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5 Tips for Employers Handling Redundancies

Published June 10, 2020 (last updated on June 7, 2024) | Adam Wyatt - Copywriter and Content Creator


You aren’t the only small-medium business owner in New Zealand feeling a bit under the weather during this unstable economic climate. Making an employee redundant may seem like a complicated and draining last resort – and it isn’t designed to be quick or easy – however it can be a straightforward process.

Read our 5 top tips for making an employee redundant, so you can get back to business.

The following article is not a substitute for professional advice. If you’re considering making a redundancy, Peninsula recommends that you seek professional advice prior to undertaking a redundancy.

Keep Everyone in The Loop

Making an employee redundant is often a last resort for employers, and it can be a difficult and emotional time for both employees and employers.

It is important to keep everyone in the loop during this process. As an employer, being open and honest about the situation at hand is the recommended approach. Letting employees know what’s going on throughout the process which assists with keeping minds at ease and may reduce chances of the employee-employer relationship turning sour. Explain the steps to those affected, why these steps must be taken, and be honest about likely outcomes. Make an effort to help explain the process to all employees, those affected and those not affected.

Trust the Process

An employer must go through a workplace change process before making an employee redundant. The steps in place, including the proposal to employees, the feedback and time taken to assess that feedback are all important steps and cannot be skipped. There is no fast track to redundancy.

Employees must be given the chance to have their say and should be encouraged to place their feedback around the situation. Considering the employee’s feedback is an important step. Even if an employer believes there is no other outcome other than redundancy, other suggestions should and must be considered.

A Reasonable Timeframe

Many employers may aim to get through the process as quickly as possible, which is understandable. Emotion and stress may be high for both the employer and employees if the business is going through the redundancy process.

A recommended approach is to take some time and ensure that each step is followed through thoroughly, with every avenue explored. Do not rush your employees. It is important to note they can have a say in what happens and might have ideas which have not been considered.

Give the process a decent timeframe, allow time between steps, it cannot be achieved in a day. Employees need time to process the information and how it will affect their lives – remember, redundancy isn’t an easy or quick fix!

Remain Focused

Whether we like to admit it or not, emotions can get the better of us – especially in times of strain and stress. Keeping emotions in check throughout the redundancy process is the best way to avoid any ill effects of the process, such as an employee-employer relationship turning sour.

Keep conversations appropriate and relevant to the redundancy; bringing up past incidents to prove a point, rationalize or validate yourself is not the best route.

Employees may feel as though they are being treated unfairly and it is likely they will become emotional at some point throughout the process. Sympathize with your employees. They are losing their job; if they are the sole earner of their household think about how this will impact not just the employee but their whole family. It is likely harder on them than it is on you.

Be a Fair and Honest Employer

Making an employee redundant should be a last resort.

A workplace change process is designed to offer all chances to keep employees employed.  Being a fair and honest employer throughout a workplace change process is recommended to help ensure the restructure runs smoothly and adverse outcomes are minimized.

If there are ways to offer an employee another role or make the process easier for them, this should be done. A ‘palms open’ approach to redundancy is the best approach; that is, ‘here’s what the situation is, here’s what we can do about it, this is how it will affect you’ approach.

Being open and honest about the situation from the start, may make your process easier to go through. If employees have questions, honest answers are generally appreciated.

Keep in mind employees will remember how the redundancy was dealt with and will likely hear about any negative aspects with relation to their former colleagues. Set a high standard of employment relations in your workplace and lead by example, and it may pay off in the long term.

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