Tips for NZ Employers: reducing employee hours and redundancy

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Written by Kalev Crossland, www.shieffangland.co.nz
Republished with permission.

Not a substitute for specific legal advice; guidance only.

1. Casual workers

For employees who are genuinely casual workers (on a casual agreement, hours are irregular, they can turn down shifts and/or make themselves unavailable for periods), they have no expectation of ongoing employment. With these workers you can simply stop offering shifts.

 2. Permanent full-time or part-time workers

Your two options here are:

  • Request changes to hours by agreement; or
  • Follow a redundancy process.

The first option involves meeting with the employees (could be a Skype meeting) and explaining the predicament. You would explain that your options include:

  • reduction in hours by agreement
  • reduction in wages by agreement
  • staff agreeing to take annual leave
  • staff agreeing to take unpaid leave
  • or some combination of the above
  • or redundancy if nothing else works.

If the above isn’t successful and you elect to follow a redundancy process, the good faith obligations in the legislation require you to provide to the affected employees:

  • Access to information, relevant to the continuation of the employees’ employment, about the decision; and
  • An opportunity to comment on the information before the decision is made.

Thus, a consultation process needs to be commenced and concluded prior to any decision being made on the proposal to make employees redundant.

The first step then is for you to commence the process by preparing the information that you will present to the employees i.e. your proposal. This sets out the reasons for the proposed redundancies, and what exactly is proposed. If you are retaining some roles in some stores (presumably likely) then the material that you give them also needs to include the basis on which you will be offering the remaining roles if the proposal goes ahead (i.e. the basis on which you will choose to continue to employ some people and not others).

The next step is to meet with the employees to advise them of the proposal, and to commence the consultation process by inviting them to provide their feedback on the proposal. This can be by one-on-one meetings with the affected employees, or email and phone calls if you are trying to avoid contact. The employees need to be told of their right to have a support person or representative at any feedback meeting.

After you have had the meetings you need to consider the feedback received, the impact if any on your proposal, and make a decision. Note that employees’ feedback does not have to be accepted or acted on, but must be considered in good faith. This consideration can on occasion result in a change to the original proposal. Otherwise, you will then move to make a decision on the proposal as to whether it will go ahead, and notify the employees.

You will then follow a process of offering ongoing work to those who meet the selection criteria. For those who aren’t successful, you will confirm their role is redundant, and follow up this confirmation in writing.

For more help call Kalev Crossland +64 274 740 835 or email: kalev.crossland@shieffangland.co.nz

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