When an employment relationship has broken down, an exit package is often used to end the employment contract. They can be initiated by either the employer or the employee.

Exit Packages are attractive to both employer and employee.

Exit Packages allow the employer to bring the employment relationship to an end quickly, easily and without a lot of delay and expense.

There are many reasons for an employee to need to leave a job. Sometimes it’s the arrival of a new CEO who wants to place their ‘own people’ in pivotal roles. Suddenly responsibilities change, new middle managers appear, and employees find themselves doing the same job but with less status. Alternatively, an employer may genuinely need to restructure a business, resulting in redundancies, or the business may be in trouble and the employee is able to see the writing on the wall.

Sometimes you can tell you are no longer wanted or needed through no fault of your own. An Exit Package is a much more attractive option than simply resigning.

Whatever the reason it’s always best to make a dignified exit.

Many problematic employment relationships do not end by dismissal or resignation, but through the negotiation of an Exit Package.

The perception comes from dissatisfaction in the workplace for the employee, performance issues for the employer and most often when a disciplinary meeting takes place. An exit package is attractive to both parties when the employment relationship has no real future.  

Typically, such a package will contain some financial benefit for the employee and possibly a reference. The employer can have the assurance that any grievances or claims arising out of the employment relationship (existing or yet to be raised) are at an end.

Our advocates can recognise the opportunity for an exit package and negotiate the best possible package in the circumstances. It is always best to engage our advocates at an early stage so that this strategy can be considered and prepared together, making for the best outcome.

If you need help negotiating an exit package with your employer give us as much information as possible below or call us on 0800 669 466.

What is an exit package?

An exit package is when both the employer and employee come to a mutual agreement for the employment agreement to come to an end quickly and without a lot of delay or expense.

Typically, an exit package will contain some type of financial benefit for the employee, sometimes including a reference.

We can assist with ensuring the process is dealt with on a professional level and the agreed terms will be recorded in a record of settlement.

What does an exit package cost?

The cost of an exit package will depend on the length of time it takes to reach the final decision between employee and employer.

We can usually get your fees paid for by the employer, this is part of the negotiation process.

From Our Clients

Thousands of employees and employers have trusted us us to help with their employment issues, here are reviews from a handful of them.

Trustworthy

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July 11, 2020
Review of No Win No Fee

Thank you Work Law for your professional service with Employment issues & disputes. The advice & knowledge of your Advocates has been very helpful. I can highly recommend No Win No Fee-Work Law as a trustworthy company that gets results.

Sheree H.

Response from No Win No Fee

Thank you Sheree, you’re welcome to call us anytime you need employment law advice.

I was in a very difficult and sensitive situation

5.0 rating
September 30, 2019
Review of Kam Bailey

I was in a very difficult & sensitive work situation. After contacting a couple of other services with no reply it was Kam from Work law who took on my case & managed everything for me. I was kept well informed a long the way & Kam quickly reached a positive result for me & my employer, amazing!. I really appreciate the work Kam & the Work law team have done. Highly recommended ;0)

Christian McLay

Couldn't be happier with how it all worked out!

5.0 rating
September 24, 2019
Review of Andrea Kelleher

I was lucky enough to have help from Andrea, she was so polite, helpful and made sure that I understood certain aspects to what was going on with the work she helped me with. I couldn’t have asked for a more easier and awesome process, couldn’t be happier with how it all worked out! Thank you heaps! Daniel

Daniel Marinov

 

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Restructuring

Is your employer restructuring your workplace?

Employers may need to make changes with restructuring in the workplace for a variety of reasons, such as:

The law requires employers to provide information to employees when they are considering changes that will affect their jobs and to give them an opportunity to contribute to any decisions.

If you find yourself in the position of being subjected to a restructuring process – our company can provide representation to ensure that your rights are upheld.

Check our page on redundancy

More: When is a redundancy not a redundancy?

Is your employer making you redundant?

Have you been made redundant due to Covid-19?

Covid-19 Subsidy:

The  Government has provided support in an attempt to keep as many New Zealanders in work as possible.  Unfortunately, this will not protect everyone from job loss.  It is not compulsory to apply for the subsidy, but if employers do apply, they MUST pass the subsidy on to their employees.

 If your employer has not applied for the subsidy and instead has told you you are redundant, they still need to follow the correct procedures.

If your employer is considering redundancy, you can ask if they have considered taking the government wage subsidy and paying you with that.

If your employer has received the subsidy for you, the government expectation is that you will remain in employment until at least the end of the subsidised period (end of June 2020).

There should be a genuine reason.

Sometimes employers use ‘Redundancy’ to dismiss staff when they don’t have grounds for dismissal.

If your employer is facing hardship they must enter into a consultation process where you are told your position could be made redundant and given the chance to provide feedback.  You can counter the proposal with your own suggestions such as taking a pay cut, leave without pay or changing the role to include other work.

If your employer says the business is struggling and if you are the only person who is facing the redundancy process then it may not be genuine.  Your employer can’t employ a new person to do the same job as you, but they may be able to combine two jobs.  They can’t make you redundant and then advertise for someone to fill your role.

It is a genuine redundancy if a person’s employment has been ended because their employer has decided, for ‘genuine reasons’ that the employee’s job is no longer needed. A ‘genuine reason’  could, for example, be that the employer is making changes to enable the business to operate more efficiently and cost-effectively; or closing down or selling the business.

Minor alterations to a job’s role and responsibilities should not be a reason for redundancy.

    Check your Employment Agreement

    What does it say about redundancy in your Employment Contract?  You should always make sure you are familiar with the terms of the employment agreement. This will usually have specific provisions dealing with the redundancy process and any entitlements.

    Redundancy Payments

    Under New Zealand law it is not compulsory for an Employer to pay redundancy compensation.  Check Your Employment Agreement:
    If your employment agreement mentions redundancy compensation, it will probably also show what the amount of compensation will be.  If there is no mention of the amount it could be up for negotiation.

    Notice of redundancy

    If there is no specific clause in an employment agreement giving a period of notice in a redundancy situation, ‘reasonable notice’ must be given. The length of ‘reasonable notice’ depends on a variety of factors, such as:

    • the reason for the redundancy
    • the employee’s length of service
    • the employee’s seniority and/or remuneration package
    • custom, practice and industry norms
    • the employee’s ability to find alternative employment
    • the amount of compensation being paid (if any).

    A ‘reasonable’ notice period is usually two weeks to a month.

     

    The decision must be about the position and must not be about an individual employee personally.  The employer cannot use redundancy as a means of getting rid of under-performing employees or disciplining employees for misconduct.

    When can a person be made redundant?

    1. The position must be superfluous to the employer’s needs.
      For example, where a larger number of employees are employed than necessary to operate the business efficiently, certain positions may be disestablished.
    2. The position must actually disappear. The employer cannot claim redundancy by changing a job description slightly or employing new employees to undertake the same or a similar position.
    3. The business is closing down

    What is the process for making a person redundant?

    Your employer must follow the proper process when they need to make you redundant.

    Restructuring or redundancy must be carried out in good faith and your employer must not mislead or deceive you.

    Your employer must;

    • Give you written notice of a discussion/meeting. The letter should say that the meeting is to discuss redundancy or restructuring ;
    • tell you the reasons for the proposed changes, and how they will affect your job;
    • consult with you and anyone else who may be made redundant;
    • give you a chance to get independent advice, and to have a representative or support person with you when you attend the meeting to discuss your possible redundancy or restructure;
    • consider your suggestions before they make any decision about their proposed changes; and
    • consider alternatives to making you redundant e.g. giving you a job elsewhere in the company or reducing the hours you work.

    If the redundancy is false and amounts to an unfair dismissal we can pursue a grievance on your behalf.

    We can help you with all aspects of redundancy.

    It’s free to discuss your situation with us.

    What does redundancy mean?

    To be made redundant from your job position means that your position is no longer needed in the company. Redundancy is a type of dismissal. This may be due to a company re-structure or shifts in the economy or job industry.

     

    What am I entitled to?

    Throughout the redundancy process as an employee, you are entitled to seek legal advice, negotiate and provide feedback to the employer.

    It is important that you have read and fully understood your employment agreement. Your notice period will be outlined in this agreement along with information regarding final pays. Generally, an employee will be paid our their annual leave once the redundancy has been finalised.

    What is the redundancy process?

    Your employer must notify you in writing that your position may be up for redundancy. You should be supplied with a letter/notice of redundancy that asks you to attend a meeting with your employer.

    The employer must explain the situation to you and give you adequate time to process the news, seek legal advice and provide feedback. Feedback can be where the employee offers a reduction in hours, pay or other factors of your role. Although this may not save your job, it is a good chance to negotiate your redundancy in the case these offers change anything on the employers’ end.

    Once you (the employee) has had the opportunity to provide feedback and seek legal advice the decision now sits with the employer. You will receive confirmation of your redundancy and you will start working out your notice period (check your employment agreement).

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    Statistics prove that legal representation for employees  by an employment lawyer or employment law advocate improves your chance of a successful outcome. You have nothing to lose by having a free chat with an Employment Law Advocate.

    You can email us using the form below.   When you receive the automated reply to your email please reply with any correspondence you have received from your employer regarding your job loss. 

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