New year, new law – employment relations amendment bill passes parliament

The Employment Relations Amendment Bill passed its third and final reading in Parliament on 17 February 2026, and will become law upon Royal Assent being received, which is anticipated in the coming days.

These changes to labour market legislation are some of the most significant in over 30 years, particularly concerning personal grievances.

We have touched on some of the changes promised by the coalition government in our previous article, which you can read more about here.  Those key changes have been widely publicised throughout 2025, and include:

• Clarifying the distinction between employment and contracting arrangements by introducing criteria for a “gateway test” for a contractor.
• Reducing access to the personal grievance process and associated remedies, including by:
• Introducing an annual remuneration threshold of $200,000 (previously, this was to be $180,000) which prevents higher earning employees from pursuing unjustified dismissal claims or any unjustified disadvantage claim in relation to their dismissal. There will be annual amendments to the remuneration threshold, from 1 July 2027 onwards.
• Removing access to remedies for personal grievances in circumstances where the employee has engaged in behaviour which has contributed to their grievance, and where it amounts to serious misconduct.
• Where a workplace has a collective agreement, removing the “30-day rule”, which previously required individual employment agreements to reflect collective agreement terms for the first 30 days of employment, irrespective of whether the employee elects to join the union. Much of the onerous union-related information sharing requirements have also fallen away.

Importantly, those earning over this $200,000 annual total remuneration threshold (including bonuses) can opt in to personal grievance provisions by agreement with their employer.  For existing employees earning at least this amount, there will be a 12-month window from when the law comes into effect for them to consider renegotiating their employment agreements to include the ongoing application of personal grievance provisions.  If they don’t, then after those 12 months, those provisions will not apply.

The effect of this also includes that they will not be entitled to reasons for their dismissal, and the duty of good faith will also not apply to their dismissal.  This is the most significant change for a specific group of employees in the labour market in decades.

The focus of investigating personal grievance claims in the Employment Relations Authority is likely to shift towards the employee’s conduct and the impact of that on potential remedies.

With the Bill now having passed its third reading in Parliament and awaiting Royal Assent, the team at Wynn Williams is well placed to ensure any employment agreements are up to date and fit for purpose – and to navigate our clients through employment processes – in light of the sweeping changes.

We recommend getting in touch with one of our employment law specialists to ensure your business is well equipped to handle the upcoming changes.