Your rights: You said you were going, now go

Q. We are relocating to a new city and my husband advised his employer that once our house sold, he would give notice and resign after 15 years employment as warehouse manager.

They agreed he should train his replacement and the company promoted a colleague to work alongside my husband (two men getting paid to do one job). Meanwhile, my husband was told he could sit back and wait it out.

After three months, the house has not sold. The CEO has now put it to my husband that they cannot afford to pay two men to do one job and that he should leave at end of June or accept three months payout at 60 per cent of his rate.

The redundancy clause in his employment contract states four weeks for the first year, two weeks a year of service after that which comes to 32 weeks. They are not offering redundancy as such but are certainly trying something underhand. What's your advice?

A. Employers must have good reason to end employment.

It does sound like your husband's employer is trying something underhand. Your husband has not resigned and you say he told his employer he would not resign until his house was sold. Therefore, his employment can only end if his employer dismisses him. That can only happen if your employer has a proper reason for a dismissal and carries out the dismissal fairly.

Redundancies must be genuine and carried out fairly.

From what you have told me, the only reason your husband's employer might be able to dismiss him is for redundancy. If the employer wants to do that, it must have genuine reasons for making your husband redundant (i.e. genuine business reasons) and follow a fair process for making him redundant. It may be that there are proper reasons for a redundancy. There might simply not be enough work for two people.

However, the employer took a risk here in hiring a replacement before your house had sold. It is common knowledge that the housing market is slowing.

So I believe you would have a good argument that the employer should have anticipated your house might take a long time to sell and must now show how its circumstances have changed since it hired the replacement, so that it can no longer keep both employees on until your house sells.

If there are genuine grounds for a redundancy, the employer must follow a fair process. Among other things, a fair process includes telling any employees who might be affected by a restructuring/downsizing proposal, what the proposal is, and consulting them about the proposal before a decision is made. Also, explaining how the employer will select who will be made redundant and having fair reasons for selection.

If your husband is being made redundant, it appears that his employer has not followed a fair process. In particular, your husband does not seem to have been told why he has been selected for redundancy instead of the new employee.

To recap, it appears your husband's employer could only dismiss him for redundancy. Clearly, if it does this, your husband is entitled to the redundancy compensation in his employment agreement.

If your husband's employer does end his employment without paying him redundancy compensation, he could bring a personal grievance claim against his employer. As a first step for this, he could contact the Employment Relations Service.

Even if your husband does receive redundancy compensation, he could also bring a personal grievance if he believed his employer did not have proper reasons for making him redundant and/or did not follow a fair redundancy process. One remedy he could seek for this is reinstatement.

Instead of making your husband redundant, it may be that the employer is attempting to force or persuade your husband to resign. Your husband should resist this. If he is forced to resign, he could bring a personal grievance claiming unjustified 'constructive' dismissal - that he was effectively dismissed because his employer gave him no choice but to resign.

The expert

Rani Amaranathan is a solicitor in the employment team of the Australasian law firm, Phillips Fox.