Restructure & Redundancy
IT’S A PROCESS
If you own or manage a business that has been affected financially by Covid or some other reason, and you need to reduce your costs further, you may be considering a restructure of your team.
This can be a daunting decision to process and we often hear from business owners who do not know where to start. Everywhere you search, every article you read is filled with legal jargon and you feel out of your league. You are terrified of getting it wrong and ending up with a Personal Grievance on your hands. You are not alone.
A restructure is simply defined as a management-led change that results in reorganisation of an existing structure. It can be for one team, or on a much larger scale. It can lead to redeployment of staff to other roles, changes to the grading of posts or positions becoming redundant.
We strongly suggest taking your time to carefully consider your reasoning. Is there a genuine business reason to restructure? Can you demonstrate a commercial imperative? Would you be prepared to open your books to prove this?
Once you have done your numbers and can demonstrate necessity, there are a few basics that will carry you through a fair process.
HERE ARE A FEW BULLET POINTS OF THE BASICS FOR YOU
Have a genuine reason to restructure your business. Keep honesty at the forefront of all your calculations. Base your decisions on facts not feelings.
What you initially present will be your proposed restructure. You cannot overuse the word proposed; right through until the end of the process when the restructure is finalized.
Act in good faith. Act well and be fair always. Keep your own and your businesses values at the forefront of your mind. Restructures and redundancies are underpinned by the principle of good faith detailed in Section 4 of the Employment Relations Act 2000.
Consult fairly. It is important not to cut corners in the consultation process. The more detailed and precise the information available to the employees is, the better the quality of the decision making.
New Zealand employment laws stipulate that staff must be consulted on every aspect of a redundancy or restructure before the final decision to either make someone redundant or to disestablish their role.
Ask the greater team for feedback and consider it carefully. There are times when the team come up with solutions that you have not thought of.
It is a job being made redundant, not a person. Never predetermine which employee will be made redundant before hearing their feedback. Never try to short-cut a performance management process by constructing a redundancy situation. This will not only land you in hot water, but it is likely to leave a bad taste with the remaining team and create loss of trust and friction.
Offer emotional and career support to affected employees. There is every chance they may be upset. Kindness is key.
STEP BY STEP GUIDANCE AVIALABLE
As outlined in our latest newsletter, we have available a 3-part, 9-step process that is easy to follow and you have our guidance throughout as well. This is offered as a fixed price package, empowering you to resolve any workplace issues quickly and safely, while easily managing your budgets.
We would love you to engage with us to help you safely navigate a restructuring or other employment law process and are currently offering complimentary exploration calls for the remainder of November.
Thanks, from the team at Resolve Legal. We really enjoy sharing our thoughts and news with you.
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