Manawatu Employment Law Services
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DISCLOSURE OF INFORMATION TO EMPLOYEES IN REDUNDANCY

Any discussion on disclosure of information to employees has to include the subject of good faith in the employment relationship.  That is because Part 1 section 4 of the Employment Relations Act 2000 (ERA) requires that both parties MUST         deal with each other in good faith and, further, in sec. (4) (e) of the same part, redundancy is specifically mentioned.  In sec. 1A (c) (i) of Part 1, which this blog is concerned with, the employer is required to provide an employee access to information relevant to the employee’s continuation of employment if the employer is considering making the employee redundant.  Therefore, the question arises, how much information is required to comply with this section of the ERA?  The answer to that is in the next clause of the Act, (1B), which states:

However, subsection (1A)(c) does not require an employer to provide access to confidential information—

(a) that is about an identifiable individual other than the affected employee if providing access to that information would involve the unwarranted disclosure of the affairs of that other individual:

(b) that is subject to a statutory requirement to maintain confidentiality:

(c) where it is necessary, for any other good reason, to maintain the confidentiality of the information (for example, to avoid unreasonable prejudice to the employer’s commercial position). 

Or, to put that in plain English, employers do not have to disclose confidential information if there is good reason to maintain the confidentiality of that information. Good reasons include:

  • complying with statutory requirements to maintain confidentiality;
  • protecting the privacy of individuals;
  • protecting the commercial position of an organisation from being unreasonably prejudiced.

Clause (1B) does not affect an employer’s obligations under the Official Information Act 1982, or the Privacy Act 1993. 

To sum the above up, an employer must give any employee who may be affected by redundancy relevant confidential information about themselves.  An employer does not have to give him or her confidential information about another employee if, by doing so, it would involve an unwarranted disclosure of the affairs of that person.  This would be a good place to give a definition of confidential information.  It is information subject to an express or implied mutual understanding of secrecy. 

This area of employment law is difficult for employers because even with the guidance provided by the ERA, it can sometimes be very difficult to determine what is, or is not, confidential information.  For example, what information will or will not cause unreasonable prejudice to an employer’s commercial position?  An employer may think one thing; his lawyer may think another; and his accountant yet something else.  And, on that very unhelpful note, I will close because I may think something else as well. 

P.S.  No, seriously, the place to look for the answer is the judgements of the Employment Relations Authority and the Employment Courts.  I just wished to make the point that, for many employers, they simply wouldn’t know.  If he or she is thinking of making an employee redundant, it may pay to get some advice on the process rather than possibly face an unjustified dismissal claim.

Posted: Thu 08 Oct 2015

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