How to dismiss an employee.

A brief guide to the employee dismissal process in NZ.

If the time comes and it becomes apparent to you or your team that a certain employee is not fulfilling their employment agreement obligations or is committing repetitive breaches or mistakes that warrant dismissal, there are a number of things you need to be aware of. 

Your duty as an employer is to make the employee termination process as fair, reasonable and legally watertight as possible. If you skip steps in the process, you leave yourself vulnerable to liability, where the employee may raise a personal grievance regarding the process or the way they have been treated. 

Employee termination - it is not a quick or easy solution to rid yourself of unwanted employees.

 It must be stressed that ending an employment relationship is not as simple as it may sound and requires a legally binding process that must be followed to prevent an unfair dismissal or a constructive dismissal. NZ employment law is very strict about the reasons for ending an employment relationship and how you can do so. It should not be viewed or used as a quick and easy way to cut costs or remove a team member that you may have personal issues with. 

Employers seeking a valid  employee termination must:

  • Proceed with honesty and integrity.
  • Provide a valid justification.
  • Adhere to a fair and reasonable procedure.
  • Approach challenges with an unbiased mindset to avoid predetermined outcomes.

Failure to comply with the above may lead to the employee filing a personal grievance claim against you or the business. We are employee termination experts who can assist you through the process in a manner that will allow you to take charge of the situation with confidence reducing your risk of liability. 

For specific advice and guidance, get in touch with our employee termination consultant today.

A brief guide to the employee dismissal process in NZ.

There are many reasons why you may be seeking employee termination; some of the reasons include:

Providing an explanation to the terminated employee.

If an employee is terminated outside of a trial period, they are entitled to request a written explanation for the dismissal from their employer. This request can be submitted within 60 days of the termination date, and you must provide the written statement within 14 days of the request. In cases of dismissal during a trial period, you are obligated to offer an explanation upon request, and this explanation may be conveyed verbally within the context of a trial period.

Writing a dismissal or redundancy letter template.

You might be able to find a suitable dismissal or redundancy letter template online to tailor to your situation, but it is more effective to work with an employee dismissal consultant, like ours, to craft a specific dismissal or redundancy letter template that is fit for purpose. We can structure all kinds of templates, including a written warning template, a call to disciplinary meeting template, letters explaining formal decisions, and other documents pertaining to your employment relationships.

How many warnings before a dismissal in NZ?

How many warnings must you give to your employee before dismissal largely depends on the nature or severity of the conduct or performance issues being addressed. If you are not sure how many warnings are appropriate, talk to our employee dismissal consultant today to create a plan to suit your specific situation.

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Giving a notice period.

Unless terminating for serious misconduct, you are obligated to provide the specified notice period as outlined in the employment agreement. Any changes to this notice period must be agreed in writing with the employee unless it is in the event of serious misconduct. 

Instant dismissal/summary dismissal for serious misconduct in NZ

In cases of serious misconduct, you may have the option to terminate an employee without providing any notice or making any payment in lieu of notice.

 

In such instances, following the completion of a procedurally fair discipline process, the employee is required to leave the workplace immediately and will not be entitled to receive compensation for any notice period. However, they are still entitled to receive wages/salary up to the day of dismissal and any annual leave owing, in their final payment. 

For less severe issues, a preliminary investigation process, less formal than a full investigation, may be sufficient.  

FAQ

The employment agreement should include a notice period that you need to give.  However, it may be left up to you to determine whether the employee works out the notice period or is paid in lieu. Factors influencing the notice include:

 

  • Severity of the reason for employment termination.
  • Ability of the employee to successfully perform their duties during the notice period.
  • Length of time with the same employer or organisation.
  • Industry and sector considerations.
  • Time required to secure a replacement for the position.
  • Standard practices within the workplace.

 

As a general guideline, employers typically provide or require at least 2 to 4 weeks of termination notice. It is crucial that notice periods are communicated in writing, rather than conveyed over the phone or verbally, and records are kept for future reference.

Where an employee refuses to work out their notice period, you have a number of options they can consider, including:

  • Having the employee forfeit any payment for the period not worked or:
  • Making a deduction from the final pay where additional costs are incurred in seeking a replacement employee

Each situation is different, but for the most part, employees are expected to work for the entirety of their notice period, potentially taking agreed time off to attend job interviews  For sound advice from an employee termination expert, get in touch with us today.

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