Here’s the reality: in 2023, the Employment Relations Authority (ERA) awarded compensation payments between $500 and $55,000 for personal grievances. The most common claims? Unjustified dismissal, breaches of good faith, and legislative violations.It gets worse: more than 2,000 cases were lodged with the ERA last year. Of those, 17% ended up in the Employment Court—time, money, and stress you could spend elsewhere.
The Cost of Doing Nothing
If a workplace issue escalates to a grievance and results in compensation (usually tied to emotional harm), it typically falls into one of three bands:Band 1: Up to $12,000For minor breaches, like process errors with limited harm.
Band 2: $12,000–$50,000For cases involving measurable harm, like flawed dismissals or serious disadvantage.
Band 3: Over $50,000For severe breaches, such as repeated violations or discrimination.And that’s just compensation.In 2023, penalty awards ranged from $100 (for breaching a settlement) to $153,000 (for repeated minimum standards breaches). The most common penalties were for:Employment Relations Act 2000 breaches (e.g., failing to keep wage/time records or breaching settlements).Holidays Act 2003 breaches (e.g., unpaid leave or public holiday entitlements).Minimum Wage Act 1983 and Wages Protection Act 1983 violations.Add to this:
- Costs contributions to the employee’s legal fees.
- Your legal fees.
- Lost time fighting the case instead of running your business.
- The toll on your team, reputation, and mental health.
The costs climb fast.
Prevention is Always Cheaper (and Smarter)
Compare that to the upfront cost of getting it right.Reviewing agreements or updating policies? A few thousand at most.Legal advice or manager training? A fraction of what you’d spend on a dispute.It’s not rocket science—spending a little now saves a lot later.
The Wake-Up Call
The numbers don’t lie: disputes happen all the time, and they’re expensive. But they’re also preventable. Getting ahead of issues protects your business, your time, and your sanity.
So, when’s the last time you reviewed your agreements or policies? If you’re not sure, now’s the time. Fix the roof while the sun’s shining – future you will thank you for it.
