An ERA ruling exposes a costly step many employers miss in restructures
A NZ builder was ordered to pay nearly $15,000 after making a job offer the day before its redundancy consultation began.
On 16 April 2026, the Employment Relations Authority ruled that SAS Builders Limited had unjustifiably dismissed Stephanie Martin, its Marketing Manager/Office Assistant, after a redundancy process that skipped a critical redeployment step.
Ms Martin joined the Auckland-based firm in June 2023. Director Shaun Spillane described her as a leader, highly competent and ambitious. In April 2024, she resigned but was persuaded to stay, with a pay increase and a move toward sales agreed. Ms Martin told the Authority the pay rise then became a source of friction, and that the tone of the relationship changed after a disagreement in July 2024 over its implementation.
By August 2024, business had slowed. On 7 August 2024, SAS advertised a new Admin support/PA role on TradeMe. On 15 August 2024, Mr Spillane asked Ms Martin at a café whether she would take on the role instead of a new hire. She declined. Mr Spillane told the Authority he privately believed she was not a good fit and also that she lacked the accounts and administration experience the role required. The Authority found, however, that Ms Martin's experience in running businesses and managing the various systems and software required to perform the role would have meant she was capable of performing it.
The restructure formally commenced on 18 September 2024, with a letter proposing to disestablish Ms Martin's position due to a slowdown in work. The letter stated a redundancy notice may be issued "in the absence of any redeployment opportunities." Critically, on 17 September 2024, one day before the letter was issued, Mr Spillane had already made an offer for the Admin/PA role. It was accepted on 22 September 2024, with the new hire starting on 1 October 2024, during the consultation period.
Ms Martin's termination was confirmed on 3 October 2024, her employment ending on 18 October 2024. At the hearing she said that had she been formally offered redeployment, she would have stayed and done the role rather than being out of a job, despite her career goals pointing elsewhere. The Authority noted the role may have also meant reduced hours and lower pay, matters that should have been worked through with her but never were.
The Authority found SAS had genuine commercial reasons for restructuring. The problem was not the restructure itself, but that the employer had filled the only available alternative role before consulting Ms Martin on it. The August 2024 café conversation did not qualify as redeployment consultation because it predated the formal process.
On lost wages, Ms Martin sought compensation to 31 March 2025. She started an alternative role on 30 November 2024 at lower pay and without fixed hours. The Authority found her evidence of job-seeking efforts in the interim was of limited probative value. It also concluded she would likely not have remained at SAS longer than six weeks given her stated desire to move into sales and the friction between the parties, and awarded six weeks' lost wages calculated at the new Admin/PA role's rate, totalling $4,872 gross.
SAS was also ordered to pay $10,000 for humiliation, loss of dignity and injury to feelings, and $71.55 as reimbursement of the lodgement fee. No reduction was made for contributory conduct on Ms Martin's part.
The case is a clear signal: a manager's private view on an employee's suitability for redeployment is not a substitute for a formal conversation. Redeployment options, including any changes to hours and pay, must be put to the affected employee before any alternative role is filled.
