The Employment Relations Authority has ordered an employer to pay an employee over $7,300 after a flawed redundancy process that resulted in the employee being unjustifiably disadvantaged and dismissed.

The employer told the employee that the business was considering making his role redundant due to financial pressures. The employer explained the proposal and welcomed feedback from the employee.

The employee was provided with a few documents relating to the redundancy, but not enough to information to provide a proper response.

The employer let the employee take special paid leave during the process. Although it was agreed that the employee was to be paid while on leave, the employer failed to pay the employee for a period of his leave.

After a brief period of time, the employer held a follow-up meeting. The employer told the employee that he was being made redundant, and his role dis-established.

The Authority held that failing to pay the employer during special leave, despite having agreed to, unjustifiably disadvantaged the employee.

Additionally, the Authority held that the employer had a genuine reason to carry out a redundancy process. However, failing to provide the employee with adequate information to come up with a response to the proposal was found to be a significant deficiency in the process.

The employer was ordered to pay the employee $2,306 in lost wages and $5,000 in compensation.

Even if an employer has a genuine reason to carry out a redundancy process, it is important that all aspects are carried out correctly. Failure to follow the correct process may result in expensive grievances.

If there are concerns surrounding the redundancy process an employer has carried out, it is wise to speak with a professional experienced in the area.

Leading law firms committed to helping clients cost-effectively will have a range of fixed-priced Initial Consultations to suit most people’s needs in quickly learning what their options are.  At Rainey Collins we have an experienced team who can answer your questions and put you on the right track.


Alan Knowsley
Employment Lawyer