The ruling has major implications for any NZ employer weighing offshore resourcing
A New Zealand authority has ruled that replacing a local worker with a cheaper offshore resource is a legitimate ground for redundancy.
In a determination dated 3 March 2026, the Employment Relations Authority dismissed a claim of unjustified dismissal brought by Christchurch-based fire protection engineer Gitae Kee Nam against his former employer, GHD Limited.
Nam had been employed by GHD, a global engineering and advisory firm, from mid-2022 until August 2024. He originally applied for an advertised position titled "Auto CAD/Revit Technician (Fire Protection)" but was offered and accepted a contract with the title of Fire Protection Engineer. In practice, he spent roughly 80 percent of his time on AutoCAD and Revit modelling work. GHD's own internal correspondence had earlier flagged that Nam was one of two employees who had been hired "with a finance classification that does not align with their salary," pointing to a tension between his formal title and the work he was actually performing.
On 7 August 2024, GHD presented Nam with a change proposal citing falling workloads across the New Zealand business, driven by a change in government, delayed infrastructure investment, and cost pressures on clients. Utilisation rates across the team had dropped to around 60 percent, well short of the business target. Nam's own rate had fallen to 33.3 percent against a target of 75 percent. The proposal was direct: "Manila resources are more cost effective compared with NZ based resources." The work Nam had been doing in Christchurch would be redistributed to a more senior local role and to GHD's contracted modelling resource in Manila — a resource that was part of GHD's global network of businesses, and whose capacity GHD had begun exploring after a consultant was engaged to look at the matter in April 2024.
Nam challenged the dismissal on several grounds. He argued GHD had breached its good faith obligations by not warning him earlier that the pipeline of work was drying up. He also argued that GHD had shifted project costing toward the Manila resource around the time his utilisation fell, which he said unfairly contributed to his underutilisation rate. He separately contended that he had never been told that failing to meet charge-out rate targets could cost him his job, and that he could have acted earlier had he known. He also argued that a colleague hired after him held effectively the same role but kept their position while he was made redundant.
Authority Member Antoinette Baker was not persuaded on any of these grounds. She found that GHD had provided Nam with sufficient information during the restructuring process, extended time for feedback through a representative, and responded to that feedback. No breach of good faith was established.
On the billing targets allegation specifically, the Authority noted that Nam had later accepted in his own evidence that he was aware of billing targets through regular team meetings. The Authority also found he was unlikely to have had the seniority within his role to have influenced work continuance regardless.
On the singling-out question, the Authority accepted evidence that Nam's colleague, despite sharing a job title, occupied a distinctly more senior, client-facing role involving supervision, quality assurance review of fire protection designs, preparation of technical specifications and design reports, value engineering review, and input into fee proposals — functions materially different from the modelling work Nam primarily carried out. The claim was dismissed. Costs were reserved.
The case raises several practical points for HR leaders. Job descriptions need to reflect actual duties rather than aspirational titles, as the gap between Nam's formal designation and his day-to-day work complicated the proceedings considerably. When selecting roles in a restructure, the rationale must be grounded in function rather than title alone, and clearly documented. And where offshoring forms part of a restructuring strategy, the Authority's ruling confirms it can withstand legal scrutiny, provided the business reason is genuine and the consultation process is real.
