Café employee claims unfair redundancy process following failed business sale and restructure
The Employment Relations Authority (ERA) recently dealt with a case involving a worker who claimed she was unjustifiably dismissed during a business restructure.
The worker, who had been employed since 2014, challenged her dismissal following the collapse of a proposed sale of the business in September 2023.
The worker argued that her employer failed to follow proper consultation procedures during the redundancy process and did not provide adequate information to enable meaningful participation in discussions about her future employment.
The employer denied the claims and argued that the decision to dismiss was due to genuine redundancy and was both substantively and procedurally justified.
The employer was the sole owner of a café in Tauranga. She had decided to sell the café and retire in 2022 due to financial and stress considerations.
A sale and purchase agreement had been entered into, but the sale fell through at the last minute, meaning that settlement scheduled for July 2023 did not proceed. Following this failed sale, the owner decided to restructure aspects of the business.
The worker had started employment in 2014 and was employed as a barista according to an individual employment agreement dated 5 June 2022. The agreement recorded that her agreed hours of work were a minimum of 28 hours per week.
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