Contribution under the new Employment Relations Amendment Act: what the first cases tell us

Contributory conduct is behaviour which is blameworthy and caused or contributed to the situation giving rise to the grievance.

Previously, contribution under s 124 was a factor the Court or Authority had to consider when awarding remedies. The Judge or Member had a broad discretion to determine the extent of an employee’s contribution, and which remedies (if any) should be reduced.

A 100% reduction in remedies was not expressly permitted under s 124, but in rare cases the Court or Authority declined to award any remedies because the misconduct of the employee was so egregious. A recent example is Gorrett v Skibo Ltd,¹ where an employee was dismissed for sexually harassing a colleague. Although the dismissal was unjustified on procedural grounds, the Authority held that it would be contrary to equity and good conscience to award Mr Gorrett remedies.

The changes introduced by the Employment Relations Amendment Act 2026 now either eliminate or restrict an employee’s entitlement to certain remedies in cases of serious misconduct or other contributory behaviour:

• Section 123B prevents the Authority or Court from awarding any remedies for a personal grievance if the employee’s behaviour amounts to serious misconduct.
• Section 123C prevents the Authority or Court from awarding reinstatement and/or compensation where there is contributory behaviour other than serious misconduct.
• Section 124(2) allows the Court or Authority to reduce any remaining remedies (such as lost wages) by up to 100% if there has been contributory behaviour.

The early determinations are all urgent applications for interim reinstatement. Because interim reinstatement applications are decided on untested evidence, the Authority has taken a cautious approach to the new contribution sections.

On timing, the cases have been consistent: the new sections apply where the cause of action accrued on or after 21 February 2026.

In Mandich v Civil Aviation Authority,² the employer argued that the new regime applied because the employee filed proceedings after 21 February. The Authority rejected this argument, determining that the old regime applied because the employee was dismissed prior to 21 February.  Similarly, in Mitchell v Tasman Rugby Union,³ the employee argued that the employer had pre-determined the decision to dismiss prior to 21 February so the old regime should apply. This argument was again rejected in favour of the actual date of dismissal. The dismissal occurred after 21 February 2026, so the new regime applied.

The most substantive guidance on how the new sections may be applied comes from Waanders v MSX.⁴ The Authority confirmed that contribution under the new s 123C will be assessed by reference to the established case law under the old s 124. The employee’s conduct must be culpable and/or blameworthy, and not every action by an employee will extinguish the remedy of reinstatement. On the facts, the Authority was unwilling to draw any conclusions about the alleged serious misconduct at an interim stage but did find that the employee’s failure to engage with his employer’s concerns during the disciplinary process was relevant.

In GLM v Kāinga Ora – Homes and Communities,⁵ the Authority took a more nuanced approach to the relevance of contribution at an interim stage. The fact that contribution issues would arise at the substantive hearing was accepted as a reason for caution, weighing against interim reinstatement.

The question of which version of the law applies has dominated the first wave of cases, but it has a natural expiry date. As dismissals pre-dating 21 February 2026 work their way out of the system, attention will shift to the harder questions the interim decisions have so far deferred.

Because these provisions significantly limit employees’ access to remedies under the Act, it is likely that the Authority and the Court will read these sections strictly. In our view two areas are likely to receive more scrutiny:

• The threshold for “serious misconduct” under s 123B. Because the finding now removes all remedies, the threshold for what constitutes “serious misconduct” may rise, and conduct at the margins of the definition may no longer qualify.
• The meaning of “contributed to the situation”. There is likely to be an increased focus on the strength of connection required between the employee’s behaviour and the situation giving rise to the grievance before a finding of contributory conduct can be made.

The amendments may also change how employers and employees approach disputes. For employees, the prospect of a Pyrrhic victory may encourage settlement where misconduct is alleged, even where the process was plainly deficient.

For employers, there may be a temptation to cut corners during a disciplinary process on the assumption that serious misconduct bars remedies in any event. That may prove to be a dangerous strategy, particularly if the Authority and Court take a strict approach to interpreting the amendments.

These amendments represent a significant change to the remedies framework for personal grievances, and it remains to be seen how the Authority and the Court construe the new sections in substantive determinations. We will continue to monitor the developing case law and provide further updates as they emerge. In the meantime, please contact our team if you would like advice on how the amendments apply to your circumstances.

1. [2026] NZERA 241.
2. [2026] NZERA 339.
3. [2026] NZERA 435.
4. [2026] NZERA 411.
5. [2026] NZERA 456.

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