Covid-19 & Redundancy

Many employees in the current climate or more aptly named crises, are justifiably worried about their jobs and potentially being dismissed.

Some employees are now being told it is likely that they will be dismissed.

Employees are also worried about being dismissed and not receiving any redundancy payment.

Other employees are also worried about being made redundant for disingenuous reasons when what is happening is an unfair dismissal.  

Redundancy Payment Acts

The legislation provides a general right to redundancy payment for employees, who are dismissed, that the employee can rely upon if a number of conditions are met.

It is important at the present time, to restate what the legislation considers a Redundancy.

Evidently a dismissal must arise, but the reason for the dismissal is the point to consider.

There must be a genuine redundancy situation.

A dismissal will be taken to be a dismissal by a reason of Redundancy if one of the following circumstances arise:

  1. The employer has ceased to carry on business, or intends to do so;
  2. The requirements of that business have ceased or diminished for which the employee was employed;
  3. The employer has decided to carry on the business with fewer or no employees;
  4. The work the employee was doing is now going to be done in a different manner, as decided upon by the employer, and the employee is not trained or qualified to carry out the new work;
  5. The employer has made the decision that the work for the employee had been employed is to be done by a person who is also capable of doing separate work for which the employee is not sufficiently qualified or trained.

Employees should ask themselves is one of the above circumstances a present fact in their workplace ?.

The employee must have been in continuous employment for 2 years to be entitled to a redundancy payment and the obvious one is they must have been dismissed.

Employer’s Notice

An employer should give the employee 2 weeks-notice of the fact of the redundancy and should pay the lump sum on the date of termination.

An employer should give the employee written notice of the redundancy.

Dismissal for Gross Misconduct

If the employer dismisses the employee because of the employees conduct, then the employee is not entitled to a redundancy lump sum. Evidently an employer should not now dismiss an employee citing reasons of ‘conduct’ when the real reason is the Covid-19 crises.

Employee Questions

Some employees are currently concerned about being made Redundant when the situation is instead an unfair dismissal.

If this arises then it may be possible for an employee to commence an unfair dismissal action and also a redundancy action.

More often in the current crises the lay-off procedure will be availed of by employers, as this is for a temporary cessation of employment, and the employer intends to take the employee back once business efficacy resumes.

If an employer terminates an employee’s employment citing a redundancy reason, and the employee disputes this, then the obligation is on the employer to show a valid redundancy arose, and the obligation is on the employee to show that an unfair dismissal arose and no genuine redundancy situation existed.

Frequently Asked Questions

What is the statutory redundancy sum in Ireland ?

An employee who qualifies is entitled to two weeks statutory redundancy payment for every year of service, plus a bonus week.

What are you entitled to when you are made Redundant ?

This is answered above.

Can you make someone redundant and then replace them ?

This should not happen and the employer may be open for an unfair dismissals action being taken by the former employee.

In redundancy it is the position / role / job that becomes redundant.

If an employer terminates an employee giving a reason for the redundancy, the only valid reasons for redundancy are those permitted by the Redundancy Payments Acts.

How do you prove unfair redundancy ?

There is a significant difference between a genuine redundancy and a sham redundancy. A sham redundancy can give rise to an unfair dismissal claim. If a disingenuous redundancy reason is given, this is unfair, and contrary to the legislation, and it can then be the duty of the employer on which the burden of proof resides, to prove no unfair dismissal arose.

How is Redundancy Calculated ?

To calculate Redundancy you need the Date of Commencement, the Date of Termination, and the Gross Weekly Sum.

By typing in the above information to a Redundancy Calculator, you can find many online, it will give you the sum you are entitled to.

What is a true redundancy situation ?

There are 5 reasons set by Law whereby a dismissal constitutes a redundancy.

These are:

 a) the fact that his employer has ceased, or intends to cease, to carry on the business for the purposes of which the employee was employed by him, or has ceased or intends to cease, to carry on that business in the place where the employee was so employed, or

(b) the fact that the requirements of that business for employees to carry out work of a particular kind in the place where he was so employed have ceased or diminished or are expected to cease or diminish, or

(c) the fact that his employer has decided to carry on the business with fewer or no employees, whether by requiring the work for which the employee had been employed (or had been doing before his dismissal) to be done by other employees or otherwise, or

(d) the fact that his employer has decided that the work for which the employee had been employed (or had been doing before his dismissal) should henceforward be done in a different manner for which the employee is not sufficiently qualified or trained, or

(e) the fact that his employer has decided that the work for which the employee had been employed (or had been doing before his dismissal) should henceforward be done by a person who is also capable of doing other work for which the employee is not sufficiently qualified or trained.

Many of the above genuine reasons for redundancy relate to the economic need of the enterprise. Redundancy dismissals are not about the employee’s personality, performance or a personality clash with the employer, for example. Genuine redundancy situations are impersonal to that employee.

Do you have to pay Redundancy ?

If an employee has been dismissed by and employer, is entitled to redundancy under the Redundancy Payments Acts, the employer has a legal obligation to discharge the lump sum payment to the employee.

If an employer contravenes the redundancy payments acts, an employee should avail of and activate their legal rights under the legislation.

Disclaimer

Please be advised that the above-mentioned material is intended as an overview and as a broad out-line of the topic discussed. It should not be considered as complete and comprehensive legal advice, nor act as an appropriate substitute. Legal advice should be sought from a solicitor prior to relying on anything in this article.

Due care has been taken in the publication of this article and we do not accept legal liability as a result of reliance on any material covered in the above article.