Contracting out of personal grievance claims

The personal grievance provisions in the Employment Relations Act 2000 (“the Act”) are intended to protect workers from unjustifiable dismissal or disadvantage.  This overrides any existing agreements agreed to by the parties.

The Employment Relations (Allowing Higher Earners to Contract Out of Personal Grievance Provisions) Amendment Bill (“the Bill”), promoted by National’s Scott Simpson, amends the Act to allow employees with an annual gross salary over $150,000 to contract out of the personal grievance provisions.

Under the Bill, if that option is taken, whatever the employee and the employer have agreed to in their employment agreement stands.  This removes the threat of personal grievance for the employer in exchange for agreed terms with the employee.

These changes, if implemented, may help focus employment law provisions on those who have most need of employment protection, and may assist to reduce the number of personal grievance cases clogging up the legal system.