Ending an employment relationship

Employees may resign at any time, provided they give reasonable notice. The employment agreement should be checked to confirm notice periods and final pay should be calculated. If the employee gives the required notice, the employer must pay the employee to the end of the notice period, unless the employee is justifiably dismissed during that period. The employment relationship continues until that date.

The employee may be required to work for the full notice period or may be asked to stop coming to work before this date. In either case, the employee should be paid to the end of the notice period. If pay is stopped before the end of the notice period, the employee may be able to claim for wages owed.

If an employee leaves work without giving notice, the employer is not required to pay for time beyond the employee's last actual working day. The employer must not deduct pay in lieu of notice from any amount owed to the employee unless the employee agrees in writing or the employment agreement specifically allows it.

The employer must pay all holiday pay owing to the employee in their final pay.

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Forced resignation

If an employer puts pressure (directly or indirectly) on an employee to resign, or makes the situation at work intolerable for the employee, it may be a forced resignation, often known as a "constructive dismissal".

A constructive dismissal may be where one or more of the following occurs:

• the employer has followed a course of conduct deliberately aimed at coercing the employee to resign
• the employee is told to choose between resigning or being dismissed
• there has been a breach of duty by the employer (i.e. a breach of the employment agreement or the duty of fair and reasonable treatment) such that the employee feels he or she cannot remain in the job.

If an employee has been forced to resign, they may have a personal grievance case.

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Retirement

In law, there is in general no set age to retire from work. Employers cannot require employees to retire just because of their age.

There is an exception to this rule if the parties have a written employment agreement that was in force on 1 April 1992 and remains in force. If this agreement specified a retirement age, and the employer and the employee agreed in writing on or after 1 April 1992 to confirm or change this retirement age, then the employee must retire at this age.

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Dismissal

There must be a good reason for a dismissal and the dismissal must be carried out fairly. Otherwise, the employee may have a personal grievance claim against the employer.
 
What is fair depends on the circumstances. Any relevant provisions in the employment agreement must be followed. If an employment agreement does not have a notice period, then reasonable notice must be given.

Employees have the right to be told what the problem is and that dismissal or other disciplinary action is a possibility. Employees must then be given a genuine opportunity to tell their side of the story before the employer decides what to do.

The employer should investigate any allegations of misconduct thoroughly and without prejudice. Unless there has been misconduct so serious that it warrants instant dismissal, the employee should be given clear standards to aim for and a genuine opportunity to improve.

If an employee is dismissed, he or she has the right under the Employment Relations Act to ask the employer for a written statement of the reasons for dismissal. This request can be made up to 60 days after they find out about the dismissal. The employer must provide the written statement within 14 days of such a request. If the employer fails to provide this written statement, the employee may consequently be able to raise a grievance after the required 90-day limitation period.

There are some different provisions applying to dismissal during a trial period.

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Restructuring and redundancy

An employer must have a genuine work-related reason for a redundancy.  Employers may need to make changes in the workplace for a variety of reasons, such as:

• improved technology
• more productive business processes
• product changes
• loss of suppliers or markets
• a decision to contract out or sell some or all of the business.

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.

The first step is to refer to the employment agreement, since that sets out the basis for the relationship and the procedures for changing its terms.

The more significant a proposed change is, the more likely it is that it cannot be imposed without the employee’s agreement. Even where the employment agreement states that certain changes can be introduced in the future, they should be introduced with early advice and discussion. Employees should have an opportunity to comment before an employer makes a decision.

Generally, there is no right to redundancy compensation unless employers and employees and/or their union have agreed to it. This can be done before or after an actual redundancy is planned. It is also up to the parties to decide what any redundancy compensation should be.

Where employees agree to a change, the terms of the employment agreement must be updated, signed by both parties and kept on file.

Employees may be able to raise a personal grievance if they believe their employer has acted unjustifiably in the event of a redundancy. For instance, the employer cannot use redundancy as a way of dismissing someone for reasons relating to the employee personally (such as the employee's performance).
Remedies are available through the  Employment Relations Authority or the  Employment Court.

Employers do not have to disclose confidential information if there is good reason to maintain the confidentiality of that information. Good reason to maintain confidentiality includes:

• complying with statutory requirements to maintain confidentiality
• protecting the privacy of individuals
• protecting the commercial position of an organisation from being unreasonably prejudiced.

Employers also have some specific legal obligations where a business is sold or transferred, or work is contracted out:

• Most employers must take the steps outlined in the employment agreement to protect employees in such situations.
• Employers who employ staff doing certain catering, cleaning, caretaking, laundry and orderly work have special obligations that provide continuity of employment protection to employees during restructuring.