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Mediation

HR Policies

7 May 2025 (Last updated 3 Dec 2025)

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The Employment Relations Act 2000 (the Act) advocates mediation as the leading method of solving problems in the employment relationship (except for the enforcement of employment standards).

In this best practice guide for employers, we outline mediation, the mediation process, dispute resolution, and other key factors relating to mediation. Please note that the information below is general and is not intended to act as advice.

What is Mediation?

Mediation is a voluntary process and involves the engagement of a neutral third party,

Once the employer and employee have agreed and committed to finding a mutually acceptable solution to their dispute or employment problem, they can partake in mediation. The mediator’s role is to facilitate movement in the parties’ respective positions by creating a climate of confidentiality and bargaining in good faith. The mediator is often seen as the “go-between” who aids the parties in striking a deal.

The main characteristics of a mediation process are:

  • Aimed at reaching consensus (voluntarily)
  • Non-legalistic and simple
  • Focus on compromise and resolution

The advantage of mediation is that it is quick, and cost effective compared to costly litigation, which often ends in settlement anyway

Mediation is normally used to resolve disputes between an employer and employee, although sometimes mediation is used to settle disagreements involving only employees. 

Mediation is a semi-formal process. It does not have the same formalities as those observed in a Court. Employers and employees will not be placed under oath or cross-examined.

Employment Relations Disputes - Mediation Services

The Employment Relations Act 2000 (the Act) established a framework in terms of which employers and employees can resolve relationship problems or disputes. When a employment relations issue cannot be resolved internally, the first port of call is the (Ministry of Business, Innovation and Employment (MBIE).

The MBIE offers a free mediation service to any employer or employee with an employment problem. The role of the mediator is to listen to both parties and provide expert advice as to each party’s legal position.

Often, the mediator will listen to both parties’ versions and arguments and then will break away and meet with the employee and employer separately in an effort to settle or resolve the employment problem. During these separate meetings the mediator usually advises the parties as to the merits of their case and encourages them to reach agreement with the other party. Mediation services are confidential in nature and are conducted on a without prejudice basis. The premise being that the parties can speak freely during mediation without it being used against them later.

If, as a result of mediation, the parties agree to settle their dispute, the mediator will sign a record of settlement. Once signed, this agreement becomes final and binding on the parties and may be enforced by them.

If mediation is not successful and the parties cannot reach agreement, the matter may be referred to the Employment Relations Authority and in limited circumstances, the Employment Court.

During mediation, employers should keep in mind that:

  • Everything discussed in mediation is kept private. All information provided for the purpose of mediation is confidential.
  • Mediation is impartial. The mediator will not take sides and is neutral.
  • The MBIE offers free mediation services. If the employee decides to hire a representative, there may be costs associated with their service.

Is mediation voluntary?

Employers and employees are not required to use mediation services when there is an employment relationship problem.

However, the act promotes mediation as the main way to resolve these problems. With limited exceptions, the Employment Relations Authority must direct the parties to mediation and the Employment Court has the authority to direct the parties to undertake further mediation with a view to resolving the problems between them. The court must consider mediation as an option throughout Court proceedings.

Confidentiality and without prejudice status of mediation proceedings

The Act endorses the fundamental premise that mediation is confidential. Statements, admissions, or documents created or made "for the purposes of mediation''. and information disclosed orally during mediation, must be kept confidential by the parties involved, the mediator, officials and any assistant to the mediator or the parties

Mediation is conducted on a without prejudice and confidential basis so as to provide a platform for the parties to speak freely with the aim of resolving their dispute and reaching settlement.

If, however, the parties are unable to reach settlement, then any concessions or admissions made in an attempt to reach settlement cannot be used in the Authority or Court proceedings at a later stage.

Confidentiality in mediation is absolute, except where public policy dictates otherwise.

Only documents which come into existence independently of mediation are excluded from the confidentiality provisions and may be admissible in the Employment Relations Authority or Court.

The confidentiality rule does not apply:

  • Where mediation services are provided to assist with collective bargaining
  • To information that would otherwise be admissible and that existed independently of the mediation
  • Information collected for research or education purposes, provided the parties cannot remain anonymous or cannot be identified.

The mediation process 

There is no set procedure that a mediation will follow, with the process differing from case to case. However, there are certain actions and activities involved in mediation.

These include:  

  • Early assistance - Early assistance may be conducted by the mediator through email and telephone conversations. A mediator will ascertain if the dispute can be resolved promptly without the need of a meeting.
  • Meeting - The parties will meet with a mediator in a semi-formal environment, discuss the problem and explore possible solutions. Often meetings are conducted over video conference.
  • Giving the mediator powers - Both the employer and employee can agree that the mediator can be provided with the power to make a written recommendation or a binding decision.
  • Record of settlement - If both parties agree to resolve their dispute, it will be recorded in a record of settlement. This is a legally binding document. Once a record of settlement is signed by both parties and a mediator from the MBIE, neither party may lodge a problem with the Employment Relations Authority or the Employment Court if it relates to the same issue. They may make a referral to the Authority to enforce the settlement agreement, should one of the parties fail to honour the terms thereof.

Independent Mediators

Mediators are required to be independent; this means that the mediator is not employed by or acting in the interests of either parties. To avoid any accusations of impartiality, mediators are not normally the managers or direct colleagues of the parties involved. In addition, they should not be employed by or contracted to the Employment Relations Authority or the employment Court.

A mediator’s role is to:

  • Encourage both parties to speak openly and identify the real issues.
  • Identify common interests and points of agreement between the two parties.
  • Help the parties find resolution to their problem that may not seem immediately apparent.
  • Explore settlement options and encourage both parties to negotiate.
  • Find creative solutions that allows both parties to put the issues behind them.
  • Provide an assessment of the risks if the problem is not resolved and proceeds further.

Maintaining healthy workplaces with Peninsula

Being a small business owner in New Zealand means you have many responsibilities and duties. Keeping track of all your obligations is challenging especially if you are in a dispute or disagreement with your employee. In such situations, mediation is a vital step and can help both parties reach an agreement. Peninsula has worked with several businesses, supporting them in disputes and mediation in matters of employment relations and workplace health and safety. We understand the needs of business owners and tailor our advice to their situation and industry. For free advice on dispute resolution in your workplace, call Peninsula day or night, seven days a week.

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While email has been around for years, it is still a mode of communication that involves a lot of overseeing and supervision. It’s tricky nature and lack of tone can make it an easy way for things to get lost in translation. It is hard to imagine running a business without email because it is such a convenient, flexible and immediate tool. But the fact it is so easy to send an email can result in misuse or abuse. A carelessly phrased email forwarded to lots of recipients can quickly damage your reputation or break confidentiality, even when unintended. In this best practice guide for employers, we explain email usage within the workplace and recommend a standard email usage policy that you can implement immediately. Please note that the information is general and does not constitute advice. If you need help with policies, consult an employment relations professional. Email usage in the workplace There are many risks involved with email usage. Having a company wide policy for email usage and communication can protect you and your employees from potential risks. Your employees may send emails without considering the risks of confidentiality or even security. Without a clear written and established company policy, you cannot manage security and safeguard your business. As an employer, you are liable for the acts and omissions of your employees. Drafting an email usage policy When you draft your email policy, it should keep certain factors in mind: Decide the extent to which employees can use the Internet and email for personal purposes. You should set out the consequences for not following the policy, including disciplinary action and summary dismissal. The use of email and internet should be consistent with employee responsibilities and should comply with all other rules and procedures. Avoid permitting activities which might be illegal, offensive, or likely to have negative repercussions. Depending on the business you are in, a higher level of security could be useful on the email. The email usage policy should also mention styles of communication for outside work hours or outside working days. General email usage policy requirements The policy should be made available to all staff and stored in the company internal communication network, where it can be accessed anytime. Be very clear and explicit as to what is considered forbidden. Clearly set out what information gets recorded, logged, and who has access to the information. Mention why the improper use of email can be risky and that it may pose a threat to system security and the legal liability of the organisation. Outline in plain language how the company will monitor staff compliance with company rules on acceptable use of email and browsing. The policy should be regularly reviewed in accordance with the development of the internet and information technology. Monitoring email usage There are currently no laws prescribing the prohibition of monitoring an employee’s emails or Internet usage. However, there is controversy about the grey area of ‘telecommunications’ and if it includes emails and internet. While many companies monitor email usage, the key is it to do with caution and respect: Be open about monitoring the communication channels. Your employees have a right to know that their email and internet use is monitoring. Limit personal use and set restrictions clearly. Do not intrude on the privacy of the employee and provide a mechanism for employees to delete email from the system. Any personal information that is found that concerns employees must be used fairly. Establish a business purpose for monitoring (working time is used productively or checking if they have logged in). Do not monitor websites, viewed content unless the business purpose cannot be achieved by recording time spent on the Internet. Monitoring should be limited to an automated process. You should not monitor the content of the emails unless the traffic record alone is not sufficient. If you are using the results of the monitoring, give the employee an opportunity to explain the results. Disciplinary action for improper email usage An employer may dismiss an employee for improper email usage or misuse of workplace internet resources provided the employer: Clearly demonstrates the use was an unauthorised use as defined by the email usage policy or electronic communications policy. Investigates the employee in accordance with any workplace disciplinary policy and workplace relations law. Gives the employee an opportunity to respond to the allegations. Implement effective policies with Peninsula The changing world of telecommunications means it can be tricky to ensure the safety of your employees and your business. Having clear and established policies can make a world of difference for your business. We understand small businesses may not always have the resources to create and implement effective policies for employment relations and workplace health and safety. At Peninsula, our goal is to provide tailored services and support that meet your needs as a business owner. Peninsula advisers can help you build and establish clear and sturdy email usage policies. For peace of mind, call our  advice line. This article is for general information purposes only and does not constitute as business or legal advice and should not be relied upon as such. It does not take into consideration your specific business, industry or circumstances. You should seek legal or other professional advice regarding matters as they relate to you or your business. To the maximum extent permitted by law, Peninsula Group disclaim all liability for any errors or omissions contained in this information or any failure to update or correct this information. It is your responsibility to assess and verify the accuracy, completeness, and reliability of the information in this article.

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