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Unfair Dismissal (Unjustified Dismissal)

An unjustified dismissal is a Personal Grievance claim. The central question is whether the employer's actions, and how the employer acted, were what a fair and reasonable employer could have done in all the circumstances.


Unfair dismissal and unjustified dismissal in New Zealand

If you have been fired, sacked or otherwise dismissed, the usual legal claim is a Personal Grievance for unjustified dismissal. The statutory test asks whether the employer's actions, and how the employer acted, were what a fair and reasonable employer could have done in all the circumstances.

In ordinary dismissal cases, both the employer's reason and process matter. A genuine concern does not automatically justify dismissal, and a polished process does not rescue a decision that no fair and reasonable employer could have made.

2026 procedural change: the Authority or Court must not find a dismissal unjustifiable solely because of process defects if those defects did not result in the employee being treated unfairly. The Act also now expressly requires consideration of whether the employee obstructed the employer from taking relevant procedural steps. The practical question remains what actually happened and whether the employee was treated unfairly.

Common unfair dismissal situations

  • Serious misconduct dismissal: dismissed without notice after allegations of dishonesty, violence, insubordination or another alleged serious breach.
  • Misconduct dismissal: warnings or dismissal where the evidence, investigation or outcome is disputed.
  • Performance dismissal: inadequate expectations, support, warnings, review periods or genuine opportunity to improve.
  • Medical incapacity: employment ended because of illness or injury without a sufficiently fair inquiry into prognosis, return to work or alternatives.
  • Redundancy: role disestablishment where the business rationale, consultation, selection or redeployment is challenged.
  • Constructive dismissal: resignation caused or compelled by the employer's conduct.
  • 90-day trial dismissal: whether the trial was valid and whether the statutory dismissal protections were actually excluded.
  • Dismissal on the spot: access removed or employment ended before the employee has had a proper opportunity to answer the concerns.

What a fair dismissal process usually involves

  • Sufficient investigation: the employer gathers the material reasonably required before deciding what happened.
  • Clear concerns: the employee is told the substance of the allegations or concerns and the possible consequences.
  • Relevant information: material relied on is provided, subject to legitimate limits such as privacy.
  • Reasonable opportunity to respond: enough time and a genuine chance to provide an explanation and evidence.
  • Genuine consideration: the response is considered before the decision is made rather than after the outcome has effectively been settled.
  • Any other relevant factors: including consistency, employment agreement/policy requirements, proportionality and the surrounding circumstances.

Was there actually a good reason to dismiss?

The substantive case matters. An employer may have followed meetings and letters but still fail if the factual finding was not reasonably available, the conduct did not justify dismissal, the performance concerns were not properly established, or the redundancy rationale did not support disestablishing the employee's role. The question is objective: what could a fair and reasonable employer have done on the information available at the time?

Dismissed for serious misconduct

Calling conduct "serious misconduct" does not make it so. The employer still needs an adequate factual basis for the finding and a dismissal that meets the statutory justification test. If summary dismissal is imposed, the classification matters because serious misconduct is also usually relied on to justify dismissal without notice.

The 2026 remedy changes make the employee's conduct especially important after liability is established. If the Authority or Court finds that an employee's contributing action amounted to serious misconduct, no PG remedy is available even if the grievance itself is established.

Fired without a warning or disciplinary meeting?

A prior warning is not legally required in every possible dismissal, and serious misconduct can justify dismissal without notice. But an employer will ordinarily need to put the relevant concerns to the employee and give a reasonable opportunity to answer them before deciding. An on-the-spot dismissal without that opportunity can create a significant justification problem unless a statutory exception applies.

Special rules: trial periods and high-income employees

A valid 90-day trial period can remove the ordinary ability to challenge a dismissal and dismissal-related disadvantage, subject to the statutory exceptions. Different dismissal protections can also apply to employees at or above the statutory remuneration threshold, currently $200,000, with transition and opt-back-in rules. These issues should be checked before assuming the ordinary dismissal test applies.

What to do after dismissal

  • Check the 90-day PG deadline.
  • Save the evidence: dismissal letter, invitations, allegations, meeting notes, emails, texts, policies and employment agreement.
  • Write a timeline of the process while events are fresh.
  • Keep job-search records and evidence of replacement income.
  • Check final pay, notice, annual holidays and any other contractual amounts.

Written reasons for dismissal

If the reasons are unclear, section 120 provides a process for requesting a written statement of the reasons for dismissal. The request must be made within the statutory period, so it should not be left indefinitely.

Possible remedies

  • Reimbursement of lost remuneration.
  • Compensation for humiliation, loss of dignity and injury to feelings.
  • Reinstatement where appropriate and legally available.
  • Compensation for loss of a benefit where established.
Contribution can change the result. Under the 2026 rules, employee conduct contributing to the situation can remove reinstatement and compensation and can reduce available remedies by up to 100%. A finding that the contributing action amounted to serious misconduct removes all PG remedies.
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Unfair dismissal guides and ERA decisions

Go directly to the issue that matches the dismissal or browse the case summaries for recent Authority decisions and remedies.

Personal Grievance Unfair dismissal ERA cases Disciplinary meetings and investigations Probationary periods Medical incapacity dismissal Redundancy Constructive dismissal 90-day trial dismissal

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