Navigating redundancy and restructuring: A practical guide for employers

Navigating redundancy and restructuring: A practical guide for employers

Navigating Redundancy And Restructuring A Practical Guide For Employers
Contents

Introduction

Right now, many New Zealand businesses are feeling the pinch of what’s been termed a “technical recession”, pushing companies to reassess their structures and operational costs.

We know that change is inevitable in business. When the change involves restructuring roles within a company or even making positions redundant, however, there are certain processes that need to be followed to ensure the safety of your business and the well-being of your people.

For employers, understanding these processes is crucial for navigating them smoothly while supporting affected employees.

Facing the prospect of making staff redundant is never easy, and it’s natural to feel a mix of concern and uncertainty. But it’s important to remember that these decisions, though difficult, are sometimes necessary to ensure the long-term viability of your business.

With that, what follows is a practical guide for employers to manage restructuring and redundancies effectively.

Defining restructuring and redundancy

Restructuring involves reorganising the business or specific roles to align with changing company requirements.

Redundancy is when a position is disestablished, and the employee is not deployed into another role.

It’s important, as an employer, to consider other options prior to redundancy to show your commitment to valuing your employees.

Other options could include redeployment opportunities, reduced hours by agreement, or cost-cutting measures in other areas of the business.

restructure-checklist-pdf

Planning and preparation

Before initiating any changes, you’ll need to establish the business reasons behind them.

These reasons should be justifiable and clearly documented, and you’ll need to communicate the reasons to employees during the consultation process. A solid rationale not only guides your decision-making process but also provides transparency to your employees during consultations. This clarity ensures that everyone understands the necessity and inevitability of the changes.

Identify which roles need to be changed or disestablished, then draft a proposed organisational chart to visualise the new structure.

Creating new positions during this process is common. If a new role is identified, assess its similarity to existing roles so that you can determine whether you need to offer it to affected employees or conduct a recruitment process.

Conducting the consultation and decision process

Next, it’s time to talk. Present the proposal for change, and actively listen to feedback offered by your employees. Not only does this demonstrate the respect you have for your team, but it also fosters trust that the organisation is considering the options thoroughly.  

Employee input and feedback may also uncover insights and enhance acceptance of the proposed changes, so it’s important to consider the points raised during this process.  

Any decision you make, even if it’s as a result of the feedback you’ve already received, will need to be proposed to your employees first. This will protect you legally should any disgruntled individual raise a grievance.  

When presenting change, it’s also important to provide the employee with time to reflect on the proposal, and you need to ensure that decisions are not made prior to employee feedback.  

Finally, any questions, comments, or alternative suggestions must be considered, and as the employer, you’ll need to provide feedback to those responses. 

Additional information and potential issues

During this period of transition, emotional responses from employees are expected.

Provide support and show empathy if employees are distressed. This can alleviate tensions and facilitate smoother interactions. Handle the process transparently, avoiding the misuse of redundancy to sidestep performance management issues.

Mistakes to avoid

Avoid these common pitfalls:

  • Making a pre-determined decision around the outcome of the proposal (even private emails may be used as evidence if the issue goes as far as employment court).
  • Being unclear about the justification for the change or what the proposal means for affected employees.
  • Using redundancy to remove staff for poor performance or other reasons.
  • Not providing all the documentation for the proposed restructure.
  • Failing to consider all possible alternatives to redundancy.

Managing redundancy and restructuring requires careful planning, transparent communication, and empathy towards affected employees. By following established guidelines and seeking professional support when needed, employers can navigate these challenges effectively while upholding their legal obligations and fostering a positive workplace culture.

Restructures and redundancies can be complex to navigate – as well as exposing employers to legal action if mishandled, they can also take an emotional or psychological toll on both employers and employees.

During these challenging times, many decision-makers prefer to arm themselves with the support of an HR specialist.

Contemplating some difficult decisions?

We’ve got your back, and you’ve got options for expert support:

 

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Navigating New Zealand’s wage landscape: Minimum wage, median wage, and living wage explained

Navigating New Zealand’s wage landscape: Minimum wage, median wage, and living wage explained

navigating-new-zealands-wage-landscape-minimum-median-and-living-wage-explained
Contents

Introduction

Understanding the various wage metrics is crucial for both employers and employees in New Zealand. The country has a well-defined wage structure, consisting of minimum wage, median wage, and the living wage. In this post, we’ll delve into the key differences between these three measures, shedding light on their significance in the Kiwi job market.

1. Minimum wage

The minimum wage is the lowest legal remuneration that employers can pay their employees. Effective April 1, 2024, businesses should prepare for an upcoming hike in minimum wage rates. The adjusted rates are as follows:

The adult starting wage will increase from $22.70 to $23.15 per hour.

The starting-out and training minimum wage will rise from $18.16 to $18.52 per hour.

This increase reflects the government’s commitment to ensuring that workers receive a fair and equitable wage, keeping pace with the rising cost of living.

2. Median wage

The median wage, currently set at $31.61 an hour as of the June 2023 quarter, plays a pivotal role in the immigration system. As of February 28, 2024, the new median wage rate has been adopted into various immigration categories:

Wage thresholds for the Skilled Migrant Category, the Green List Straight to Residence and Work to Residence visas, and the Parent Category residence class visa will increase in line with the median wage ($31.61 an hour).

The wage threshold for the Transport Sector Work to Residence Visa will also increase in line with the new median wage (excluding bus drivers).

However, it’s important to note that this increase does not apply to the Accredited Employer Work Visa (AEWV), which remains at the current rate of NZD$29.66 an hour. The pause also applies to AEWV-linked work visas set at or indexed to the median wage rate from February 2023, including Partner of a Worker Work Visa, variation of conditions for AEWVs, legacy Essential Skills work visas, interim visas granted under the Skilled Migrant Category, and Partner of a Worker work visas.

This pause allows time for decisions to be taken on alternatives to the median wage threshold, ensuring that it attracts the workers New Zealand needs and fills genuine skill shortages.

3. Living wage

The living wage goes beyond legal minimums and median wages. It is an income level deemed sufficient to cover basic necessities, allowing individuals and families to live with dignity. While not legally mandated, the living wage is advocated for by various organizations and community initiatives as a guideline for fair compensation.

As of September 1, 2023, the Living Wage hourly rate stands at $26.00. This rate is carefully calculated every five years through a comprehensive review of prices, expenses, and calculation methods. The Living Wage rate aims to provide workers and their families with the basic necessities of life, enabling them to live with dignity and participate as active citizens in society. The 2023/24 rate represents a $2.35 or 9.9% increase from the previous year.

Conclusion

In conclusion, navigating the wage landscape in New Zealand involves understanding the minimum wage, median wage, and living wage. Employers must not only comply with legal minimums but also consider median and living wages for fair compensation and a positive work environment. The recent adjustments in median wage rates have implications for immigration policies, highlighting the interconnected nature of wages and broader societal considerations.

For expert advice on optimizing your wage structure and ensuring compliance, contact ConsultingHQ today. Our team is dedicated to providing tailored solutions that align with your business needs, promoting fair compensation practices and legal adherence.

Contact us to find out how we can help your business.

HR tips for a stress free Christmas closure

HR tips for a stress free Christmas closure

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Contents

Mondayisation

When a public holiday falls on a Saturday or Sunday, employees who don’t normally work that day then get the following Monday as their paid public holiday — this is called Mondayisation.

National public holidays – 2023/2024

The public holidays for the upcoming Christmas break and for 2024, are as follows:

Christmas Day – Monday 25 December 2023
Boxing Day – Tuesday 26 December 2023
New Year’s Day – Monday 1 January 2024
Day after New Year’s Day – Tuesday 2 January 2024
Waitangi Day – Tuesday 6 February 2024
Good Friday – Friday 29 March 2024
Easter Monday – Monday 1 April 2024
Anzac Day – Thursday 25 April 2024
King’s Birthday – Monday 3 June 2024
Matariki – Friday 28 June 2024
Labour Day – Monday 28 October 2024
Christmas Day – Wednesday 25 December 2024
Boxing Day – Thursday 26 December 2024

Public Holidays and days in lieu

When a public holiday falls on a day your employee would usually work, no matter how long they’ve been working for you they’re entitled to a paid day off. You can only require an employee to work on a public holiday if it’s written into their employment agreement. 

If they agree to work, you must: pay them at least time and a half and give them another paid day off later (a day in lieu).

Transferring public holidays

Any employee can ask to transfer a public holiday to another day and the public holiday then becomes a working day for the employee. To transfer a public holiday to another day, both the employee and employer need to agree. You must consider the request seriously unless you have a policy that prevents transferring public holidays. Ensure you put any agreement to transfer a public holiday in writing.

You can decline requests to transfer public holidays — it’s good to give a reason, although you’re not legally required to.

Annual leave

During the Christmas closedown period the employer can direct employees to take annual leave. This is easy where the employee has enough annual leave to cover the break, so say has worked for over 6 or 12 months. Employees with less than one year of service can be paid 8% of their earnings up to the closedown.

If an employee doesn’t have enough leave, time off during the closedown will be unpaid. Employers can agree (at their discretion) to top-up the payment, which in turn creates a negative leave balance. There are pros and cons to this as it ensures the employee is not out of pocket through this period (which we know can be expensive) but the downside is that if the employee was to leave soon after this period, they may not have a positive leave balance to have paid the money in advance back.

As with any annual leave payment employees can request to have the leave paid out in full, in advance of the closedown. But it is much more common for leave to be paid in the normal pay-cycle.

Communicating expectations – payroll and company property

This time of the year is quite stressful and financially demanding for many people and their families. To help alleviate this stress for your teams here are some simple tips.

  1. Let you team know if you are processing payroll in advance prior to close down and the amount they will be paid, ensure this is communicated (give them all payslips if you don’t normally) well before closedown to ensure no last-minute scrambles to sort any payroll queries / issues on the last day of the year.
  2. If you do decide to keep paying your team as normal, please tell them this, let them know of any extra pay through this period (if any) such as end of year bonuses, discretionary bonuses as these things go a long way and you may forget to mention this in the lead up to the silly season! Plus, I am sure they’d love to thank you in person!
  3. If your team have motor vehicles, fuel cards, mobile and laptops etc which belong to the company, now is the perfect time to send out a memo or discuss individually the expectations around whatever use of these items have been agreed to. If company vehicles are fitted with GPS, remind them of this and fair and reasonable personal use (obviously depending on your company policies). It is much better to have this conversation beforehand than leaving it to fester and then snowball into an HR issue in the new year.
  4. Make a list of what you think could potentially go wrong with any misunderstandings if you are either open or closed during this period. Things such as contact numbers and who is on call, who is out of range, it is better to have a plan now that having the team trying to scramble in an emergency and have no one available.

New Year expectations

It’s important to have a start-up plan that ensures everyone is aware of their priorities and key focus on their return to work. You can also consider extending the first morning break in the new year by 15 minutes to give staff time to catch up and hear each other’s holiday experiences. This will reduce the disruption in the workplace through the rest of the day and coming week.

Contact us for help planning a stress-free Christmas closure with your employees and to tidy up any HR documentation.

Contact us to find out how we can help your business.

Navigating the complex world of HR: common pain points employers face

Navigating the complex world of HR: common pain points employers face

Illustration of an HR manager addressing team dynamics. Overcoming HR challenges.

Navigating the complex world of HR: common pain points employers face

Introduction

In the realm of human resources, employers often find themselves navigating a complex landscape filled with challenges and pain points. Whether you’re a small startup or a large corporation, these HR hurdles can impact your organisation’s success. In this blog, we’ll explore some common HR pain points that employers face and offer insights on how to address them effectively.

1. Talent acquisition challenges

One of the fundamental HR challenges is finding and hiring the right talent. The job market is competitive, and identifying candidates with the skills and cultural fit for your organisation can be a daunting task. To address this, consider refining your recruitment strategies, leveraging employee referrals, and using technology to streamline the hiring process.

2. Employee retention

High turnover rates can drain resources and disrupt productivity. Retaining top talent is essential for long-term success. Develop robust retention strategies, such as providing opportunities for growth, recognising achievements, and fostering a positive workplace culture.

3. Compliance and regulations

Navigating labour laws and regulations is a perpetual challenge for HR professionals. Staying updated on legal requirements, investing in compliance training, and seeking legal counsel when necessary can help your organisation remain in good standing.

4. Performance management

Managing and improving employee performance is an ongoing process. Implement regular feedback mechanisms, establish clear goals, and offer professional development opportunities to enhance employee performance.

5. Employee morale and engagement

A disengaged workforce can lead to decreased productivity and increased turnover. Focus on boosting morale through team-building activities, open communication, and initiatives that promote a sense of purpose within your organisation.

6. Workplace conflict

Conflicts among employees can disrupt the workplace and damage team dynamics. Implement conflict resolution strategies, encourage open dialogue, and provide mediation resources to address issues promptly.

7. Benefits and compensation

Designing competitive compensation packages and benefits plans is crucial for attracting and retaining top talent. Regularly review and adjust your offerings to remain competitive in the job market.

8. Training and development

Providing employees with opportunities for growth and development is essential for both individual and organisational success. Invest in training programmes, mentorship, and continuous learning initiatives.

9. Diversity and inclusion

Creating an inclusive and diverse workplace is not just a trend but a necessity. Develop diversity and inclusion policies, provide diversity training, and actively promote an inclusive culture.

10. HR technology

Embracing HR technology can streamline processes, but its implementation can be challenging. Invest in user-friendly systems, provide adequate training, and ensure ongoing support for your HR tech solutions.

11. Workplace safety

A safe working environment is a legal and ethical imperative. Regularly assess and improve safety measures, educate employees on safety protocols, and comply with relevant regulations.

12. Succession planning

Identifying and preparing future leaders within your organisation is vital for continuity. Develop a succession plan that identifies and nurtures potential leaders.

Conclusion

While HR pain points are diverse and multifaceted, addressing them strategically can lead to a more efficient and productive workplace. By continuously assessing and adapting your HR practices, you can build a strong, engaged workforce that contributes to your organisation’s long-term success. Remember, HR challenges are opportunities in disguise, waiting for innovative solutions to propel your business forward.

Take our complimentary HR Audit to uncover your pain points and to come up with a plan to help address them.

Contact us to find out how we can help your business.

Employer accreditation: get ready for documentation audits

Employer accreditation: get ready for documentation audits

Employer Accreditation Documentation Audits

Employer accreditation: get ready for documentation audits

The Accredited Employer Work Visa is invaluable for NZ employers that have been grappling with on-going skills shortages. Under the employer-led framework, organisations must first gain accredited employer status from Immigration New Zealand. The intention being that only reputable employers that can demonstrate financial stability and that have good workplace practices and process can hire migrant workers.

Employer accreditation: documentation audits have been announced

Thus far, the employer accreditation application process has been declaration based; organisations were not required to supply supporting documentation. However, the Ministry of Business, Innovation and Employment (MBIE) has recently announced it will be undertaking post-accreditation documentation audits to verify employers’ compliance with the accreditation requirements.

What will an accreditation documentation audit look for?

The purpose of the documentation audit is to ensure employers are financially sustainable; provide settlement information and support to migrant workers; ensure that migrant workers complete the online modules from Employment New Zealand in time; and have professional and legally sound HR processes, procedures, and documentation in place.

What are the likely consequences for employers who don’t have adequate documentation?

Accreditation suspension may occur if an organisation is unable to furnish the required documentation during an audit’s investigation process. Such a situation would be disruptive, and cause instability for both employers and migrant workers.

It is strongly advices that you proactively gather all the essential documentation now, should an audit occur. That will help to circumvent any potential disruptions to your business operations.

ConsultingHQ can assist you with employer accreditation documentation

ConsultingHQ has years of experience in creating supporting HR documentation that complies with both Immigration New Zealand rules, as well as NZ employment law and business standards.

ConsultingHQ can also work with our in-house immigration advisers, VisaAide, who are able to submit your documentation on your behalf.

Contact us for help with your HR and accreditation documentation.

Contact us to find out how we can help your business.

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