Millions paid, complaints hidden: how the public service secretly settles workplace bullying
Tuesday, 10 February 2026
Across New Zealand’s public service, workplace bullying, harassment and discrimination have cost taxpayers millions of dollars over the past five years, yet no central agency can say with confidence how widespread the problem really is.
Official Information Act responses from a dozen government agencies show at least $7.5 million has been paid out in financial settlements since 2020, alongside millions more in legal fees.
Almost all agreements are confidential. Many agencies say they do not record the reasons for settlements in a way that allows meaningful scrutiny, or say releasing the information would breach privacy.
The Ministry of Social Development (MSD) reported 245 settlement agreements over the same period, the highest volume of any agency reviewed. However, MSD refused to disclose how much these cost the taxpayer or even how many related specifically to bullying or harassment.
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It argued analysing the data would “impair the Ministry's ability to continue standard operations”.
That’s despite taking 13 weeks to respond to the request, where most other agencies provided their data within the standard 20-working-day window.
Health New Zealand (Te Whatu Ora) also stood out for both the volume and cost of its settlements.
Between January 2020 and the end of 2025, the agency recorded 205 settlements related specifically to bullying, harassment or discrimination, totalling $4.08 million. Most payments fell between $10,000 and $50,000, though 18 exceeded $50,000.
Health NZ also spent at least $624,310 on external legal advice linked to those claims.
Internal legal costs are not tracked on a per-case basis, meaning the true cost is likely higher. Nearly every settlement (about 99%) included confidentiality clauses preventing disclosure of the underlying complaints.
Police reported 83 settlements over the same period, costing $1.64 million, alongside more than $630,000 in external legal fees.
While most payments went to complainants, police also paid 12 settlements to the subject of the complaint, often linked to exits following unsubstantiated allegations or relationship breakdowns.
Other agencies report smaller numbers, but similar patterns.
Customs finalised 10 settlements between 2020 and late 2025, totalling $372,955, and spent $212,194 on legal costs.
In three cases, the respondent received a payout; in two cases, both parties did.
Customs disclosed that one case alone incurred legal fees of up to $129,000. Despite this, the agency said no specific policy changes resulted from the settlements.
The Ministry of Justice recorded 12 settlements worth $158,850, with a further $92,410 in external legal costs. Eleven payments went to complainants and one to the subject of the complaint.
All were resolved through formal Records of Settlement under the Employment Relations Act. All were confidential.
Treasury reported three settlements over five years, with total payouts between $50,000 and $100,000, but said it could not isolate legal costs because invoices are bundled across employment matters.
The Accident Compensation Corporation recorded 13 settlements specifically related to bullying, harassment, or discrimination, paying out $231,048.
All 13 settlements fell within the $10,000 to $50,000 bracket. The state insurer spent $76,420 on external legal fees, roughly $1 for every $3 paid out.
Like other agencies, 100% of ACC’s settlements included confidentiality clauses.
The Department of Internal Affairs recorded eight settlements worth $212,353, plus $208,951 in legal fees.
Crown Law, the government’s principal legal adviser, refused to disclose how many settlements it had entered into, or their value, citing privacy concerns.
It did, however, report $45,863 in harassment-related legal costs, and no legal costs for bullying or discrimination over nearly six years.
Several agencies, including the Department of Conservation and MBIE, said settlement data was either not held in a usable form or could only be retrieved through a “substantial collation” of individual files.
DOC said earlier settlements were often recorded under generic descriptions such as “agreed terms of settlement to employment relationship problems”, making it impossible to retrospectively identify bullying or harassment cases.
The transport agency Waka Kotahi NZTA claimed the information “cannot be easily retrieved”, saying it does not categorise settlement costs and bundles legal fees and personal grievance payouts into a single, unsearchable reporting bucket.
Confidentiality ‘should not be used to protect perpetrators’
Under public service rules, an employee dismissed for serious misconduct can be disclosed to other agencies for three years, but where matters are resolved by settlement, confidentiality often prevails.
Fleur Fitzsimons, national secretary of the Public Service Association, said workers should receive compensation for bullying and harassment, but more effort needed to go into prevention.
Confidentiality clauses were appropriate in instances where victims needed protection “but should not be used to protect perpetrators”, she said.
“There should be full transparency of this use of public money at each agency including because this helps incentivise prevention of bullying and harassment.”
The amount spent on external legal fees was excessive, Fitzsimons believed.
Health NZ’s Robyn Shearer said the agency had launched a new code of conduct alongside national policies on bullying, harassment, discrimination, and disciplinary investigations. There was also an expanded Employee Assistance Programme, Stress First Aid resources, a newly appointed “national programme lead for psychosocial risk” and a “chief wellbeing officer”.
As the country’s largest employer, with about 100,000 staff, settlement agreements involve fewer than 1% of employees, she said.
“Confidentiality is a standard part of employment mediation under the Employment Relations Act, and we apply it in line with public sector expectations and guidance from the Public Service Commission (PSC).”
A PSC spokesperson said financial decisions about employment matters were “operational decisions for chief executives”.
He confirmed there were no standards set in relation to how costs needed to be recorded or reported by agencies.
Proposed legislation before Parliament will require agencies to notify the Public Service Commissioner when they commence a misconduct or serious misconduct investigation in relation to senior employees and to report annually the outcomes of all misconduct and serious misconduct investigations.
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