The Employment Relations Authority has upheld a personal grievance for unjustified dismissal and a failure to provide an employment agreement or employment records, and ordered an employer to pay an employee $19,500.

The employee worked for the employer for a significant number of years. After the employee suffered an injury and took time off work, he received several messages from his employer.

The texts explained that the business had been sold. The employee asked if he had been dismissed, but the employer said that he had not, and that the employee would have to discuss any future employment with the new business owner.

The Authority held that the employer unjustifiably dismissed the employee. It explained that by telling the employee that he would have to discuss with the new business owner himself about his future employment, he was dismissed.

Additionally, the Authority noted that employers are required by law to “take steps to protect an employee’s continued employment by negotiating with the new owner about whether their employment could be transferred on the same terms and conditions of employment.”

The Authority also noted that the employee was not provided with a written employment agreement and that holiday records were not properly maintained.

The Authority ordered the employer to pay the employee $14,000 in compensation and to pay a penalty of $5,500 for failing to provide a written employment agreement and failing to maintain holiday records.

It is important that employers understand their obligations toward employees when a business is sold. These obligations must be included in employment agreements that are required to be provided to employees. Failing to get these basics right puts employers at risk of potentially expensive personal grievances.

If a business is being sold it is wise to speak with a professional experienced in the area, so you know what your rights and obligations are.

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.


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