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Redundancy and changes to working hours

The Employment Court has held that where an employment contract regulates an employee's hours of work and provides that there can be no variation without mutual agreement, the employer may, if the employee refuses to consent to the changes, dismiss the employee for redundancy

The Upper Hutt City Council employed Michelle Parsons as a booking officer at its swimming pool complex in Upper Hutt. As the complex was a 7 day a week business, it employed separate weekday and weekend staff.

Ms Parsons' employment contract provided that she would work weekdays between the hours of 3.30pm and 10.15pm. These hours were specifically negotiated to reflect her childcare responsibilities and, in particular, her inability to work at weekends. The employment contract further provided that Ms Parsons' hours of work could only be changed by mutual consent.

The Council decided to restructure the operation of its booking office to provide greater continuity between weekday and weekend staff. It proposed to introduce a roster system, which required staff to work longer hours and on both weekdays and weekends.

Ms Parsons was unable to work at weekends because of her childcare responsibilities. She therefore refused to consent to the proposed changes. In doing so, she relied on the clause in her employment contract that her hours of work could only be changed by mutual consent. The parties were unable to resolve the impasse, and eventually the Council dismissed her for redundancy.

Ms Parsons brought a personal grievance claim against the Council for unjustified dismissal. She argued that, by signing an employment contract that regulated her hours of work and provided that there could be no variation without mutual agreement, the Council had signed away its right to make her redundant insofar as her redundancy was based solely on changes to her hours of work.

The Employment Tribunal disagreed. It held that while Ms Parsons' employment contract placed some limitation on the Council's ability to change her hours of work without her consent, it was a matter of degree. The roster changes fundamentally altered the nature of her position and, if she did not consent to the changes, the Council was entitled to make her redundant.

Ms Parsons appealed to the Employment Court. She argued, amongst other things, that, in the absence of consent, her employment contract prevented the Council from changing her hours of work to any degree, let alone fundamentally. Accordingly, the Council could not claim that her position had fundamentally changed because it was prevented from making the fundamental change in the first place.

The Employment Court disagreed and dismissed her appeal on this point. It held that the changes to the hours of work fundamentally altered the nature of Ms Parsons' position and, if she refused to consent to the changes, the Council was justified in making her redundant.

The Employment Court further said that the Council's requirement that Ms Parsons work weekends when rostered was, by itself, a fundamental change to her contractual position, which, in the absence of agreement, would justify her being made redundant.

The Court's decision gives employers considerable scope to implement changes to an employee's hours of work, regardless of what is in their employment contract.

Provided that the changes are significant enough to fundamentally alter the nature of the employee's position, the employer may, if the employee does not agree to the changes, make the employee redundant.

The threat of redundancy will of course induce many employees to agree to the changes so as to avoid being made redundant.

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