Redundancy - rights & options

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

Being made redundant is stressful. In some cases, you may have little warning that your job is about to end, in others you may have weeks or months of rumours and negotiations before an announcement is made.

Either way, redundancy is a difficult and emotional process. But unplanned change can also create opportunities. Knowing your rights and your options can help you through this process.

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 your job may be on the line, make an appointment to talk to your supervisor. That way you can get a definitive answer, or, failing that, at least get a sense of whether redundancies are a possibility.

Can I reduce my chances of being made redundant?

Being adaptable may decrease your chances of being made redundant.  This could mean taking on new tasks or working different hours.

By being flexible you increase the opportunity for your employer to find ways to keep you on, perhaps in a different role. You could also suggest changes to your current role that would improve profitability or effectiveness.

Does my employer have the right to terminate my employment?

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

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

Sonya Thomas had realised her employer was in trouble even before she was made redundant. "I had known something was up because I did a lot of financial reporting on sales, and I’d worked out that things weren’t ticking along as they should."

Sonya Thomas

Sonya Thomas

Marketing and Communications Assistant

When can't my employer make me 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 cut staff, they are legally required to tell you:

  • how many staff they plan to lay off
  • where those jobs will be cut
  • how they will run the redundancy process - including how they will decide who will lose their jobs.

They should also give you time to consider and comment on those criteria.

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.

However, in some cases decisions are made quickly – such as when a business closes or needs to make mass redundancies – and you may get little warning of your employer’s plans.

Will I get compensation if I am made redundant?

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

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
  • the Department of Labour
  • 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 take your case to the Employment Relations Authority or Employment Court.

What protection do I have from redundancy?

A man stands with a mop by his cleaning van

Some workers, such as cleaners, may have extra protection during restructures

In most cases, your employment agreement will define what protection you have from redundancy. However, certain workers have extra protection if a business changes owners and is restructured. They are:

  • cleaners
  • food catering workers
  • orderlies in hospitals or rest homes
  • laundry workers in hospitals, rest homes or educational institutions
  • caretakers in educational institutions.

Updated 21 Jul 2016