Kiwi Workers Can Now Chat About Their Cash

HR Policy Global perspective: New Zealand joins a growing number of countries introducing various elements of pay transparency.  At its core, the new legislation aims to empower employees to discuss their pay, which can help identify and address pay inequities like gender and ethnic pay gaps. However, unlike Australia, New Zealand does not yet require employers to publicly disclose gender pay gaps or publish remuneration statistics.

The Bigger Picture

Historically, pay secrecy clauses have been common in New Zealand employment agreements, especially in large corporations and professional services firms. Confidentiality provisions in employment contracts prohibited employees from discussing their pay with co-workers.

These clauses were seen to prevent internal disputes about pay differences, protect “commercial sensitivity” around salary structures and retain employer control over wage setting and negotiations.  Ultimately, pay secrecy made it difficult for employees to compare pay rates and detect and gender or ethnic pay disparities, or unjustified wage differences between similar roles. 

The Employment Relations (Employee Remuneration Disclosure) Amendment Bill passed its third reading in August 2025 and awaits Royal Assent to become law, allowing employees to disclose their pay without fear of adverse conduct from their employer, such as dismissal or detrimental treatment. Pay secrecy clauses in existing and future employment agreements will not be unlawful but will become unenforceable under this new law. 

A reverse burden of proof is introduced with the new law.  This means that where adverse conduct is established around pay disclosure (such as dismissal or detrimental treatment), the burden shifts to the employer to prove that remuneration disclosure was not a substantial reason for their conduct. In effect, the law presumes such disclosures were a substantial factor unless rebutted.

Key takeaways for employers

• Employers should start auditing their existing employment agreements to identify and prepare for the removal of pay secrecy clauses.
• Organizations should anticipate and prepare for more open conversations about pay within the workplace, which may highlight disparities and lead to a review of compensation practices.

While potentially uncomfortable, the increased transparency can foster greater trust, fairness, and attract top talent, aligning with growing expectations for openness around compensation.