As highlighted by many recent earthquakes, including the Darfield earthquake in New Zealand (2010), damage to non-structural components contributes significantly to the overall earthquake damage and costs. Understanding the interaction between a structure and its non-structural components is critical in order to reduce the damage to non-structural components during an earthquake event. This paper presents a numerical investigation into the local interaction between cladding systems and moment resisting frames utilizing lumped plasticity models of the cladding connections based on a two-dimensional finite element model. The research is part of a larger coordinated research programme which aims to reduce the damage to all non-structural components during earthquake events. The modelling exemplifies the different failure mechanisms that can result due to cladding-structure interaction. Results confirm that common design methods which neglect cladding interaction are inaccurate. The authors intend to continue the research to successively develop improved and innovative low damage cladding-moment resisting frame systems. They also aim to produce simple design tools that provide easy inclusion of the effects of cladding-frame interaction to the seismic response.