Covid-19 Updates

Covid-19 employment law issues - wage subsidy, minimum wage, vaccines, and dismissal risk

Covid-19 created a wave of employment disputes in New Zealand. The patterns are consistent: pay changes made without proper agreement, rushed decisions under pressure, and confusion about what employers can and cannot require. Many of these disputes still surface now as historical arrears claims, personal grievances, and costs risk.

This category pulls together the main Covid-19 topics we see in real matters: wage subsidy and pay compliance, minimum wage obligations, and vaccination related employment decisions. If you are an employer, the core theme is simple: document your decision making and follow a defensible process. If you are an employee, preserve evidence and act within time limits.

1) Wage subsidy and pay changes

A common mistake during lockdowns was treating the wage subsidy like "employee money" that automatically replaced normal wages. The wage subsidy was paid to employers and came with conditions, but normal employment law still applied.

• Do not reduce wages unilaterally: If wages are reduced without written consent, it can become an unlawful deduction issue.
• Get agreement in writing: Any temporary wage reduction or variation should be clearly agreed and documented.
• Minimum wage still matters: Minimum entitlements cannot be contracted out of, even if there was pressure to "just accept the subsidy".
• Holiday pay top-ups: Using annual leave to top up pay can be an option, but must comply with Holidays Act rules.

2) Vaccination policies, mandates, and process

Covid-19 vaccination issues produced some of the most heated disputes we have seen. The legal risk is rarely the employer having a view on vaccination. The legal risk is the pathway taken to implement it.

• Consultation and a genuine process: Employers still needed to consult, consider feedback, and keep an open mind.
• Role based assessment: The key question is whether vaccination was required for the work and the specific risk factors involved.
• Alternatives before termination: Redeployment, adjustments, remote work, or other alternatives should be explored where reasonably available.
• Notice and documentation: If termination occurs, the steps and reasons must be recorded and communicated clearly.

3) Dismissal and personal grievance risk during Covid-19

Covid-19 did not remove the usual standards of fairness. Even in urgent situations, employers were still expected to act as a fair and reasonable employer in all the circumstances at the time.

• Rushed decision making: Predetermination and "we already decided" behaviour is a common problem in Covid-era dismissals.
• Information and disclosure: Employees should be given the information relied on (subject to legitimate limits) and a real chance to respond.
• Consistency: Unequal treatment between staff is a common trigger for disadvantage and good faith arguments.
• Evidence matters: Emails, texts, meeting notes, rosters, and payroll records often decide the outcome.