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In New Zealand, the Employment Relations Act aims to protect employees by requiring employment agreements to include employee protection provisions for restructuring situations. These also apply to the sale and purchase of a business. Parry Field Lawyers provide legal advice on a range of employment matters.
Restructuring Provisions Under these provisions, there are two types of employees - first, those who are specified in Schedule A . These are employees who work in the cleaning and food catering services at any workplace; laundry services for the education, health, or age related sector, orderly services for the heath or age related sector and caretaking services for the education sector, and second, all other employees.
Employees in schedule A are protected persons and special rules apply to them on the sale or transfer of a business as these employees have a right to choose whether to transfer on the sale of the business to the new employer. Potential purchasers must be aware of this provision as they may incur considerable costs in the transfer (for example, long service leave or holiday pay).
There is no automatic right not to take on existing employees from Schedule A.
Should you need any assistance with this, or with any other Employment matters, please contact Lois Flanagan at Parry Field Lawyers (348-8480).
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