Your rights: Reasonable notice accepted procedure

Q: I have just been told that I will be made redundant in a month and I have no employment contract with the business. My employer has said there will be no redundancy package because I have no contract.

I have been in the same business for 20 years.

I was employed before employment contracts came in.

A: The rights of employees who lose their job and have no employment agreement, or contract, can seem confusing.

Individual employment agreements entered into under the Employment Relations Act 2000 (ERA) must be in writing.

But this does not apply to you because you say you were employed before employment contracts came in.

Q: What happens when employees without contracts are made redundant?

A: You have no written terms telling you what your rights are if you are made redundant - including whether you are entitled to redundancy compensation - or what your notice period is for redundancy.

For employees with no written terms of employment at all:

* A period of reasonable notice is implied in the terms of employment.

* You might be entitled to compensation if your employer has an implied obligation to pay it.

* You have the same rights as other employees in redundancy situations.

* Your employer must use a "fair and reasonable process" when making you redundant and should have consulted you, in good faith, before making a decision about any redundancy.

* The redundancy must be genuinely required for the needs of the business.

For more information about your rights in redundancy situations, you can contact the Employment Relations Service or an employment law specialist.

Q: What is "reasonable notice"?

A: our employer has said you will become redundant in a month so it appears you have been given one month's notice of redundancy. It may be that this notice period is not reasonable.

The Employment Court says reasonable notice should be the amount of notice a "just employer would provide for in treating the employee fairly". The purpose of reasonable notice is to give employees an opportunity to adjust to their changed circumstances or seek other employment (Kitchen Pak Distribution Ltd v Stoks [1993] 2 ERNZ 401). The amount of notice that is reasonable depends on the facts of each situation.

Relevant facts in your situation could include your length of service and seniority.

A long-serving employee at management level might be entitled to several months, notice. You have been with the same employer for 20 years. You have not said what position you hold. You may be entitled to more notice than your employer has given you.

Employees get redundancy compensation if their terms of employment say they must be paid.

If their terms of employment say nothing about redundancy compensation then they are not entitled to any. In your case, we don't know what your terms of employment are because you have no written agreement.

At the time you started your job, the court's practice was to determine the amount of redundancy compensation payable to an employee if their employment agreement seemed to contemplate its payment but didn't provide for the amount payable.

If you believe you verbally agreed, or your employer led you to believe you would be paid redundancy compensation, you may be entitled to it on the basis that it is an "implied term" of your employment.

If this is the case, you should raise the matter with your employer. If you cannot reach a satisfactory agreement about compensation you could raise a personal grievance by following the Employment Relations Authority's procedure. There is a slim possibility that at the time you were hired you were covered by an industrial award which may have provided for redundancy compensation. If nothing has occurred to change your employment terms in the intervening years, this may still apply. An employment lawyer can check this for you.

Q: What if you are redundant because of restructuring?

A: You haven't said why you were made redundant. For some restructuring situations - for example, if your employer has sold or transferred its business or part of it - the ERA has a system to protect employees. If you believe this might apply you should seek advice from the Employment Relations Authority or an employment specialist.

Your options:

If you believe your rights have been breached as to redundancy, you could raise this with your employer.

Alternatively, you could contact the Employment Relations Service or an employment law specialist for more advice.

You might wish to raise a personal grievance through the Employment Relations Authority to seek remedies from your employer.

www.ers.dol.govt.nz