The Government said today it would strengthen employment protections for temporary and casual workers.
Business New Zealand warned this could blow out costs for the Rugby World Cup and other events.
But the Council of Trade Unions (CTU) said the changes would help the army of casual employees who did not know enough about their rights.
Labour Minister Trevor Mallard said the Government would change the Employment Relations Act to strengthen employment protections for temporary and casual workers.
The Department of Labour would develop a code of employment practice for casual workers to make it easier for employers to understand their obligations.
An awareness campaign would be done to help workers understand their statutory rights in the workplace.
Under the proposed changes, employees and employers would be able to clarify their relationship using a test that would take into account how regular the employment was, how much autonomy the worker had and whether the worker was genuinely free to accept or reject offers of employment.
Under the changes, a labour inspector would be able to decide whether an employee had a fixed term contract or was actually a permanent employee - something only the Employment Relations Authority and the Employment Court currently had the power to do.
The Act would also be amended to strengthen the rights of employees who were in a triangular employment relationship.
These were employees whose employer contracted their services to a third party, which effectively controlled the employee's work.
Employees in this situation, who belonged to a union, would be entitled to terms and conditions at least as favourable as those enjoyed by unionised workers employed directly by the secondary employer under a collective agreement.
Business New Zealand chief executive Phil O'Reilly said the Government was seeking to change the Employment Relations Act "to give some casual workers the same pay and conditions and permanent staff".
"It would make temp agencies uneconomic and there would be huge ramifications for events like the Rugby World Cup that rely on large numbers of temporary workers," he said.
CTU president Helen Kelly said there were cases of genuine casuals where the arrangements were necessary in normal business operations.
However, there were many workers who were classified as casuals but were expected to turn up to work on a regular basis and were really no different to permanent workers.
New Zealand First deputy leader Peter Brown said he had negotiated the changes.
For several years, NZ First had been pushing for added protection for casual workers and at long last something was about to happen, he said.
