Redundancy

 The Basics (North Ireland):

 

******The following is some basic guidance and rules for redundancy (July 12th 2020) for the North of Ireland jurisdiction.******

This section only applies to people with 2 or more years service with the employer.

Redundancy pay:

 

You are entitled to:

  • Half a week’s pay for each full year you were under 22

  • One week’s pay for each full year you were 22 or older, but under 41

  • One and half week’s pay for each full year you were 41 or older

  • Plus any extra redundancy pay that is outlined in your contract

  • Length of service is capped at 20 years.

 

From the 6 April 2020, your weekly pay is capped at £538 and the maximum statutory redundancy pay you can get is £16,140. Redundancy pay (including any severance pay) under £30,000 is not taxable.

Exemptions to redundancy pay:

 

You are not entitled to statutory redundancy pay if:

  • Your employer offers to keep you on

  • Your employer offers you suitable alternative work which you refuse without good reason

  • You have worked for less than 2 years with this employer

 

If you have been laid off for more than 4 weeks in a row or more than 6 weeks in a 13 week period, you can write to your employer and tell them you wish to claim redundancy pay.

 

The following applies to everyone being made redundant:

 

You must be selected for redundancy in a fair way, for example because of your level of experience or capability to do the job.

You cannot be selected because of age, gender, or if you’re disabled or pregnant. If you are, this could be classed as an unfair dismissal.

Notice periods:

You must be given a notice period before your employment ends.

The statutory redundancy notice periods are:

  • At least 1 week’s notice if employed between 1 month and 2 years

  • 1 week’s notice for each year if employed between 2 and 12 years

  • 12 weeks’ notice if employed for 12 years or more

 

Check your contract. Your employer may give you more than the statutory minimum, but they cannot give you less.

Notice pay:

 

As well as statutory redundancy pay, your employer should either:

  • Pay you through your notice period

  • Pay you in lieu of notice depending on your circumstances

Consultation:

 

You’re entitled to a consultation with your employer, this involves speaking to them about:

  • Why you are being made redundant

  • Any alternatives to redundancy

 

If your employer is making up to 19 redundancies, there are no rules about how they should carry out the consultation. If they are making 20 or more redundancies at the same time, the collective redundancy rules apply.

You can make a claim to an employment tribunal if your employer does not consult properly, for example if they start late, or do not consult at all.

 

Collective redundancy rules:

 

If your employer is making 20 or more employees redundant at the same time, the consultation should take place between your employer and a representative (rep).

This will either be:

  • A trade union rep (if you’re represented by a trade union)

  • An elected employee rep (if you’re not represented by a trade union, or if your employer does not recognise your trade union)

Collective consultations must cover:

  • Ways to avoid redundancies

  • The reasons for redundancies

  • How to keep the number of dismissals to a minimum

  • How to limit the effects for employees involved, for example by offering retraining

 

Your employer must also meet certain legal requirements for collective consultations.

Length of consultation:

 

There’s no time limit for how long the period of consultation should be, but the minimum is:

20 to 99 redundancies – the consultation must start at least 30 days before any dismissals take effect

100 or more redundancies – the consultation must start at least 45 days before any dismissals take effect

 

Electing employee reps:

 

If you’re an employee affected by the proposed redundancies you can:

  • Stand for election as an employee rep

  • Vote for other reps

 

Suitable alternative employment:

 

Your employer might offer you ‘suitable alternative employment’ within your organisation or an associated company.

Whether a job is suitable depends on:

  • How similar the work is to your current job

  • The terms of the job being offered

  • Your skills, abilities and circumstances in relation to the job

  • The pay (including benefits), status, hours and location

 

Your redundancy could be an unfair dismissal if your employer has suitable alternative employment and they do not offer it to you.

Refusing an offer:

 

You may lose your right to statutory redundancy pay if you unreasonably turn down suitable alternative employment.

You can make a claim to an employment tribunal if you think the job you’ve been offered is not suitable.

Trial periods:

 

You have the right to a 4 week trial period for any alternative employment you’re offered.

 

The 4 week period could be extended if you need training. Any extension must be agreed in writing before the trial period starts.

Tell your employer during the trial period if you decide the new job is not suitable. This will not affect your employment rights, including your right to statutory redundancy pay.

You’ll lose your right to claim statutory redundancy pay if you do not give notice within the 4 week trial period.

Time off for job hunting:

 

If you’ve been continuously employed for 2 years by the date your notice period ends, you’re allowed a reasonable amount of time off to:

  • Look for another job

  • Arrange training to help you find another job

 

How long you can take will depend on your circumstances.

 

No matter how much time you take off to look for another job, the most your employer has to pay you is 40% of one week’s pay.

For more information on redundancy check out the following links:

Citizens Advice NI

Citizens Advice Redundancy

The Basics (South Ireland):

 

******The following is some basic guidance and rules for redundancy (March 27 2020) for the South of Ireland jurisdiction.******

 

Where can I find out about redundancy rights during the COVID-19 emergency period?

For up to date information on the rules on claiming redundancy from your employer if you have been laid off, or put on a short-time work arrangement, you can read our document 'Employment rights during the COVID-19 restrictions'.

How will sick leave affect my redundancy?

When the actual length of your service for redundancy payment purposes is being calculated, the following periods over the last 3 years are included in the calculation:

  • Any period of absence from work due to illness up to 26 consecutive weeks

  • Any period up to 52 consecutive weeks where you were off work due to an injury at work 

 

If you are out sick, then return to work, go out sick again, and return to work again, each period of your sick leave up to 26 consecutive weeks is included in the calculation of your length of service for redundancy payment purposes. 

 

What is a reasonable alternative ?

If your employer makes you a reasonable offer of alternative work, and you refuse it, you may lose your entitlement to a redundancy payment. What is reasonable depends on the facts of each case. Generally speaking, alternatives which involve a loss of status or lessening of the terms and conditions would not be considered reasonable. Likewise, you may be justified in refusing an offer that involves you travelling an unreasonable distance to work. 

 

What is the difference between short time for redundancy purposes as opposed to social welfare purposes?

 

In redundancy legislation short time is defined as a situation where, due to a reduction in the amount of work to be done, your pay or hours are less than half the normal weekly amount. This must be a temporary situation and your employer must notify you before the reduction starts.

For social welfare purposes the definition of short-time employment is employment in which, for the time being, the number of days systematically worked in a working week is less than the normal number of days in a working week in the employment concerned.

 

How does accepting reduced working hours or pay affect my redundancy payment later on ?

If you were made redundant within one year of being put on reduced hours or pay, your redundancy payment would be based on your earnings for a full week. If you are made redundant after working reduced hours for more than a year, how your payment will be calculated depends on whether you accepted being on reduced hours or not.

 

If you fully accepted the reduced working hours as your normal week and never asked to return to full-time work, then your redundancy payment will be based on your gross pay for the reduced working hours. If, on the other hand, you never accepted the reduced working hours as your normal hours and continually asked to be put back on full-time working, then it is clear you did not accept your reduced working hours as normal.

 

If you have a dispute about this with your employer you could make a claim to the Workplace Relations Commission. 

 

How will short time affect my redundancy payment?

If you have been put on short time and then are made redundant your redundancy payment may be based on your pay for a full week. It has been the view of the Workplace Relations Commission that when a person is put on short time, that is, less than half their normal weekly earnings, the gross wage for the calculation of a redundancy lump sum is based on a full week's pay. 

 

I have been on short-time working for 2 months and my employer is now making me redundant. Is my entitlement to notice based on my short-time hours?

No. When your employer gives you notice, your notice entitlement is based on your full-time work. When you were put on short-time work, your contract of employment was temporarily suspended. When your employer decided to make you redundant, they had to re-activate your contract in order to dismiss you on grounds of redundancy. If you were made redundant and you were not required to work out your notice you are entitled to payment in lieu of notice which is your normal pay for that notice period. This means that your notice entitlement is based on the hours of work in your contract of employment, not on the short-time hours of work.

 

Can I be made redundant if I am on sick leave?

If your employer decides to make you redundant while you are on sick leave, you may qualify to bring a claim for unfair dismissal. Unless your employer can prove there was a genuine redundancy situationand that fair procedures were followed, your dismissal may be found to be unfair. Even if a genuine redundancy situation exists, you may bring a claim for unfair dismissal if you consider that you were unfairly selected for redundancy. Your employer should apply selection criteria that are reasonable and are applied in a fair manner. 

 

Can I be made redundant if I am on carer's leave?

If you are dismissed on grounds of redundancy, while on carer’s leave, under the Carer’s Leave Act 2001 it would be considered unfair dismissal. If your employer does not allow you to return to work at the end of your carer’s leave you may qualify to bring a claim under the Unfair Dismissals Acts 1977-2015. However you may be made redundant after you have returned to work. 

 

Can I be made redundant if I am on maternity leave?


No, you may not be made redundant while on maternity leave or additional maternity leave. You may be made redundant when you return to work or while you are pregnant before you go on maternity leave. However if you are selected for redundancy because you are pregnant, you may qualify to bring a claim for unfair dismissal. Selection for redundancy based on certain grounds such as pregnancy is considered unfair under the unfair dismissals legislation. 

 

If I get more than statutory redundancy?

If your employer pays you more than the statutory lump sum, your statutory redundancy payment is tax free but some of your lump sum payment may be taxable.

 

My employer says he cannot afford to pay my redundancy, what should I do?

If your employer has not paid your redundancy lump sum, you should apply to your employer for it using form RP77 (pdf). If your employer still refuses to pay it, you can apply to the Department of Employment Affairs and Social Protection for direct payment from the Social Insurance Fund. It must be done online using form RP50 as follows: 

  • If your employer is unable to pay your redundancy lump sum, he should sign the RP50 and submit a letter from an accountant or solicitor stating he is unable to pay and for 100% of the lump sum owing to the Social Insurance Fund. Documentary evidence such as audited accounts should also be included. 

  • If your employer refuses to pay your redundancy lump sum or if there is a dispute about redundancy you can bring a claim to the Workplace Relations Commission. You must use the online complaint form available on workplacerelations.ie. This must be done within one year of your dismissal. Then you apply for your lump sum by sending a completed form RP50 together with a favourable decision from the adjudicator of the Workplace Relations Commission

 

How are overtime and bonuses and profit sharing used in calculating my weekly wage for Redundancy purposes?

The weekly wage for redundancy purposes is your gross pay before tax and PRSI deductions. It is calculated by adding together your gross weekly wage, average regular overtime and benefits-in-kind up to a maximum of €600 a week.

Average weekly overtime earnings are calculated as follows: 

  • First, find the total amount of overtime earned in the period of 26 weeks ending 13 weeks before the date of redundancy 

  • Then, divide the total by 26 to get the average weekly overtime earnings

 

My organisation went under a transfer of undertaking last year, business is slow now, what happens if I am made redundant?

Under the European Communities (Protection of Employees on Transfer of Undertakings) Regulations 2003, your new employer is legally obliged to take on the existing employees of the business. The terms and conditions and your employer’s obligations in your contract of employment are automatically transferred to your new employer. 

 

Neither the previous nor the new employer can use the fact of the sale as a justification for dismissing employees unless there are valid economic, technical, or organisational grounds justifying changes in the workforce. Dismissal on economic, technical, or organisational grounds is a redundancy and, if you qualify, you may be entitled to a redundancy lump sum. If you are made redundant, continuous service is based on service with your new employer and your previous employer.

 

I have been working on a fixed-term contract for the last 2 years. Am I entitled to a redundancy payment when my contract ends?

If you are employed under a fixed-term contract, and you have worked continuously for your employer for at least 104 weeks when your contract ends, you may qualify for a redundancy payment.

 

I am a seasonal worker, how do I qualify for redundancy ? Does the 104 weeks apply to my time off ?

 

If you are a seasonal worker who has at least 104 weeks service with your employer you may qualify for redundancy. The 104 weeks does not include the time you are off work. The question of redundancy does not arise until the usual time when your seasonal work would start. If you are not re-employed then, you may be entitled to a redundancy payment.

 

Is an apprentice entitled to a redundancy payment?

An apprentice who is made redundant during the apprenticeship may qualify for a redundancy payment provided they meet the conditions such as 2 years' service over the age of 16. However an apprentice who is dismissed within one month of the end of the apprenticeship will not qualify for a redundancy payment.

 

If an apprentice is kept on as an employee for more than a month after the apprenticeship ended and is subsequently made redundant, the time spent as an apprentice aged over 16 will count in the redundancy payment calculation. 

 

If my employer does not offer the 30 day consultation process in the case of a collective redundancy what can I do about it ?

Collective redundancies come under the Protection of Employment Acts 1977-2007, which requires that both the Minister for Employment Affairs and Social Protection and employees’ representatives should be consulted at least 30 days before being given notice of redundancy. If your employer has not complied with the requirement for a 30-day consultation process you may make a complaint to the Workplace Relations Commission that your employer has contravened Section 9 or 10 of the 1977 Act in relation to information and consultation of employees. 

 

If I am made redundant and I then get an offer of work from my previous employer, will this affect my redundancy payment?

If your employer offers you alternative work, you may lose your entitlement to a redundancy payment in the following circumstances:

  • If you accept a new contract or re-engagement with immediate effect and the terms do not differ from those of the previous contract

  • If your employer makes you a reasonable offer of alternative work, and you refuse it

  • If you accept an offer in writing from your employer for a new and different contract which will take effect within 4 weeks of the ending of the previous contract. Equally, if you refuse such an offer unreasonably, you may lose your right to a redundancy payment.

For more information on redundancy you can check out the following links from Citizens Information:

Citizens Information Redundancy

You can read more information about alternative work in Citizens Information document on redundancy procedures.

 

© 2018 by Industrial Workers of the World Ireland Branch