Redundancy in New Zealand

You only get redundancy compensation if your employment agreement provides for it. Check it (and any collective agreement) for a redundancy clause, notice period and any redeployment obligations.

Even without compensation, your employer must have a genuine business reason, consult you in good faith before deciding, consider alternatives such as redeployment, and give you the notice in your agreement (or "reasonable" notice if it says nothing).

• Vulnerable workers (Part 6A): cleaners, food caterers and some laundry, orderly and caretaking staff can choose to transfer to a new contractor on the same terms when work changes hands.
• High earners: since the Employment Relations Amendment Act 2026, people earning $200,000 or more can’t bring an unjustified-dismissal grievance under new agreements (existing agreements from 21 February 2027), unless the agreement keeps the right.

You have 90 days to raise a personal grievance with your employer (12 months for sexual harassment). You can ask for written reasons for your dismissal within 60 days. Free mediation is available through MBIE on 0800 20 90 20, and unresolved cases can go to the Employment Relations Authority.

Redundancy pay is taxed as a lump sum ("extra pay") at your marginal rate, with no tax-free portion and no ACC earners’ levy. Unused holiday pay must be paid out in your final pay.

Jobseeker Support pays up to $426.12 a week before tax for a single person aged 25 or over. It is income-tested, including your partner’s income, and you reapply every 26 weeks.

• A stand-down of 1 or 2 weeks usually applies, based on your recent income. Redundancy pay counts towards that average but doesn’t push back your start date.
• Holiday pay and pay in lieu of notice delay payments until the period they cover has passed.
• KiwiSaver can’t be withdrawn because of redundancy; only a significant-financial-hardship application can release funds.