The decision to restructure your business is never easy, and it’s important to get the law right. Here are our top five tips for dealing with a redundancy or restructuring situation.
- Do your homework
If you are thinking about restructuring your business, make sure you have done your homework. Even if the decision is motivated by financial considerations, the Courts have said an employee has a right to request and receive information about the financial reasons for the decision. An employee is entitled to request copies of all relevant information relating to a restructuring process – including information about other candidates if the employee is competing with outsiders for a new position that has been created.
- Consider all options
Often employers start the restructuring process with a clear outcome in mind. Rather than thinking about the staff that are affected, think about the particular roles. Which are surplus to requirements? Which are likely to expand (or disappear)? If you start with the positions, rather than the people, you are more likely to make an informed decision.
- Consult. Consult. Consult.
You have a legal obligation to consult with staff throughout the process. This means you must give staff information about the proposal and the reasons for it, and meet with staff to get their feedback before you make any final decision. Sometimes, staff come up with creative solutions that you hadn’t previously considered.
- Consider redeployment.
Often employers simply consider whether a job is being created or disestablished. Sometime however, new positions are created. The law requires an employer to consider whether any new positions being created are suitable for existing employees. This needs to be explicitly considered and discussed with your employee. Even if you don’t consider they are suitable for a new position being created, you have an obligation to tell them this, and explain the reasons for your view.
- Get advice
Restructuring and redundancy situations can be a minefield. Getting good advice at the outset can help to develop a clear and robust process and avoid a number of potential pitfalls. To discuss redundancy or restructuring processes in more detail, contact sue@gallie.co.nz or shelley@gallie.co.nz.