Restructures and redundancies are some of the most challenging situations any employer will face. They’re emotionally charged, legally sensitive, and carry huge implications for people’s livelihoods and for the organisation’s future. Unfortunately, they’re also areas where many businesses unintentionally get things wrong — not out of bad intent, but because the terminology and processes can be confusing.
Across both New Zealand and Australia, the law is clear about what constitutes a restructure and what constitutes a redundancy — but many employers (and employees) use the terms interchangeably. This misunderstanding creates risk, mistrust, and often leads to avoidable disputes.
Here’s the plain-English guide to understanding the difference, following the right process, and avoiding the mistakes that cause the most issues across ANZ workplaces.
First: Restructure and redundancy are not the same thing
Restructuring
A restructure is a process — a business decision about whether roles, functions, reporting lines or organisational needs should change. It’s about structure.
Redundancy
Redundancy is a possible outcome of that process — it occurs when a role is genuinely no longer needed due to the restructure.
Put simply:
Restructure is the change.
Redundancy is one potential result.
Why the distinction matters
Because legally, you cannot start with redundancy.
In both NZ and Australia, a redundancy is lawful only if:
- a restructure process has occurred, and
- that process identifies a role that is genuinely surplus to requirements, and
- fair consultation has been completed, and
- the employer has fairly considered all feedback and alternatives.
Skipping straight to “You’re redundant” is unlawful — and reveals that the outcome was predetermined.
What makes a restructure lawful and genuine?
A restructure must be driven by legitimate business reasons, such as:
- financial pressure
- duplication of roles
- operational changes
- technology changes
- improved efficiency
- changed service delivery
- health and safety requirements
- customer or market changes
- strategic realignment
You can’t restructure because:
- a manager dislikes someone
- there’s a performance issue
- there’s a personality conflict
- someone complained
- someone is inconvenient
Misusing restructuring to manage performance is unlawful and will not hold up under scrutiny in either jurisdiction.
Consultation is mandatory — not optional
Across New Zealand and Australia, employers must consult before making a decision, not after.
Consultation means:
- sharing the proposal
- explaining the reasons behind it
- showing the impact on roles
- providing supporting information
- giving employees time to provide feedback
- considering that feedback genuinely
- being open to alternatives
It is not consultation if the decision has already been made.
Employees must feel:
- heard
- understood
- fairly included
- respected
This doesn’t mean they have veto rights — but it does mean their voice matters.
What is redundancy (and when is it justified)?
A redundancy happens when:
- The role is genuinely no longer required, and
- A fair, transparent consultation process has occurred, and
- All alternatives have been genuinely considered, and
- Redeployment obligations have been met.
Redundancy is about the role, not the person.
If a role continues to exist with similar duties, but a different person will perform it, that is not redundancy — that’s a termination disguised as one.
This is one of the most common mistakes employers make.
What about selection criteria?
Selection criteria are required when:
- multiple people hold the same or similar roles, and
- fewer roles will remain after the restructure.
Criteria must be:
- objective
- measurable
- transparent
- relevant to the job
- based on evidence
- applied consistently
Examples include:
- skills required for the future state
- qualifications
- performance history (documented)
- experience
- capability
- attendance ( factual, not medical )
- technical proficiency
Subjective ratings (“star performer”, “best attitude”) create legal risk.
Redeployment: the part most employers overlook
Both NZ and Australia require employers to consider redeployment before confirming redundancy.
This means:
- reviewing all current vacancies
- assessing whether any are suitable
- offering suitable roles
- discussing any roles that could become suitable with minor adjustments
- documenting every consideration
You are not required to create a role.
But you must genuinely explore options.
What redundancy payments apply?
Australia
Under the National Employment Standards (NES), redundancy pay applies unless exceptions apply (e.g., small business, casuals, fixed-term employees).
New Zealand
There is no statutory redundancy pay, unless:
- the employment agreement includes it, or
- company policy provides it, or
- custom and practice indicates it.
Regardless of jurisdiction, always follow:
- notice periods
- final pay rules
- accrued entitlements
- consultation obligations
Common mistakes employers make (ANZ-wide)
- treating redundancy as a shortcut for performance issues
- consulting after making the decision
- failing to provide enough information
- using subjective or unfair selection criteria
- not genuinely considering feedback
- not exploring redeployment
- misunderstanding “genuine business reason”
- communicating poorly
- making the process rushed or impersonal
The process doesn’t need to be slow — it needs to be fair.
The human side of restructuring
Restructures are tough, even when done well. Employees may feel:
- shocked
- anxious
- insecure
- confused
- undervalued
- embarrassed
- powerless
Managers may feel:
- guilty
- stressed
- unsure
- emotionally drained
A restructure done with dignity makes a huge difference.
One HR Unlocked client put it perfectly:
“We followed your restructure framework step by step — and even the people who were made redundant said they felt respected. I didn’t think that was possible.”
It is possible — when the process is fair, transparent and human.
The bottom line
Restructuring and redundancy are not the same.
Redundancy is only lawful when preceded by:
- genuine business reasons
- fair consultation
- transparent decision-making
- objective criteria
- proper redeployment efforts
- clear communication
- dignity and humanity
Across New Zealand and Australia, the legal principles are consistent: do it with fairness, clarity, evidence and empathy.
If you want ANZ-ready restructure proposal templates, consultation packs, selection criteria tools, redundancy letters and redeployment checklists, HR Unlocked gives you everything you need to run a lawful, respectful and low-risk process — without the consulting fees or the legal jargon.
#HRUnlocked #Restructure #Redundancy #EmploymentLaw #FairWork #EmploymentRelationsNZ #HRAdvice #PeopleAndCulture #ANZHR #WorkplaceChange #LeadershipTools #HRMadeSimple