Monique Mackie is a Special Counsel in the Private Client, Trusts, Estate Planning & Asset Protection team at Glaister Keegan. She has over twenty years’ experience practising in the area of Trusts and Personal Asset Planning. Prior to specialising in this area of practice, she also worked in the tax team of a large New Zealand law firm. This experience allows Monique to bring an understanding of structuring and commercial considerations when advising clients. Monique prides herself on being approachable, caring and professional while providing expert legal advice on such an important area of law for individuals and families. Frank Chan is a Senior Associate in the Private Client, Trusts, Estate Planning & Asset Protection team at Glaister Keegan. Frank has built a diverse legal career spanning residential and commercial property, trusts, wills, estates, and banking and finance law. Over the years, Frank has had the privilege of advising families, small‑to‑medium businesses, family trusts, estates, property developers, and financial institutions. He takes pride in offering practical, effective legal advice that empowers clients to achieve their goals, whatever they may be.
Several changes impacting on employer/employee relationships have been introduced under the Employment Relations Amendment Act 2026 with effect from 21 February 2026. New Remuneration Threshhold for Unjustified Dismissal Claims: A new provision has been implemented whereby employees earning more than $200,000 per year will no longer be able to raise a personal grievance for unjustified dismissal, or unjustified disadvantage relating to the dismissal. It is necessary to be aware that the $200,000 annual income threshold is based on total remuneration - this includes not only salary but also bonuses, commissions, share-related benefits and other allowances actually paid in the year before dismissal. Employers are no longer required to comply with the usual unfair dismissal procedures, such as providing reasons or following good faith obligations, when dismissing high earner employees. Those employees do still retain rights to bring grievances on other grounds (eg discrimination, harassment, etc). On a practical level, there is a transition period of 12 months for current employees, before the change takes effect, and even after that initial period the threshold does not automatically override existing terms and policies in employment agreements. The Act does allow parties to opt out of the new provisions. Action: Employers and employees affected by the changes should look to renegotiate the terms of their employment agreements before the end of the transition period if appropriate. Unless there are specific provisions imposing obligations on the employer to follow a fair and reasonable process and have justifiable reason for termination, the employee will be subject to termination at will. It is however still possible for parties to opt out of the new sections under the Act and to allow an employee to retain the right to claim unjustifiable dismissal. Another option is to look at an extended notice period so an employee will have a reasonable time in which to look for a new job. Changes to Justification for Dismissals and Reduction in Remedies: The new law introduces stronger consequences where an employee’s conduct has contributed to a personal grievance. The amendments provide that contributory conduct can significantly reduce or eliminate remedies that were commonly previously awarded. Minor procedural defects will no longer automatically result in a dismissal being unjustified, unless the defects result in unfair treatment. If an employee’s own behaviour contributed to the situation, for example misconduct, dishonesty, or refusal to obey reasonable instructions, the compensation which might be awarded may be reduced by up to 100%. Where the actions of the employee amounted to serious misconduct then the Employment Relations Authority or Employment Court will not award any remedy at all. Contractor v Employee – New “Gateway” Test: The amendment aims to provide more upfront certainty for employers and workers to determine whether they are a contractor or an employee. The historical position has been that Courts (or the Employment Relations Authority) looked at the real nature of the working relationship between the parties to determine the worker’s status. The Employment Relations Act now sets out prescribed criteria that, if met, will recognise a worker as a specified contractor and exclude them from the definition of an employee. The key criteria are: There is a written agreement specifying that the worker is an Independent Contractor (or not an employee); The worker is not restricted from performing work for others; The worker is not under control as to how and when the work is done, or is allowed to sub-contract the work; The business/employer cannot terminate the arrangement if the worker turns down additional work; The worker had a reasonable opportunity to seek independent advice before entering into the agreement. If any of the gateway test criteria are not met, the existing common law test of employment status will still be used. Conclusion – Action: In light of the changes which have been introduced it will be important to review and amend terms of existing employment agreements, particularly for employees on or approaching the high threshhold remuneration level, within the next 12 months. When entering into a new arrangement to engage a worker or to undertake work, consider whether the criteria are met to be defined as an independent contractor rather than employer. When actions or conduct of an employee bring disciplinary action into consideration, take into account whether the employee’s behaviour is of such a level that it may impact on the justification for dismissal.
A recent Tenancy Tribunal decision gives us an opportunity to consider the strengths and limitations of fixed term tenancies. Background Shadrock was a tenant under a fixed-term residential tenancy. She attempted to terminate her tenancy, citing that the rent was too expensive. The landlord reminded her that she had a fixed-term tenancy and could not end it by notice. Shortly thereafter, she tried to terminate the tenancy under s 56B of the Residential Tenancies Act, which allows tenants to urgently withdraw from residential tenancies if they have been victims of family violence. She could not, however, provide the evidence required by the Act. Shadrock eventually vacated the premises and the landlord re-took possession. The landlord sought an order from the Tenancy Tribunal seeking payment of the bond to them, payment for rent up to the date they had re-taken possession, and other costs (including the costs to repair water damage that had occurred to the premises). The Tribunal found that the tenant had no grounds to terminate the lease under s 56B, ordered that the entirety of the bond be released to the landlord, and that the tenant pay an amount to the landlord for cleaning and carrying out repairs to the premises. S 56B Residential Tenancies Act 1986 This section permits a tenant to withdraw from a residential tenancy (whether periodic or fixed term) with 2 days’ notice, provided qualifying evidence is provided showing that either the tenant or a dependent of the tenant has been the victim of family violence while a tenant of the premises. The qualifying evidence must be given by one of a broad number of prescribed people, such as a medical professional, police employee, social worker, school principal, or lawyer, and can be: a written statement that they reasonably believe that the tenant or their dependent has been a victim of family violence; the first page of a family protection order; a Police safety order; or a charging document under s 14 of the Criminal Procedure Act 2011 relating to family violence against the tenant. All of the above must show or state that the violence occurred while the tenant was a tenant of the premises. If the tenant is the sole tenant under the lease, the lease immediately terminates. If there are remaining tenants, the rent is temporarily reduced for two weeks and a special procedure determines how the bond is to be treated. Termination of a Fixed-Term Residential Tenancy Landlords and tenants are obviously limited in their ability to terminate a fixed-term tenancy prior to its expiry. Aside from the provisions of s 56B, a tenant may terminate a fixed-term tenancy: where the premises is destroyed or otherwise rendered uninhabitable; or where the premises has been contaminated above the prescribed maximum safe level. A landlord may also terminate a fixed-term tenancy with 14 days’ notice where a tenant has assaulted the landlord, a member of the landlord’s family, or the landlord’s agent. The Tenancy Tribunal may also order a residential tenancy to be terminated where the tenant is chronically arrears in rent, has seriously breached the tenancy agreement, or has committed incidents of anti-social behaviour. Tenant’s Liability for Damage to the Premises In Shadrock’s case, the tenant was found to have carelessly, but not intentionally, caused water damage to the premises from a series of accidental floods in the kitchen and bathroom. Section 49B(3)(a) of the Residential Tenancies Act sets out a tenant’s liability for damage to premises: When caused carelessly and covered by the landlord’s insurance, the tenant’s liability is limited to either the landlord’s excess, or four weeks’ rent (whichever is lesser). When caused carelessly and not covered by the landlord’s insurance, the tenant’s liability is limited to four weeks’ rent. When caused intentionally, the tenants will be liable for the costs of repair, and an insurer will be entitled to pursue the tenant for the full costs of repair. A Trap For Unwary Players A fixed term tenancy of longer than 90 days does not automatically end on the scheduled end date – it will instead automatically become a periodic tenancy unless either the landlord or the tenant give written notice to the other between 21 and 90 days before the end of the term, confirming that the tenancy will end on the end date. Conclusion Even if a fixed term tenancy is brought to an end correctly, there can be unanticipated costs for the tenant. Both parties – landlord and tenant - need to be aware of their rights and obligations when a tenancy ends, whether it is a fixed-term or periodic tenancy.