The government has announced proposals to electronically tag asylum seekers.
Courts would be able to order that anyone claiming refugee status be monitored, with other conditions such as residency requirements and curfews.
The government said it was introducing the change so asylum seekers were only detained in prisons when absolutely necessary.
No asylum seekers have been held in custody in New Zealand for three years. The government commissioned a report by Victoria Casey KC in 2021 into the policy of detention, mainly at Mount Eden prison in Auckland.
That followed a report by Amnesty International into the practice, detailing the rape of a man who later was recognised as a refugee, and coercion by criminals into taking part in fight clubs.
The Casey report was critical of the practice of detaining asylum seekers.
She recommended that "access to electronic monitoring should be available as an option in cases of heightened risk, if it is assessed as the only option providing sufficient security to avoid detention (noting that the UNHCR Guidelines direct that electronic monitoring should be avoided as far as possible as it is a harsh restriction, bringing with it the stigma of criminality)".
But Immigration Minister Michael Wood said the assessment of asylum claims could take a significant amount of time, and community management measures would expand the tools available to manage asylum seekers.
"Community management conditions imposed by a court would be tailored to the nature of the risk posed by the individual. They could include things like residency conditions, curfews, the use of electronic monitoring, non-association requirements, restrictions on the use of and provision of technology and media, and attendance at cultural, therapeutic or rehabilitation programmes.
"We continue to be focussed on upholding human rights and assisting in integration into New Zealand should a claim be successful. The proposed changes demonstrate the government's commitment to upholding human rights and the rule of law."
The government said it would use detention and community management only for people believed to pose a risk, including that they may abscond.
Mass arrivals
Legislation is also being introduced on Tuesday to give courts longer to make decisions if asylum seekers arrive en masse.
"While it's unlikely we'll experience a mass arrival due to our remote positioning, there is no doubt New Zealand is a target for people smugglers. As responsible government we must remain prepared," Wood said.
"These changes amend provisions to ensure those seeking asylum will have access to adequate legal representation by extending the period that a decision is required to be made by."
The Green Party denounced the legislation.
"It is a human right for people escaping harm to arrive at any border, by any means, to seek asylum. When families arrive in Aotearoa the very least they should expect is that they will be treated with dignity," Greens refugee spokesperson Golriz Ghahraman said.
"The government is today extending the power to detain them without charge or trial, without the right to be heard, rather than honour our commitment to uphold people's basic rights to safety and fairness.
"This is the first time in our political history that a government has made the humanity and rights of asylum seekers an election year issue."
One of the greatest dangers was that the issue could be used to stoke fear and division, she said.
"We simply cannot turn an issue of human rights into political division. The government needs to unequivocally support the right to asylum and the right not to be detained without trial.
"New Zealand has a history of detaining asylum seekers in prisons, where they have suffered violence and abuse. Today the government has acknowledged prisons will still be used for asylum seekers under this bill."