Redundancy Refresher - Update from the Employment Court

In November last year, the Employment Court delivered an interesting decision which serves as a good reminder about the manner in which an employer must engage with an employee when undertaking a restructure process. 

The case concerns Mrs Archibald, who worked for the Waikato District Health Board.  Mrs Archibald was 67 years old at the time of the decision and worked as a Health Promoter.  That job sometimes required her to travel around the Waikato region, but was largely based in Thames. 

In 2016, the Health Board re-examined the manner in which services were delivered, and looked to rearrange the Health Promoter role, although largely retain the services that Mrs Archibald and her colleagues provided.  A consultation process began. 

Mrs Archibald was very concerned that the proposed new role would require significant travel – up to 2 hours and 45 minutes a day.  She told the employer that would “destroy” her. 

The Health Board concluded that Mrs Archibald could be deployed into one of the new Health Promoter roles.  Mrs Archibald said that she couldn’t accept a job with that much travel, and her employment was terminated.  She was not entitled to receive redundancy compensation (which was provided in her employment agreement) because she had not accepted the similar role. 

The Employment Court held that was unfair.  The additional travel was significant for Mrs Archibald, even if it wasn’t for the other affected Health Promoters.  Mrs Archibald’s concern that she would not cope with the travel was not adequately considered, and the Health Board’s decision was therefore unjustified. 

The take home lessons from this case are:

1. Changes to a job description that may have an impact on an employee’s subjective experience of work are significant.  Changed reporting lines, additional travel, or venue rearrangement may trigger redundancy. 

2. Even when employees do the same job, their feedback on a proposal must be considered on an individual basis.  It is not necessarily acceptable to have a one size fits all policy.

3. There need not be any change to an employee’s actual work duties for their employment to trigger a redundancy. 

4. Compensatory awards are probably on the rise – I’ll develop this point next time.

Until then - if you have any issues with changes in your business, please give me a call.