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Home / New Zealand

<i>Your rights</i>: Dismissed in favour of cheap labour

Kate Hoyle of Phillips Fox
20 Aug, 2006 09:55 AM3 mins to read

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Q: I was dismissed from my job after two months because my boss said he couldn't afford to pay me the amount he was paying me. I then talked to him about a lesser pay rate only to find out he had already hired somebody else as a replacement. Do I have a case of unfair dismissal? I was given no warning.

A: In short, you have good grounds for taking a claim against your employer for unfair (unjustified) dismissal. Even if your employer genuinely couldn't afford to pay you at your current pay rate, he cannot dismiss you for this reason alone.

Your employer had the opportunity to negotiate a lower pay rate with you, but failed to do so. You were under no obligation to accept a lower rate of pay but it seems from your question that you were prepared to.

All employers must follow a fair procedure before dismissing an employee. The kind of procedure will differ depending on the particular circumstances. But, generally, a fair procedure will involve meeting with the employee, discussing the reasons why the employer is considering dismissal, giving the employee the opportunity to explain their side of the story and hearing what the employee has to say with an unbiased and open mind before making any decision regarding the future.

Usually, employers can only dismiss an employee after issuing them with formal warnings. Your employer may have considered your position was redundant so formal warnings were not required. But if someone else is now doing your job, it is very unlikely that the redundancy was genuine - the position obviously still exists.

Even if there were genuine reasons for a redundancy, there are special process requirements for redundancies that employers must consider. These include consulting the employee about any proposal to restructure the organisation, giving the employee an opportunity to discuss the proposal and make any suggestions, and considering the suggestions before making a final decision. Alternatives to redundancy should also be explored by the employer.

Your employment has ended so you are entitled to any notice specified in your employment agreement (unless the dismissal was for serious misconduct) and all wages and unused holidays owing to you. Your employer should have paid this to you on your final day of work.

Your dismissal was both substantively and procedurally unjustified. So, the chances of succeeding with a claim in the Employment Relations Authority is high.

You can contact your union if you are a union member or an employment lawyer for advice on how best to take your claim to the Authority.

Generally, you have 90 days from the time you were dismissed to bring your 'personal grievance' to your employer's attention. So you should act promptly.

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