Do I Have To Accept Redeployment If I Am Being Made Redundant?

Losing your job is stressful. Being told your role is “redundant” can feel personal  even though legally, it’s meant to be about the role, not you.  But what if your employer says “Your role is disestablished, however, we can offer you redeployment.” Do you have to accept it?   What happens if you say no?  And what if you weren’t offered anything at all?  In this blog, we explain your rights under New Zealand employment law in clear, practical terms and what steps you should take to protect yourself.

What Is Redundancy?

Redundancy happens when your employer decides your role is no longer required. This might be because of restructuring, financial pressure on the business, technology changes such as automation and other efficiencies, sale of the business, or a reduction in work due to a lost client or contract etc. 

Under the Employment Relations Act 2000, employers must act in good faith when making your role redundant.  That means they must consult with you before making a final decision, provide relevant information about what is happening and how you will be affected, give you the opportunity to provide feedback and then consider that feedback, as well as follow a fair and genuine process.  

Redundancy must be genuine. It cannot be used to remove a person the employer simply doesn’t like or to avoid performance management.

What Is Redeployment?

Redeployment means offering you another job within the organisation instead of ending your employment.  This is important because before dismissing someone for redundancy, an employer must consider whether redeployment is reasonably available.  The Employment Court of New Zealand and Employment Relations Authority have both made it clear that employers must actively consider redeployment where possible.

Do You Have to Accept Redeployment?

The short answer is no, but it will depend on a few factors.  You are not automatically required to accept any job offered. However, refusing redeployment can affect your entitlement to redundancy compensation (if your contract provides for it).  The key question to ask is whether the role being offered is suitable. 

Whether you should accept depends on whether the role is:

• Similar in seniority, 

• Comparable in pay, 

• Within your skillset, 

• In a similar location, and 

• Reasonable in hours and responsibilities.  

If the role is substantially similar, refusing it may mean that you are treated as having resigned and you may lose redundancy compensation if it applies.   

If the role is significantly different, for example lower pay, lower status, significantly different hours, different location or short-term instead of permanent, then you may be entitled to decline it and still receive redundancy compensation.  

Each case depends on the wording of your employment agreement and the employer’s policies.

What Happens If You Refuse Redeployment?

If the role is suitable and comparable, your employer may argue that you unreasonably refused redeployment and that you are not entitled to redundancy pay.  Some employment agreements specifically state that redundancy compensation is not payable if a suitable alternative position is offered and declined.

If the role is not comparable you may refuse the offer and still receive redundancy compensation (if provided for in your contract). 

What If You Weren’t Offered Redeployment But Think You Should Have Been?

This can be quite common.  If your employer operates a large organisation or has other vacancies, they must genuinely consider whether you could perform another available role,  even if training (within reason) is required.  If they fail to do this, the redundancy may be unjustified and you may have grounds to raise a personal grievance for unjustified dismissal.  A grievance must normally be raised within 90 days of the dismissal.

The Employment New Zealand website confirms that employers should consider existing vacancies, roles that are about to become vacant, fixed-term opportunities and adjusted duties.  

If you believe redeployment wasn’t properly considered you should ask your employer for the reasons why.  You may request confirmation of what roles were considered, why you were not suitable and whether any suitable vacancies existed.  You should also be proactive in checking iInternal job listings and other places that opportunities within your company may be advertised.  

You can then raise your concerns in writing and seek advice if it seems you have missed out on appropriate redeployment options.  

Legal Principles Around Redeployment

New Zealand case law establishes that employers must turn their mind to redeployment when restructuring.  This obligation is stronger in large organisations.  The process for considering redeployment must be genuine, not token and employees should be given enough information  and time to respond.  Employee’s suitability for redeployment opportunities must be assessed objectively.  

However, employers are not required to create a new role, displace another employee or offer a role where one does not genuinely exist.  The key test is whether the employer acted as a fair and reasonable employer could have in all the circumstances.

What should I do if I am offered redeployment?

Before accepting or declining an offer, ask for a copy of the position description and compare the duties carefully with the role you had.  Confirm with the employer what the salary and benefits are with the new role and check what the new reporting lines would look like.  

If you are unsure if the redeployment opportunity is a fair replacement for your role, get in touch with an expert for advice, especially if redundancy compensation is at stake.  You should not be pressured to decide immediately. You are entitled to reasonable time to consider the offer.

FAQs

Do I have to accept redeployment?

No. But if the role is suitable and comparable, refusing it may affect your entitlement to redundancy compensation.

What counts as “suitable” redeployment?

There is no strict legal definition. Factors include pay, seniority, duties, location, hours, and whether the role matches your skills.

Can my employer offer me a lower-paid role?

Yes. But you are not required to accept it. If it is significantly worse, you may still qualify for redundancy compensation.

What if I accept redeployment and later regret it?

If you believe the process was flawed or you were pressured, you may still be able to raise a personal grievance but you will need to seek advice quickly due to deadlines.

My contract doesn’t mention redundancy pay. Do I get any?

Unlike some countries, New Zealand law does not automatically require redundancy compensation. You are only entitled to it if your employment agreement provides for it, or a workplace policy forms part of your terms and conditions.

What if my employer says there were no other roles available?

You are entitled to ask for evidence. If other roles were advertised or filled around the same time, that may be relevant.

How long do I have to challenge a redundancy?

You must normally raise a personal grievance within 90 days.

Can I negotiate a redeployment offer?

Yes. You may negotiate things like salary protection, a trial period, retraining support and/or relocation assistance. 

Redeployment can be a genuine attempt to preserve your employment or it can sometimes be used to limit redundancy payments.  The key questions to ask are: was the redundancy genuine, was the process fair, and was redeployment properly considered?  If you are offered redeployment you do not have to accept any job simply because it is offered but your decision should be informed, careful, and legally aware.

If you are unsure about your redundancy and/or redeployment options, seek advice early. Contact Mathews Walker today for a free consultation.  MathewsWalker.co.nz | 0800 612 355

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