The ministry had spent over $100,000 before it ended proceedings in March
The Public Service Association (PSA) has criticised the Ministry of Business, Innovation and Employment’s (MBIE) spending on costs related to a legal challenge over its flexible working policy from May 2025, reported the NZ Herald.
Per proactively released documents, the ministry had spent $102,451.50 on the challenge, which was brought by the PSA in July 2025 to the Employment Relations Authority (ERA) on claims that the MBIE’s policy did not align with a collective agreement. The documents indicated that the MBIE engaged external legal representation and involved its legal, ethics and privacy team; nonetheless, it did not cover the time spent by staff on the issue.
The MBIE filed a memorandum with the ERA in March of this year conceding to the PSA’s terms. The filing was made one day before a scheduled two-day hearing.
PSA national secretary Fleur Fitzsimons described the MBIE’s expenditure on the matter as a “total waste of taxpayers’ money”, per a statement published by the Herald. She called for the ministry to issue an apology.
“It should never have come to this. MBIE should have listened to the union from the very beginning instead of stonewalling for nine months and dragging workers through three rounds of failed mediation. At a time when the public service is facing cuts and job losses, burning through six figures on a losing legal battle against your own workers is deeply irresponsible”, she said in a statement published by the Herald.
Meanwhile, MBIE chief people officer Jennifer Nathan highlighted the extensive process through which it engaged with the PSA, which included three rounds of mediation that did not achieve a resolution and the ERA proceedings.
“Alongside this, MBIE remained committed to finding a resolution and subsequently undertook full consultation on a new Flexible Working Policy and Procedures”, Nathan told Newstalk ZB in a statement published by the Herald.
That new policy went into effect on 30 March, and Nathan said the ministry had opted to end the legal bout since the old policy had been lifted.
“MBIE is confident that the March 2026 policy reaches the balance of providing a Flexible by Default environment, while still meeting MBIE’s organisational needs and the Public Service Commission guidance”, she said in a statement published by the Herald.
Fitzsimons countered that the ministry’s replacement policy remained non-compliant with its collective agreement, cautioning that the PSA would raise the issue with the ERA again “if they don’t get it right”.
The government is looking to cut costs and jobs in a public sector reform expected to dissolve about 8,700 jobs. The overhaul is anticipated to save the government $2.4bn.
