PENNY v FRELLO LIMITED [2025] NZERA 317

This page summarises and embeds an Employment Relations Authority (ERA) determination. It is not legal advice.

Story in plain English

The Authority ordered remedies and addressed unjustified dismissal issues.

In summary, He says the decision to make him redundant was predetermined because there had already been resignations in the team negating the need to reduce the overall team numbers. After that, This meant there was a failure to genuinely consult with him about the redundancy proposal or any potential redeployment opportunities and therefore his dismissal was not justified. Later, Frello says the decision to make Henry Penny's position redundant was justified because there were genuine financial reasons for the restructure and a thorough selection process using a matrix was applied to determine which members of the software developer team would remain. The determination records that Rodd Penney was also appointed to the position of CEO on 24 October 2023 and the next day the restructure proposal was communicated to staff. The Authority notes that The restructure proposal [10] On 25 October 2023, Henry Penny attended a meeting and learned of the restructure and then received the written proposal from Rodd Penney attached to an email. Ultimately, Frello's evidence was that this employee actually resigned on 10 October 2023 which is prior to the redundancy proposal circulated on 25 October. In the end, On 8 November, the same day Henry Penny was made redundant, a second employee in the software development team told Henry Penny they had also resigned earlier in the week.

Key case markers

• This determination comes from the Wellington registry.
• The parties are PENNY (employee) and FRELLO LIMITED (employer).
• Hearing date noted: 4 March 2025.
• Authority member: Sarah Kennedy-Martin.

Key events described

• He says the decision to make him redundant was predetermined because there had already been resignations in the team negating the need to reduce the overall team numbers.
• This meant there was a failure to genuinely consult with him about the redundancy proposal or any potential redeployment opportunities and therefore his dismissal was not justified.
• Frello says the decision to make Henry Penny's position redundant was justified because there were genuine financial reasons for the restructure and a thorough selection process using a matrix was applied to determine which members of the software developer team would remain.
• Rodd Penney was also appointed to the position of CEO on 24 October 2023 and the next day the restructure proposal was communicated to staff.
• The restructure proposal [10] On 25 October 2023, Henry Penny attended a meeting and learned of the restructure and then received the written proposal from Rodd Penney attached to an email.
• Frello's evidence was that this employee actually resigned on 10 October 2023 which is prior to the redundancy proposal circulated on 25 October.
• On 8 November, the same day Henry Penny was made redundant, a second employee in the software development team told Henry Penny they had also resigned earlier in the week.
• Rodd Penney's evidence was slightly different in that he says the second employee was considering resigning but they did not actually resign until 8 November and importantly this was after Henry Penny had been informed he was selected for redundancy.
• A letter was emailed to him the same day (8 November) confirming his redundancy and recording his employment had also ended that day.
• What is being challenged is whether consultation was reasonable and the selection criteria and matrix were applied fairly and this includes whether the resignations from the team were taken into account.
• The proposal [29] The proposal was to reduce the number of software developers in the team from five to three but it transpired that one developer had already resigned prior to the proposal being circulated so the information consulted on was not correct.
• Rodd Penney's evidence was that Frello was not aware of the second employee's resignation until after Henry Penny was informed his position was redundant and his employment terminated the same day.

Decision markers

(No decision markers were extracted automatically.)

Orders and payments mentioned

• Compensation: $20,000.00
• Costs: Costs reserved.

Note: figures above are extracted from the orders section (or the final orders wording). Check the PDF for full context and any gross/net directions.

Practical takeaways

• Redundancy determinations usually turn on genuineness and consultation quality.
• Dismissal justification is assessed through s 103A: what a fair and reasonable employer could have done in all the circumstances.

Read the full ERA determination (embedded)

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Source: Employment Relations Authority determination hosted on determinations.era.govt.nz.