Redundancy – rights and options

What you should know if you're likely to experience redundancy.

I’ve heard rumours of redundancies at work – what should I do?

An older man discusses his role with his employer

Be flexible, and consider taking on new roles or tasks

If you are worried that you may be made redundant, it is a good idea to talk to your supervisor or manager to get more information.

Can I reduce my chances of being made redundant?

Showing you are flexible by taking on new tasks or working different hours could make it easier for your employer to keep you in work.

Does my employer have the right to make me redundant?

You can only be made redundant if genuine commercial reasons mean your position is no longer needed. This can be due to:

  • a decline in available work
  • restructuring, including contracting out work
  • the sale or transfer of the employer’s business.

When can't my employer make me redundant?

A man stands with a mop by his cleaning van

Employers can't use personal reasons to make you redundant

An employer can’t use redundancy as a way of dismissing you for reasons relating to you personally, such as:

  • concerns about your performance or reliability
  • your age - there is no compulsory retirement age, unless it is specified in your employment agreement.

Your employer also cannot:

  • put pressure on you (directly or indirectly) to resign
  • make the situation at work intolerable for you.

This is known as a forced resignation. If this occurs, you may have grounds to file a personal grievance claim.

Does my employer have to give me advance notice of redundancies?

If an employer is planning to make staff redundant they need to tell them in advance. How much time in advance depends on what is in the staff member's employment agreement.

If there is no notice time in the employment agreement the employer must give 'reasonable notice'. 

Employers must give you a letter with:

  • the end date of employment
  • how much notice you have
  • whether you will receive any compensation
  • an offer to meet and discuss the redundancy process.

 Employers need to tell you:

  • about how how they will run the redundancy process and the timeframes
  • what will change and the reasons for the changes
  • which jobs will be removed or changed
  • the final structure of the organisation.

They should also give you time to consider and comment on the redundancy process.

Many employment agreements set out guidelines for what the employer must do in the case of redundancy – check to make sure these have been followed.

Will I get compensation if I am made redundant?

You are entitled to redundancy compensation only if it is outlined in your employment agreement/contract.

Can I challenge a redundancy or dismissal?

If your employment is terminated because of a redundancy or dismissal and you think you’ve been treated unfairly, you can challenge your employer’s decision. Before doing this, you may want to get advice from:

  • a community law centre
  • Citizens Advice Bureau
  • Employment New Zealand
  • the union that covers your area of work.

You can also:

1. Raise a personal grievance claim

This must be done within 90 days of the redundancy or dismissal.

You can raise a personal grievance verbally, but it is best to write a letter outlining your problem and desired outcome to the head of your organisation, or your manager. 

You can't raise a personal grievance if you are employed on a 90-day trial.

2. Seek help from a mediator

A mediator can help you identify problems and look for ways to resolve the disagreement.

This option is also available for people employed on a 90-day trial.

3. Take your case to the Employment Relations Authority or Employment Court

If you fail to reach an agreement with your employer, you may decide to take your case to the Employment Relations Authority or Employment Court.

Updated 24 Jan 2019