$20,000 … the cost to one employer for insufficient communication and a lack of consultation …

The law requires employers and employees to deal with each other in good faith.  This includes having open lines of communication, as well as consulting the employee on decisions likely to have an adverse effect on their continued employment.

In a recent Employment Relations Authority decision an employer was found to not have communicated or consulted with an employee sufficiently, and was ordered to pay over $20,000.

The employer argued that the employee’s employment ended because her role became redundant, and because she walked away from her job.  The employer also tried to argue that the redundancy was the only commercially sensible decision available to the employer.

The Authority dismissed the employer’s arguments on three procedural grounds:

1. The consultation process was not completed

The employee was so emotional at the only meeting that was held that the employer left the room.  In a situation like this an employer must allow the employee a sufficient “cool-down” period before continuing talks or making any decisions.

2. The consultation that there was, was inadequate

The Authority found that consultation in this case would have required the employer to advise the employee of the nature of the problem the business had, and to ask her for possible solutions before pursuing any course of action.

3. When the employee failed to respond when asked for her input, the employer did not meet its legal obligations

The employer should have put the employee on notice that if she continued to not respond, she ran the risk that the employer would make a decision without her input.

The employer may have believed that redundancy was the only option, but due to flaws in the process followed, the Authority found that the employer’s belief could not have been reasonably held.

It is of absolute importance in any employment situation that employers communicate and consult with their employees on important decisions – particularly those that may have an adverse effect on the continuation of the employee’s employment.