Disguising dismissal as redundancy costs employer over $25,000

A recent Employment Relations Authority decision has upheld a claim for disadvantage and unjustified dismissal. The employee and employer traded arguments at a performance meeting. The employee was suspended without pay or any process to discuss the suspension. The employee was then dismissed for redundancy without any opportunity to comment on the redundancy.

The ERA held that the suspension without a proper process was unlawful. Payment of wages should have been made and the employee should have had the opportunity to comment before the decision was made.

The employer also messaged other employees attacking the character of the suspended employee. This was held to have aggravated the damages to be awarded.

The employer then dressed up a dismissal as a redundancy but provided no supporting material to justify a decision on cost saving grounds and gave the employee no opportunity to comment on the proposal. It was presented as a “done deal”.

The ERA held the redundancy to have not been genuine and awarded 13 weeks lost wages ($13,700) plus $12,000 compensation for the hurt and humiliation suffered by the employee as a result of the employer’s illegal actions.

Alan Knowsley
Employment Lawyer
Wellington