Assisting employees dealing with redundancy

One of the most common employment issues that we see is employers dressing up a dismissal as a restructure or redundancy. Alternatively, some employers simply don’t take the required care with ensuring a proposal for change is well researched and fair.

Early case law from the 80s and 90s suggested that the Employment Relations Authority and Employment Court had limited ability to examine redundancies. This widespread view still prevails amongst many employers. However, it is simply not the case given modern decisions.

A redundancy must be both genuine and reasonable, and the employer has to prove this. Beyond that, the Employment Relations Act 2000 gives an employee the ability to ask for a wide range of information when your employment is at risk of redundancy in a restructure. The Employment Relations Act 2000 sets out that part of the employer’s duty of good faith is to:

  • provide access to information relevant to the continuation of an employee’s employment, about the decision
  • provide an opportunity for an employee to comment on the information to their employer before the decision is made.

We can help you ask the right questions and determine whether the redundancy or restructure proposal is reasonable and genuine and often position you to protect your role or leverage a settlement.

The other most significant issue is the obligation to offer redeployment. Redeployment should occur where one role is disestablished and another is created but that new role is within an affected employee’s capabilities. The Employment Court made itself clear on the issue of redeployment in the decision of Wang v Hamilton Multicultural Society Trust. In this decision, the Court found that, where an employee’s role is disestablished and a new role is created, if the new role is within the employee’s capability, the employee must have the opportunity to be redeployed to the role. This is in preference to any external candidate. This should occur regardless of the new role’s content or position description. Further, a role will be within an employee’s capability if the employee could perform the role with reasonable retraining or upskilling.

We have acted for employees in a number of significant restructures where the employer attempted to avoid redeploying qualified employees to newly created roles. We have been successful both in ensuring redeployment to the new role and in negotiating compensation where the employee did not feel they could have trust and confidence in the employer and continue working for them.

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