Laid-off workers should receive a longer notice period when losing their jobs and more should be done to encourage them to access welfare support afterwards, a new report says.
Released on Friday, the Organisation for Economic Cooperation and Development report said many workers made redundant earned less, worked shorter hours and had fewer benefits in new jobs than in their previous jobs.
Titled Back to Work: New Zealand, the report also found 1.1 percent of workers made redundant in the last five years who are of working age were yet to find a new job.
To help them, it recommended a number of measures, including introducing a minimum notice period employers must give when laying their workers off.
Counselling and training for redundant workers, especially those with fewer qualifications, should also be boosted, while more effort should be made to get them to make use of government income support packages, the report said.
It also recommended introducing an insurance scheme that would enable all workers to be covered by redundancy payments regardless of their employment contracts.
The authors of the report argued New Zealand would benefit from boosting the support available to laid-off workers because it would promote greater job mobility and help prevent many from falling into poverty.
This was especially important because even three years after redundancy, personal income was about 20 percent lower for workers in a new job compared to their peers who stayed in work, the report found.
"Low-skilled workers are particularly at risk," the report said.
"People with lower secondary education are twice as likely to be made redundant as people with a bachelor degree or more, and the shares among those with no qualification are three times higher."