ChatGPT for HR under the Employment Relations Act 2000

The legal frame ChatGPT has to work inside

Section 4 of the Employment Relations Act 2000 requires employers and employees to deal with each other in good faith and not to mislead or deceive each other, directly or indirectly¹. Employment New Zealand explains what that means for a decision that could affect someone's job: the employer must give the employee the relevant information and a chance to comment before deciding². When a dismissal or other action is challenged, section 103A of the Act asks whether the employer's actions were what a fair and reasonable employer could have done in all the circumstances¹.

That test looks at the process. Did the employer investigate sufficiently, raise the concerns with the employee, give a reasonable chance to respond, and genuinely consider the explanation¹? A letter written by ChatGPT can help with every one of those steps. A decision that was effectively made by ChatGPT fails the last one, because no person genuinely considered anything.

The Act changed this year. The Employment Relations Amendment Act 2026 came into force on 21 February 2026, adding a gateway test for contractors and an income threshold above which employees on new agreements cannot bring an unjustified dismissal grievance⁸. Existing agreements come under it 12 months later, and the parties can agree in writing to keep dismissal protection⁸. Make sure any template you load into ChatGPT reflects the current law, and check with an employment adviser if you are unsure.

Privacy rules for staff information

Employee files hold some of the most sensitive personal information a business has: health details, performance concerns, family circumstances, pay. The Office of the Privacy Commissioner expects senior approval before a generative AI tool is used, a privacy impact assessment, human review of outputs before action, and steps to stop personal information being retained or disclosed by the tool¹⁰. The Government Chief Digital Officer's guidance for the public service goes further and says public servants must not put personal information into public generative AI tools¹⁴. Private businesses are not bound by that rule, but it shows where the line sits for free, consumer-grade accounts.

Staff also have a right to see what you hold about them. Under the Privacy Act 2020, an agency must respond to a request for personal information within 20 working days⁹. Notes, summaries and drafts about an employee that you keep in a ChatGPT workspace may fall within such a request. Write them as if the employee will read them, because they may.

• Use ChatGPT Business or Enterprise only. OpenAI says it does not train on business data by default on those plans¹¹.
• Limit HR Projects to the people who need them. Do not add an HR file to a project shared with the wider team.
• Use initials or a role, not a full name, unless the draft needs it. Never paste medical records.
• Use Temporary Chat for a quick question about a sensitive case. It does not appear in history and is not used to improve models, though OpenAI may keep a copy for up to 30 days for safety¹³.

Employment agreements and offers

Every employee must have a written employment agreement³. The employer must keep a signed copy and, if the employee asks, give them a copy as soon as is reasonably practicable¹. The employer must also tell the employee they can get independent advice and give them a reasonable chance to do so before they respond¹.

Start from Employment New Zealand's Employment Agreement Builder or your lawyer's template, not from a blank ChatGPT chat. Then use ChatGPT for the parts that change by role: a clear job description, the hours pattern, a plain-English cover letter. Put the approved template into an HR Project as a file, and ask ChatGPT to fill the role-specific parts and nothing else. A Project keeps its files, instructions and chats together, and a shared project uses project-only memory, so it does not draw on anyone's chats outside it¹².

• Prompt: using the agreement in this project, draft the duties schedule for a warehouse team leader on rotating shifts. Do not change any other clause.
• Ask it to compare the draft with the template and list every difference. Read that list carefully.
• If the role includes a trial period, the trial clause must be agreed in writing before the employee starts, and the trial cannot exceed 90 days⁴. Employment New Zealand notes that a trial is not valid if the agreement is signed after the employee starts⁴.
• Write the offer letter in ChatGPT. Include the advice statement. Send the agreement as an attachment from your normal system.

Investigations and disciplinary meetings

This is where ChatGPT helps with the most paperwork and carries the most risk. Employment New Zealand lists the elements of a fair process: investigate fully, raise the concerns properly, give the employee a reasonable chance to tell their side, genuinely consider their explanation, tell them they may bring a support person or representative, and give them full and relevant information⁶. Each element needs a document. None of them can be delegated to software. The fair-process steps do not apply when dismissing an employee paid above the income threshold (unless they opted back in) or one on a trial period⁶.

A worked example: a generic forty-person Dunedin food manufacturer receives a complaint that a shift supervisor has been changing timesheets. The operations manager sets up a restricted HR Project. They upload the complaint, the timesheet export and the company's code of conduct, then ask ChatGPT to draft a letter inviting the supervisor to a meeting. The draft sets out the specific allegations, attaches the evidence, explains possible outcomes, and states the right to a support person. The manager rewrites the allegations to match the evidence exactly and has the letter checked before sending.

• Use ChatGPT to: draft the invitation letter, list the questions to ask, summarise the employee's written response, and structure the manager's notes.
• Use data analysis to compare timesheet and access-log exports, then check every mismatch it finds by hand.
• Do not use ChatGPT to: decide whether misconduct occurred, choose the outcome, or write the decision before the employee has responded.
• Keep a note of what you considered and why. The Authority will look for a genuine consideration of the explanation¹.

Restructures and consultation

A proposal to change roles needs genuine consultation. Employment New Zealand says the employer must give affected employees information about the reasons for the change, a reasonable time to respond and suggest alternatives, and must consider that feedback before deciding¹⁶. ChatGPT is good at the drafting this involves. Give it the business reasons and ask for a proposal document a non-specialist can follow. Ask for a feedback summary that groups every comment received without losing any.

Be careful with the word proposal. If the restructure document was clearly final before staff saw it, consultation was not genuine, whatever the letter says. Ask ChatGPT to read your draft and point out any sentence that sounds like the decision is already made. Then change those sentences, or change the plan.

Records, grievances and time limits

Employers must keep wage and time records and holiday and leave records for 6 years, even after the employee leaves⁵. ChatGPT is not that record. Keep payroll and leave in your payroll system, and use ChatGPT's data analysis feature only to check an export for gaps, such as days with hours but no rate.

Grievances run on a clock. An employee generally has 90 days from the issue arising or coming to their attention to raise a personal grievance, and 12 months for sexual harassment⁷. When a grievance letter arrives, ChatGPT can help you build a timeline of events from emails and notes. Read every entry against the source. Then take advice before you reply.

Build an HR letters skill for the routine work

Most HR letters follow a pattern: confirming a pay change, approving parental leave, ending a fixed-term role, inviting someone to a return-to-work meeting. In ChatGPT, a skill packages instructions, examples and supporting files into a reusable workflow, and a workspace can allow members to share skills with chosen groups¹⁷. Keep the skill's instructions short and firm: NZ English, warm but plain, always state the employee's right to ask questions, never make a decision on the employer's behalf.

If your business already built an HR custom GPT, move it rather than extend it. OpenAI retires custom GPTs on 11 December 2026, and its migration guidance points to plugins^18,19.

• Include: your policies, approved letter templates, the code of conduct and the leave policy.
• Leave out: any individual employee file.
• Share the skill with the managers who write HR letters only. Keep investigation work in a restricted Project instead.
• Review the skill's files every quarter and after any law change.

A short policy for managers

MBIE's voluntary guidance for businesses treats responsible AI use as part of existing governance, privacy and risk practice¹⁵. In HR, that means a policy a manager can follow on a busy afternoon.

• Draft with ChatGPT. Decide as a person, and record the reasons.
• Business workspace only. Restricted Projects for any matter about a named employee.
• Every letter that could affect someone's employment is checked by a second person before it goes.
• Templates for agreements and trial clauses come from Employment New Zealand or a lawyer, not from a chat.
• Write every note as if the employee will ask for it, because they can.