{"id":21377,"date":"2025-08-11T02:49:37","date_gmt":"2025-08-11T02:49:37","guid":{"rendered":"https:\/\/nzsda.org.nz\/?p=21377"},"modified":"2026-02-10T19:41:59","modified_gmt":"2026-02-10T19:41:59","slug":"protected-negotiations-a-potential-game-changer-for-small-businesses","status":"publish","type":"post","link":"https:\/\/nzsda.org.nz\/index.php\/2025\/08\/11\/protected-negotiations-a-potential-game-changer-for-small-businesses\/","title":{"rendered":"Protected Negotiations: A Potential Game Changer for Small Businesses"},"content":{"rendered":"\t\t
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Protected Negotiations: A Potential Game Changer for Small Businesses<\/h2>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
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If you\u2019ve ever had a staff member who just isn\u2019t the right fit, but there\u2019s no clear misconduct or formal dispute, you\u2019ll know how tricky it can be to end the relationship without risking a personal grievance.<\/p>

Right now, the law only allows \u201cwithout prejudice\u201d exit talks when there\u2019s already a dispute on the table. But a proposed law change could give small business owners a new option \u201cProtected Negotiations\u201d<\/p>

What\u2019s Changing?<\/strong><\/p>

The Employment Relations (Termination of Employment by Agreement) Amendment Bill aims to let employers start confidential exit talks without needing a formal dispute first.<\/p>

Under the proposal:<\/b><\/p>

  • You can offer an exit package e.g., payout, reference, mental health support etc in exchange for ending employment by mutual agreement.<\/li>
  • All discussions remain confidential and inadmissible in future legal claims (unless dishonesty or bad faith is involved).<\/li>
  • The offer must be in writing, signed, and you must advise the employee to seek independent legal advice and give them a reasonable chance to do so.<\/li><\/ul>

    \u00a0<\/p>

    The bill is currently with the Select Committee, expected to report back in October 2025.<\/p>

    How would this work in reality?<\/b><\/p>

    Current Law: Jane owns a small printing business. One of her designers, Sam, is a good person but constantly misses deadlines and struggles with the fast-paced environment. There\u2019s no serious misconduct, just a mismatch. If Jane raises the idea of parting ways now, she risks Sam claiming \u201cconstructive dismissal\u201d unless she goes through a lengthy performance management process.<\/p>

    Under Protected Negotiations: Jane could approach Sam for a confidential, \u201cprotected conversation\u201d:<\/p>

    \u201cSam, I can see this role isn\u2019t playing to your strengths. I\u2019d like to discuss a mutual exit that supports you in finding something more suitable. I\u2019m happy to offer four weeks\u2019 pay, a written reference, and flexibility on your finish date.\u201d<\/p>

    Sam is encouraged to seek legal advice before deciding. If Sam accepts, they sign a written agreement, and the exit happens smoothly, without a drawn-out legal process.<\/p>

    The UK has something similar called \u201cProtected Conversations\u201d under the Employment Rights Act 1996. Employers can initiate \u201coff the record\u201d settlement discussions for any reason, not just disputes.<\/p>

    UK Business owners found that this enabled:<\/p>

    \u00b7 Faster resolution when someone isn\u2019t the right fit.<\/p>

    \u00b7 Reduced legal risk from informal conversations being used against you.<\/p>

    \u00b7 Preserved relationships by keeping talks dignified and private.<\/p>

    Obviously, this is still under consideration, but this could be a great tool to use to manage \u201cchallenging employees\u201d. However, like any tool, it works best when used carefully, fairly, and with a clear understanding of the risks.<\/p>

    Sign up to our newsletter to be kept informed of other employment related, health and safety and training changes hello@networkhr.co.nz<\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t","protected":false},"excerpt":{"rendered":"

    The Employment Relations (Termination of Employment by Agreement) Amendment Bill aims to let employers start confidential exit talks without needing a formal dispute first.<\/p>\n","protected":false},"author":2,"featured_media":19841,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[25],"tags":[],"class_list":["post-21377","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business-advice"],"_links":{"self":[{"href":"https:\/\/nzsda.org.nz\/index.php\/wp-json\/wp\/v2\/posts\/21377","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/nzsda.org.nz\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/nzsda.org.nz\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/nzsda.org.nz\/index.php\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/nzsda.org.nz\/index.php\/wp-json\/wp\/v2\/comments?post=21377"}],"version-history":[{"count":13,"href":"https:\/\/nzsda.org.nz\/index.php\/wp-json\/wp\/v2\/posts\/21377\/revisions"}],"predecessor-version":[{"id":21390,"href":"https:\/\/nzsda.org.nz\/index.php\/wp-json\/wp\/v2\/posts\/21377\/revisions\/21390"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/nzsda.org.nz\/index.php\/wp-json\/wp\/v2\/media\/19841"}],"wp:attachment":[{"href":"https:\/\/nzsda.org.nz\/index.php\/wp-json\/wp\/v2\/media?parent=21377"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/nzsda.org.nz\/index.php\/wp-json\/wp\/v2\/categories?post=21377"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/nzsda.org.nz\/index.php\/wp-json\/wp\/v2\/tags?post=21377"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}