An easier end to employment

Small businesses shouldn’t need a lawyer just to have a difficult conversation about someone’s employment.

Sometimes an employment relationship is no longer working. An employer may be willing to pay the employee to leave, and the employee may be happy to accept. Under today’s law, simply raising that possibility can expose the business to a personal grievance.

ACT’s Golden Handshake policy would let both sides discuss a voluntary exit. The employee is free to say no. If they agree, the deal goes in writing and both sides can move on. ACT trusts adults to make their own decisions.

ACT will:

• Allow an employer to offer an employee a specified payment to end their employment by mutual agreement, whether or not a dispute has already arisen.

• Protect the employee’s right to reject the offer.

• Stop the offer itself from becoming grounds for a personal grievance.

• Generally keep the offer and resulting negotiations out of later Employment Relations Authority proceedings.

• Require every agreement to be written and signed by both sides.

• Require the employer to advise the employee to seek independent advice and give them a reasonable opportunity to do so.

• Make an accepted agreement a full and final settlement of claims arising from the employment relationship.

In our team’s words:

ACT Small Business spokesperson Laura McClure says:

“In some cases, an employer would happily offer an employee compensation to leave, and the employee would happily accept. But current law makes it unnecessarily risky to even start that conversation.

“Small businesses shouldn’t need a lawyer just to have a difficult conversation.

“There is no reason our laws cannot treat people like adults and provide the opportunity to reach a fair agreement, shake hands, and move on before a difficult employment relationship turns into an expensive legal dispute.”