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Employer In Strife for Suggesting Employee Applies for Vacant Position in Redundancy and Redeployment

Published 01 Oct 2011

When an employer is faced with restructuring which may lead not only to a position becoming redundant but a new position being created then the employer must be mindful that they should be up front at the beginning of their restructure process and make efforts to find alternative roles for employees likely to be displaced through redundancy. Employers should note the increased importance placed on procedural fairness, especially the requirement to consult with employees in all redundancy situations. In HP Industries (NZ) Ltd v Davidson the Employment Court held that even though there was a genuine redundancy situation the employer (HP) was in breach of its good faith obligations under the Employment Relations Act 2000 (the Act). It had rushed its consultation process, had not provide timely and relevant information about alternatives to the redundancy and its consultation process was perfunctory at best. In another recent case (Simpsons Farms v Aberhart) there had been some consultation but the employer was found to have acted unfairly by rejecting "out of hand" an alternative to redundancy put forward by the employee and also by failing to disclose certain information.

Finally in the most recent case Wang v Hamilton Multicultural Services Trust the Employment Court has gone a step further and said that where an employee could do the role with reasonable training (or is predominately doing it anyway in another guise) the employee must be offered the role.

Therefore a prudent employer would ask an employee if they wanted to be considered for any or all of the new roles but don't ask them to apply; The employer should then consider offering them a specified probationary period in the role in which both sides can assess their suitability without loss of any alternative redundancy compensation if they don't work out in the role. Of course the employer can offer the redeployment straight up if the person has the skills or experience to do the role - even with a reasonable degree of relevant training.