Can I electronically sign an Employment Contract?
E-Signature Legality Summary
Under New Zealand law, a written signature is not necessarily required for a valid contract - contracts are generally valid if legally competent parties reach an agreement, whether they agree verbally, electronically or in a physical paper document.
The Contracts and Commercial Law Act 2017 (CCLA) specifically confirms that contracts cannot be denied enforceability merely because they are concluded electronically. In particular, under the CCLA an “electronic signature” is treated as the legal equivalent of a written signature when determining a party’s intention to be legally bound by an agreement or deed, provided that the signature meets certain criteria.
This general position is subject to a few limited exceptions. Under the CCLA, a legal requirement for a signature can be met if the electronic signature adequately identifies the signatory, indicates the signatory’s approval of the information to which the signature relates and is reliable as is appropriate given the purpose for and the circumstances in which the signature is required. There is a presumption that an electronic signature “is reliable as is appropriate” if the means of creating the signature are linked to the signatory and under the signatory’s control and of no other party, and any alterations to the signature, or the information to which the signature is related to, made after the time of signing, are detectable.
However, a person may prove on other grounds that an electronic signature is, or is not, “reliable as is appropriate.” Under the CCLA, a person is not required to use, provide, or accept information in electronic form or without that person’s consent. A legal requirement for a signature that relates to information that is legally required to be given to a person is met by means of an electronic signature only if that person consents to receive the electronic signature. Consent may be inferred from a person’s conduct.
Documents That May be Signed Electronically
Use cases where a Standard Electronic Signature is typically appropriate include:
- Some HR documents such as employment contracts, benefits paperwork, and other new employee onboarding processes
- Commercial agreements between corporate entities including NDAs, procurement documents, sales agreements
- Some consumer agreements including new retail account opening documents
- Certain real estate documents, such as lease agreements
- IP licenses, including patent, copyright and trademark
Further Guidance
Use cases that are specifically barred from digital or electronic processes or that include explicit requirements, such as handwritten (e.g. wet ink) signatures or formal notarial process that are not usually compatible with electronic signatures or digital transaction management.
- Handwritten - powers of attorney and enduring power of attorney (Parts 1-4, Schedule to the ETA)
- Handwritten - affidavits statutory declarations, or other documents given on oath or affirmation (Parts 1-4, Schedule to the ETA)
- Handwritten - bills of landing (Parts 1-4, Schedule to the ETA)
- Handwritten - wills, codicils, or other testamentary instruments (Parts 1-4, Schedule to the ETA)
- Handwritten – warrants (Parts 1-4, Schedule to the ETA)
- Notarization - real property transfer contracts and deeds
- Handwritten – transfers of intellectual property (e.g. assignment of patent or copyright)
As part of its open, technology-neutral approach to electronic signature, the CCLA does not require the use of specific technology for a legally enforceable electronic signature, either for digital certificates or otherwise. To be a legally enforceable signature under the CCLA, the electronic signature must meet the requirements of sections 226-228 of the CCLA.