New Zealand: New Pay Transparency Rules
With effect from 27th August 2025, new rules allow employees to talk freely about their pay with other employees, without the risk of adverse consequences.
This will apply despite any existing confidentiality clauses in their employment contracts.
Adverse consequences could include dismissal, failing to be offered the same terms, conditions or benefits as employees with similar skills and experience or being disadvantaged as compared with peers. It could also apply if an employee is caused to resign or retire.
This new rule has been added to the list of grounds for a “personal grievance”. An employee who suffers adverse consequences as a result of disclosing their pay to another employee, can now bring a personal grievance claim.
The employee will need to establish that:
- the adverse conduct took place;
- their pay disclosure was a substantial factor in the adverse conduct – although this will be assumed in the employee’s favour, unless the employer can show otherwise.
Employer action:
- ensure HR personnel are aware of the change;
- while there is no need to make changes to confidentiality clauses in existing employment contracts (as they won’t be enforceable anyway), future contracts should not attempt to impose such restrictions.
This is a high-level general update only. Legal advice should be obtained on specific circumstances.