Is New Zealand's Remote Work Retreat Fueling a Brain Drain to Australia?

New Zealand's Flexible Work Decline Outpaces Australia

New data reveals that New Zealand employers are scaling back remote-work options more rapidly than their counterparts in Australia, a trend that experts warn could accelerate the brain drain of talent to Australia.

According to recruitment website Seek, only 7% of job ads in New Zealand now mention work-from-home or hybrid flexibility, down from nearly 10% a year ago. In contrast, Australia maintains a higher rate at just over 9%, down from 11%.

Caption: New data shows just 7% of new job ads on Seek in NZ mention work from home flexibility, compared to Australia’s 9%. Both countries have declined in flexibility, according to the job ad data. ROBERT KITCHIN / THE POST

Economic and Social Impacts

Seek senior economist Blair Chapman highlighted that this retreat "has the potential to exacerbate the brain drain to Australia, which has not retreated to such an extent." Applications from New Zealanders for Australian jobs surged in 2022 and remain elevated, growing about 1.3% per quarter since November 2022, while international applicant growth for Australia has slowed to 0.5% per quarter.

Chapman noted, "During the pandemic, flexibility was a useful recruitment tool. Now, with more labour available, New Zealand employers don’t have to compete as hard."

Legal and Union Responses

This week, the Public Service Association (PSA) launched legal action against ACC after it increased mandatory office days from two to three. PSA national secretary Fleur Fitzsimons criticized the move, stating, "It reduces morale when employers try to cut work from home allowances. Too many New Zealand employers have outdated ideas."

She emphasized, "Australian employers realise working from home is good for workers and good for business — it’s a genuine win-win." Fitzsimons attributed the shift to a "lack of trust rather than recognising the productivity gains that can occur."

Caption: PSA national secretary Fleur Fitzsimons said Australian employers are recognising the value for flexible working to retain talent. DAVID UNWIN / The Post

Worker Experiences

Employees in New Zealand report increasing restrictions. An Auckland-based accountant, Christine, shared that she can only work from home one day a week with strict rules, such as no remote work before or after holidays and requiring two days' notice. She expressed, "After Covid we were trusted to work from home full-time – now it feels like a lack of trust, like being back at school."

A Christchurch employee at a major insurer described a similar tightening, with a new two-day office rule imposed after a leadership change, adding 90 minutes of daily commute. He noted, "Working from home is now seen as something that can affect salary or even trigger disciplinary review," and felt misled as permanent remote contracts were overridden.

Legal Protections Disparity

In Australia, the Fair Work Commission (FWC) can intervene if an employer unjustly rejects a flexible work request, even approving it directly. For instance, the FWC recently ruled that Westpac failed to justify rejecting an employee's full-time remote work request.

Conversely, New Zealand's Employment Relations Authority (ERA) lacks such powers; it can only review if employers acted in good faith but cannot compel decisions. Employers must consider requests fairly but can deny them for valid business reasons, with fines up to $2000 for procedural failures. There are no plans to align with Australia's stronger protections.

Caption: Mana Communications founder and managing director Caleb Hulme-Moir said Australian workers have more legal protections. SUPPLIED

Success Stories and Future Outlook

Mana Communications founder Caleb Hulme-Moir highlighted that Australian policies, driven by government and unions, foster better employee conditions. His firm adopted a structured hybrid model with a set work-from-home day each Wednesday and a nine-day fortnight, proving no drop in quality during a four-day week trial.

Hulme-Moir stated, "Humans are social. Being together is healthy. Work from home is great for productivity, but it will never replace connectivity." His account manager, Robert Hoek, appreciated the flexibility as a new parent, which boosted his motivation and loyalty.

Chapman pointed out that Gen Z values flexibility highly, equating it with salary and purpose. He predicted New Zealand's remote work ads will continue declining before stabilizing above pre-Covid levels but below current rates.

Fitzsimons concluded, "There’s no going back to pre-Covid workplaces. Employers need to value this or they’ll lose more talented staff to Australia."