Businesses urged to bypass free MBIE employment mediation service due to wait-list

The Ministry of Business, Innovation and Employment building. Photo / Mark Mitchell

By Nona Pelletier of RNZ

An employment lawyer is advising businesses to bypass the government’s free employment mediation service.

There was currently a seven-week waiting list to access the Ministry of Innovation, Business and Employment’s mediation service, which was supposed to be a way to avoid drawn-out disputes between employers and their employees.

“Don’t wait,” Rotorua employment lawyer Michelle Urquhart said, adding the cost of accessing private services was well worth it given the risks associated with leaving a dispute to fester.

MBIE advised availability was limited due to high demand and apologised for the inconvenience, though wait time was an improvement from the peak 11-week wait in February.

“There has been a sustained demand for employment mediation services, with a 12 percent increase in mediations delivered in 2024/25 compared to the previous year,” MBIE director Pele Walker said, adding full-day mediations rose by 25 percent over the past three years, which reduced overall mediator availability.

“Mediators report that the complexity of issues being brought to mediation has increased, contributing to longer sessions and more time needed to reach resolution.”

Urquhart said it was more than an inconvenience for businesses, as the longer it took to resolve an issue the more complicated and costly it became.

“Having to wait more than two months for mediation - which is meant to be an early intervention service - is far from ideal in the current economic environment,” Urquhart said.

She said the delay means an increasing number of businesses were turning to independent specialists - or not dealing with the issue at all.

“The second option is a lose-lose for both parties,” she said, given current labour market conditions.

“No one wants to be looking for a new job. For an employer, it can cost up to 1.5 times a person’s salary to replace them, including recruitment, onboarding and lost productivity.”

She said the parties involved in a dispute should seek help quickly, even if they have to pay to use private services.

“A dispute will initially impact the people directly involved, but it doesn’t take long for it to start impacting wider teams, productivity, morale and ultimately, the bottom line.

“Getting on top of the concern early, having calm conversations, and developing a resolution plan that works for everyone is critical to moving forward before too much damage is done.”

Urquhart said businesses could find a private employment mediator online through the Arbitrators and Mediators Institute or the Resolution Institute.

MBIE also offered an early resolution service with most cases resolved within 15 working days, though urgent cases, such as those involving strikes or collective bargaining, continued to be prioritised.

-RNZ