A redundancy occurs when a role or a position within a business becomes surplus to the requirements of the business or when the role needs to be changed significantly for operational purposes.

There needs to be clear and genuine business or commercial reasons for a redundancy and it must always be carried out in a fair and procedurally correct manner in consultation with the employees concerned.

The Best Advice In 3 Easy Steps!

Before declaring a position redundant, thereby effectively terminating the employment of the incumbent, the employer must follow a full and fair consultation process with all employees who would potentially be impacted by the proposal. The employer must comply with the statutory duty of good faith and must therefore provide the employee with full information to support the proposal and consider any feedback to the proposal before taking a final decision on the way forward.

The main stages involved in making a position redundant include:

  1. Identify and articulate the business case for redundancy or restructuring and present this as a proposal for consultation with your staff
  2. Hold meaningful consultations with your staff – ask for their feedback to the proposal and consider all feedback with an open mind
  3. Consider the feedback and make any necessary adjustments to your original proposal before proceeding
  4. Go through with your selection process using the proposed criteria if applicable and confirm the outcome in writing

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If you have a poor performer you are advised to go through a proper performance management process. Making a person redundant cannot be used as a suitable legal alternative to managing their performance!

EIPM can help

Navigating your way through a redundancy process can be very stressful for all parties involved and it is perhaps where the employer is most at risk of receiving a personal grievance.

So don’t get this wrong! We can help with:

  • Talking you through the process to ensure you understand your obligations, options and the associated risks
  • Helping you to prepare and clearly articulate your business case
  • Prepare all necessary paperwork including the consultation letter, feedback sheet and outcome letters
  • Help you to carry out the consultation process with your staff
  • Go through a correct selection process if required

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The Ministry of Business, Innovation and Employment (MBIE) has just published a booklet entitled: Holidays Act 2003 - Guidance on Annual Holidays and Related Provisions. A long and painful read, no doubt, but certainly this should prove to be a very welcome guidance to what is arguably one of NZ's most complex pieces of employment legislation. You can access the Guidelines here: www.employment.govt.nz/assets/Uploads/tools-and-resources/publications/Holidays-Act-2003-Guidance.... ... See MoreSee Less

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Guidelines to The Holidays Act (2003)

The Ministry of Business, Innovation and Employment (MBIE) has just published a booklet entitled: Holidays…

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