Employers will be able to require new employees to have been vaccinated against Covid-19 if they wish to.
However, existing employees' conditions will still be set by their employment arrangements with employers, which cannot change to require them to be vaccinated.
Employment Relations Minister Michael Wood appeared before Parliament's education and workforce select committee on Thursday morning to face questions about the impact of lockdown on employers and employees.
National MP Scott Simpson pressed Wood on whether employers could require employees to be vaccinated.
The short answer is that they cannot.
"There is not a standing provision for employers to terminate employees' employment for not being vaccinated," Wood said.
This was slightly different for people who worked on the Government's Covid-19 response at the border. These employees were covered by a health order.
"We have got a vaccine order in place that does enable certain employers in border organisations to require a vaccine as a condition of employment by a certain date.
"The fact that an order has had to be created to facilitate that requirement is a clear indication that in normal times that is an extraordinary step that ordinary employment law does not allow for," Wood said.
Wood said he encouraged employees and employers to work together regarding vaccines, but employers could not sack their staff because they were not vaccinated.
He said there was currently "no standing provision that enables employers to terminate someone's employment outside of the order if they have not had a vaccination".
Wood said that allowing employers to sack staff over vaccination was effectively a compulsory vaccination order, which the Government and National were both against.
"If we were to bring in a widespread power to that effect, that amounts, to wide number of New Zealanders, a compulsory vaccination order - that is not something that the Government has proposed," Wood said.
Simpson pressed Wood on whether employers could exclude staff on the basis of not being vaccinated and what obligations employees had to make sure their vaccinated staff were not put at risk by unvaccinated staff.
"The Health and Safety at Work Act has an absolute requirement on employers to work with employees to make sure that any health and safety risks are appropriately managed, that they are eliminated where possible and that they are minimised where that is not possible.
"That is quite a powerful and flexible tool for employers to be able to use to manage this situation," Wood said.
Wood said that neither business, nor unions, had been pushing for ways of compulsory vaccinations.
However, while employees could not upend existing contracts to require a vaccination, new staff may be required to be vaccinated as a condition of their employment.
"There is a bit of a distinction between people who are currently in their employment, and the ability of employers to set requirements for new people that they might employ into the future," Wood said.
Officials confirmed that new employment agreements could include vaccination status, meaning employers could require new staff to get the jab.