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Labour MP's Private Bill Looking To Implement A Redundancy Entitlement

Published 08 Dec 2012

Initially introduced in 2009, the Employment Relations (Statutory Minimum Redundancy Entitlements) Amendment Bill has been introduced by Labour MP Sue Moroney. The Bill is not Government supported by the Government.

The provisions of this Bill are based on the recommendations of the Public Advisory Group on Restructuring and Redundancy (the Advisory Group) who reported to the Government in 2008. The Advisory Group assessed the adequacy of redundancy laws and provisions and recommended options for addressing gaps in and issues with existing laws and policy provisions.

Currently there is no statutory entitlement to redundancy compensation or even a minimum notice period. Redundancy entitlements are governed by the employment agreement and this mean that many Employees are not entitled to redundancy compensation and sometimes only one or two weeks notice of their impending redundancy.

If it were passed by Parliament, this Bill would have major financial implications for both Employers and Employees.

The intention of the Bill is to protect workers against unexpected redundancy, with minimum entitlements to notice and compensation as follows:

•        notice of dismissal of no less than 4 weeks; and
•        compensation for redundancy in the amount of 4 weeks' remuneration for the first full year of the employee’s continuous employment with the employer; and
•        further compensation for redundancy in the amount of 2 weeks’ remuneration for each subsequent full or partial year of the employee’s continuous employment with the employer, up to a maximum entitlement of 26 weeks’ remuneration.