Restructures can affect one role or many, and while the scale can vary, the process is largely the same.
At the heart of both processes is the principle of good faith detailed in the Employment Relations Act, and before any decision is made, employers must consult with every employee whose ongoing employment will, or is likely to be, adversely affected. Taking employee feedback into consideration is also crucial.
To save opening the business up to too much legal risk, plan and prepare well. You need a genuine business reason to launch a restructure, things like financial constraints, realigning services or products to meet a change in market demands, or merging with another company. The commercial imperative must be demonstrable and clearly stated throughout the restructuring process.
Once you have the business case sorted, the next step is to develop a proposal that you will put to affected team members for feedback. In essence, you are telling your employees a story that has to make commercial sense.
Employees should have access to all the information used in preparing the proposal so they can respond in a meaningful way. This includes the objectives, why you’ve chosen specific roles for changes or redundancy, costs and expected benefits to the company, and how the changes will roll out.
Present the proposal by meeting individually with the people affected, then give them time to digest the proposal and prepare their feedback – anything up to 2 weeks is reasonable, but it all depends on the scale of the changes and your employees’ reactions.
Following this consideration period, meet with employees to give them a chance to present their side of the story. Unless your staff are part of a union, getting together with individuals first, then as a team, is much more considerate, especially if people’s jobs are on the line.
Once you have all the feedback, the business is legally obligated to consider it and make a fair and reasonable decision. While the changes may seem obvious to the business, it’s possible a team member could identify a flaw in the proposal or present an option you hadn’t considered.
If an employee comes up with a valid idea that causes changes to the restructure, you will need to redo the proposal and consult on it again. Once you have reached a final decision, you’ll need to present that to the affected employees along with justification and how their feedback was considered. Confirm any redundancies, changes to roles and/or responsibilities, if redeployment is an option or new roles are available, and timeframes.
Implementing the changes can take a while, especially if you are making people redundant or hiring people for new roles.
Be mindful that jobs and livelihoods are really important, so there will be a lot of scrutiny of your proposal, the consultation process you follow, and your decisions. Also expect some emotion and stress.
Offer people all the support and compensation detailed in their employment agreements, company policies, and the restructure proposal.
The more humane and transparent you make the change process, the quicker people can move on with their lives and the team that remains (including management) can get on with business.