Redundancy Letter Template NZ: What To Include

Mike runs a small cleaning business in Hamilton. Two large contracts have ended, and he thinks he may no longer need one supervisor role. He knows he needs to talk to the employee first, but he isn't sure whether to send a consultation letter, a redundancy notice letter, or a final confirmation letter.

That confusion is really common. Redundancy isn't just about the business reason. For most employees, the Employment Relations Act 2000 requires the process to be fair, genuine and carried out in good faith.

The documents you use at each step matter because they show what you proposed, what information you shared, what feedback you considered, and when the final decision was made.

Do You Need A Redundancy Letter Template In New Zealand?

Yes, a template can be useful, but it should only be a starting point because redundancy documents need to match your business, the employee's agreement and the real reasons for the proposed change.

A redundancy letter that looks polished but skips consultation can still create problems. In New Zealand, you generally need to:

• Have a genuine business reason for proposing redundancy.
• Share relevant information with the employee, unless there's a lawful reason not to.
• Give the employee a real chance to comment before you decide.
• Consider their feedback with an open mind.
• Look at possible alternatives, such as redeployment, reduced hours or restructuring duties.
• Confirm the outcome in writing once the decision is made.

The key point is timing. Your first letter should usually be a proposal, not a termination letter. If your document says the role is already redundant before consultation has happened, it can look like the decision was predetermined.

Templates often miss details that matter, such as the selection criteria for impacted roles, the employee's right to bring a support person, and the exact notice and final pay position. A lawyer should tailor your redundancy document suite before you use it, especially if the employee is long-serving, on parental leave, raising health issues, or covered by a collective agreement.

What Documents Do You Need For A Fair Redundancy Process?

You usually need a small document suite, not just one letter, because each document does a different job in the process.

A practical redundancy document suite might include:

• Business case or internal restructure proposal: your internal record of why change is being considered, what roles are affected and what options you have looked at.
• Consultation letter: the letter inviting the employee to discuss the proposed redundancy before any final decision is made.
• Information pack: relevant financial, operational or organisational information that helps the employee understand the proposal.
• Meeting notes: a clear record of what was discussed, questions asked and feedback given.
• Outcome letter: the letter confirming whether you have decided to proceed, change the proposal or not proceed.
• Redundancy notice letter: the letter giving formal notice if the role is genuinely disestablished.
• Final pay summary: details of wages, holiday pay, notice, redundancy compensation if any, and the last day of employment.

Some businesses combine the outcome letter and notice letter. That can be fine if the wording is careful and the decision has already been made fairly after consultation.

What you should avoid is sending a final notice letter first and calling it consultation later. If the employee brings a personal grievance for unjustified dismissal, your documents will be closely looked at to see whether the process was fair.

What Should A Redundancy Consultation Letter Include?

A redundancy consultation letter should clearly explain the proposal, invite feedback, and make it plain that no final decision has been made yet.

This is the document that starts the formal conversation. It should be respectful and practical, not defensive. You want the employee to understand what is happening and how they can respond.

Consultation Letter Outline

Use this outline as a drafting checklist, not as a finished legal document:

1. Opening: explain that you're proposing changes that may affect the employee's role.
2. Business reasons: describe the commercial, operational or organisational reasons for the proposed change.
3. Roles affected: identify the role or roles that may be impacted, without saying the decision is final.
4. Information provided: list the documents or information you're sharing, such as a proposed structure chart or workload data.
5. Possible alternatives: explain any alternatives you have considered, such as redeployment or reduced duties.
6. Feedback process: invite the employee to give feedback, ask questions and suggest alternatives.
7. Meeting details: include the date, time and location of the consultation meeting.
8. Support person: tell the employee they may bring a support person or representative.
9. Response deadline: give a reasonable deadline for written feedback.
10. Next steps: say you'll consider feedback before making any final decision.

For most employees, the good faith obligations in the Employment Relations Act 2000 mean you need to provide relevant information and a genuine opportunity to comment before a final redundancy decision is made. If you withhold sensitive information, you should have a clear reason, such as confidentiality or privacy concerns, and still provide enough detail for meaningful consultation.

There are newer exceptions and transition rules for some employees earning at or above the specified remuneration threshold, which is $200,000 initially, unless they've opted back in to dismissal protections. Different rules can also apply to trial periods, so get advice before relying on a template if either applies.

How Much Notice Should A Redundancy Notice Letter Give?

The notice period depends on the employment agreement first, because New Zealand law doesn't set one standard statutory notice period for ordinary redundancy dismissals.

Check the employee's employment agreement before you draft any employee termination documents or notice letter. Many agreements set a notice period, such as two weeks or four weeks. If the agreement is silent, you generally need to give reasonable notice, which depends on factors like the employee's role, length of service, seniority and how easy it may be to find similar work.

Your redundancy notice letter should state:

• the final decision after consultation;
• the role that's being disestablished;
• the notice period and last day of employment;
• whether the employee is required to work out the notice period or will be paid in lieu, if the agreement allows it;
• what will be included in final pay;
• whether any redundancy compensation applies under the agreement or workplace policy;
• arrangements for returning company property and handing over work; and
• who the employee can contact with questions.

There's no general legal requirement in New Zealand to pay redundancy compensation unless it's in the employment agreement, a collective agreement, or your workplace policy. If your documents or past practice suggest redundancy compensation is payable, get advice before making a different decision.

Final pay will usually include wages up to the last day, accrued and unused annual holidays under the Holidays Act 2003, and any other amounts owed under the agreement. Holiday pay calculations can be tricky, so make sure payroll checks them carefully.

Can You Use One Letter For Consultation And Final Notice?

Usually, no. It's safer to keep consultation and final notice separate because they happen at different stages of the process.

A consultation letter is about a possible change. A final notice letter is about a decision already made. Mixing those messages can make it look like you had already decided the outcome before hearing from the employee.

There are some situations where one combined outcome and notice letter is appropriate. For example, after consultation has finished, you might send one letter that says you have considered the employee's feedback, have decided to proceed with disestablishing the role, and are now giving notice. That's different from sending one letter at the start of the process that both proposes and confirms redundancy.

Worked Example

Say Mike's supervisor has an employment agreement requiring four weeks' notice. Mike first sends a consultation letter explaining that two contracts have ended, the supervisor duties have reduced by around 30 hours per week, and he is proposing to disestablish one supervisor role.

He gives the employee a proposed structure chart and invites feedback by Friday, with a meeting on Wednesday. The employee suggests taking on some admin work instead. Mike checks the workload, considers the suggestion, and decides there still isn't enough ongoing work to keep the role.

Mike then sends an outcome and notice letter confirming:

• he considered the admin work suggestion;
• the supervisor role will be disestablished;
• the employee's last day will be four weeks from the date of the letter;
• the employee will be paid wages and unused annual holidays in final pay; and
• no redundancy compensation applies because the agreement doesn't provide for it.

That paper trail helps show the decision was based on genuine business reasons and a fair process.

What Common Drafting Mistakes Should You Avoid?

You should avoid any wording that makes the decision look final before consultation, because that's one of the biggest procedural risks in a redundancy process.

Common mistakes include:

• Calling the first letter a termination letter: use proposal language at the consultation stage.
• Giving too little detail: vague statements like business needs have changed may not be enough for the employee to respond meaningfully.
• Ignoring redeployment: check whether there are suitable alternative roles before confirming redundancy.
• Forgetting selection criteria: if several employees do similar work, explain how you're proposing to choose which role is affected.
• Skipping support person rights: invite the employee to bring a support person or representative to meetings.
• Using the wrong notice period: check the employment agreement, policies and any collective agreement.
• Promising redundancy compensation by mistake: only include it if it's actually payable.
• Not keeping records: keep letters, emails, notes, feedback, calculations and the final decision rationale.

You should also be careful if the person doing the work is called a contractor. From 2026, the Employment Relations Amendment Act 2026 introduced a contractor gateway test for businesses engaging contractors. If a worker is really an employee, employment protections may apply even if the contract says otherwise. If the status is unclear, get advice before using redundancy documents.

Redundancy can also overlap with other legal risks, such as discrimination, parental leave protections, health and safety issues, or a performance management process. If any of those are in the background, a tailored approach is much safer than a generic letter.

How Do You Put Together A Redundancy Document Suite?

You can put together a redundancy document suite by mapping each document to the step it supports, then checking that the wording stays consistent from start to finish.

A simple step-by-step approach is:

1. Check the employment agreement: confirm notice, redundancy compensation, consultation terms, redeployment clauses and any policy references.
2. Write the business case: record the genuine business reasons, affected roles, financial or operational information and alternatives considered.
3. Prepare the consultation letter: explain the proposal, provide relevant information and invite feedback.
4. Hold the consultation meeting: let the employee ask questions, bring a support person and suggest alternatives.
5. Consider feedback: genuinely assess what the employee says and whether the proposal should change.
6. Prepare the outcome letter: explain the decision, the reasons for it and how feedback was considered.
7. Issue notice if needed: confirm the notice period, last day and final pay position.
8. Keep records: save the full paper trail in case the process is later questioned.

It's worth slowing down at the drafting stage. A tidy set of documents does more than tick boxes. It helps your team communicate clearly, treat people fairly, and protect your business if the decision is challenged later.

If you're using a free template, check it carefully against New Zealand law. Templates written for Australia, the UK or the US often use the wrong language, assume different notice rules, or refer to agencies and claims that don't apply here.

Key Takeaways

• A redundancy letter template is only a starting point. Your documents should match your business reasons, the employee's agreement and the process you actually followed.
• Your first document should usually be a consultation letter, not a final notice letter.
• For most employees, the Employment Relations Act 2000 requires a genuine business reason, good faith consultation and an open mind before a final redundancy decision is made.
• There are newer exceptions and transition rules for some high-income employees, and different rules can apply to trial periods, so get advice if either applies.
• New Zealand doesn't have one standard redundancy notice period for every employee. Check the employment agreement and give reasonable notice if the agreement is silent.
• Redundancy compensation is only payable if the employment agreement, collective agreement, workplace policy or another binding commitment provides for it.

If you'd like help with redundancy consultation letters, final notice wording, employment agreement checks or a redundancy document suite, you can reach us at 0800 002 184 or team@sprintlaw.co.nz for a free, no-obligations chat.