Letter Of Intent Not To Renew Employment Contract Template for New Zealand

A Letter of Intent Not to Renew Employment Contract is an essential formal document that New Zealand employers must use when deciding not to extend a fixed-term employment agreement. This letter provides official notification to your employee about your intention not to renew their contract, ensuring you meet your legal obligations while maintaining professional relationships and protecting your business interests.

When do you need this document?

You need this letter when your employee's fixed-term contract is approaching its end date and you have decided not to offer a renewal or extension. This situation commonly arises when project-based work concludes, temporary coverage ends, or business circumstances change. You should send this letter well before the contract expires to give your employee adequate notice and time to seek alternative employment. The letter is also necessary when restructuring occurs, budget constraints prevent contract renewal, or when the specific role is no longer required. Using this document demonstrates good faith dealing and helps prevent potential employment disputes.

Key legal considerations

Your letter must clearly reference the original employment contract terms, including start and end dates, and explain the legal basis for non-renewal. You must ensure the decision is not discriminatory under the Human Rights Act 1993, avoiding any grounds related to age, gender, ethnicity, or other protected characteristics. The notice period should align with your contract terms and employment law requirements. You must handle any personal information in compliance with the Privacy Act 2020. Include information about final pay, accrued leave entitlements, and return of company property. Ensure your communication is truthful and not misleading under the Fair Trading Act 1986.

Legal requirements in New Zealand

Under the Employment Relations Act 2000, you must act in good faith when dealing with employment matters, including contract non-renewal. This means being honest, open, and communicative about your decision. The Act requires that fixed-term agreements have genuine reasons for their limited duration, and you should reference these reasons in your letter. You must provide reasonable notice of non-renewal, typically as specified in the original contract or as required by employment standards. The letter should be delivered in writing and kept as part of your employment records. If your employee requests reasons for the non-renewal, you must provide them honestly and without discrimination. Consider offering transition support where appropriate, as this demonstrates good faith and may help maintain positive relationships.