Death of Employer

Key Points

  • As a general rule the death of an employer automatically terminates personal employment contracts.
  • Although the contract ends, there will have been no dismissal and hence, on the face of it, no possibility for the employee to claim either compensation for unfair dismissal or statutory redundancy pay.
  • The resulting possible injustice is corrected by statute. It is specifically provided that termination of an employment contract by death of the employer counts as dismissal for redundancy law purposes unless the deceased's personal representatives offer to renew the employee's contract within eight weeks of the death (ERA 1996 s.136(5)(b) and ERA 1996 s.174).
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