 103A(3), the Authority must consider whether the employer, having regard to its resources, sufficiently investigated, raised its concerns with you, gave you a reasonable opportunity to respond, and “genuinely considered” your explanation before acting. Since February 2026 it must also consider whether you obstructed the employer from taking any of those steps or another relevant step (section 103A(3)(e)).

Good evidence includes emails announcing the change, payslips and rosters before and after, meeting notes, your complaint and the response (or lack of one), and medical notes if your health was affected.

What are common examples of unjustified disadvantage?

Employment New Zealand (MBIE) and the Community Law Manual list similar examples to the ones I see most.

• Unilateral changes: cutting your hours, pay or duties, or changing your role or reporting line, without consultation or agreement.
• Demotion or transfer: moving you to a lower-paid or less senior job, or to another location, without a proper process.
• Withdrawing work or benefits: taking away shifts, clients, a company vehicle or another benefit you were entitled to.
• Unjustified warnings: a warning given without a fair investigation, or for conduct that did not justify it.
• Unjustified suspension: suspending you without a proper basis or process, or without pay where your agreement does not allow it. See our post on whether your employer can suspend you while it investigates.
• Failing to deal with a complaint: for example, not investigating or acting on a bullying or harassment complaint.
• An unfair process: a performance or disciplinary process a fair employer would not have run that way, where it has affected your employment.

Whether any of these is unjustified depends on the facts. An employer can change some things under your agreement and can raise performance concerns, and the question is whether it did so fairly and in good faith.

Can every workplace disagreement become a disadvantage grievance?

No. Under section 103(3), an unjustifiable action does not include an action deriving solely from the interpretation, application or operation (or disputed interpretation, application or operation) of a provision of an employment agreement. That kind of disagreement is a dispute about the agreement, dealt with through the disputes procedure rather than as a personal grievance.

The Court of Appeal looked at this in Breen v Prime Resources Company Ltd [2026] NZCA 33 (24 February 2026). The employer deducted about $4,326 from a general manager’s pay for hours it estimated he had not worked during the August 2021 COVID-19 lockdown in Auckland. The Employment Court had held that the claim was solely a dispute about a clause in his agreement.

The Court of Appeal disagreed. It held that the bar applies only if resolving the claim turns entirely on whether the employer’s genuine interpretation of the agreement was correct. Here, the deduction also came from the employer’s own estimate of his hours, made unilaterally and without warning. The Court sent the grievance back to the Employment Court without deciding whether it should succeed.

Community Law also notes that a claim is less likely to succeed where the employer had a genuine discretion over a benefit, rather than a contractual obligation to provide it.

How is unjustified disadvantage different from unjustified dismissal and constructive dismissal?

	Unjustified disadvantage	Unjustified dismissal	Constructive dismissal
Statutory basis	s 103(1)(b)	s 103(1)(a)	s 103(1)(a), treated as a dismissal
Are you still employed?	Usually yes	No, the employer ended it	No, you resigned
What you must show	An action affected your employment to your disadvantage	That you were dismissed	That the employer’s breach or conduct left you no real choice but to resign
Who must justify	The employer, under s 103A	The employer, under s 103A	The employer, once dismissal is shown
Available to $200,000+ earners?	Yes, unless it relates to dismissal	No (from 21 February 2026), except existing employees dismissed before 21 February 2027	Probably not, as it is treated as a dismissal (not yet tested)

If you resign because of an unresolved disadvantage, the claim may become one for constructive dismissal, which has a higher bar to prove. Take advice before resigning.

What remedies can you get?

Section 123 sets out the remedies the Authority or Court may award if the grievance is upheld. For a disadvantage grievance these usually include reimbursement of lost wages or other money lost (section 123(1)(b)), compensation for humiliation, loss of dignity and injury to feelings (section 123(1)(c)(i)), and compensation for the loss of a benefit you might reasonably have expected to get (section 123(1)(c)(ii)).

The Authority can also make recommendations to the employer about how to stop the problem happening again (section 123(1)(ca)). Getting back what you lost, such as your former hours or role, is often what a disadvantaged employee wants most, and it is often agreed at mediation.

These remedies are now subject to sections 123B and 123C. If something blameworthy you did contributed to the situation, the Authority or the court cannot award reinstatement or any compensation under section 123(1)(c), and lost wages can be reduced to reflect your share (see below). Where compensation is available, the amount depends on evidence of harm such as stress, sleeplessness or damage to reputation, so record these as they happen.

What has changed recently?

The Employment Relations Amendment Act 2026 mostly came into force on 21 February 2026. These are the changes that affect disadvantage grievances. Our full post on the Employment Relations Amendment Act 2026 explains the Act as a whole.

• High earners: under section 113A, an employee whose annual remuneration (broadly, annualised PAYE income from the employer) meets the threshold cannot bring an unjustified dismissal grievance or a disadvantage grievance that relates to the dismissal. The threshold is currently $200,000 and rises each 1 July in line with average weekly earnings (section 113B). Employees already in their job (or a restructured one) on 21 February 2026 who are dismissed before 21 February 2027 keep their protection, unless they agreed in writing that the threshold applies to them (Schedule 1AA, clause 29).
• What high earners keep: other disadvantage grievances, and grievances such as discrimination, harassment and duress. The line between the two kinds of disadvantage grievance is not clear yet, and an employer may argue that a warning or process leading to a dismissal relates to it.
• Contributory conduct: if an action of yours contributed to the situation and amounted to serious misconduct, no remedies are available (section 123B). If something blameworthy you did contributed, even without serious misconduct, the Authority or the court cannot award reinstatement or any compensation under section 123(1)(c), including for humiliation or loss of benefit (section 123C). Lost wages can be reduced to reflect your contribution, by up to 100% (section 124). Where the employer’s action happened before 21 February 2026, the Authority may apply the old law, under which contribution reduced compensation instead of removing it.
• Obstruction: the section 103A test now asks whether you obstructed the employer from taking the steps of a fair process (section 103A(3)(e)).
• Procedural defects: under amended section 103A(5), the Authority must not find a dismissal or an action unjustified solely because of process defects that did not result in you being treated unfairly. The word “minor” has been removed.

“Most people who come to me about a disadvantage grievance want to talk about what their employer did. One of my first questions is what the employer will say about them, because anything they did that contributed to the problem will affect the compensation they can recover. A grievance letter that deals with your own part openly from the start is much harder for an employer to pick apart than one that leaves it out.” Andy Bell, Partner, Lane Neave (Legal 500 Asia Pacific Recommended Lawyer)

What should you do?

1. Write a dated timeline of what changed, who made the decision, and how it has affected your pay, role, health or reputation, and keep copies of the documents.
2. Ask your employer in writing for the reason for the change and any information it relied on. A clear request often produces either a fix or useful evidence.
3. Raise the grievance within 90 days. The law only requires you to make your employer aware of it, but writing gives you a clear record. Our guide on how to raise a personal grievance with your employer sets out what to include.
4. Think about what outcome you want, such as your old hours back, the warning removed, or an agreed exit, before you go to mediation.
5. Get advice before resigning, as resignation changes the claim and the evidence you will need.

Frequently asked questions

Can I bring an unjustified disadvantage claim while I am still employed?

Yes. Most disadvantage grievances are raised by people who are still in the job, and high earners can bring one too, provided it does not relate to a dismissal. The law requires your employer to deal with you in good faith while the grievance is being resolved.

Is a written warning an unjustified disadvantage?

It can be, because a warning affects your employment record and can be relied on later in a dismissal. It is likely to be unjustified if the conduct did not warrant a warning, or if a flaw in the process, such as no proper investigation or no chance to respond, treated you unfairly. The Authority will also ask whether you obstructed that process.

What happens if I miss the 90-day deadline?

You can still raise the grievance late if your employer agrees. If it does not, you can ask the Employment Relations Authority for leave, which it may grant if the delay was caused by exceptional circumstances under section 115 and it considers it just to do so. Those circumstances include being so affected or traumatised by the matter that you could not properly consider raising it, or a representative you had made reasonable arrangements with unreasonably failing to raise it in time.

How much compensation do people get for unjustified disadvantage?

There is no fixed amount. Awards depend on the evidence of how the action affected you, but since February 2026 no compensation is available if something blameworthy you did contributed to the situation, and no remedy at all if that action was serious misconduct. Many disadvantage grievances settle at mediation, where the outcome is often a fix to the problem as well as, or instead of, a payment.

Can my employer change my hours or duties without my agreement?

If your hours are set in your employment agreement, Employment New Zealand says your employer cannot change them without your agreement, which should be in writing. Where the agreement lets the employer change your hours, it must still act fairly and reasonably, and a change to your duties is judged on whether a fair and reasonable employer could have made it. A significant change to hours, pay or duties without agreement or a fair process is one of the most common grounds for a disadvantage grievance.

Related: types of personal grievances, how to raise a personal grievance, and the Employment Relations Amendment Act 2026.

Andy Bell is a Partner at Lane Neave, an employment lawyer who has practised in New Zealand for over 20 years, acting for employees and employers in the Employment Relations Authority and the 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: 13 November 2026. This article is general information about New Zealand law, not legal advice on your situation.