Consultation on redundancy the right decision

Media release
10 October 2008

Consultation on redundancy the right decision

The Government has done the right thing in inviting public consultation on restructuring and redundancy, says Business NZ.

Chief Executive Phil O’Reilly says there has been a lot of pressure on the Government to immediately agree –before the election - to a statutory minimum payout for redundancy.

“This would have been the wrong thing to do, as it could have far-reaching negative economic implications. The analysis and work required for an immediate decision of this kind have simply not been done, and the potential for unintended consequences would be huge.

“To their credit the Government has resisted this pressure.

“Business NZ does not support simply introducing statutory compensation levels and will be saying so during the consultation.

“Employers are most unlikely to agree to minimum redundancy requirements as these would put the viability of many businesses at risk.

“These are matters best left for individual employers and employees to work out between themselves. Legislation of this kind would harm our economy just when it is most vulnerable.

“Business NZ was pleased to contribute to the Advisory Group’s work which recommends a holistic approach including improved labour market and social protection policies – work that is yet to be done.

“The key issue is successfully achieving viable employment – something that benefits everyone concerned – rather than a narrow backward-looking focus on a job that became unviable.”

ENDS

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