Unlike other countries, mediation is common in New Zealand as a basic step when employers look to resolve employment disputes with employees. There is no legal requirement to attend mediation, and you can opt-out of it if you do not wish to take part. However, you must have a good reason for doing so. Otherwise, you may fail to meet the ‘acting in good faith’ requirement, as you may impede a quick resolution of the dispute. This article will explain what mediation involves, whether you are required to attend, and what the process is for an employer.

What Does Mediation Involve?

Mediation is a half or full-day event where an independent person called a mediator helps resolve an employment relationship problem between you and an employee in a semi-formal environment. Mediation is not a formal legal process and certainly is not a court process. The aim is to resolve issues so that they do not need to progress to a more formal (and expensive) setting.

A mediator will help you and the employee to identify main issues and find potential solutions. The aim is for you both to come to an agreement, recorded in a binding settlement agreement. You cannot be forced into a decision or mediation agreement.

Is Mediation Required When Employment Relationships Break Down?

Technically, mediation is voluntary, which means there is no legal requirement for you to attend. However, your participation in mediation can demonstrate your commitment to employment relationship’s good-faith duties. As an employer, bypassing the opportunity for mediation can result in not fulfilling your responsibilities to manage conflicts.

The other possibility if you choose not to take part is the other party can take their complaint to the Employment Relations Authority, which can then require you to attend mediation. As part of a typical process, the Employment Relations Authority will always ask if the parties have attended mediation to try to resolve their issues. 

For these reasons, it is almost always worth it to try and resolve an employment conflict in mediation first.

What is the Process for Mediation?

One important note is that a mediation meeting is not like going to court. You are not under oath, and you will not be cross-examined. Anything you say throughout is confidential and the other party cannot use it against you in any later proceedings.

The only people who must attend a mediation are the parties (you, and the employee) and the mediator. You can bring a support person or lawyer, but you do not have to. Typically, mediations will last 3-4 hours, but more complicated situations may take a full day.

In terms of the process, expect the mediator at the outset to:

  • outline the mediation process and rules;
  • allow you and the employee to have an uninterrupted opportunity to give your side of the story;
  • allow you and the other party to indicate the outcome you are both looking for;  and
  • help identify and discuss each issue. 

It is advisable to be honest about the outcome you are seeking in the mediation. A common example is when an employer feels that the working relationship is beyond repair and does not want to consider reinstating a dismissed employee. On the other hand, if the employee believes the working relationship is beyond repair, they might be asking for a good reference and compensation for their stress and costs. Being upfront with these goals is usually a good idea.

The mediator will usually attempt to negotiate a compromise between what you are looking for and what the employee is looking for. It is a good idea to remain open about a solution that might work, even if it involves paying the employee an amount of compensation that you do not think they deserve. If the agreement resolves the issue, you will save money and costs from not having to defend a formal legal case in a court.

Key Takeaways

Mediation is not legally required for resolving employment issues in New Zealand. However, in practical terms, it is a common step in the grievance process. This is because both parties have a good faith obligation to try to resolve issues efficiently, and mediation is much faster and cheaper than a court setting. You can be required to attend mediation by a court if you refuse in the first instance, so you should seek legal advice if you do not wish to attend mediation for any reason.

If you have any questions about mediation in New Zealand, contact LegalVision’s employment lawyers on 0800 005 570 or complete the form on this page.

FAQs

Do I have a good faith duty as an employer to participate in mediation?

Yes, your good faith duty towards an employee extends to trying to resolve disputes quickly and efficiently.

How long does mediation take?

A mediation itself usually takes only a day, or even a half-day, depending on the situation’s complexity. It may take some more days to then agree to a final settlement agreement.

Can any employee raise a personal grievance and request mediation?

Yes, any employee has the right to raise a personal grievance. Requesting mediation is a typical step in that process.

About LegalVision: LegalVision is a tech-driven, full-service commercial law firm that uses technology to deliver a faster, better quality and more cost-effective client experience.

The majority of our clients are LVConnect members. By becoming a member, you can stay ahead of legal issues while staying on top of costs. For just $199 per month, membership unlocks unlimited legal consultations, faster turnaround times, free legal templates and members-only discounts.

Learn more about LVConnect

Need Legal Help? Get a Free Fixed-Fee Quote

If you would like to receive a free fixed-fee quote or get in touch with our team, fill out the form below.

Our Awards
  • 2019 Top 25 Startups - LinkedIn 2019 Top 25 Startups - LinkedIn
  • 2020 Fastest Growing Law Firm - Financial Times APAC 500 2020 Fastest Growing Law Firm - Financial Times APAC 500
  • 2020 Law Firm of the Year Finalist - Australasian Law Awards 2020 Law Firm of the Year Finalist - Australasian Law Awards
  • Most Innovative Law Firm - 2019 Australasian Lawyer 2019 Most Innovative Firm - Australasian Lawyer