When: This law became effective from 23 December 2023
What: All employers in New Zealand, no matter their size, are now able to use 90-day trial periods. Previously, they only applied to employers with fewer than 20 employees. The trial periods are now available to all employers.
Why: Provides employers with greater confidence when hiring new employees.
What you need to do: A trial period must be agreed to by the employer and the employee in writing, and in good faith, before the employee starts work, as part of their employment agreement.
The extension of 90-day trials will not affect other aspects of employment relations, such as the requirement to act in good faith, or worker protections regarding pay, conditions, leave, and health and safety.
If you’re hiring people on certain work visas, you will also need to consider any immigration requirements relating to the use of trial periods.
Trial periods(external link) — Employment New Zealand
Employment Agreement Builder(external link)
Repeal of Fair Pay Agreements legislation
When: From 20 December 2023
What: The Fair Pay Agreements (FPA) Act has been repealed. Rights and obligations under other employment legislation still apply. Employers, unions, and employees are encouraged to work together to agree suitable employment terms.
What you need to do: If your organisation currently holds any personal information collected for the purpose of the Fair Pay Agreement activities, including bargaining, it must now be disposed of in line with the privacy laws. The Office of the Privacy Commissioner explains how you can do this.
Disposing of information and documents safely(external link) — Office of the Privacy Commissioner
The repeal of fair pay agreements legislation(external link) — Employment New Zealand
The Ministry of Business, Innovation and Employment has more information on fair pay agreements.
Fair Pay Agreements legislation(external link) — Ministry of Business, Innovation and Employment
Potential changes to tax
This content is written in association with Hnry.
When: From June 2024
What: The new government have disclosed their upcoming tax plan. There have yet to be any policies passed that will impact you today. However, it can be helpful to be aware of what might be around the corner. The proposed changes include:
- increasing income tax thresholds
- increasing eligibility for the Independent Earner Tax Credit (IETC)
- the FamilyBoost childcare tax credit
- increasing Working for Families tax credits
- mortgage interest deductibility reintroduced for rental properties
- higher CO2-emitting vehicles will no longer be subject to fees
- reversal on app tax reversal
- repeal of the foreign buyers tax.
Why: New Zealand has been managing inflation and the cost-of-living crisis. The proposed changes are aiming to tackle these financial strains for Aotearoa.
What you need to do: Keep an eye out for updates. We will be sharing any major changes, including from IR, that you will need to be across.
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For more information on what all the changes mean for sole traders and small businesses, Hnry has a full article going into depth on the specific impacts.
