Doing it Right: Performing a Fair and Just Redundancy Process

Two Employers DeliberatingThe redundancy process — and if applicable, the redundancy compensation payment — should be your last option as a responsible employer. It must only occur after you have exhausted every redeployment option. The following are essential steps if you must perform the redundancy process for your NZ company:

  • Consider all redeployment options and go from there. You must then speak individually to all employees that might be affected by the redundancy.
  • During the individual meeting, you should inform employees that you’re looking to make changes in your company due to financial or other viable reasons, and that their position might change as a result.
  • Provide specific details of what you’re proposing and ask the employer for their input. Tell your employee that you would take their input under advisement and that you’ll get back to them later. You should also advise that your employee receives legal advice if they’re unsure of what’s going on.
  • Deliberate on all the details, taking into account your employee’s input, and make your decision.
  • Meet with the employee again, preferably with other representatives (if applicable), and tell them your decision.
  • If the employee’s position is regrettably redundant, give them a notice. Discuss the redundancy payment if applicable, as well.
  • If you have available positions or hours, offer it to your employee. Don’t forget to give them a chance to think about it before getting back to you.
  • If your employee doesn’t accept your offer, inform them about the redundancy of the position. Include a written notice stating it, as well as the notice period.

Put simply, if you’re looking to make your employee redundant, you have to make certain that the process is fair. You could justify the redundancy substantively, and that you have to comply with all relevant terms included in your employment agreement.

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