Pitfalls Of Not Following A Fair Process
In today’s climate more and more companies are having to make hard decisions about their business and inevitably there will a conversation about if redundancies should be made.
Therefore, it is critical that you get advise before doing anything, then follow a well-defined process that avoids any legal pitfalls, that minimises the risk to your reputation, and maintains employee trust. The E Tū Incorporated v Television New Zealand Ltd case serves as a cautionary tale for organizations navigating similar changes.
In this case, TVNZ undertook a significant restructuring, which included eliminating 68 roles. However, the company failed to adequately consult with its employees as required under their collective agreement. Although they had a collective agreement the principles are still the same for Individual employment agreements.
Consultation is key. Effective communication and genuine consultation are not just legal requirements—they are crucial for maintaining morale and reducing resistance during a period of change.
While TVNZ provided the minimal legal notice and allowed a feedback period, the court ruled that these actions were insufficient. The key issue was that TVNZ did not involve staff in the early stages of decision-making, which their agreement required.
Organizations must go beyond simply announcing decisions and provide opportunities for employees to contribute meaningfully to the process. This includes involving staff from the developmental stages of decision-making, as failing to do so could lead to costly legal battles, as seen in TVNZ’s case.
Moreover, businesses need to recognize that simply meeting the minimum legal standards may not always be sufficient. Genuine engagement can prevent the perception that decisions are pre-determined, fostering a collaborative environment that can generate alternative solutions, reduce the need for redundancies, or at least soften the blow to staff.
The TVNZ case reinforces the importance of proactive, transparent communication during any restructuring effort. When done correctly, it can help businesses mitigate risks and maintain a productive workforce, even in challenging time.
So if you are thinking about making changes get advice from Network HR.
