The changes to the party's Constitution will be made at the annual conference in November, although they are still subject to possible change.
It said the clear message from party members was that they wanted to take part in electing a new leader, as happened in many overseas Labour parties.
Labour leader David Shearer said the changes were aimed at making the party more democratic, along with others decided on during a six month review of the party.
There are also hopes giving more influence to party members will encourage more people to join.
In a letter to members, Party President Moira Coatsworth said the raft of recommendations constituted a significant change for the party and members could give further feedback until the end of August to allow any major disagreements to be identified.
Other changes included:
- allowing young and low income people to join the party based on a minimal koha, rather than full membership fees.
- establishing a new 'registered supporter' category, a step below full membership.
- changes to list selection, including a more open process and smaller moderating committee.
- allow groups other than unions to become affiliates, such as Maori organisations.