Preparing for change - post lock down
It's clear that many small to medium NZ businesses will, despite best efforts, struggle to recover from the Covid-19 pandemic, and the subsequent restrictions on operating in Level 4, 3 and beyond. Many are already thinking about needing to change the shape of their workforce, to aid their recovery, and perhaps ultimately survive. Here's some key principles to consider when making workplace change or restructuring:
1. It's important to invest time developing a business case, and ensure there is a genuine business reason for change. A restructure can't be used to 'get rid' of an employment problem - and it is not a way to avoid managing individual employee performance issues.
2. Where a business has two or more similar roles and is proposing to reduce the number of them, in order to decide which employees are successful in obtaining one of the remaining roles, a transparent, objective selection criteria is critical.
3. Anything is possible by mutual agreement - you can also try discussing things with employees to determine if there's a compromise that can be made by both parties. This also means that you might need to be prepared to make different arrangements for different people in your business - one size does not fit all.
4. The employment law principle of good faith has not been relaxed - employers and employees are obligated to be responsive and communicative; and to not act in a misleading or deceptive way. This also includes the requirement for employers to provide information and genuinely consult employees about changes that may affect their employment e.g. hours, position, responsibilities etc, before making a decision.
5. Redundancy is considered a 'last resort' option - if the parties have not been able to agree on alternative working arrangements - which could include receiving the Covid-19 Wage Subsidy amount only, extended leave (with or without pay), or reduced hours.
Restructuring continues to be one of the most litigious areas of employment law, and one that can be difficult to get right without good advice. The HR Connect team continues to be available and we're proud to be working alongside businesses through this uncertain time. Please get in touch with your HR Consultant if you require any assistance.