The Teaching Council said teachers should be able to intervene earlier than the current threshold, which was when children were at imminent risk of serious harm.
"Currently the legislation limits physical restraint to situations where there is a risk of serious and imminent harm, which has had the effect of deterring teachers from intervening before a situation gets serious," the council said.
"We are proposing to enable teachers to intervene earlier and to consider the emotional and physical harm of all the learners, as expected in the Code."
Education Minister Chris Hipkins said he had heard teachers' concerns about the rules and was working on them.
Teachers and principals have criticised the rules, which were introduced several years ago, as too restrictive and confusing.
