Employment Law – Basics of Dismissal

Ending an employee’s employment is not straightforward. There are many steps an employer must follow before they can tell an employee that they are dismissed. Those steps are different depending on the proposed reason for dismissing the employee.

Reasons for Dismissal

There are many reasons why an employer may want to dismiss an employee, including but not limited to:
• Performance issues;
• Repeated misconduct;
• Serious misconduct;
• Health reasons; and
• Restructuring/Redundancy.

How should an employer conduct themselves?

Throughout the dismissal process, an employer must act in good faith, have a good reason to do what they are doing, follow a fair and reasonable process and have an open mind when dealing with the issue; to ensure no outcomes are predetermined.

If an employer fails to conduct themselves in the manner above, the employee may be able to bring a personal grievance against the employer.

What is the employer’s first step?

No matter the proposed reason for dismissing an employee, as a start the employer should familiarise themselves with the employee’s individual employment agreement (“IEA”) or collective employment agreement (“CEA”).

There are certain clauses in an IEA/CEA that may be applicable to the situation. For example stand-downs/suspensions, notice periods, examples of misconduct and/or serious misconduct, redundancy, consultation obligations.

By way of example, if an employer needs to suspend an employee to investigate an issue in the workplace, the employer must abide by what the IEA/CEA says in respect of suspension. If the IEA/CEA does not contain a suspension clause, it can be more difficult to suspend the employee.

How should an employer engage with the employee at the start?

Ideally, an employer will make first contact with the employee in written form; that may be a letter or an email. The email/letter needs to provide the employee with all the relevant information that is applicable to the situation.

For example, if an incident has occurred in the workplace warranting an investigation, an employee must provide the employee with all the details surrounding the incident ( that may be witness statements, video recordings etc.), what the employer’s process will be (internal or external investigation), whether the employee is to be stood down, who the employee’s point of contact is and that the employee is entitled to take advice and/or bring representation to any meetings that occur.

There should be minutes taken of all meetings.. Alternatively, the meetings can be recorded digitally if all parties agree.

What happens if the employee does not respond to the employer’s communications?

An employer must endeavour to receive a response from the employee. If an employee is ignoring requests to meet or comment on issues/an incident, an employer is entitled to make a decision in their absence.

Before a decision is made, the employer must advise the employee of their intention to make a decision in their absence.

The employer has come to a decision, what is next?

Once the employer has made a decision, they must provide that outcome to the employee and seek comments from the employee. Depending on the outcome, the employer may be able to dismiss the employee without notice. If so, the employee is required to leave the workplace immediately and will not be paid for any notice period.

Note: an employee is still entitled to any entitlements (such as holidays etc.) they are owed, which must be paid out in their final pay.


An employer cannot dismiss an employee without following a fair and reasonable process. Throughout the process the employer must act in good faith.

The process of dismissal can be daunting for employers. There are risks throughout the process that may lead to liability for the employer if they are not conducted properly. An employer’s best bet at reducing that risk is to seek employment advice before engaging in the process.

If you have any questions or need any employment advice, please contact us for an appointment T:06 349 0090 or email mattb@horsleychristie.co.nz

Matt Bouzaid LLB Bcom

Disclaimer: This publication should not be construed or acted on as legal advice. It is brief and general in nature. Specific advice should be sought.